"In other words, the economic stimulus the government deployed in an attempt to get the economy back on track are all but gone. And now, spending cuts are on the way.
"The economic indicators are pretty disturbing in light of the fact that policy is going in the opposite direction of a normal response to an economic slowdown," said Chad Stone, chief economist at the Center on Budget and Policy Priorities."
http://money.cnn.com/2011/07/29/news/economy/spending_cuts/index.htm
Is this REALLY the backdrop to an expanding bull market?
Sunday, July 31, 2011
Saturday, July 30, 2011
TO THE BRINK
http://www.washingtonpost.com/wp-dyn/content/article/2010/10/06/AR2010100606772.html
REAL GDP is barely growing in the low 1% range, yet how are corporate profits hitting all time highs?
"Some companies are buying back shares partly because they don't want to invest in developing new products or services while consumer demand remains weak, analysts said.
"They don't know what they want to do with all the cash they're sitting on," said Zachary Karabell, president of RiverTwice Research.
Historically low interest rates are also prompting some companies to borrow to repurchase shares.
Microsoft, for instance, borrowed $4.75 billion last month by issuing new bonds at rock-bottom interest rates and announced it would use some of that money to buy back shares. The company already has nearly $37 billion in cash, but much of that money is being held by its operations overseas. The tech company is reluctant to repatriate the money, because it would get hit with a huge corporate tax bill.
A share buyback is a quick way to make a stock more attractive to Wall Street. It improves a closely watched metric known as earnings per share, which divides a company's profit by the total number of shares on the market.
Such a move can produce a sudden burst of interest in a stock, improving its price.
Among the biggest buybacks so far this year: Hewlett-Packard, the world's biggest maker of personal computers, said in August it would spend $10 billion buying its shares. Its shares rose 1.5 percent after the announcement."
So another issue with LOW Interest rates is companies are lured into borrowing and using it NOT to create jobs but to buy back shares, make earnings APPEAR better and so when they CASH out to the bag holders they get more. WHAT about ALL the cash these companies have? why borrow if they really have all that cash?
The economy is limping along at a rate that cannot sustain economic activity, which in turn is what helps to create jobs, which in turn allows people to borrow andbuy homes, which in turn causes people to buy stuff for their homes, which in turn spurs additional consumer spending and increase in the velocity of money.
Stimulus used has created very little except a rise in stock prices. Fed has bought $2.5T of US Treasuries and now holds more than any entity. China holds around $1.7T.
The game of chicken being played between the 2 parties now is very dangerous and may have already done heavy damage to economy. ALL this is happening with near lowest long term rates in history.
A loss of credit rating would cause US interest rates to climb, hurting everybody. OUR CURRENCY which is mandated to the FED Reserve to be protected is being anything but that, a spit away from its historic LOW in value. The AIM is to FORCE YOU into risky assets in attempt to find yield.
"TIME IN THE MARKET" IN FOR THE LONG HAUL" LONG TERM BUY AND HOLD" "THE MARKET ALWAYS GOES UP"
I was in a branch of B of A Friday and I heard this from a Bank official talking to a depositor on the phone....."yes you should keep making 401 contributions, over 10 years the return on stocks is 10%".....I don't think that is actually true do you? The market has gone nowhere over last 10 years, but I can say it surely hasn't returned 10% a year over that time! TOO many people paid to help others no far too little about what they are peddling.
YES over time, if you live long enough, the stock market always goes up.
SInce January there have been 10 90% volume days....9 were down days only ONE was up! Volume has whithered away yet the market remains in a 6 month trading range. THIS is why there is no bear call from me yet. I SEE warning signs, I have said if it were me I would RAISE cash levels....you cannot buy discounted stocks if you don't have cash.
WE know there is a gov't debt bubble, come Tuesday does it pop? VIX moved up to above 25, this does show an elevated level of FEAR, but FAR from PANIC.
I have been watching the sector related to gov't contractors like SHAW GROUP and a few others, they are mostly at or near 52 week lows.
To cut Gov't spending, agencies have to shrink, budgets have to be cut, programs cut or reduced....and could lead to government employees losing their jobs.
If gov't cuts spending, if taxes on companies and middle America are reduced or not raised, we can choose where to spend our money vs govt....and we do much better job creating economic activity than the govt does.
WE have promised too much and we can't afford it. 40% of Americans get 90% of ALL their living cash from Social Security payments, this is NOT how the program was originally set up.
What does this say about our prosperity if 40% of Americans rely on just SS to get buy in retirement? what happened to savings, stock holdings?
Majority of Americans have wealth tied to HOME VALUES!!! AND what has been targeted by the (wish was abolished ) FED RESERVE has been (in their own words) ASSETS....the STOCK MARKET...and I don't think this in their mandate.
Banks CANNOT attract savers, which we use deposits for investment as they don't pay ANY INTEREST!!!!!!!
A WHOLE SECTOR of our society, is being SCREWED and HOSED because they don't want risk, at 70 you can't make up for steep losses, you run out of time. THERE IS NO SAFE OUTLET VEHICLE to gain good interest as investment.....this retarded imbalance cannot be good.
Your/mine cash that you don't want in the stock market, you know your money is used so the insiders can cash out shares and maintain their opulent lifestyles, you are told holding stock is a big deal....it's only a big deal for the privileged few who get shares for next to nothing and then sell them to you...and you hope to sell them to someone else and so on.....and its all just a PONZI SCHEME, so you better get in LOW and hope to sell high. A MOVE from lows of SPX 666 to near 1340 isn't good enough? can we go higher? YES....but do you believe stocks are now priced for big breakouts to the upside? are you then buying now early in the trend? or trying to catch the last bit of final move should it come?
Are we early in an economic renaissance?
WHY haven't anyone been arrested for their part in the financial crisis of the history of this country, not even ONE SHREW? SO no one did anyting wrong? The dude from countrywide? no one? these guys made Bernie ebbers from Worldcom look like a saint....the system is bought off....and that's how it is, as we teeter on the brink.
Many joining armed forces to get a job, not serve the country, it's that bad. The government is becoming the largest employer???? Pays the most with the most benefits......the size of gov't is grotesque and eating our economy whole.
SO as you watch this drama play out, and see both sides fighting for what they stand for, what kind of comprimise is possible? How do companies or investors make investments based on an uncertain outcome? THEY CANNOT
The adjusted money supply, the Treasuries and other paper that sit on the FED Reserve balance sheets, the worlwide bailouts of countries.....we are awash in paper....it has risen like a flag up a pole......its gets destroyed or it has to go somewhere....and that is part why GOLD stands at new highs.....a SLOW WORLD ECONOMY....deflating housing and economic activity and INFLATION at the edge of getting out of hand.
Is this thee fork in the road I am to see the world economies at the beginning of some new wodnerful expansion? or already past the best it could be.
Never before this far into "recovery" never before has so much been spent and done to gain sustainability and such futile anemic reults.....except stock prices. And I am afraid at some point we will reach that tipping point where the weak hands get killed again when the distribution is over and the insiders no longer play the game of buy the higher price.
Duratek
REAL GDP is barely growing in the low 1% range, yet how are corporate profits hitting all time highs?
"Some companies are buying back shares partly because they don't want to invest in developing new products or services while consumer demand remains weak, analysts said.
"They don't know what they want to do with all the cash they're sitting on," said Zachary Karabell, president of RiverTwice Research.
Historically low interest rates are also prompting some companies to borrow to repurchase shares.
