PM WRAP

Briefly, the day the market stood still. I will provide a thorough update by 12 PM Saturday, til then

D

STOCK MARKET IS A BARGAIN?

"Today with 53% of companies' results reported for the 2nd quarter 2009 the Operating PE is surprise, surprise "only" at 22.87. So according to CNBC and Wall Street the S&P 500 is fairly valued so please ignore reality, live in denial and BUY!!! Unfortunately the reality shown by the as reported PE is a truly mind blowing 723. I repeat 723, the previous all time high was 46".

ARTICLE ON SPX PE RATIO buying because prices are going up has always ended well hasnt it....

D

LET'S ALL CELEBRATE THE GDP and RECESSION IS OVER?

briefing.com
"Personal consumption expenditures, which are the main driver of the economy, fell at an annualized rate of -1.2% and subtracted 0.88 percentage points from the change in real GDP. In the first quarter, PCE added 0.44 percentage points to real GDP.

This disappointment was a reminder that the economic recovery will be an uneven affair, quite simply because the U.S. consumer isn't what he/she used to be in the face of rising unemployment and falling home values. Real final sales, which exclude the change in private inventories, decreased -0.2% in the period versus a -4.1% decrease in Q1."

Addressing the comments made, I am not one sided, but if you think I dont know what I'm talking about, keep tuning into CNBC and be happy, a fool and his money is soon departed.

My more astute A commentor is more to the point, my fundametal comments and analysis never EXCLUDE making money on any rally in a bear market. But truth is you dont CHASE it if you didnt get in early enough.

Lot of my friends feel market going much higher, feel it has to get better, so they arent moving money OUT.

Remember this, last recession ended in 2001....when did Bear MArket end?

What good is the gov GDP data, when prior get revised down nearly by 20% !? and this one show gains coming from ? Government Spending....which may be crowding out private sector investment....to each his own

Duratek I'll keep calling it as I see it...it just my opinion...but its MINE!

GDP

http://briefing.com/Investor/Public/Calendars/EconomicCalendar.htm I have one thing to say......what good is any of this data? GDP came in at 1% BUT last qtr GDP was REVISED DOWNWARD FROM 5.5% to 6.4% !!!!!!!! so what good is current estimate? Stock rally is in there.

Buyer beware

D

QUICK WRAP

EXXON'S profit slid 66%, OIL is a main component in the S and P 500. 5 years of housing inventory to work thru which will put pressure on prices for some time to come.

More looking for top, then even thinking of scalping this rally.....gotta run, Wine festival tonight, more tomorrow AM LOTS of data will come out

D

AM DATA DUE AT 8:30

Briefing.com here is link to see what reports are out.

China has now used 80% of total GDP in first 6 months to stimulate economy, Banks are asked to only loan where the money will spur economic develop, and the key is to goose internal consumption, even going as far as to hand out COUPONS in rurual areas for deep discounts for TV's and appliances.

I will again ask this question, what good will this Chinese stimulus do, when there are already TOO many factories in CHina and sinking world demand? Trouble could be brewing here....the Chinese market is up some 90% this year!

Futures point green for a positive open, tomorrow a host of data is released at 8:30 including initial GDP....which should be assisted by the MArch rally in stocks....in reality our economy is at a standstill at best.

Roubini praises Bernanke for "diverting a near depression with his FED actions" and IMHO Roubini has lost his edge, Big BEN presided over the FED during this perilous time and seemed oblivious to its birth. NO I say he goes and we find someone who might be willing to take unpopular action before the problem gets this bad, any ass can mop up a problem HE created.

A 50% retrace level of the entire decline is still a real potential, I wonder how many are watching the near term levels of the .382 FIB...SPX near 1014.

from June BLS employment report:

"Metropolitan Area Unemployment (Not Seasonally Adjusted)
In June, 144 metropolitan areas reported jobless rates of at least 10.0 percent, up from 6 areas a year
earlier, while 62 areas posted rates below 7.0 percent, down from 312 areas in June 2008.

Of the 49 metropolitan areas with a Census 2000 population of 1 million or more, Detroit-Warren-
Livonia, Mich., reported the highest unemployment rate in June, 17.1 percent.

D

GOOD NEWS RECESSION IS OVER

IN THE FED'S OWN WORDS

BEIGE BOOK Before they speak and tell us how everything is improving, maybe they should read their own release?

NEW BILL GROSS PIMCO PIECE
"Investment conclusions? A 3% nominal GDP “new normal” means lower profit growth, permanently higher unemployment, capped consumer spending growth rates and an increasing involvement of the government sector, which substantially changes the character of the American capitalistic model."

Folks, we havent gotten ourselves wrapped around the problems. Some of which may have NO fix

D

A DURABLE RECOVERY?

Add to this Consumer sentiment dropped again even with large market rally. And do you have the climate, the underpinnings of anything sustainable?

If this IS a Bear market rally (and it is IMHO) there is a very good chance the lows will not be the lows.

We got Manny, Moe and Jack trying to take us out of this nose dive....

Inflation FREAKS are wrong. Billions sit atop the FED REserve Banking system, but they aren't going anywhere. and demand for loans and risk are dampened. And Banks are cutting credit lines in HALF for those who might use it to stim economy.

Does in the above chart the decline in durable goods look like just a small correction? This has the makings of the most severe recession in history bar one, the Great Depression, the data bears this out. Thats why Im cautious, am not taking risks, and do not believe the hype.

D

AM MARKET TALK

POPULAR VIEW (from sub letter writer sent in an email this AM)
"I use the LEI to back up this view. It moved up from minus 4.0 percent year-over-year in May to minus 1.2 percent in June. This clear improvement points to some kind of an economic rebound.
No, the crisis is not yet over. Longer-term fundamentals are strongly against a more optimistic outcome. But a few quarters of a shallow economic recovery, caused by the huge stimulus programs all over the world, is the most probable outcome now."

*One main component of the LEI is stock prices.

Bank lending FELL last report from prior, though Bank Reserves have SOARED, they are..just that. You have collapsing housing prices, a stock market still down 60%, you don't have Consumers fighting in a bidding war for THINGS, car sales in toilet with HUGE discounts to lure you in.......where is the INFLATION?

You have a lar and incompetant running the FED, a rigged market trying to lure unsuspecting lemmings back in and sell you their stock as they always do.....you have gov's all trying to launch huge Bond sales and yet leave it rates on the floor.

The consumer is retrenching, is his behavior changed for the intermediate term? Very good possibility and what if XMAS is a total disaster?

I can try and guess the end of this BEar market, and try to get in front of these great bear rallies, but if NOT a new bull mkt, with indexes up so much already, I wonder friends would it make sense to chase after this one for the remainder of the rise should there be one, when in your daily routine you cannot find much to be bullish about?

Everybody's needs and plans are subject to their own situation, and if you trust a financial planner explain to them what you are worried about and what your goals, and hopefully they can execute for you.

For me? I don't TRUST anyone! I think most of these folks can do a good job in a bull market, for that cause, most of you could as well if in decent stocks and mutual funds, but in a BEAR MKT the SAME strategy does not work. And I don't think any of these people understand anything else but Long Term Buy And Hold (PTBH)
The market is BELOW where it was almost 10 years ago......now that's progress?

Again today we are knocking at door of 1014 area whicg by many is close to the .382 fib of decline. We have VIX on its weekly supportive trendline. We have US $$ firming in the AM, should it rise BACK above 80.00 would surprise many,a falling US $ has coincided with stock prises rising . CHINESE market had a nice decline overnight.

D

DO THEY THINK WE ALL HAD LABOTOMYS?

*Title ...let's see...how about THE WORST IS OVER!

NEW YORK (CNNMoney.com) -- The value of U.S. homes grew on a monthly basis in May for the first time in nearly three years (me..break out the champagne!), according to 20-city index released Tuesday.
The month-over-month increase was 0.5%, according to the report from financial data company Standard & Poor's and economists Case-Shiller. It was the first increase in the monthly index since July 2006.
On an annual basis, home prices in the 20 cities fell 17.1%, but it was the second straight month that the year-over-year decline lessened.

