DOG OF THE HAIR THAT BITES

Borrowing a bit from this weekend Barron's Alan Abelson's always well crafted weekly essay, there is always more to a story than meets the eye.

If inflating your way to prosperity made it easy to bring about an economic revival and lasting growth economy, Argentina would far surpass Nations for prosperity. IN essence, the GOV and FED are trying to replace the COnsumer in the void that has been left by people trying to dig themselves out of debt. The government does not want you saving nor paying down debt. Investment coming from a populace's savings leads directly to productive capital expneditures which creates things, not consumption.

Can I shed some light on Fridays employment report? When concensus has us looking for "ONLY" 325,000 jobs lost in the month of July, when it came in at ONLY 245,000 well from Obama to CNBC this was trumpeted as proof positive the Recession was ending and time to rejoice. However they left out a few FACTS, let's not let FACTS get in the way of figuring out where we stand in this cycle?

100,000 auto workers and friends were ADDED back into work force as GM and friends came OUT of bankruptcy, and of course Federal Gov hires! And have incomes really gone up? Does adding 3 cents to everyone's paycheck give us reason to toot? Remember the min wage was raised.

We have LOST almost 7 MILLION jobs since 2007 ! We have countless MILLIONS on furloughs, reduced hours, part time or lower paying jobs desiring full time.

People getting Gov assistance for more than 27 weeks GREW by 584,000 to 5 MILLION!!! is that a sign of economic revival the stock mkt is reciting?

And how about the DROP in rate to 9.4% from 9.5%? It was caused by 422,000 decline in work force, people just giving up!

Another sign of "strength" for the "first time ever, it (market) has rallied nearly 50% amidst a two-million- job-slide" says Dave Rosenberg of Guskin Sheff.

Now, I've been thinking......there have been a LOT of firsts during the decline.......and we now know THE IN CROWD is monitoring historic technical analysis and when even MAIN STREAM MEDIA began recounting the month ago head and shoulders formation....and the day it broke down......instead of fullfilling the decline it prognosticated it REVERSED ABCK UP and NEGATED the signal!!!! interesting.

We have the big dogs (GS friends) allowed to "trade in front of everyone else" and make BILLIONS doing so sanctioned by the protective? SEC.

We have GS and JPM and who knows who else taking OUR money from the GOV teet and putting it to work in the market....worldwide maybe.

WE have CHina goosing economy, naming 8% GDP? by sending out appliances for free mostly to people without adequate electricity or water to run them?

Cash for klunkers.....instead of buying that suit we got a new car, and more debt. Another sign of Gov intervention in the marketplace, determining where money is spent.

A commercial real estate sector now just shit hitting the fan....not being reported.

We have SLACK by historical standards in our manufacturing capacity, not showing we have increased our output nor will that help companies raise prices for more profit.

Will 7 MILLION newly unemployed since 2007 CUT BACK on spending? especially XMAS? HOW could 7 MILLION fewer people with jobs take up the slack in spending needed?

Is and SPX 500 at 24X earnings (fake) and dividend yield 2.75% more indicative of past TOPS than stocks at GOOD VALUES? Have stocks reached a point where way more than good news is priced in, instead of opposite. WHAT does history tell us of buying at these levels?

If stock prices are below the 2000 level, are we NOT in a SECULAR BEAR TREND that will last for many more years UNTIL HISTORIC NORMS ARE RETURNED?

WILL a MACD monthly bullish cross usher in a BULL MKT as it mostly has, or is that broke too?

This is UNLIKE 2002-2003 where autos, housing had YET to be PUMPED, now we are just trying to REFLATE THEM, way different backdrop.

Recent poll showed 97% Bearish view towards US $$ ($$ decline has fueled stock rally). Interest rates may not but are near an upside breakout.

ALT A loans are due to begin resetting and foreclosures are rising. HOME PRICES have not yet stabilized, but Banks are allowed to carry their paper as if worth 90% of orig value!!!! are they? This in turn allows them NOT to have to raise capital requirements for losses.

I am not stating anything that isn't true, how this plays out in the stock market is yet to be determined.

I showed by some accounts the SPX 1036 LINE IN SAND, 1017-1020 zone forced back prices Friday.

VOLUME is way below previous BULL breakouts, are institutions on sidelines? is that THE SMART money and where the volume hides? WILL THEY BE FORCED to come in? How many BEARS have capitulated?

Duratek