Microsoft, for instance, borrowed $4.75 billion last month by issuing new bonds at rock-bottom interest rates and announced it would use some of that money to buy back shares. The company already has nearly $37 billion in cash, but much of that money is being held by its operations overseas. The tech company is reluctant to repatriate the money, because it would get hit with a huge corporate tax bill.
A share buyback is a quick way to make a stock more attractive to Wall Street. It improves a closely watched metric known as earnings per share, which divides a company's profit by the total number of shares on the market.
Such a move can produce a sudden burst of interest in a stock, improving its price.
Among the biggest buybacks so far this year: Hewlett-Packard, the world's biggest maker of personal computers, said in August it would spend $10 billion buying its shares. Its shares rose 1.5 percent after the announcement."
So another issue with LOW Interest rates is companies are lured into borrowing and using it NOT to create jobs but to buy back shares, make earnings APPEAR better and so when they CASH out to the bag holders they get more. WHAT about ALL the cash these companies have? why borrow if they really have all that cash?
The economy is limping along at a rate that cannot sustain economic activity, which in turn is what helps to create jobs, which in turn allows people to borrow andbuy homes, which in turn causes people to buy stuff for their homes, which in turn spurs additional consumer spending and increase in the velocity of money.
Stimulus used has created very little except a rise in stock prices. Fed has bought $2.5T of US Treasuries and now holds more than any entity. China holds around $1.7T.
The game of chicken being played between the 2 parties now is very dangerous and may have already done heavy damage to economy. ALL this is happening with near lowest long term rates in history.
A loss of credit rating would cause US interest rates to climb, hurting everybody. OUR CURRENCY which is mandated to the FED Reserve to be protected is being anything but that, a spit away from its historic LOW in value. The AIM is to FORCE YOU into risky assets in attempt to find yield.
"TIME IN THE MARKET" IN FOR THE LONG HAUL" LONG TERM BUY AND HOLD" "THE MARKET ALWAYS GOES UP"
I was in a branch of B of A Friday and I heard this from a Bank official talking to a depositor on the phone....."yes you should keep making 401 contributions, over 10 years the return on stocks is 10%".....I don't think that is actually true do you? The market has gone nowhere over last 10 years, but I can say it surely hasn't returned 10% a year over that time! TOO many people paid to help others no far too little about what they are peddling.
YES over time, if you live long enough, the stock market always goes up.
SInce January there have been 10 90% volume days....9 were down days only ONE was up! Volume has whithered away yet the market remains in a 6 month trading range. THIS is why there is no bear call from me yet. I SEE warning signs, I have said if it were me I would RAISE cash levels....you cannot buy discounted stocks if you don't have cash.
WE know there is a gov't debt bubble, come Tuesday does it pop? VIX moved up to above 25, this does show an elevated level of FEAR, but FAR from PANIC.
I have been watching the sector related to gov't contractors like SHAW GROUP and a few others, they are mostly at or near 52 week lows.
To cut Gov't spending, agencies have to shrink, budgets have to be cut, programs cut or reduced....and could lead to government employees losing their jobs.
If gov't cuts spending, if taxes on companies and middle America are reduced or not raised, we can choose where to spend our money vs govt....and we do much better job creating economic activity than the govt does.
WE have promised too much and we can't afford it. 40% of Americans get 90% of ALL their living cash from Social Security payments, this is NOT how the program was originally set up.
What does this say about our prosperity if 40% of Americans rely on just SS to get buy in retirement? what happened to savings, stock holdings?
Majority of Americans have wealth tied to HOME VALUES!!! AND what has been targeted by the (wish was abolished ) FED RESERVE has been (in their own words) ASSETS....the STOCK MARKET...and I don't think this in their mandate.
Banks CANNOT attract savers, which we use deposits for investment as they don't pay ANY INTEREST!!!!!!!
A WHOLE SECTOR of our society, is being SCREWED and HOSED because they don't want risk, at 70 you can't make up for steep losses, you run out of time. THERE IS NO SAFE OUTLET VEHICLE to gain good interest as investment.....this retarded imbalance cannot be good.
Your/mine cash that you don't want in the stock market, you know your money is used so the insiders can cash out shares and maintain their opulent lifestyles, you are told holding stock is a big deal....it's only a big deal for the privileged few who get shares for next to nothing and then sell them to you...and you hope to sell them to someone else and so on.....and its all just a PONZI SCHEME, so you better get in LOW and hope to sell high. A MOVE from lows of SPX 666 to near 1340 isn't good enough? can we go higher? YES....but do you believe stocks are now priced for big breakouts to the upside? are you then buying now early in the trend? or trying to catch the last bit of final move should it come?
Are we early in an economic renaissance?
WHY haven't anyone been arrested for their part in the financial crisis of the history of this country, not even ONE SHREW? SO no one did anyting wrong? The dude from countrywide? no one? these guys made Bernie ebbers from Worldcom look like a saint....the system is bought off....and that's how it is, as we teeter on the brink.
Many joining armed forces to get a job, not serve the country, it's that bad. The government is becoming the largest employer???? Pays the most with the most benefits......the size of gov't is grotesque and eating our economy whole.
SO as you watch this drama play out, and see both sides fighting for what they stand for, what kind of comprimise is possible? How do companies or investors make investments based on an uncertain outcome? THEY CANNOT
The adjusted money supply, the Treasuries and other paper that sit on the FED Reserve balance sheets, the worlwide bailouts of countries.....we are awash in paper....it has risen like a flag up a pole......its gets destroyed or it has to go somewhere....and that is part why GOLD stands at new highs.....a SLOW WORLD ECONOMY....deflating housing and economic activity and INFLATION at the edge of getting out of hand.
Is this thee fork in the road I am to see the world economies at the beginning of some new wodnerful expansion? or already past the best it could be.
Never before this far into "recovery" never before has so much been spent and done to gain sustainability and such futile anemic reults.....except stock prices. And I am afraid at some point we will reach that tipping point where the weak hands get killed again when the distribution is over and the insiders no longer play the game of buy the higher price.
Duratek
ARGENTINA USA?
"The U.S. is in danger of reaching a generational tipping point at which older Americans have the clout to vote themselves benefits that sap the strength of the younger generation -- benefits that can never be repeated. Kotlikoff argues that we may have reached that point already. He worries that the U.S. could become Argentina, which went from one of the world's richest to lower-middle income in a century of chronic mismanagement"
http://finance.yahoo.com/banking-budgeting/article/113222/why-debt-crisis-is-even-worse-than-you-think-businessweek?mod=bb-budgeting
http://finance.yahoo.com/banking-budgeting/article/113222/why-debt-crisis-is-even-worse-than-you-think-businessweek?mod=bb-budgeting
Friday, July 29, 2011
BIG HAVE AND THE NOTS
Bill Gates sold 5 MIL shares at $27 plus per for over $135 MILLION, he still owns 551 MILLION shares! worth about $15 B. The little plankton eaters can't wait to plunk down money for LNKD etc ....they may make some money....stock shares are all about the INSIDERS gaining liquidity to cash out...why you see them now going into DEBT to buyback shares
IS ALU A BUY HERE?