*Yeah, this type of shit pisses me off. You got Ben Bernanke who couldn't fight his way out of a wet paper bag.....and is oN FILE, YOUTUBE whatever saying the things he said when he said them...while guys like Peter Schiff were laughed at...he's a JOKE! SAME BOOB is going to plan our way out?

HOW CAN ONE ASS have so much power over all of us? How cool is that? NOW what we really need is to give the FED.....MORE POWER! haa

Did you read the 72 page report from zero hedge I posted link to? You know it was damn hard getting a stapler through it......

We have, in best case scenario 5 YEAR supply of homes.....We have a shitstorm of homes being held off with moratorium of some foreclosures.....among other things is there a thinking person alive that thinks our current situation is SUPPORTIVE of HIGHER home prices in the near future?

Maybe we should rework ALL these mortgages...use taxpayer money to buy them down...in fact buy us all down in rice so we can afford our houses. WILL State tax men lower the value of our homes next asessment?

WHAT IS GOING TO BE the driver to economic recovery?

Am I really supposed to get excited that homes rose month/month by 1/2 of 1 %??? when they fell like a stone!? OMG!

goodnight

D

"AMUSING OURSELVES TO DEATH"

ALDUS HUXLEY VS GEORGE ORWELL Sent to me by friend P.....and SSK comments "ain't some of this the truth" thought provoking.....I've got to cut this short, don't want to miss the Bachelor reunion.....

NAZ continues to outperform, not much going on today, some volume pickup, at this stage I can't assume a healthy pullback as we are already in ST overbought, until Bears can prove otherwise, the rally that began in MArch does not APPEAR to be over.

I hope for everyone "this time it's different". Some subs are calling for 5 WEEK RALLY to commense soon, only a few are not convinced. One notable guru has just doubled his cash position in defensive move to 49% ot total. ANOTHER is on sidelines 100% cash because the setups to trade are not there.

The toughest thing in trading besides controlling your own emotions, is PATIENCE.

I used to only buy companies I researched on my own and liked the story, used casual observation to determine 52 week range of price to determine the current price in that range, it was all about the prospects for that company and what they did, I needed to beleive in what they were doing. I usually made money doing that.

INvesting in solid companies will usually pay off over time, unless the one you pick turns out to be Lehman Bros or a BEar Sterns type or Enron. That sort of blind side is impossible to see.

Sharp move from highs in gold...US $$ been anging around will it revive in price to recapture 80.00 and frustrate again all those who figure it is DOA?

A move UP in the dollar that holds may coincide with end of March rally...we'll see.

Duratek

LEADER OF THE PACK

How wrong could an "expert" be? "WHY are we still listening to this guy?"

Market could continue to rise for any reason, facts dont change, we are led by those who can't.

D

CAPACITY UTILIZATION TELLS THE STORY

* We are near a RECORD (not even shown here) going back DECADES of SLACK in our manufacturing capacity levels.

I ask you dear readers, how is it that China can BOAST of 7% GDP growth in an environment where US Consumers are retrenching, saving, and the manufacturing capacity ALREADY IN PLACE here has near record slack? In CHINA they already have tons of idled capacity, facturies shut down ,workers set out, not much better elsehwere in world, WHERE is all that CHINESE lending, stimulus going to?

The Chinese stock market is up near 90% this year! that's where it's going, isn't that how you FEED a BUBBLE?

13 Million flat screens sold in China 2008, on pace to sell 24 Million in 2009 (source NPR's All Things Considered 7/27) It is said the GOV is going into RURAL areas and handing out COUPONS for HUGE discounts for durable goods, TV's.....must be fun to sit around the shack watching STATE run TV....don't think they get WHO WANTS TO BE A MILLIONAIRE or the BACHELOR.....

Now Zero Hedge published this important read of which is 72 pages long, I emplore you to download and read every page, it goes fast as 1/2 is filled with charts.

Has the US Consumer (you and me and them) REALLY changed his modus operandi? The savings rate is moving up and new credit issued of Consumer Debt is falling.......is this the backdrop for a new worldwide economic expansion?

I challenge and enjoy any and all comments given in a thoughtful reasonable manner, there is not one reality or perception, but it helps to have the FACTS to back up any opinion.

The market staged a BRILLIANT rally weeks after 911 !! The market had been shut down for a week after the attack. Calls for PATRIOTISM and NOT SELLING went on deaf ears....but when that was done it looked like the worst was over only to fall to NEW LOWS in 2002 until THE BOTTOM.....and this decline in 2009 broke THAT BOTTOM.

The data and stats are close to the worst in this countries history. There is litterally NO MARKET for the toxic assets accept US, the FED buying them back.

How is it that LONG TERM interest rates have stayed LOW, despite the greatest expansion in DEBT and fiscal irresponsability in the world?

US debt issuance as far as THE EYE CAN SEE, and for some time to come, yet a 10 YEAR Treasury Note yields about 3.7% !! doesn't sound like inflation.....

D

PM MARKET WRAP "IN THE LAND OF OZ"

http://www2.standardandpoors.com/spf/xls/index/SP500EPSEST.XLS S and P earnings info from website.


As Rpt EPS for 12 Mo Sep,'09 estimated to be negative ($-1.01 EPS) - first time in index history

SPX dividend yield last 12 months is 2.6% !!!! You know, companies have to make REAL earnings to pay REAL dividends.

"You can only cut so much...." to show earnings.....it all depends on the Consumer...how he doin?

GRAND BEAR markets of the past ENDED with PE ratios for SPX in single digits, and Dividend yields near 6%. AT 3% was near 2000 bubble top, so whats 2.6%??

Paying high stock prices for companies that cant back it with real earnings will probably lead to tears.

Parabolic moves smell of manipulation and can come to crashing halts.

From peak in 2008 Office Contsruction is off 50% (MMQB.com 24/7 column "where's the bottom?") "It appears we have not yet hit the bottom of this construction downturn", Chief Economist Kermit Baker PHD

"AIA American Inst of Architechts JUNE ABI rating was 37.7, far below the 42.9 from previous month." THIS score indicate a SHARP decline in demand for design services" which is where the NEW RECOVERY would be planned....

from SPX

"Getting less worse if different than getting better...." ..." and significantly different than being good"

from the land of OZ over and out

D

DERIVITIVE BUBBLE NEXT?

Five Firms Hold 80% of Derivatives Risk, Fitch Report Finds
First-quarter financials mark the first time comprehensive derivatives disclosure was mandated for all U.S. companies.
David M. Katz, CFO.com US
July 24, 2009

"Members of Congress probing threats to the global financial system — especially the threat of concentration of risk — will have a lot to ponder in newly mandated disclosures highlighted by a Fitch Ratings report issued last week. While derivatives use among U.S. companies is widespread, an "overwhelming majority of the exposure is concentrated among financial institutions," according to the rating agency's review of first-quarter financials.

Concentrated, in fact, among a mere handful of financial-services giants. About 80% of the derivative assets and liabilities carried on the balance sheets of 100 companies reviewed by Fitch were held by five banks: JP Morgan Chase, Bank of America, Goldman Sachs, Citigroup, and Morgan Stanley. Those five banks also account for more than 96% of the companies' exposure to credit derivatives.

About 52% of the companies reviewed disclosed there were credit-risk-related contingent features in their derivative positions. Such features require a company to post collateral or settle outstanding derivative liabilities if there's a downgrade of the company's credit rating.

The Fitch analysts also found that just 22 companies disclosed the use of equity derivatives. Just six nonfinancial firms — IBM, General Motors, Verizon, Comcast, Textron, and PG&E — reported exposure to share-based derivatives. "

"DONT BELIEVE THE HYPE"

There has been an abatement of bad news rather than emergence of good news," said Diane Swonk, chief economist with Mesirow Financial, a diversified financial services firm based in Chicago. "Stabilization in a deep hole is not something to pop champagne corks over."
Swonk said she remains concerned about the effect that lingering job losses and high unemployment could have on consumers.

A weak labor market, coupled with banks continuing to tighten credit standards, could mean that even if the economy technically emerges from recession this year, a recovery could be dampened by anemic consumer spending.

*I have been critical of Swonk before, but never doubting her intelligence, hearing this accurate and realistic pessimistic outlook from someone notknown for a bearish lean is eye opening.

