Sept 18 The new
September high in the DOW has not yet been confirmed on a market cash flow
basis. Volume has been higher on
declines than on recent price rises. The
broader marker indicators have not even hit new highs. The DOW is always the last refuge of
investors before a bear market sets in.
The scenario for the coming end of the bull market is still in
play.
The Death of Money discusses the economic problems America
will face if we continue in the direction Obama and other socialists
prefer. Ultimately the socialists seek
to abolish competition. Socialism is
more of a religion that an economic system.
That is why extremely religious people and especially terrorists tend to
embrace socialism.
Sept 17 there are two
international signs that the equities markets are at the top. First Sony, once the world leader in home
electronics has had to cut its dividend for the first time since 1958 and
market makers are in hype mode saying it is time to buy the copycat do-it-all
patent violator… Alibaba.
No one forecast the collapse of the Dot Com market in 2000
that was built on Alibaba type hype and off the books debts, not income let
alone profits.
No one predicted the Dodd-Frank-Obama liar loan mortgage
derivatives collapse in 2008 from which we still have not recovered. We are one of the few who predicted this
economic liar-loan recession would have no end as long as Quantitative Easing
was used to depress economic growth like a narcotic drug that removes the pain
but leaves the user addicted and broke.
We pointed out from the beginning that Japan started QE in 1990 and
immediately began their continuous slide into economic oblivion.
Sept 16 As we
predicted weeks ago what hedge funds would do, the WSJ now reports that hedge
funds are beginning to given up using hedging.
We reported that in an irrationally exuberant market like what we have
today there is no benefit in distinguishing good growing companies from below
average companies and shorting the below average while buying the growing
companies. That is because it eventually
good stocks are so overpriced that the below average companies become relative
bargains and play catch-up to maintain the same relative price relationship
they had when prices were low. At that
point the index funds stand out and the stocks within the indexes are bought
making it virtually impossible for anyone to beat the indices. Right now the DOW and the Nasdaq are about
10% more overpriced than the overall market.
That happens in every peak hyperactive cash flush market. That is why the indices stocks plunge 60% in
bear markets before the cycle repeats itself.
The bull market consists of sub cycles that are three to
four months long and interim cycles that are a year or more long. It is usually at the beginning of the interim
cycles that the price catches up of the poorer stocks take place. That is why near the peak the small cap
(risky) stocks make their final surge and then they lead the overall market
into the next bear market. The DOW was,
and the Nasdaq now tends to be the last index to give a sell signal for the
bear market.
(CNSNews.com) - "This is what happens at the end of
wars," President Barack Obama said Tuesday when he was asked about
swapping American Army deserter. Bowe Bergdahl for five dangerousTaliban
terrorists. "That was true for George
Washington, that was true for Abraham Lincoln, that was true for FDR. That's
been true of every combat situation, that at some point, you make sure that you
try to get your folks back. And that's the right thing to do."
But what is so stupid about what the most powerful man in
the World and 2 term President of the United States said is it shows he lacks
even a first grade level of knowledge of American History. There was no president of the USA until
several years after the American Revolution so and an American Constitution was
first written. Abraham Lincoln was assassinated in mid April
of 1865. The Civil War ended the following month. He was still dead at that
time so he made no deals to exchange prisoners after the war. All prisoners
were simply freed. Finally FDR died of a stroke before the end of WWII. You'll
recall that Harry S. Truman ended World War II. We made no deals for American
prisoners we went in and released them.
The greatest ignorance of this clueless president is demonstrated by the
way he managed to surround himself with a staff that is just as clueless as he
is and allows him to make such ignorant statements.
World Economy
Sept 19 India
recovers some of the recent market loss as imports decline improving the
balance of payments.
Sept 18 The
International Swaps & Derivatives Association said it postponed the
overhaul to the $18 trillion credit derivatives market in more than a decade
for fear investors do not know what is coming.
New rules governing credit-default swaps will take effect Oct. 6 rather
than Sept. 22. The changes seek to fix flaws in sovereign and bank insurance
that prevented some contracts from paying out as was intended since the
Liar-Loan financial crisis. As part of
the overhaul, the list of events triggering swaps is being expanded to include
bail-ins, where investors will be forced by regulators or governments to
contribute to bank rescues. The new definitions also insure against debt write
downs, bond exchanges or conversions of debt into equity which monetize the
loss so that it becomes a credit or expansion in the reserves. The entire Quantitative Easing program
monetized the Liar-Loan defaults to enable the worthless mortgages to be used
to back the expanded American money supply so that America could buy up American
debt an compete with international investors and thus artificially cap the
interest on American foreign debt. When
this “QE smoke and mirrors” process ends, interest rates on American debt will
rise and force up all American interest rates. The delay will “enable market participants and
infrastructure providers to make the necessary operational and infrastructure
changes and to allow a smooth adoption of the new definitions with minimal
impact on markets,” ISDA said in the statement.
Sept 17 China , the most authoritarian thief and censor
of personal and public information in the world and the most inclined to steal
other nation’s personal and national economic information is launching Alibaba,
possibly the most viable snooping platform China
Alibaba is a copy cat scam.
It is like the Chinese communist Intelligence and Espionage agency
running the free world’s economic system called free enterprise. Its first business was alibaba.com in 1999 a
website to help communist exporters in China (and other countries) connect with
product importers in over 190 free-enterprise countries around the world. The system allows a business in America to
find a manufacturer in China and have a range of goods produced and shipped. It also owns taobao.com, China's largest
shopping website, and tmall.com, which offers to export to Americans a wide
selection of cheap goods currently bought by China's emerging middle
class. It also runs the online payment
system alipay.com, which copies PayPal.