**Update 8/1 Sold into open, feel stock may try and fill lower end of gap....broke even. $3.50 SHOULD be good support.
from seeking alpha: http://seekingalpha.com/article/283021-top-buy-and-sell-ideas-based-on-thursday-s-biggest-losers?source=yahoo
"The S&P 500 ($SPX) and the broader Russell 3000 ($RUA) dropped 0.3% on Thursday, July 28th, 2011. Of the 4,600 stocks that were tracked, the top 25 losers that closed above $1 at market-close on July 28th and fell 10% or more were analyzed to determine if they would continue going down, or if they would reverse their moves going forward. The following are the best buy and sell ideas based on that analysis:
Buy Alcatel-Lucent ADS (ALU): ALU, the telecommunications giant, is the result of a 2006 merger between France-based Alcatel and U.S.-based Lucent Technologies. It operates in over 130 countries worldwide, and is a leading provider of telecommunications equipment and services to fixed line, wireless, and internet service providers. It is also the world leader in ADSL1 equipment. ALU shares were down 20.4% on Thursday, and they are up 32.1% YTD.
The company reported that in the June 2011 quarter, they swung to a profit of 5c, beating analyst estimates of 2c. Revenue, however, came in under at $5.67 billion versus the $5.73 billion estimate, and the company confirmed that it would meet its fiscal year targets. ALU trades at a forward 7-8 P/E, at the bottom of its historic range, and also at a steep discount when compared to most of its peers, including JDS Uniphase Corp. (JDSU) that trades at a forward 12 P/E, Tellabs Inc. (TLAB) that trades at a forward 100+ P/E, Numerex Corp. (NMRX) that trades at a forward 17 P/E, Cisco Systems Inc. (CSCO) that trades at a forward 10 P/E, and others. The entire sector was driven lower yesterday due to continuing concerns over the macro-economy and its impacts on enterprise spending as well cuts in government budgets and spending, and also concerns that network investment by telecom service providers may be slowing down.
We believe that while concerns over the economy and carrier spending may be valid, ALU maybe the best value in the sector, trading at a historically low P/E and at a steep discount to its peers, while executing a turnaround and projecting earnings rising from 10c loss in 2010 to 28c profit in 2011 and rising to 51c profit in 2012. The stock continues to trade at lows, down almost 80% from its 2004 high, and is currently in free fall along with the rest of the networking stocks.
We would wait for it to bottom and buy in stages so as to take advantage of any further weakness. The stock has firm support in the $3.50s, so the downside appears limited whereas the upside is high in the long-term as the company continues its turnaround, increasing revenues at a modest pace along with rapid earnings growth. It seems that analysts would agree with us, as they have a mean target of $7.26, with a high of $10, well above current $4.01 price; and of the 15 analysts that cover the company, nine rate it at buy/strong buy, four at hold, and one each rate it at underperform and sell."
I bought some this AM, I think its in that GAP FILL RANGE though at higher limits. HUGE amount of volume on th down day, I am hoping that wrung out majority of weak hands.
D
from seeking alpha: http://seekingalpha.com/article/283021-top-buy-and-sell-ideas-based-on-thursday-s-biggest-losers?source=yahoo
"The S&P 500 ($SPX) and the broader Russell 3000 ($RUA) dropped 0.3% on Thursday, July 28th, 2011. Of the 4,600 stocks that were tracked, the top 25 losers that closed above $1 at market-close on July 28th and fell 10% or more were analyzed to determine if they would continue going down, or if they would reverse their moves going forward. The following are the best buy and sell ideas based on that analysis:
Buy Alcatel-Lucent ADS (ALU): ALU, the telecommunications giant, is the result of a 2006 merger between France-based Alcatel and U.S.-based Lucent Technologies. It operates in over 130 countries worldwide, and is a leading provider of telecommunications equipment and services to fixed line, wireless, and internet service providers. It is also the world leader in ADSL1 equipment. ALU shares were down 20.4% on Thursday, and they are up 32.1% YTD.
The company reported that in the June 2011 quarter, they swung to a profit of 5c, beating analyst estimates of 2c. Revenue, however, came in under at $5.67 billion versus the $5.73 billion estimate, and the company confirmed that it would meet its fiscal year targets. ALU trades at a forward 7-8 P/E, at the bottom of its historic range, and also at a steep discount when compared to most of its peers, including JDS Uniphase Corp. (JDSU) that trades at a forward 12 P/E, Tellabs Inc. (TLAB) that trades at a forward 100+ P/E, Numerex Corp. (NMRX) that trades at a forward 17 P/E, Cisco Systems Inc. (CSCO) that trades at a forward 10 P/E, and others. The entire sector was driven lower yesterday due to continuing concerns over the macro-economy and its impacts on enterprise spending as well cuts in government budgets and spending, and also concerns that network investment by telecom service providers may be slowing down.
We believe that while concerns over the economy and carrier spending may be valid, ALU maybe the best value in the sector, trading at a historically low P/E and at a steep discount to its peers, while executing a turnaround and projecting earnings rising from 10c loss in 2010 to 28c profit in 2011 and rising to 51c profit in 2012. The stock continues to trade at lows, down almost 80% from its 2004 high, and is currently in free fall along with the rest of the networking stocks.
We would wait for it to bottom and buy in stages so as to take advantage of any further weakness. The stock has firm support in the $3.50s, so the downside appears limited whereas the upside is high in the long-term as the company continues its turnaround, increasing revenues at a modest pace along with rapid earnings growth. It seems that analysts would agree with us, as they have a mean target of $7.26, with a high of $10, well above current $4.01 price; and of the 15 analysts that cover the company, nine rate it at buy/strong buy, four at hold, and one each rate it at underperform and sell."
I bought some this AM, I think its in that GAP FILL RANGE though at higher limits. HUGE amount of volume on th down day, I am hoping that wrung out majority of weak hands.
D
I TOLD YOU SO
That's my post of the day.....if people won't listen, what the F am I doing this for? The overall I don't care attitude is deafening, people won't even try to help themselves.
AS you all get circle jerked by the politicos, our country is going down the tubes, no jobs, insiders still getting paid, little guy and saver getting hosed, what else is new.
Break the 200 moving average and watch this shit roll downhill. After an AM gap down we are still not broken down the lower zone, but we are going to take a real good sniff at it.
I would put a chart up but I don't know what you want to look at, if you don't leave a comment once in a year or so, I haven't a clue how to serve you, or how to show you better what is in my head.
I don't know you, you don't know me, who is this guy who sometimes rants, puts these squiggly charts up, sometimes leaving behind an essay on how things are or may become?
I'm just some guy who has spent the last 25 years of his life trying to help people and myself, by emersing myself in the subject, spending these years studying, figuring out who knows their shit and who doesn't and have become a free thinker.
I have called the last 2 bear markets, I have said we are in a long term (SECULAR) Bear phase, and that the current rally was doomed to fail and there was better than 50/50 chance of TESTING the 2009 lows.....that's who I am. I've issued a TOP warning, but the technicals have not quite issued a BEAR MKT has begun. You look at some of the action, as stupid people bid up APPL stock to above $400 and NFLZ to $300 and LINKED IN and so forth, now all of a sudden Dunkin hole is a smash.....any new issue....all the while 9.2% OFFICIAL (BS) unemployment, under 2% GDP growth at the same time CORPORATE PROFITS ARE SOARING TO NEW RECORD?????? WTF???
2+2 don't + 4
Duratek
AS you all get circle jerked by the politicos, our country is going down the tubes, no jobs, insiders still getting paid, little guy and saver getting hosed, what else is new.
Break the 200 moving average and watch this shit roll downhill. After an AM gap down we are still not broken down the lower zone, but we are going to take a real good sniff at it.
I would put a chart up but I don't know what you want to look at, if you don't leave a comment once in a year or so, I haven't a clue how to serve you, or how to show you better what is in my head.
I don't know you, you don't know me, who is this guy who sometimes rants, puts these squiggly charts up, sometimes leaving behind an essay on how things are or may become?