CONSUMER is 70% of our economy.......so back to normal?

D

NEW HOME SALES "SURGE"?

If you look HARD, you can see the chart at bottom turn UP.

More is better than LESS, but it is being presented as if this is another sign of recovery and off to the races.....

June new-home sales surge- AP

• New home sales rise by largest amount in eight years

New Home Sales Up 11% in June

Make your OWN judgment

and also

Honeywell Not Planning for '09 Recovery

Verizon Plans 8,000 Job Cuts- AP
The telecommunications company, which posted a smaller quarterly profit but higher revenue, will eliminate thousands of employee and contractor jobs before the end of the year in the wireline business.

Duratek

POWER TO THE FEW

There is no fair playing field, not when large trading houses can see you trades and move in front of them. Not where same can go to the FED window and borrow money at 0% and stick it into the stock market, INSTEAD OF LEND IT TO YOU! is this the RECOVERY we were promised?

Economy is recovering so well some auto companies are matching the $4,500 gov trade in stimulus for $9K off, and some with free maintainence for 60K miles. Don't they have to make money when they sell a car? It is you and me providing the stimulus.

We have a stock market which is rising on LOW VOLUME, we have respected stock market data keepers showing us buyers are not acting like they have in ANY other Bull Market.

Prices going parabolic in some case. CHinese government so desperate to goose their economy they are FORCING banks to make loans on top of the bad ones already made in a system already in trouble and the money is going instead into real estate and their SSEC stock market spurring a 90% RISE!!!!

Imagine a 90% rally folks in China, when the worlds Consumers are dry heaving all over the place? In A Land of over capacity and too much of everything, we just flood it with stimulus?

TO MAKE WHAT??????? FOR WHO??????

"Castles made of sand slip into the sea....eventually...." "Come on Mr Businessman, you can't dress lile me...." ooops I digress..... "IF 6 was 9...."

Over 50% of trading is "program trading" so if these hoodlums are allowed to see what you ar doing before you can do it and that's legal? it's a rigged game friends.

EVERYONE (but me??) is turning BULLISH! as if some miracle has been accomplished, disaster averted...for another day perhaps.

But the Banks are NOT reporting as they were reporting and their EARNINGS are doggone suspect because of the "suspension of mark to market accounting"...sorry if I am not a true believer.

Economie GROW and DEVELOP from a vast EXPANSION of CREDIT and DEBT.....when a DEBT is taken there is usualy an order placed....money created....and it gets into systme and it changes hands, the more rapidly the better. (velocity of money)

As shown in above chart, you can't have expanding economy without VELOCITY of the money.

What we are witnessing are NOT fixers of the ISSUES, but manipulators and the profiteering from AVG people by the chosen insiders (GS etc).

OK, Banks are NOT lending, credit is NOT expanding, banks are not valuing their assets as was previously mandated as excepted accounting prinicples, why? because it showed how illiquid their assets and devalued they had become, all of a sudden their whole again.

We are in a contracting credit environment, with some NEW tricks and quany easing, and some old ones, puppets on MSM, lots of PRES speaches, but LITLE SUBSTANCE.

Bernanke says....."dont investigate the FED come on, this would HURT the economy..." scare tacticts?????? what DO they have to HIDE?

D

US $$$ DEMISE A BOON FOR US STOCK MARKET?

Notice how $$ has been crushed same time RALLY BEGAN? US $ carry trade!......world economies all show no go, it's all an illusion friends. Key an eye on the action here may be key

D

AND HE SHOULD KNOW?

May 19, 2008
Article from: The Australian

THE end of the global credit crisis is drawing closer, Deutsche Bank chief executive Josef Ackermann says.He also said it will leave Deutsche Bank relatively unscathed and possibly in a stronger position. "Yes, I believe we are getting closer to the end of the financial crisis," Josef Ackermann told Swiss Sunday paper Sonntagsblick. "It is not fully over yet, but the signs from the US are encouraging."
Mr Ackermann said he believes the pragmatic approach taken in the US towards limiting the impact of the crisis on the financial system should soon be paying off. "We should feel the effects in the second half of the year already and see a strong recovery on the US real estate market," Mr Ackermann told Sonntagsblick.

The global financial crisis originated from the defaulting of US households on mortgage payments, which affected global credit markets as the risk from the lending was spread internationally through structured products traded among banks. Separately, Mr Ackermann told German Sunday paper Frankfurter Allgemeine Sonntagszeitung he doesn't see the danger of a collapse of the global financial markets. "This is out of the question," Mr Ackermann said, adding that he believes the impact of the crisis on the real economy will be limited.

In London
Even “five star” home buyers are struggling to move in many cases because it can take months for them to secure a deal.
The problem has been blamed on banks holding onto funds to boost their cash reserves, which mortgage experts said is “choking” the housing market.

Quantitative easing only one week to run, economists warn
The unprecedented programme of quantitative easing could be coming to an end, with just one more week of the Bank of England buying back government bonds, economists warned.

The Monetary Policy Committee has a target to pump £125bn of cash directly into the economy by buying government and corporate debt, the process known as quantitative easing (QE), and has already gone above £120bn. This week will see it reach £125bn, according to Michael Saunders, chief western European economist at Citigroup.

Suspension of Mark to Market is Fraud
Every pumper of stocks is saying that suspension of mark to market is good for banks, good for the stock market, Suspension of mark to market is where the banks estimate the value of assets that the banks are refusing to sell that are labeled as "toxic" assets instead of letting the free market determine the value of the assets.

**

CDO'S and MBS's, these are what the banks would package and sell in the free market to creat liquidity and finace their loans....the FED has been monetizing the debt when others dont step in to buy in attempt to keep interest rates low. Banks do not trust these instruments from each other, the market is FROZEN.

Mark to Market suspension has allowed banks not to recongnize paper losses in value of the loans they still hold on their books, so free market has no place here in the valuing of bank assets. Which IMHO puts into question the banking sectors in fluence on the S and P 500 earnings results. We are approaching paying 20 X 2009 earnings of $55 which we could argue is OVERSTATED. We again reach overpriced stocks with dividend yields nowhere close to prior BEar Market levels of near 6%.

Did anyone worry about paying up for INTERNET STOCK values in 1999? or even worry about profits.....so stocks can rise anticipating the future, problem here is the future is unknown and likely fraught with more downside.

The engine to economies is Consumer spending especially here in the US some 70%. But Consumers access to credit is being hampered by rising credit score requirements, down payments, slowly rising int rates, falling home vlaues, loss of employment, underemployment, and a rise in the savings rate.

WHAT will the climate be for this XMAS season shopping? With unemployment probably not abating by then......it is the time of year MANY Retailers make or break it.

ONE VIEW OF K WAVE
How the Kondratieff Cycle Might Play Out

There is a very important point that many deflation advocates seem to be ignoring: Unlike Kondratieff winters of past eras, a modern Kondratieff winter does not necessarily have to follow in like fashion. I believe Ian Gordon and Robert Prechter are right about a winter coming, i.e., massive recessionary forces descending upon America and the world. We are confronting the end phase of the 60-70 year cycle that is now in its fourth repeat over the past 240 years. The fact that it must play out is, in my opinion, inevitable. But HOW it plays out is, by no means, set in stone. This is because we can now intervene with monetary and political policies that can alter the nature of the winter phase of the cycle. We can change its form. (can we?)


Quote of the Day"There are three classes of people: those who see, those who see when they are shown, those who do not see." Leonardo da Vinci
>>
The main idea of Kondratieff was that the market economy self-heals itself each time it goes into trouble. USA was the strongest country in the world in 1929, and it still was the strongest country in 1940’s, after the Great Depression. So the Great Depression does not break the economy, it heals it. The idea is that all the bad debt must be eliminated, which probably means that pretty much all debt must be eliminated. The nation of spenders is converted into the nation of savers, which can export more than it imports, which produces more than it consumes, which saves more than it spends. (this is happening now)

The collapsing credit is essentially equivalent to the collapse of monetary base, because the debt obligations are essentially money, or at least very similar to money. The collapse of money supply is called deflation. It leads to the decrease of all kind of prices – goods, real estate, labor, stock market. There is no enough money and too much goods competing for money. It’s a time of oversupply. Too many factories, too many factory workers. <<<<

Remeber my comment on china, they are BLITZING the country with money....problem is there is ALREADY TOO MUCH CAPACITY!!! so the money is going RIGHT into the SHANGHAI stock market and Chinese real estate....creating tons more BAD LOANS and one hell of a mess coming.!!!