Almost all its technology is created from stolen knockoffs of American
technology. For instance it has China's
version of Twitter, and online video similar to YouTube. It claims it offers online marketing, cloud
computing and a logistics operations. It recently bought a controlling stake in
a second rate film business and 50% of China's new unknown football club. Finally, it has plans to enter the banking
industry and run the whole world’s system of capitalism. Ha Ha! If you believe this hype, go buy Alibaba.
Sept 16
The conflict in Ukraine will take years to resolve, rattling
Russia’s investment climate and threatening to push its economy into recession
at the current level of sanctions, former Finance Minister Alexei Kudrin said.
“It’s no quick task to resolve the situation in the
southeast of Ukraine,” Kudrin said today at a conference organized by the
American Chamber of Commerce in Moscow. Finding a solution will require two to
three years “at a minimum” under what he called an “optimistic scenario.”
If you look at Germany where the people have perhaps the
strongest work ethic in the world, their stock market has topped out too but
their trend is upward only because the dollar is continually weakening.
Obama’s incompetence gave the FED the opportunity to cripple
free enterprise the same way socialist Japan did in 1990. Japan has never recovered. Japan’s stock market appears to have topped again
and begun a new decline. It has declined since 1990 when it began Quantitative Easing
because their Yen is dropping faster than the dollar.
The French market is only about 60% of what it was fourteen
years ago. At it most recent highs it is still is still down 50% from 2008 and
down 60% from 2000.
http://in.finance.yahoo.com/q/bc?s=%5EFCHI&t=my&l=on&z=l&q=l&c=
The Swiss market still indicates stagnation since 2007. It
has hit the highs of 2003 but could not make it to the highs of 2007. Obama has
destroyed Swiss banking by attacking Swiss confidentiality that had protected
people from the Hitlers and Stalins of the past.
http://finance.yahoo.com/q/bc?s=%5ESSMI&t=my&l=on&z=l&q=l&c=
American Economy
…has been stagnant since the liberal socialists took
office. Their Quantitative Easing was
invented by the Japanese liberal socialists and put into effect in 1990. Their economy has been stagnating ever
since. You would think liberal
socialists could learn from their mistakes but they never do.
Sep 15
Empire Manufacturing Sep 27.5 up from 14.7 This is Blasio nonsense and completely
inconsistent with the next four economic indicators.
Industrial Production Aug -0.1% down from 0.4%
Capacity Utilization Aug 78.8% down from 79.2%
Sep 16
PPI Aug 0.0% down from 0.1% --
Core PPI Aug 0.1% down from 0.2%
Net Long-Term TIC Flows Jul -$18.6B flat from -$18.7B
Sep 17
MBA Mortgage Index 09/13 +7.9% rebound from -7.2%
This does not compute.
It probably should be zero plus zero which gives the same net result.
CPI Aug -0.2% deflationary 0.1% --
Core CPI Aug 0.0% neutral 0.1%
Current Account Balance Q2 -$98.5B improved from -$111.2B++
NAHB Housing Market Index Sep 59 improved from 55 seasonal
and contradictory
FOMC Rate Decision Sep 0.25% shows their fear 0.25% -
Sep 18
AM Initial Claims 09/13 280K down slightly 315K +
Continuing Claims 09/06 2429K more stop working 2487K ---
Housing Starts Aug 956K down sharply 1093K-- contradicts the good housing news
AM Building Permits Aug 998K down 1052K-- contradicts the good housing news
Philadelphia Fed Sep - 15 sharply worse from 28.0 -- show unreliable Obama data
Sep 19
Leading Indicators Aug 0.2%
sharply down from 1.1%
The Markets
Sept 19 Volume on
the market advances has been low. Hold
on to your seats. The next few weeks
could be interesting.
Sept 18 The Market
Cash Flow says 30% of the most recent rise is on hot air, not cash flow, and
therefore the market needs to go that much higher to confirm if the bull market
is in place. If the market has topped out again as suspected, then it just
means we have been given more time to withdraw and to begin shorting the
market.
Sept 17 Still no sell
signal, but still there has been no confirmation of the bull market. So far this month has definitely been anemic.
Sept 16
Our market cash flow shows 30% greater weakness than the
three market price indices. The second
shoulder formations are beginning in the broader indices, the DOW, and small
cap stocks. They have peaked tending to
confirm last months technical predictions that the market would peak near the
beginning of September. Compare the bell weather DOW and the broad NYSE for the last
six months and see it you think they have formed a top. The smaller selective technology indices tend
to trail the overall market.
The Stock market is now cash driven not value driven. The cash in-flow is out of control. When one asset becomes inflated it is used as
the basis for loans or in many cases the inflated buy-out offers for other
assets driving up prices and debt. While
bank leverage is limited often to less than 20:1 the leverage of corporations
becomes unlimited because the asset prices themselves have no regulation
limits. As soon as cash flow begins to
contract the house of cards will collapse and the FED knows that and is so
terrified it has been trapped like Japan was back in 1990. Look at the Japanese stock market since 1990
to see what America now has in store.
Look at the
volatility index and you see complacency and that the market could fall much
faster when volume gets back to normal. This market has little volume or
volatility. So when volume picks up
suddenly, past history says the market usually plunges. That is not a good moment in time for holding
equities.
World market updates:
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