I'm just some guy who has spent the last 25 years of his life trying to help people and myself, by emersing myself in the subject, spending these years studying, figuring out who knows their shit and who doesn't and have become a free thinker.
I have called the last 2 bear markets, I have said we are in a long term (SECULAR) Bear phase, and that the current rally was doomed to fail and there was better than 50/50 chance of TESTING the 2009 lows.....that's who I am. I've issued a TOP warning, but the technicals have not quite issued a BEAR MKT has begun. You look at some of the action, as stupid people bid up APPL stock to above $400 and NFLZ to $300 and LINKED IN and so forth, now all of a sudden Dunkin hole is a smash.....any new issue....all the while 9.2% OFFICIAL (BS) unemployment, under 2% GDP growth at the same time CORPORATE PROFITS ARE SOARING TO NEW RECORD?????? WTF???
2+2 don't + 4
Duratek
Wednesday, July 27, 2011
6 MONTH TRADING ZONE
The private work force keeps shrinking, the government workforce keeps growing. Stimulus, ZERO % FED funds rate, gaming, have helped buoy stocks, done little for employment, housing and general economy. I won't say we shouldn't have done something, I am saying it hasn't been effective and money flowed to places not desired, like commodities, putting the breaks on consumer spending and some corporate profits.
I DO NOT SEE STOCKS AS A BARGAIN HERE. So pass a debt ceiling deal or not, that is short term stuff, long term......we got a shitload of problems and issues no one seems to want to tackle
D
ALU UPDATE
D
DAMAGE IS DONE TO US ECONOMY
WASHINGTON/LONDON (Reuters) - The United States will lose its top-notch AAA credit rating from at least one major rating agency, according to a Reuters poll that also found wrangling over the debt ceiling has already damaged the economy.
A small majority of economists -- 30 out of 53 -- surveyed over the past two days said the United States will lose its AAA credit rating from one of the three big ratings agencies -- Standard & Poor's, Moody's or Fitch.
Respondents saw a 20 percent chance of a new recession over the next year, a prospect that some economists say has been compounded by the acrimonious political fight over what is normally a procedural legislative vote on the debt.
http://news.yahoo.com/u-likely-lose-top-rating-economists-000214380.htmlBUT, news stories keep coming out about how the "market doesn't seem to care...." IS THE US STOCK MKT STILL A DISCOUNTING MECHANISM?
D
Tuesday, July 26, 2011
DESTRUCTION OF A CURRENCY
SO 1% low rates in 2001 fueled the greatest housing bubble in out history, NO OFFICIAL ANYWHERE saw or did anything about it, why? Because tax receipts were POURING in and this allowed Government to grow its spending and size and thus control your life even more, a REAL POWER GRAB.
Low rates and blind men in control led to tech bubble, same but worse to housing bubble/debt crisis, so how did these blind men deal with the newest FED created bubble? They got even more lax, lowered rates further to 0 % !!! And the government spent themselves into a stupor with LOW LOW FED rates to make them feel better about it. HOW'S this going to turn out?
Savers get hosed, and if you think 1% rates built up imbalances what will 0% FED funds rate for 3 years PLUS running do?
Well we know all the money, bailouts, stimulus, historic low mortgage rates has not healed the housing market which when it popped was the and usually IS THE MAIN DRIVER OF ECONOMY.
Consumer sentiment has barely improved from the lows after 2009, same for housing. Government spending has replaced Consumer and business spending to keep economy from black hole. BUT now with debt ceiling due date,,,,,there is lots of talk of cutting gov't spending and raising taxes.....
this will NOT be stimulative to the economy.
9.2% unemployment OFFICIAL rate, so many dropped off and not counted it's more like 16%. Cut the deficit by $400 B a year even and you may still have $1 TRILLION PLUS deficits! Our accumulated deficit is now near a years of GDP !!!
The US has the lowest interest rates around, 10 year yield is UNDER 3%, any rise would make paying the interest payments on $14.5 PLUS trillion more difficult.
The gov't overpays its employees and has been growing at a staggering pace, the size of gov't is CHOKING private enterprise. More and more companies have offices in DC to get a piece of gov't teet.
Unintended consequences of crisis actions can be seen in commodity prices, cost of energy alone has wiped out any gov't asistance to the working class.
NOT ONE SINGLE arrest from the crisis, I guess no one did anything wrong!!
Can you stand one more dingleberry speaking about the debt ceiling? Can't wait for the comprimise deal, that will most likely talk about medicaid fraud loopholes blah blah , real cuts and action most likely will be inside that can they keep kicking.
Duratek
Monday, July 25, 2011
IS THIS HILARY CLINTON?
Just on CNBC, Dennis Gartman..."BUY GOLD......grains sold off because of recent rains, corn crop upgraded..." no one holding gold seems worried of a decline.
Explanation given for LOW US interest rates given debt crisis......"no one is worried we will default...." reason our rates are so LOW????? not the FED $2.5T purchases.......
DOES THE STOCK MARKET REFLECT THIS?
Consumer spending is 70% of the economy, this does not reflect a consumer who is making big committments, the FED and US gov't led deficits and ZERO RATE policy is what is filling the gap.
D
Sunday, July 24, 2011
STOCK MARKET VOLUME DRIES UP
http://finance.yahoo.com/news/Wheres-the-volume-Stock-apf-2486403790.html?x=0&sec=topStories&pos=4&asset=&ccode=
NEW YORK (AP) -- This month may be the slowest in the stock market in more than three years.
Trading volume, or the number of shares bought and sold, is down because there are fewer big investors buying stocks. And those who want to buy are worried about the job market and the European debt crisis -- and the budget impasse in Washington. If Congress and the White House don't agree on budget cuts and raising the government's borrowing limit, the U.S. is at risk of defaulting on its debt after Aug. 2.
Daily volume on the New York Stock Exchange is down 22 percent so far in July compared with the same period in 2010, according to data provider FactSet. About 3.7 billion shares have traded hands every day on average, down from 4.7 billion in July last year.
If that continues, July will have the lowest average daily trading volume since December 2007, says Patrick O'Shaughnessy, a research analyst at Raymond James.
Low volume is worrisome because it suggests that few investors are driving the stock market's gains or losses. That creates the risk for bigger price swings. When, for example, there are few buyers, someone trying to sell a stock may be forced to keep lowering the price in hopes that someone will want it -- the same as a homeowner who can't find a buyer for a house.
A lack of volume also indicates that some investors don't believe that stocks are worth buying right now.
"Volume in many respects represents conviction," says Jack Ablin, chief investment officer at Harris Private Bank. "And there's just very little conviction."
Saturday, July 23, 2011
TOTAL CREDIT MARKET DEBT AS % OF GDP IS FALLING, WE HAVE RECOVERY???
Corporate profits soaring? 9.2% unemployment, wages stagnant, home values and equity collapsed....this is one crazy mixed up recovery which began in June of 2009, yes recovery is now 3 years old!!!!!!!!
And we are to believe that a NEW BULL MKT has formed, can last for many more years, yet there has been NO recovery in the largest segment of the economy HOUSING, and the job market remains challenging? And prices for things are rising, food, energy and health care.
There is a SMALL MINORITY who have their wealth in STOCKS, the avg American has most of its wealth concentrated in their homes, no wonder their is a disconnect between the message from stocks and the reality for most people.
Yes above chart is STARK contrast to what you are being told, what book explains "economic expansion" comes from a contraction of credit? And we are a FAR CRY from the historic norm, and once these trends begin, they usually don't end until most of abuse is unwound....there may be nothing FED and govt's can do, except make a bad situation worse.