DROPPING MARK TO MARKET IMHO has spit in the face of K winter and having the banks cleanse themselves INSTEAD those TOXIC deals are SITTING on their books not being RECOGNIZED...NOT BEING DEALT with.

ZERO INT RATE MONIES FREE TO firms like GS and being sucked up like a HOOVER and FED right into the US stock market PUMPING it up as we speak.

AS SHORTS COVER, as potential sidelined money is DRAWN in afraid to miss the boat.....when we reach the point REALITY will reappear and those same bastards pumping will be DUMPING on YOU.

D

SPX 1,200 A REAL POSSIBILITY

*Click to enlarge, see notes made. We also have inverted Head and Shoulders which point to 1200 area, where we have also downtrend line (dashed) and 61.8% FIB. Can never be certain, but I dont think SECULAR BEAR can resume until that level is reached, and most by then will feel the WORST is over.

ASSETS are being reflated as in stock market assets, multiple BUBBLES are being developed, maybe the worst iN China, where much of stimulus is finding its way into stocks and real estate....in a country already consumed by TONS of BAD LOANS....that is being piled on, their mkt up near 90%.

Just as huge divergence found at MArch lows, I think we'll see reverse near THE TOP.

LONG SHOT is just as smaller H and S formation break was negated, so may this breakout from inverse.....with upside resistance dead ahead....a short recess seems likely.

There is no set TIME a BULL can last.....this is one party you DONT want to overstay welcome.

Duratek

CHINESE AND US OFFICIALS MEET

"But the Obama administration intends to remain focused on the trade gap. It plans to stress at the talks Monday and Tuesday that China can't rely on U.S. consumers to pull the global economy out of recession this time. In part, that's because U.S. household savings rates are rising, shrinking consumer spending in this country.

"Perhaps the most important message we are going to have for the Chinese is that there has been a fundamental change in the U.S. economy," said a senior administration official, who briefed reporters on the meetings under rules that did not permit use of his name. "The U.S. economy is going to recover, but it is going to be a different type of recovery than what the Chinese have seen in the past."

NUCLEAR POWER IS NOW?

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Now it is! Introducing the Hyperion Power Module (HPM)

*** I WOULD INVEST IN ANY COMPANY no matter WHAT CLIMATE if I believed in the product and felt price of stock was cheap…..HYPERION MUST be private….I hear TOSHIBA is also working on Nuclear stuff

http://www.toshiba.co.jp/nuclearenergy/english/experiences/capacity/npgcij.htm
#1 supplier in Japan and IS public

HISTORICAL REAL PRICE TO EARNINGS RATIO

*Chart courtesy of Professor ROBERT SHILLER

It is my contention that we WILL see another bottom like occurred after 1929 Bear and 1970's Bear markets which left the S and P 500 at HISTORICAL LOWS when compared to valuation based on earnings X PE ratio. TOO many people follow the skimpy 30 Industrial stocks of which recently had 2 weak ones removed and 2 stronger ones added helping to skew results to the upside. Whereas now we compare 500 of our best companies, it is harder to change results when a few drop out and new ones added.

You can also see the HISTORICAL EXTREMES of VALUATION at the end of what most of our generation can remember, our experience is tainted by living during the LONGEST RUNNING BULL MARKET IN HISTORY. Did it end in 2000 or 2007? some 25 years LONG!

2 of the worst Bear markets in history FOLLOWED these generational BOOMS which resulted in BUSTS.

But in 2000 the FED threw all they had at the decline, cut interest rates to 1% and held them there, we also had the "YEN CARRY TRADE" which artificially held DOWN long term interst rates.

Instead of correcting and taking the medicine, we just threw more FUEL on the fire and popped right back up. THE FED did not take heed in the real Estate speculation BUBBLE, remember they are just a CONSORTIUM OF CENTRAL BANKERS GREEDY MF'ers.....and were making money hand over fist.......did NOTHING, GOV DID NOTHING (also greedy mf'ers because TAX RECEIPTS were POURING IN) and the population went WILD and everybodys next door neighbor were buying MIAMI CONDO'S to FLIP!!!!!!!!!!!!

Like almost ALL "INVESTING" its ONE BIG PONZI scheme, one of musical chairs which COLLAPSED.

More of a worldwide global economy now then in 1920's, even ICELAND got in game, and went bankrupt too. SEE they don't have THE RESERVE CURRENCY to print at will....and pay fpr everything.......TOXIC DEBT FROM SEA TO SHORE TOUCHING ALMOST EVERYBODY EVERYTHING.

Now, I am going to ask you a simple question, it is obvious to me, this last GAMBIT was the MOST SPECULATIVE IN THE HISTORY OF SCHEMES, how then should the TRIP TO THE MEAN be accomplished? TO HEAL, to be in position to GROW again, for our next BULL MARKET......WHY WOULDN'T WE SEE PE'S DECLINE to what was seen at the 2 other prior mania'? BECAUSE PRINTING PRESSES HAVE GONE WILD it wont be as bad?

History tends to repeat. We are living through the Kondrateif Winter Cycle, it is usually 50-60 years, it has been delayed by EXTROARDINARY FED and GOV measures.......to a 70 yr something cycle.

And I BELIEVE this BEAR MKT will end near SINGLE DIGIT PE RATIOS......and this would probably mean an S and P 500 price of somewhere between as low as 250 to maybe 400, which mean an ultimate BREAK of the MArch lows.....this is JMHO of course.

Our current PE ratio looks more like a mkt top than a bottom. Dividend yields for SPX 500 are not near their historic high avg either. This SECULAR BEAR could be interupted by a few cyclical bull markets before final lows are set in.

We talked about pace of NEW HOME SALES. in 2005 we sold 1,283,000 homes, we are now off some 73% !!!!!!!!!! Carloads of tonnage off more than 20%. Unemployment highest in 30 years. Data which is DROPPING MORE SLOWLY is not like economic EXPANSION.

4 MILLION US WORKERS cannot find jobs for some 26 weeks, most on record.

US CORPORATE TAX MONIES HAVE DECLINED BY 57% (data Catherine Clifford) which means profits are EVAPORATING.

Listen to the bulls if you like, and those yelling NEW BULL MKT, the medicine we need to take to find our BOTTOM is not being adminsitered, what they are feeding us may be killing us.

Firms like GS have had their competitors taken out, and sit on top of the drain. MOST States cannot balance their budgets and are mandated to do so.

YET...the NAZ bros have risen the most consecutive days since 1992 !!!! I say BEWARE

Duratek

YOU WANT THE TRUTH?

http://railfax.transmatch.com/ check this site out for rail shipping volume.....you see a revival?

WELCOME TO HELL by KD many believe their is a US CARRY TRADE going on right now....with GOV backstops why not take on MORE RISK? cant lose for them...dangerous game.

and this response from Sushi


Karl,

"It's very important to emphasize that this is a mutant and much more dangerous form of the Carry Trade as it existed prior to 2008 with the Yen. Back then, there was a significant interest rate spread to work with so the trader could earn the differential without credit risk via S-T sovereign debt (T-bills and equivalents). As Ldog pointed out, there is not much spread of that sort available to work with now.That means that any carry is having to go into risk assets to achieve a worthwhile return.

This is MUCH more dangerous than the old "clip the coupon and watch the cross-rate" version of the carry. Atop the currency translation risk, they now pile market risk, credit risk and maybe duration mismatch or maturity/liquidity risk. Another way to borrow short and lend long with all of the corresponding issues. Makes me think a big chunk of this might be the "too big to fail" guys going max risk assuming they can stick any losses to the taxpayer when it does go pear shaped. "
----------http://jengafinance.blogspot.com/

WHAT ECONOMY? SPX 1000 target is nearing, one possible TOP (THE TOP)

FROM PEAK OIL TO PEAK EMPLOYMENT

Claims came in at 554,000 this AM, staying stubbornly high. You can see where we compare to worst reading from last Recession in 2001! As claims receded after peaking in 2001, we now know the stock market did not bottom until late 2002 early 2003! So even an improving employment picture here wouldn't guarantee a higher stock market.

After reading July Elliott Wave Theorist, a few things come to mind. Gov hardly ever gets it right, even as the fervor over Global Warming recedes, the Gov is attempting to pass along the highest tax increase inits history called CAP and TRADE.

Institutions set up to assist Small BIZ have failed and Banks will not lend (as I pointed out with 7a data)

It is indeed VERY possible this rally will carry further and last longer than most consider it could, but I warn IMHO this will be used to distribute to the unwary, and draw in as many as possible before the REALITY of the 2nd Depression hits home and real panic begins.

I do not believe there is any government action that can derail the unwinding of the most excessive powerful CREDIT EXPANSION and DEBT EXPLOSION in history.

INstead of Banks lending for normal business reasons, most became MORTGAGE BROKERS, now they are almost ALL saddled with NON PERFORMNG LOANS.

And many foreclosed homes are being vandalized by previous owners, tennants, or others depreciating their value even more.

How is this being dealt with? WE fixed the problem by SUSPENDING the need to "mark the assets to TRUE market value."

HOPE? maybe it starts HERE with PETER SCHIFF, one of the few speaking out before the shit hit the fan and a NON POLITICIAN, is anyone else SICK of politicians? LETS TAKE BACK OUR GOV!

Friends,
As you know, I have been seriously considering running for U.S. Senate against Chris Dodd.
Everywhere you turn there is evidence of just how bad our economy is getting. Growing unemployment, families that are struggling to put food on the table, and retirees that are having to make the choice between doing without or joining the millions of others that are looking for a job. Unfortunately, many of our economic woes have been created by government intervention and politicians who believe themselves to be economic “experts.”

http://www.schiffforsenate.com/

If I WAS LONG THE MARKET......I would be using this rally to raise cash, put my money in safest place possible, and try to survive the 2nd great depression. Come on friends, what have these IDIOTS fixed? the game maybe nothing more.....

D

HISTORY OF THE US DOLLAR

* On this monthly chart, you can see the 80.00 line of support and resistance the US $ has been dancing around, now it has plunged below again.

I see NO correlation in previous stock market action, as rising $ led to 2000 top and falling $ led to eventual 2002-2003 Bear bottom. But now MANY are saying a "FALLING $ WILL BE GOOD FOR THE STOCK MKT"

Perhaps it is NOW we are fighting the battle between DEFLATION and INFLATION, as INFLATION is the preferred METHOD of dealing with our MASSIVE DEBT OVERHANG.

Perhaps if DEFLATION will WIN THE DAY, it would mean more $'s are being destroyed so they become MORE valuable as debts are repaid in them. CASH IS KING or CASH IS TRASH.

I am trying to sell a piece of commercial property to raise cash for my BUSINESS. Should I get my price and sell at profit, that in this environment would be incredable, we an interested party or 2, I'll update when needed. My hypothetical profit could lead me to believe real estate brought me a pretty damn good return even in this hideous environment, that would be something.

Owning stocks may be losing some luster for a generation. HOW could it be possible for EVERYONE TO WIN? The stock market is a huge PONZI SCHEME, it REQUIRES more and more to enter the game and pay ever rising prices for the paper assets....when that slows or ends...prices fall.

Its also a rigged game, with MANY getting INSIDE info we the people never sniff.....wouldn't that be nice?

You have connected GOLDMAN SACHS people in every poop shoot of the economic and financial and political process, so of course GS would NOT get preferential treatment?

They can now belly up to the FED bar and get monies almost for nada.......is it ANY wonder their TRADING PROFITS are exploding.....who needs to lend money?

Bear, LEhman, Morgan all executed and were MAIN competitors of GS and JPM, their gone now.

No income tax for GS?????????????????? NO repay of AIG $13B monies doled out by an EX GS employee?

ALL this BS is happening right in front of your nose, and we all just bend over and take it?

AVG AMERICAN is suffering, AVG GS exec getting $$$Millions in bonuses.

Last 3 months the BLS (or BS BLS) created over 600,000 jobs......as the CONTINUING CLAIMS was being HYPED because it fell a bit from historic HIGH levels.....NO ONE mention the previous months data was REVISED WORSE.

This is the game being played. This is your stock market where fair play and everyone is supposed to be equal and have a fighting chance.

SHOULD the US $ regain 80.00 somehow...VERY good chance rally will be DOA. Right now it would seem destined for another fate.......being even more worthless than it has become in the world market.

Art Cashin sites SPX 875/6 as one key area traders will key next move off of. IT would seem for now the SHORTS are VERY nervous and if have not already could rush to cover causing another explosive rally.....mkt seems to go up every day.....the new normal is not at all

Duratek

IMPORTANT MKT WRAP "IT CAN'T HAPPEN HERE"

We have the best market money can buy! Liquidity flowing like wine and it's going into assets. I don't see it doing what it was intended,repairing the economy, Paulson and friends settled for helping their friends oN Wall Street, screwing the avg American not an INSIDER, and wasting precious US resources to help the connected few. GOV SACHS and friends.

Must read link below.




Conclusion http://voxeu.org/index.php?q=node/3421
"To summarise: the world is currently undergoing an economic shock every bit as big as the Great Depression shock of 1929-30. Looking just at the US leads one to overlook how alarming the current situation is even in comparison with 1929-30.

The good news, of course, is that the policy response is very different. The question now is whether that policy response will work. For the answer, stay tuned for our next column. "

Trading ranges of the major indexes including the transports are at the top end of a 3 month trading range. Overbought readings are coming in, so a pause would not be surprising here.

I have not seen the selling needed to break down the markets, should buyers finally step it up here an upward EXPLOSION could result.

Some of my indicators (especially after 2nd push to VIX 80) were signalling seller capitulation. The market is tracking VERY similar to 2002 lows action, rise, and now all is left to see if we plunge to test THE lows n place from MArch....as we did test in early 2003. A BOTTOM was confirmed then and it was safe to go long until OCT 2007 top.

My main personal goal had become one of staying LIQUID, and avoiding all risk, so even as I prepared for the MArch lows, I did not follow through. Not always easy to do in REAL TIME, but I thought DOW 6,000 zone would be a good 25% in zone for my cash with the HAIRCUT we had from highs.

If you stay in mkt during bear you wont have the CASH to buy ANY LOW.

Also my blog hadn't been intended to make real time BOTTOM CALL....I'll continue to present the evidence and rate the risk.

Historic monies have been THROWN at this crisis...what you see now is the result.

WHEN the upper (we're clOSE) trading range is taken out, we can try and predict next level. 975 may be some R, then 1000 oN SPX

There is a chart out there Ive seen but cant find one to post called "DIVIDEND SUSTAINABILITY RATIO",,,,,,it has risen SO HIGH the comments were EARNINGS would need to TRIPLE from here to bring it down to normal.

Companies are in general not expanding sales but cutting costs, what they HAD to do. WILL CREDIT and the COnsumer come roaring back?

Duratek

KARL DENNINGER on "GOVERNMENT SACHS"

Tuesday, July 21. 2009

Posted by Karl Denninger in Macro Economics at 09:11

UTX: Conference Call **FLASH**

In the "no kidding" department, UTX's CEO said:
"Does not expect a substantial economic recovery next year."
Go ahead Sheeple, keep buying those stocks...... you know that Goldman would never issue a forecast of a big rise in a market (cough-oil to $200-cough) and then use that "prediction" to sell off their holdings to you and even get short, right?

Go ahead folks, buy buy buy as Cramer would say. Never mind the actual CEOs in the trenches are telling you the truth about economic prospects. It may not be as sexy as listening to CNBC's "talent" having orgasms on the floor of the NYSE, but it sure as hell is a lot more accurate to listen to those who are involved in running businesses instead of parading in front of a "Tout-TV" camera, right?

PS: Look at the DX again this morning - dollar down (again) materially, about 1/3%. "What are much higher energy prices, Alex?" Just remember, Government Sachs has your back America (and they will shoot you in the back - again - since you continue to allow it to happen!)