There are MILLIONS that have left the stock market for good, that is what 2 BRUTAL Bear Markets over 10 years will do to investors heads.
These same investors have run into bonds accepting minuscule returns. BUT of you are a saver...you get NOTHING!!! There IS a downside to current FED 0% policies which by the way have done little to help anybody except the INSIDERS and the RICH who have MOST of their wealth in stocks.
And NO ONE seems interested in bringing ANYONE to justice who by their outright greed and dishonesty got us into this mess, not ONE SINGLE ARREST.
Now they are fist pounding and arguing about what to do with debt ceiling and soaring govt debt, but 20% of our economic activity comes from govt assistance of one form or another.
Rather than actually deal with the issues, each side is posturing and any deal will be hollow, any CUTS in govt spending will hurt economy.IT IS HOWEVER GROSS GOVT WASTE and excessive spending that is the problem....and all they will probably do is keep kicking that can down the road.
2012 is election year, and to get re-elected is going to be the priority, each side will want to be seen as victorious and each one taking care of its core constituents.
The government is floating its out of control deficits by selling 2, 5 and 10 year notes mostly with he 10 year UNDER 3% !!!! There seems to be NO FEAR from the purchasers of the debt? OH it' s been mostly the Federal Reserve.
WHAT would happen if the COST TO FUND THE DEFICITS ROSE EVEN A LITTLE? this is what has happened to some European nations, who control their own currency.
We won't solve the current crisis, it will just sound like it, any message won't be for real change that helps the little guy but an effort to BOOST the stock market some more, from its already historic gains....in the face of the WEAKEST RECOVERY FROM RECESSION IN HISTORY?!!
The deal that might be made would lower debt let's say by $400 B a year (most aggressive plan), but where will it come from? will it start right away? yes you are catching on now....it will be over a 10 YEAR SPAN and won't effect anything until after elections....
And what about the level of yearly deficits going forward? WELL it seemed bad during Bush years as it approached $600B, but we are now nearer to $1.5 TRILLION a YEAR......I do not pay much attention to the news or how close the 2 sides might be to striking a deal....in the end I don't expect it to help the REAL economy, it's all for show with not much go and anyways.....the place we find ourselves is that fork in the road where we get in between the ROCK and the HARD PLACE.
Expect this DRAMA to be played out to the last minute and a HUGE SIGH of relief will be shouted from the highest place on earth and the NYSE, and we can all rejoice, and praise these fearless leaders for averting a calamity as the status QUO continues....being kicked down the road...waiting for someone else to figure it out.
In the meantime, corporate profits can soar to the moon, as they don't hire too many workers, not pay them too much, and use their overseas buddies to keep costs down...as America keeps getting its blood sucked out of its body and a corpse and flock of zombies will roam the land wondering what the f happened. The noise from the partying heard from the Hampton's and beyond will be deafening....but mark my words, all good things come to an end, and that won't be pretty either when the music stops and the momo crowd sees very few chairs.
Duratek
BUY US DEBT IF DEBT IS DOWNGRADED????
"It’s very likely that a downgrade of the credit rating of the U.S. would trigger a sell-off, but it’s far from clear that investors would sell U.S. government debt. More likely the investors would sell risk assets—equities, high yield corporate bonds, mortgage securities—and actually buy U.S. government debt.
What's certain is regulations won’t require most holders of Treasury debt to sell after a downgrade.
The logic of why investors would buy Treasurys even if they are downgraded is relatively simple."
CORPORATE PROFITS NEVER LOOKED BETTER, MIDDLE AMERICA NEVER WORSE
, On Friday July 22, 2011, 6:36 pm EDT
http://finance.yahoo.com/news/A-boom-in-corporate-profits-a-apf-3135711604.html?x=0&sec=topStories&pos=2&asset=&ccode=
WASHINGTON (AP) -- Strong second-quarter earnings from McDonald's, General Electric and Caterpillar on Friday are just the latest proof that booming profits have allowed Corporate America to leave the Great Recession far behind.
But millions of ordinary Americans are stranded in a labor market that looks like it's still in recession. Unemployment is stuck at 9.2 percent, two years into what economists call a recovery. Job growth has been slow and wages stagnant.
"I've never seen labor markets this weak in 35 years of research," says Andrew Sum, director of the Center for Labor Market Studies at Northeastern University.
Wages and salaries accounted for just 1 percent of economic growth in the first 18 months after economists declared that the recession had ended in June 2009, according to Sum and other Northeastern researchers.
In the same period after the 2001 recession, wages and salaries accounted for 15 percent. They were 50 percent after the 1991-92 recession and 25 percent after the 1981-82 recession.
Corporate profits, by contrast, accounted for an unprecedented 88 percent of economic growth during those first 18 months. That's compared with 53 percent after the 2001 recession, nothing after the 1991-92 recession and 28 percent after the 1981-82 recession.
What's behind the disconnect between strong corporate profits and a weak labor market? Several factors:
-- U.S. corporations are expanding overseas, not so much at home."
http://finance.yahoo.com/news/A-boom-in-corporate-profits-a-apf-3135711604.html?x=0&sec=topStories&pos=2&asset=&ccode=
WASHINGTON (AP) -- Strong second-quarter earnings from McDonald's, General Electric and Caterpillar on Friday are just the latest proof that booming profits have allowed Corporate America to leave the Great Recession far behind.
But millions of ordinary Americans are stranded in a labor market that looks like it's still in recession. Unemployment is stuck at 9.2 percent, two years into what economists call a recovery. Job growth has been slow and wages stagnant.
"I've never seen labor markets this weak in 35 years of research," says Andrew Sum, director of the Center for Labor Market Studies at Northeastern University.
Wages and salaries accounted for just 1 percent of economic growth in the first 18 months after economists declared that the recession had ended in June 2009, according to Sum and other Northeastern researchers.
In the same period after the 2001 recession, wages and salaries accounted for 15 percent. They were 50 percent after the 1991-92 recession and 25 percent after the 1981-82 recession.
Corporate profits, by contrast, accounted for an unprecedented 88 percent of economic growth during those first 18 months. That's compared with 53 percent after the 2001 recession, nothing after the 1991-92 recession and 28 percent after the 1981-82 recession.
What's behind the disconnect between strong corporate profits and a weak labor market? Several factors:
-- U.S. corporations are expanding overseas, not so much at home."
DEBT DOWNGRADE THREATS
DEAL OR NO DEAL? http://news.yahoo.com/obama-officials-clash-p-over-downgrade-threats-200358261.html
"If it turns out to be true and we see that ... we would expect to reaffirm the rating," Beers said.
The relationship between the U.S. government and the ratings agencies is complex and difficult.
The agencies came under enormous criticism for giving top ratings to the toxic mortgage-backed securities at the heart of the 2008 financial crisis and have since been threatened with increased regulation by the government.
Fitch and Moody's have threatened downgrades but not shifted the time horizon for when they want to see a deficit deal done and have not issued short-term deadlines.
Thursday, July 21, 2011
CHINESE STOCKS LAST MADE A HIGH IN 2009 !??
D
STOCKS ONLY GO UP? TZOO
D
HOW TO ENGINEER A RALLY
That's what these jackasses are playing with.
DEBT CEILING NEWS DRIVEN RALLY
BULLS in the stall. Not much else to say right now. Rally highs not far away, parts of the economy still functioning. When a deal gets struck, we will see if its in the market.
Oil back to $100, the FED is done with QE 2. Rates stuck at 0% since 2009.....could it be any more imbalanced than it is?