MORE ON GS THEFT

TRADING RANGE "BREAKING OUT or FAKEOUT?"

BETTER THAN EXPECTED?

U.S. stocks start ahead; Caterpillar fuels Dowat MarketWatch(Tue 9:35am)
Caterpillar 2Q profit falls 66 pct on weak demand

NEW YORK (MarketWatch) -- U.S. stocks ran higher at Tuesday's start, extending the prior session's surge that had the broad market clearing new highs for the year, as better-than-forecast results from Caterpillar Inc.

The new day likes 66% drop in profits as better than expected.....that's great! CAT up $4

D

MORTGAGE MESS IS OVER?

You can see why maybe 2007 marked the bull mkt top? This is where the SUBPRIME loans were to reset and were greatest volume.

These numbers blow the doors off the "containment" theory. Rather than being limited to a few million mortgages, the risks of re-sets or sinking equity affect fully 75% of all households holding mortgages in the U.S.

From Mid 2009-2011 we have to get through ALT-A and option adjustable mortgages, and in almost every case, the NEW RATE will be HIGHER than current.

ANyone telling you this crisis is BEHIND us is not telling you all the facts. And instead of the BANKS DEALING with the defaulted underwater loans, they now can use their own methods of pricing them and most are STILL on their books!!!!!

D

RECESSIONS IS OVER, OR HAVE THEY FIXED ANYTHING?

STIL SOME BEARS LEFT PROWLING AROUND

YELNICK

"The Problem With Breaking the June 11 High
There is a lot of commentary on the prior few posts about Neely having to change his count if the Jun11 high is exceeded. Here is what he had to say about it this morning (emphasis added):
It’s amazing the number of emails I’ve received lately trying to talk me out of my bearish scenario or asking what it means if June’s high is exceeded (which means they think I’m wrong). That alone favors my preferred scenario, but a move above June’s high is not a good thing, it’s a horrible thing. It means the bear market will last for years and economic conditions will get much worse than originally thought. "

Duratek

2002-2003 BEAR LOW AND NEW BULL

Sometimes it DOES NOT pay to stay pessimistic and in denial of new trend. Our bounce does not look like this. Nor does it have volume or buying enthusiasm found at bear lows. Nor does it have the valuations or dividend yields found at major bear lows.

Did the FED and GOV buy us a cyclical Bull? My opinion is not important, the votes of the shares are. IMHO I interpret this move as a bear rally, and the lows still to be tested. I think odds favor no new lows this go around, the sellers would have to step up.

With VIX 80's already posted, some bottoming data is already HERE. I choose not to chase this rally, but that's me

When confronted with a situation not seen or observed in most people's lifetimes, I will not rush into judgement when I see no tangible eveidence we're out of the woods.

Poster left comment..."Banks earnings are improving" this they must have read or heard on CNBC type slant, when we know earnings are up because MArk To MArket was dropped and B because 3 of the top banks are GONE, so GS and JPM reap from lack of comp.....

D

LONG TERM SPX MONTHLY CHART TO PONDER

*clickto enlarge

THE JOY OF SACHS

NY TIMES Paul Krugman on Goldman (goldmine?)SACHS

PM POST

Worn out this week, I haven't changed my mind one iota, BEAR MARKET IS ALIVE. Consumers are not in position to expand their debt and purchasing, did something miraculously occur recently being kept secret from me.

I see the one posting, give it mr contrarian, get on the bandwagon with the rest of us sheeple's.... If you want me to change my opinion because of popular reports and CNBC pablum, you have come to the wrong place.

Fundametal analysis is fun, but provides NO insight to the direction of the market. It comes down to supply and demand and playing the odds.

The demand tea leaves say to me.....this rally is DOOMED to fail.....banks earnings are a FRAUD, its this simple, what would they be if the STILL DEFLATING HOUSING VALUES and DEFAULTS were properly accounted for on their books?

More tomorrow afternoon.

D

"PICTURE WORTH A 1,000 WORDS"

*click to be large

When you DROP like this, you can see what is being TOUTED as SOARING! is it?

June housing construction rises, building permits soar- AP

THAT is what THEY tell you, above is what I show you.....there is a difference as I seek out truth.

GE earnings fall 49 percent- AP BELLWEATHER

Unemployment tops 10 percent in 15 states in June- AP MUCH higher than this as miracle jobs added out of thin air

D

AM POST " LOST 2 DECADES"

*click to enlarge chart.

The BURSTING of a massive real estate and Banking BUBBLE in Japan back in 1990 is still being felt 20 years later!!! Their stock market is JUST 25% of what it was.

WHY do you NEVER get this advice from your broker or financial advisor? "You should move to cash for now, there is nothing worth buying, values too high, we maybe in a bear market"

Brokers get paid when you buy or sell, not while you are in cash. The chart above and our OWN experience should DEBUNK the LONG TERM BUY and HOLD mentality (LTBH).

Our own stock market may now be in a range bound pattern, with the upper reaches near SPX 1000, I would not be venturing in NOW IMHO. AT the LOW end we could 700 ( a higher low) or even 400 SPX depending on what the ADM does from here.

It is reported this AM that "building permits and housing starts increased June from May" and now the idiotic GREEN SHOOT crowd is drinking more punch. MY friends, LOOK around, where the heck is this building going on? With unsold inventory still at record highs, job losses mounting.....I scratch my head on that one.

OPEX FRI is here (options expiration every 3rd FRI of month) TGIF!!!???

D

IS S and P RALLY POISED TO END?

http://globaleconomicanalysis.blogspot.com/2009/07/s-500-rally-poised-to-end-buy-and-hold.html Mish thinks so.

More FOOD FOR THOUGHT

Thursday 16 July 2009 Foreclosures at Record High in First Half 2009 Despite Aid http://www.truthout.org/071609A?n Lynn Adler, Reuters: "U.S. home foreclosure activity galloped to a record in the first half of the year, overwhelming broad efforts to remedy failing loans while job losses escalated."

Robert Scheer "Government Sachs" Strikes Gold ... Again http://www.truthout.org/071609B?n Robert Scheer, Truthdig: "Connect the dots: Goldman Sachs made $3.44 billion in profit this past quarter, while the U.S deficit topped $1 trillion for the first time in the nation's history and appeared to be headed toward doubling that figure before the budget year is out. Since most of the increase in the federal deficit is due to bailing out the banks and salvaging the greater economy they helped destroy, why is the top investment bank doing so well?" WHY didn't GS pay ANY taxes?

FED SURVEY IN THEIR OWN WORDS
http://www.philadelphiafed.org/research-and-data/regional-economy/business-outlook-survey/2009/bos0709.pdf

D

A NEW DAWN, HOPE SPRINGS ETERNAL FOR GREEN SHOOTS

Our economy relies HEAVILY on Consumer Spending, hopes for revival hinge on expanding Consumer Spending. We have record continuing claims, we have the most unemployed in most of ours lifetimes, as bad as 9.5% IS, this figure is being UNDEREPORTED.

GOBS of workers are on reduced hour shifts, 30-32 hours per week. Many have excepted lower paying jops, like from a house framer to a dishwasher to try and provide for family.

If even if using provided BLS stats, how do 6.5 million LESS workers do the job of SPENDING for the rest?

EST for 2009 SPX profits are around $55 if you use a 16 multiple you get SPX 500 value target near 880, this is a rich valuation, are earnings REALLY $55?

If you use ametric found at every MAJOR BEar Market bottom you take SPX 209 earnings X 9 or a single digit PE ratio, you get SPX 495 as the bottom.

Also SPX dividend yields avg over 6%, we are about half of that.

MAJORITY of Consumer spending came from HOME EQUITY LOANS, will it now?

SO QUICKLY we can revert to a BULLISH SENTIMENT, and make the news or data fit that wish, doesn't make it so.

FORECLOSURES are STILL RISING, and now unemployment is the main cause not subprime slime. ALT A loans and COMMERCIAL loans defaults NOT being discussed.

If home prices are still falling, and foeclosures still RISING, how can BANK earnings be on the MEND? WHAT IS BEING REPORTED IS PURE FICTION, IMHO!