D
Oil back to $100, the FED is done with QE 2. Rates stuck at 0% since 2009.....could it be any more imbalanced than it is?
D
Wednesday, July 20, 2011
http://news.yahoo.com/huge-deficit-cutting-bill-sails-gop-house-020151481.html
"Yet a few hours after Obama spoke at the White House, supporters of the newly passed House measure breathed defiance.
"Let me be clear. This is the compromise. This is the best plan out there," said Rep. Jim Jordan, R-Ohio, head of a conservative group inside the House known as the Republican Study Committee.
The legislation, dubbed "Cut, Cap and Balance" by supporters and backed by tea party activists, would make an estimated $111 billion in immediate reductions and ensure that overall spending declined in the future in relation to the overall size of the economy.
It also would require both houses of Congress to approve a balanced budget amendment to the Constitution and send it to the states for ratification. The amendment itself would require a supermajority vote in both houses of Congress for any future tax raises.
With time dwindling, the day's events did little to suggest a harmonious end was imminent in a defining clash between the two political parties."
"Yet a few hours after Obama spoke at the White House, supporters of the newly passed House measure breathed defiance.
HOUSING RECOVERY DO YOU SEE IT?
While raising the ceiling on what our government can borrow will lift most boats, in particular stock prices, it does little for economy and the worst hit small business, avg American, and housing.
LOOK closely at what they say they will cut, there are no real MEAT here in govt spending, it will be mostly BS accounting or chops at the little guy.....or some mysterious formula or outlay. BILLIONS will continue to be wasted, BILLIONS of spending kept OFF the official books....and the deficit will then continue to rise by $TRILLION PLUS into the near future.
How do you do, when you max all your credit cards out? Well OK you don't but if you did, you would be out of luck and you pay 20% interest. Our GOVT is not out of luck and is paying below 3% !!!
WHY below 3%, because the Federal reserve OWNS the majority of new debt issued by the US GOVT! and that cannot continue into perpetuity. ALL THE US can hope to pay is the INTEREST on the debt, NEVER the principal...they can never own their house.
ANY large increase in rates would be deadly, 20% of our economy are government transfer payments to the unemployed. We still have 9.2% (much worse actually) unemployment 3 years into recovery, so why is the stock market up over 80% from lows? because that is where the money flows..INSTEAD of where it can do some real good and help to create jobs.
That tells me, YES the market can continue to go higher, yes APPLE can sell for $1,000 a share.....but the market is the beneficiary of near lowest rates on record, people are forced into the risk to get returns. SAVERS are hosed don daily basis, AKA retirees.
THIS is an unabalnaced and overleradged situation that will come to end. The next BUBBLE may be gov't debt and the bond market. OTHER countries cannot refinance their debt as the FREE MKT system works to raise rates sky high....so they bail outs...unending bailouts.
In the US, we have the RESERVE currency, so we can print, and print and print, and the FED can manipulate rates well below where a FREE MKT would have them.
Supply and demand...not working here. and that sets up an horrible accident down the road and it will start in the stock market and catch most completely stupified when the game of musical chairs ends
D
Tuesday, July 19, 2011
Update On Bull Flag Call
Why keep rehashng the news? It's the action that counts for now. AAPL blow out numbers surprised? you have to be an idiot to short that stock now! Or goog...or whatever.
Euphoria over ceiling of DEBT being raised...yahoooooo, but not YHOO (earnings sucked)....if you are out there as I am, working hard to scrape a living, find business...my hat is off to you.
The reality is there is business, you don't dispair because if you do, all is lost. Just get up each day, be ready to fight for business and let your customers or potential ones know how much their business would mean to you! and good luck.
The stock market is a playground for the insiders, everyone else will get hosed
D
Monday, July 18, 2011
NOTHING NEW
BEAR ROAST! Low of day was 1295-6 and that was .618 FIB of move. Friends, the computers will win everytime, most traders will lose.
The debt ceiling talk....that chaos is a joke, it's a setup to pull off a "last minute deal" but friends, is it a VICTORY just because we get to continue borrowing against $14.5 TRILLION already? When you MAX your credit you are maxxed...not Sovereign govts that can print.
ANyway.....the market may be setup to see what overhead resistance it can take out. This IS a Bull market, but one that has left OUT most of the people
The debt ceiling talk....that chaos is a joke, it's a setup to pull off a "last minute deal" but friends, is it a VICTORY just because we get to continue borrowing against $14.5 TRILLION already? When you MAX your credit you are maxxed...not Sovereign govts that can print.
ANyway.....the market may be setup to see what overhead resistance it can take out. This IS a Bull market, but one that has left OUT most of the people
DOW THEORY NON CONFIRMATION
Some kind of "save" is expected, with a last minute DEAL. That may prove even if it comes to be temporary. 9.2% unemployment says more than any debt deal, things could certainly unravel quickly if the smoke clears and enough people are watching.
D
Sunday, July 17, 2011
SHARED SACRIFICE
The President is urging a debt deal that "shares the sacrifice", but as the 2009 housing crisis was at its height, avg Americans were sold out in favor of the big banks. And when it came time for stimulus, $800B was used and still another 1.4 million jobs were lost.
http://prudentbear.com/index.php/creditbubblebulletinview?art_id=10554 Doug Noland Credit Bubble Report on the Sovereign Debt Crisis
We are staring the abys right in the face. The Gov't uses funding costs of 2.5% for its projections! The market could force rates higher if it sniffs a default. Current 10 year yields are under 3%.
http://www.bloomberg.com/news/2011-07-11/german-10-year-bond-yields-approach-two-week-low-amid-italy-debt-concerns.html
Italian 10 year rates 13.38%. Portugal 10.71%. Greece 17.02% Irish 2 year yields soared to 18%
In this country 2 year yields are at 0.37% YES 0.37%. The low on record is 0.34% !! The low at height of crisis in 2009 was? 0.74% !!!!!!!!! we are 50% below that.....what does that tell you?
Duratek
http://prudentbear.com/index.php/creditbubblebulletinview?art_id=10554 Doug Noland Credit Bubble Report on the Sovereign Debt Crisis
We are staring the abys right in the face. The Gov't uses funding costs of 2.5% for its projections! The market could force rates higher if it sniffs a default. Current 10 year yields are under 3%.
http://www.bloomberg.com/news/2011-07-11/german-10-year-bond-yields-approach-two-week-low-amid-italy-debt-concerns.html
Italian 10 year rates 13.38%. Portugal 10.71%. Greece 17.02% Irish 2 year yields soared to 18%
In this country 2 year yields are at 0.37% YES 0.37%. The low on record is 0.34% !! The low at height of crisis in 2009 was? 0.74% !!!!!!!!! we are 50% below that.....what does that tell you?
Duratek
Saturday, July 16, 2011
BANK OF AMERICA IS WHITHERING
THIS WEEK
"Congress Votes: House Republicans plan to vote on a proposal to raise the debt ceiling by $2.4 trillion and cut federal spending by the same amount. Separately, the House and Senate are expected to vote on an amendment to the Constitution that would require the president to submit a balanced budget each year."
Raise the debt by same you will cut spending (OVER TEN YEARS!!!!) both parties are a joke and a half. Get ready for th eBIG rally, because we are saved....
D
Petr Schiff " Don't Be Fooled By Political Posturing"
"The debt problem does not stem from low taxes, but from high spending. I do not expect a deal to lift the debt limit will make any meaningful impact on either. Unfortunately both taxes and spending are likely to head higher in the years ahead. Americans should prepare for the sad reality."
http://prudentbear.com/index.php/guestcommentaryview?art_id=10553
http://prudentbear.com/index.php/guestcommentaryview?art_id=10553
Friday, July 15, 2011
RUNNING ON EMPTY
$800B stimulus in 2009 yet 1.4 million more out of work since then. "We need more public works, roads, bridges....."
0% FED rate, lowest mortgage rates in history.....housing still mired near the worst it ever was.
Commercial office and retail space stands vacant wherever you look blighting the landscape.
ALmost 3 years into recovery, but 9.2 OFFICIAL unemployment rate. This goes on record as weakest recovery from recession.
The gov't needs to rein in spending but too much will stall the economy addicted to gov't spending in this fragile "recovery".
Raise taxes, cut spending....solve problems? "We're not Greece" we have RESERVE CURRENCY and with FED buying majority of bonds gorging their balance sheets to $2.7 trillion....we have printed and smoked ourselves to a low 2.9% 10 year yield for borrowing....surely with deficits out of control for as far as eye can see.........there will be no end to LOW RATES.....
But if for some reason there was a sustained rise in rates, even a little....all could implode.
We are lving in dangerous times, with NO easy answers and a way out without pain. ANY escape here Houdini would be proud.
Rock N Hard place have arrived.
Duratek
0% FED rate, lowest mortgage rates in history.....housing still mired near the worst it ever was.
Commercial office and retail space stands vacant wherever you look blighting the landscape.
ALmost 3 years into recovery, but 9.2 OFFICIAL unemployment rate. This goes on record as weakest recovery from recession.
The gov't needs to rein in spending but too much will stall the economy addicted to gov't spending in this fragile "recovery".
Raise taxes, cut spending....solve problems? "We're not Greece" we have RESERVE CURRENCY and with FED buying majority of bonds gorging their balance sheets to $2.7 trillion....we have printed and smoked ourselves to a low 2.9% 10 year yield for borrowing....surely with deficits out of control for as far as eye can see.........there will be no end to LOW RATES.....
But if for some reason there was a sustained rise in rates, even a little....all could implode.
We are lving in dangerous times, with NO easy answers and a way out without pain. ANY escape here Houdini would be proud.
Rock N Hard place have arrived.
Duratek
CURRENT SPX TRENDING
With all the noise, and posturing by the parties about the debt ceiling, you cannot trade off the news.
It'st he kind of market that takes money from bull and bear day traders.
S&P THREATENS DOWNGRADES OF THE FINANCIALS
http://finance.yahoo.com/news/SP-threatens-broad-downgrade-rb-1761317270.html?x=0&sec=topStories&pos=1&asset=&ccode=
NEW YORK (Reuters) - "Standard & Poor's on Friday raised the pressure on Washington debt negotiators, saying it could downgrade insurers, securities clearinghouses, mortgage agencies and a laundry list of other firms if there is not a deal soon to lift the debt ceiling and cut the deficit.
While S&P had already made clear it could downgrade the United States's sovereign credit rating, the move Friday struck directly at the heart of the financial system, raising the prospect of knock-on effects should the country exhaust its ability to borrow to pay bills.
The Treasury took the last available step Friday to try and extend that borrowing capacity.
The ratings agency on Friday put on negative credit watch a range of powerful financial firms, many of them little known to the public but crucial to the nation's financial infrastructure. government securities are central to the operations of most of the companies cited.
They include the Depository Trust Co, which facilitates payment transfers among major banks, as well as several Federal Home Loan Banks and Farm Credit System Banks. They also singled out Fannie Mae, Freddie Mac, the two agencies central to the U.S. residential mortgage market.
S&P characterized its targets as "entities with direct links to, or reliance on, the federal government."
Separately, the agency said the four remaining U.S. nonfinancial companies with "AAA" ratings were not affected by the downgrade threat."
NEW YORK (Reuters) - "Standard & Poor's on Friday raised the pressure on Washington debt negotiators, saying it could downgrade insurers, securities clearinghouses, mortgage agencies and a laundry list of other firms if there is not a deal soon to lift the debt ceiling and cut the deficit.
While S&P had already made clear it could downgrade the United States's sovereign credit rating, the move Friday struck directly at the heart of the financial system, raising the prospect of knock-on effects should the country exhaust its ability to borrow to pay bills.
The Treasury took the last available step Friday to try and extend that borrowing capacity.
The ratings agency on Friday put on negative credit watch a range of powerful financial firms, many of them little known to the public but crucial to the nation's financial infrastructure. government securities are central to the operations of most of the companies cited.
They include the Depository Trust Co, which facilitates payment transfers among major banks, as well as several Federal Home Loan Banks and Farm Credit System Banks. They also singled out Fannie Mae, Freddie Mac, the two agencies central to the U.S. residential mortgage market.
S&P characterized its targets as "entities with direct links to, or reliance on, the federal government."
Separately, the agency said the four remaining U.S. nonfinancial companies with "AAA" ratings were not affected by the downgrade threat."
Thursday, July 14, 2011
THE ROCK HAS ARRIVED AT THE HARD PLACE
Bernanke: Deep Spending Cuts Could Derail Recovery- Reuters
Federal Reserve Chairman Ben Bernanke warned Congress on Thursday that overzealous cuts to government spending could derail an already fragile recovery and said a U.S. debt default could wreak financial havoc.
Federal Reserve Chairman Ben Bernanke warned Congress on Thursday that overzealous cuts to government spending could derail an already fragile recovery and said a U.S. debt default could wreak financial havoc.
Wednesday, July 13, 2011
IS THE MARKET ACTION BULLISH OR BEARISH?
When you look at market this way the market has been trading sideways in a range since March, and that's how traders are tresting it.Bernanke: Fed would supply more stimulus if needed
http://finance.yahoo.com/news/Bernanke-Fed-would-supply-apf-1990658503.html?x=0&.v=7
And how's that QE 1 and 2 working for you? It's all about stocks, and it would seem to work forever. The FED is now the LARGEST holder of US Treasuries, why not print and buy some more?
Savers can now grab BOTH ankles, metals on fire, US $ took a dive no surprise
"The Fed has kept its key interest rate at a record low near zero since December 2008. Most private economists believe the Fed will not start raising interest rates until next summer. And some say the Fed won't increase rates until 2013, based on the slumping economy.
Bernanke was testifying after the government released a dismal jobs report last week.
The economy added just 18,000 jobs last month, the fewest in nine months. And the May figures were revised downward to show just 25,000 jobs added -- fewer than half of what was initially reported. The unemployment rose to 9.2 percent, the highest rate this year.
Companies pulled back sharply on hiring after adding an average of 215,000 jobs per month from February through April. The economy typically needs to add 125,000 jobs per month just to keep up wiht population growth. And at least twice that many jobs are needed to bring down the unemployment rate."
THIS POLICY HAS BEEN 100% INEFECTIVE IN ROUSING THE ECONOMY....so let's do it some more
D
And how's that QE 1 and 2 working for you? It's all about stocks, and it would seem to work forever. The FED is now the LARGEST holder of US Treasuries, why not print and buy some more?
Savers can now grab BOTH ankles, metals on fire, US $ took a dive no surprise
"The Fed has kept its key interest rate at a record low near zero since December 2008. Most private economists believe the Fed will not start raising interest rates until next summer. And some say the Fed won't increase rates until 2013, based on the slumping economy.
Bernanke was testifying after the government released a dismal jobs report last week.