Watch out for strengthening US $. I am unsure of how far this rally can take us, I am sure we are still in a SECULAR BEAR MKT and will be until we get a technical signal it is over.

D

(OT) BEST CAR FINISH PRODUCT I EVER USED

http://www.zymol.com/zymolvolvowax8oz.aspx

I own a 2005 VOLVO S60R, color MIDNIGHT BLACK. I have used tons of different products, this is the best $49 I ever spent on my car. I also like Trade Secret Carnuba which you buy online, both easy to use, but Zymol product makes my car look "wet" slippery to feel and smells good enough to eat!

You wipe it off BEFORE it drys, no residue, took me 30 minutes entire car except roof. There are multiple different Zymol's depending on your car and color. Gets a D seal of approval.

Duratek

WED PM MARKET WRAP

Today was a 90% up volume day with expanding volume, obviously a strong day for the market. No surprise led by tech and financials.

Odd was RISE in VIX 3% with a 2% plus move in SPX, one of only 5X this happened? a few days near END of 2002 Bear rally.

The strength may suggest odds favor the rally is not over, BUT L stats this PM were NOT that impressive considering the move. So there is no change at this time that this rally only interrupts the larger degree trend which is down.

Remember friends, why dont the Banks release results with the reporting rules that WERE in vogue during this crisis so we as investors can make a more reliable inference to their current estimates.

INTC operating info from 2007 (just reported $8B this qtr)

Our net revenue was $38.3 billion in 2007, an increase of 8% compared to 2006. Higher microprocessor unit sales were partially offset by lower microprocessor average selling prices. Higher mobile chipset unit sales also contributed to the increase in net revenue.

YUM BRANDS recently LOWERED their outlook.......what do they see?

D

AL GORE, GOLDMAN SACHS, WE BENDOVER!

Where is the OUTRAGE AMERICA???????????? GS makes a lot of money last quarter so banking system is fixed? Sure it is....most of it coming from "trading profits"

D

PM CHART DEVIL IN DETAILS

Volume ebbing away, yesterdays ROMP in the park did not bring abou a follow thru, especially given how GS " KILLED EST"

When this rally fades I hink the decline may begin and move swiftly, faster than most will be expecting.

Words are just words not backed by anything except fantasy. Healthcare IS too expensive, there are better ways to fix it than to SCRAP the whole thing.

WE cannot continue to spend aimlessly and not adhee to any common sense approach. WE NEED GOV, but we dont want it ruling our lives, taking our liberties, and deciding where the free market takes us.

If the public sector does not return to prime source of job creation, we are neterring into a new era of gov biased growth, with little say so

D

PM MARKET WRAP

This is where I think we're headed, descending blue trendline near 8400. News this AM that "sparked" the rally was UPGRADE of GS and expected GOOD earnings from Banks, so we have "turned the corner".

Like I said, amazing how good earnings can look when you dont have to report your assets at current market value. Tax receipts have plummeted, job losses in private sector as companies grapple with slowdown. But what does Government do? Increases spending, adds hires, gets bigger.....that makes sense.

D

D

LET THE GAMES BEGIN

Maybe its' " not as bad as expected" relief rally this week, but I question the tenacity of it and how far it can go.

A HUGE amount of wealth has been destroyed in the stock market and real estate, maybe $25 Trillion or more, even if a few trillion how does that stack up against the stimulus of bilions?

And what we have to show for it? Some public works projects.

When the smoke lifts, DOWN she goes

D

POLICE SEIZE FLAG

(Iraq war vet flag) No freedom of expression?

YIKES!!!!!!!!!!!

FRIDAY AM MARKET TALK

The stock market is close to a TOTAL BREAKDOWN IMHO, the neckline I observed on the Dow was near 8200, even after 2 weeks of battering, the market could not even rise above that break, only points away.

Early AM talk is of "we don't know why futures are down this AM" this is why we use technical analysis, TALK IS CHEAP.....and not usually fruitful. Those buying the market and talking it up don't have a clue in the world.....that the ODDS are not with them in the least.

Here is some news: (broke yesterday) please note Alcoa's performance, but they BEAT estimates!

Alcoa (AA 9.72, +0.26) reported a fourth quarter loss that was above consensus, while revenue fell sharply.

The company reported a fourth loss of $0.26 per share, $0.12 better than the First Call consensus of a loss of $0.38. Revenue fell 41.4% year-over-year to $4.24 billion vs. the $3.93 billion consensus.

Alcoa said the economic downturn has affected most of its end markets - automotive, commercial transportation, building and construction, and aerospace.

from this am on yhoo finance:


The stock market headed toward a lower start Friday as investor anxiety about the economy increases. (it never went away!)

Markets around the world pulled back as traders decided to sell amid the uncertainty about upcoming earnings reports and what they'll say about the economy. News that Chevron Corp.'s refining margins fell in the second quarter added to the uncertainty early Friday; oil companies have been among the country's top performers.

My friends if Banks report stellar earnings would that make sense to you? As home prices KEEP declining how could their portfolios rise in value? Because the CHEATERS dropped MARK TO MARKET that's why.

Wise man once said " a market in decline that cannot rally from oversold conditions is a weak market" TGIF ! WHAT trader wants to hold into the weekend with uncertainty with company earnings which begin in earnest Monday? SO big question for me, is will any DECLINE come from a lack of buyers, or PICK UP in SELLING PRESSURE.....or both?

D

ADDT'L COMMENTS

Todays volume was a slack 27% LESS than yesterdays, where did all the buyers go? Have the insiders run out of free money? We can just print some more.

Folks, we are at the beginning of a new American Revolution. It sucked when Bush used 911 to pass laws taking away our COnstitutional rights, and further his war agenda in Iraq. Politicians will use FEAR to INCREASE their control and power.

Now, Obama is stacking the debt, trying to resurface America and take what's left for his Socialist agenda. There are no new faces running thnigs, some of the same old faces....and the Goldman cronies.

The Revolution begins when enough people get SICK ENOUGH with what our elected officials do, who in their right mind wants that stupid shit barney Frank in office? he's an idiot.

Look, you something is horribly wrong, we dont need left or right, we need what's right for all. Free markets, less government interevntion, smaller gov, LESS TAXES, LESS MILITARY BASES. Let the public sector out and provide for us, not gov.

STOP bailing out, live within the means. WHEN has the GOV known what is best for us??????? If you believe so, bend over and hand them the soap...

D

WAKE UP AMERICA

MARKET WRAP

A big yawner, even CNBC sheisters couldn't hawk it up, who is that trader dude with his apron on every day telling us how great it is, he's a joke.

Port traffic is drying up, dry docked, BDI rocked first quarter but is trailing off now, it rose on Chinese stimulus plans.

Market is in headwind, I am not sure if it even has one good rally left in it. Earnings full tilt next week. I'm not excepting as good LESS WORSE THAN EXPECTED....

D

AM RAMP JOB

Here come the green shooters again....retailers DOWN in sales but BEAT estimates, laughable. Unemployment report is not believable....use your eyes.

Obama plan was social engineering at expense of stimulus, so NO jobs....what a sham

D

"CATOSTROPHE" HOW OBAMA IS STEALING OUR COUNTRY

http://browseinside.harpercollins.com/index.aspx?isbn13=9780061771040&pg=1

WHO will stop this outrage... the markets sense something is wrong...g-d help us as we become Socialized and our rights taken away

D

MID DAY CHART

Note last REd candle on chart, think red line touching my neckline as drawn. IMHO this is valid chart, and maybe this is TEST of breakdown. NO decent bully response to the selling does not bode well. (can click on chart to enlarge)

Duratek

TUESDAY MARKET WRAP "Lights Out?"

Here are some headlines from YHOO FInance

Wall Street Wilts as New Stimulus Talk Stokes Fears- Reuters
U.S. stocks fell on Tuesday as talk of a second government stimulus plan stirred fears that the economy is far from well, raising the specter of an anemic second quarter earnings season. A member of the Obama administration's economic advisory panel said the United States should plan to possibly provide a second round of stimulus funds to prop up the economy, implying that recovery is still far off.

Do we need comments like this to tell us the economy is not doing well? Did anyone really believe the GREEN SHOOTS BS?

Dow OFF 162 pts TRANS off 102 pts or 3.2% VIX rose 6.5% to 30.89 (FEAR RISING)

This gets harder to write about as I go along.

"Those who lose the least win" "we all lose" says Richard Russel famed Dow Theorist. For 85 I think he is, amazing intellect.

If I morph into a subscription service, I will keep it reasonable so avg person can afford, and build even more to the service, including my opinions as to where to invest and when. But my MAIN emphasis is and will remain to first educate, enlighten and do my best to keep you out of harms way.

Calls do not always manifest themsleves as good calls immediately, you eventually have to trust someone, and rightnow it is probably your financial advisor if you have one what have they been telling you?

"Hold on, green shoots...." "It's time IN the market, not timing the market" My friends there are TIMES you need to be OUT of the market. You may get a little scalped early on, but it takes time for a trend to develop, once it does my goodness you don't fight it up or down.

I have some learned TA people telling me my H and S formation is not a true formation and calls for 1000 or 1100 SPX by some Elliot Waver followers......others have sited the formation of possible Head and SHoulders in the index, anyhow the 930 SPX are I sited I think WAS relevant and it failed to hold and since then we have been declining.

There's not enough stimulus, the right stimulus and there isnt enough liquidity and what we do have still is deflating assets prices. There has been a HUGE loss of $$$$'s, many have lost 50% of what was to be their retirement nestegg, add in home price declines and you have a HORRIBLE loss of wealth that cannot be supplanted with FED IOU'S.

D

WALL STREET WHITEHOUSE

http://www.counterpunch.org/andrew07022009.html How GS and C run the show.

Markets are CRATERING and some important support is crumbling, below 880 SPX might seal deal.

D

AM POST "WHERE ARE THE POLICE?"

http://www.correntewire.com/great_american_bubble_machine_0 I'll keep posting this piece on GOLDMAN SACHS until I think people have woken up. Is the evidence in dispute that Taiibi presents? Not from where I'm sitting, you can't make stuff like this up.

Why after reading this it wouldn't enfuriate the populace I don't know, and DEMAND change. Dem's got their man in there and he is playing the same game! When you look around and see your neighbor out of a job, just think of all the mney GS is paying out and has with your tax dollars. NO ONE is held accountable.....and it doesn't appear they pay their FAIR share of taxes.

Maybe a bounce back, but I think the market is on a sell, 3 90% down volume days may have sealed the IT trend

D

HIGH ALERT

I want to remind everyone of the Head And Shoulders formation that I believe is very much in play in the major indexes, the Dow recently broke thru its support and the transports had already given us a non confirm of the rally highs.

We have had now 3 90% DOWN VOLUME DAYS in last few weeks, and very little rally in between, it is my belief that the ONGOING BEAR MARKET everyone on CNBC told us was over, and most of their guests told us "now is a great time to buy" is ready to get back to clawing again.

I hope I am wrong, but I think rally is over and next leg down has begun. When you CRIPPLE autos, housing, and financials all at once, the government cannot step in and replace demand. The Chinese market is up nearly 70% and I think may be poised to tumble, how is their economy going to do with world mired in its worst slump since 1929?

This is going to be a bumpy and sorry summer IMHO.

D in CASH 100% and in survival mode

D

PM MARKET WRAP "Misread Economy"

NEW YORK (AP) -- Shares of major metal manufacturers traded sharply lower Monday, a day after Vice President Joe Biden said the White House "misread" the economy, prompting concerns that an economic recovery could be slower than expected.

In an interview with ABC's "This Week" broadcast Sunday, Biden said the administration "misread how bad the economy was," but stood by its stimulus efforts.

Those comments will likely dampen investor confidence, said David Silver, an analyst with Wall Street Strategies.

During the second quarter, commodity prices "went through the roof," and investors snapped up metal makers stocks on word that the economy was "less bad" than before, he said.

*An economy that's LESS BAD is not a sign we're off to moon again. Job losses that are slowing down are job losses. Prices for homes falling not so fast are still falling.

The Administration has NOT done enough, has the same GOONS from Goldman and friends in places to influence what is good for them.

We have NO ONE in high places who will do what is best for us. Enough hasn;t been done, TOO Much has been done. MANY are near the breaking point.

Lackluster trading day, weak response to 90% down days, when this is over down we go IMHO

D

THE GREAT AMERICAN BUBBLE MACHINE

MATT TAIIBI'S well documented story about GS and its many tentacles.

California is handing out IOU'S to hundreds of companies who have already provided services and product, they can't pay for.

Most State Gov's do not have thetax revenues to balance their budgets, GOV can't bail out one, then all must get bailed out.

BUT OK to BAIL OUT AIG and then have them pass along $12 Billion to Goldman Sachs.....how sick is that?

D

NEW WORLD ORDER

true story.

In Dick's Sporting goods today.....young family of 3 boys 1, 2 and 4 DAD said he is out of work as FRAMER and to support his family had to take job as DISHWASHER.....this is the story NOT reported that matters to me. A 9.5% reported unempoyment that is MUCH higher...my g-d this is sad! companies rolling over like mad.

NO WAY we can support and help housing recover as jobs are shed and others work as dishwashers......high paying jobs dissapearing.

In return we get Michele shopping che che stores in France with a big grin, GS alumni at every corner of economy and THE DRAIN.

Lip service and LIMP speaches....this country is SO lost!

PM MARKET WRAP

*that right shoulder keeps growing I charted.


Buying enthusiasm continues to retreat to the levels of the previous market lows in MArch, this sort of buying behavior is not in line with any previous bear market bottom.

The more I talk to people the more I am convinced there is more ugliness ahead, and the avg person who knows nothing of stock markets can feel it to.

Something is horribly wrong, either the wrong things have been implemented to repair the economy or the decades of risky Fed policy have come home to roost and there is little that can be done.

With so many companies cutting capital spending, it seems nearly everyone but Lebron JAmes is cutting back on spending....sticking their head in the foxhole.

What has been done is $Ttillions have been spent or committed to our current course and that is to BAIL OUT the banks and the AIG's of the world and then see some of them like C HIKE up the rates 15 Million pay on their credit cards....thank you, we appreciate it.

Now I'm telling you this....this whole system is crooked, and Im sick of the idiot near labotomized politicians pandering to the special interest groups, selling us down the river.....WHO for goodness sakes is speaking out for the avg American?

I cannot stomach another speach from Obama. I cannot listen to another word from Geithner nor Bernanke.....to me they are all liars, decievers, manipulators....career politicians...self serving types.

WHat needs to change in this country is to GET THE GOV OFF OUR BACKS! Make it SMALLER,,,,,,,ELIMINATE the tag of WORLD POLICEMAN...we cant friggin afford it. We are sold out to the foreignors....do we really want COMMUNIST CHINA holding most of our DEBT?

REDUCE friggin taxes...on the REAL MIDDLE CLASS, make gov smaller stop adding CZARS and departments.....gov getting larger is self serving...propagating. CUT GOV SPENDING...look these idiots dont know whats best for us, give it back to the American people........let private....public AMERICA GROW NOT GOV

BANKS WONT LEND, the same ones who screwed us doing it again...with 1st Bush , now O and GANG and us the patsies....answer this FED " WHERE THE F DID THE MONEY GO??? ever heard of water boarding?

Duratek

AM MARKET TALK " A BRIDGE TO SELL"

Data ADP 473K job cuts expected concencus under 400K. 18.9% DROP in mortgage applications even with rates at historic lows, anyone telling you the economy is recovering should explain this.

A black friend of mine was over for dinner last night, he is sick of Obama and knows the middle class will bear the burden of his plans, as the poor reap the benefits on the avg Joe's back, crippling further consumer sentiment, which did not ramp up in last report.

SO let them tell you CHINA is rising, Europe is rocking, the bottom is in, and I say I SMELL A RAT.

L buying power is almost BACK where it started this 4 month rally! BEAR MARKETS AREN'T OVER UNTIL TH EFINAL LOW IS IN......so is it? END OF month and quarter and even beginning of next month tend to be manipulated higher....I'M still watching SPX 930

D