The economy added just 18,000 jobs last month, the fewest in nine months. And the May figures were revised downward to show just 25,000 jobs added -- fewer than half of what was initially reported. The unemployment rose to 9.2 percent, the highest rate this year.
Companies pulled back sharply on hiring after adding an average of 215,000 jobs per month from February through April. The economy typically needs to add 125,000 jobs per month just to keep up wiht population growth. And at least twice that many jobs are needed to bring down the unemployment rate."
THIS POLICY HAS BEEN 100% INEFECTIVE IN ROUSING THE ECONOMY....so let's do it some more
D
HARPEX CHART FOR SHIPPING TONNAGE
http://www.harperpetersen.com/harpex/harpexRH.do?timePeriod=Years5&&dataType=Harpex&floatLeft=None&floatRight=None
Choose 5 year chart (unable to imbed), it shows index is rolling over and does closely resemble the stock market action since 2007. This is just a warning, but it's adding up.
What's going to happen? When the market DOES roll over for good, the avg Joe will hold all the way down, NO advisor will warn of trouble, in disgust many will sell near the lows.....where the insiders will be buying. From FEAR to GREED and back again, this scenario will always play out the same way.
STAY with me, I might be able to help you BREAK the lemming syndrome.
Duratek
Choose 5 year chart (unable to imbed), it shows index is rolling over and does closely resemble the stock market action since 2007. This is just a warning, but it's adding up.
What's going to happen? When the market DOES roll over for good, the avg Joe will hold all the way down, NO advisor will warn of trouble, in disgust many will sell near the lows.....where the insiders will be buying. From FEAR to GREED and back again, this scenario will always play out the same way.
STAY with me, I might be able to help you BREAK the lemming syndrome.
Duratek
REFLATION PRIZE WINNER LOOKING PUNK
In life you have to follow your dreams, my wish is to write about the markets and keep my subscribers on the RIGHT side of the market and this I KNOW I can do.
More info when available, I would NOT abandon my blog, it would be less frequent for sure
Duratek
STIMULUS 4.0??
FORTUNE -- With all the talk of debt ceilings and federal spending cuts, you might think that the era of stimulus programs was behind us. Think again. I strongly suspect that by the end of the summer both parties will be putting together yet another tax and spending bill designed to get the economy going. Call it Stimulus 4.0.
http://finance.fortune.cnn.com/2011/07/13/forget-deficit-reduction-here-comes-another-stimulus-package/?iid=HP_LN
NEW YORK (CNNMoney) -- While China's economic growth remains far faster than that of Western nations, it eased slightly for the second quarter in a row.
China's economy grew at an annual pace of 9.5% between April and June, the National Bureau of Statistics said Wednesday. That marks a slight slowdown from the first quarter, when GDP grew 9.7% year-over-year.
Overall, China's economy has cooled significantly since the first quarter of 2010 when it was barreling along at an 11.9%
http://money.cnn.com/2011/07/12/news/international/china_gdp/index.htm?iid=HP_LN
http://finance.fortune.cnn.com/2011/07/13/forget-deficit-reduction-here-comes-another-stimulus-package/?iid=HP_LN
NEW YORK (CNNMoney) -- While China's economic growth remains far faster than that of Western nations, it eased slightly for the second quarter in a row.
China's economy grew at an annual pace of 9.5% between April and June, the National Bureau of Statistics said Wednesday. That marks a slight slowdown from the first quarter, when GDP grew 9.7% year-over-year.
http://money.cnn.com/2011/07/12/news/international/china_gdp/index.htm?iid=HP_LN
Tuesday, July 12, 2011
THOSE THAT GOT US INTO THIS MESS ARE A MESS
NFIB INDEX SIGNALS RECESSIONARY WARNINGS
"As politicians love to point out, small businesses create the majority of new jobs in the United States. So it's yet another bad sign for the economy that the people who run them are feeling even gloomier than ever about the economy right now.
An index of small-business optimism run by the National Federation of Independent Business (NFIB), a trade group for small businesses, fell again last month, and is "solidly in recession territory," according to the group.
The index fell dropped by 0.1 and now stands at 90.8."
http://news.yahoo.com/blogs/lookout/small-biz-confidence-solidly-recession-territory-135118709.html
Duratek
An index of small-business optimism run by the National Federation of Independent Business (NFIB), a trade group for small businesses, fell again last month, and is "solidly in recession territory," according to the group.
The index fell dropped by 0.1 and now stands at 90.8."
http://news.yahoo.com/blogs/lookout/small-biz-confidence-solidly-recession-territory-135118709.html
Duratek
"Was the recession a good thing?"
NEW YORK (CNN) --" The Great Recession had many lasting negative effects -- high unemployment, falling home prices, stunted growth -- just to name a few. But the news isn't all bad.The majority of Americans feel that the past few years provided a much-needed financial wake-up call, a new study shows.
Eight out of ten people surveyed say they now exercise more caution with their finances and "learned important lessons regarding savings, investing, and preparing for retirement," according to a joint study released Tuesday by AgeWave and SunAmerica Financial Group.
"In a very interesting way, [the recession] jolted the American public to think more seriously about their future and forced them to course-correct their savings and debt approach," said Ken Dychtwald"
http://money.cnn.com/2011/07/12/pf/recession_saving_habits/index.htm?iid=HP_LN
Thanks for nothing???
D
"In a very interesting way, [the recession] jolted the American public to think more seriously about their future and forced them to course-correct their savings and debt approach," said Ken Dychtwald"
http://money.cnn.com/2011/07/12/pf/recession_saving_habits/index.htm?iid=HP_LN
Thanks for nothing???
D
RECORD GOVT SUBSIDIES BUOY ECONOMY
"An extraordinary amount of personal income is coming directly from the government.
Close to $2 of every $10 that went into Americans’ wallets last year were payments like jobless benefits, food stamps, Social Security and disability, according to an analysis by Moody’s Analytics. In states hit hard by the downturn, like Arizona, Florida, Michigan and Ohio, residents derived even more of their income from the government.
By the end of this year, however, many of those dollars are going to disappear, with the expiration of extended benefits intended to help people cope with the lingering effects of the recession. Moody’s Analytics estimates $37 billion will be drained from the nation’s pocketbooks this year.
In terms of economic impact, that is slightly less than the spending cuts Congress enacted to keep the government financed through September, averting a shutdown.
Unless hiring picks up sharply to compensate, economists fear that the lost income will further crimp consumer spending and act as a drag on a recovery that is still quite fragile. Among the other supports that are slipping away are federal aid to the states, the Federal Reserve’s program to pump money into the economy and the payroll tax cut, scheduled to expire at the end of the year.
“If we don’t get more job growth and gains in wages and salaries, then consumers just aren’t going to have the firepower to spend, and the economy is going to weaken,” said Mark Zandi, chief economist of Moody’s Analytics, a macroeconomic consulting firm.
Close to $2 of every $10 that went into Americans’ wallets last year were payments like jobless benefits, food stamps, Social Security and disability, according to an analysis by Moody’s Analytics. In states hit hard by the downturn, like Arizona, Florida, Michigan and Ohio, residents derived even more of their income from the government.
By the end of this year, however, many of those dollars are going to disappear, with the expiration of extended benefits intended to help people cope with the lingering effects of the recession. Moody’s Analytics estimates $37 billion will be drained from the nation’s pocketbooks this year.
In terms of economic impact, that is slightly less than the spending cuts Congress enacted to keep the government financed through September, averting a shutdown.
Unless hiring picks up sharply to compensate, economists fear that the lost income will further crimp consumer spending and act as a drag on a recovery that is still quite fragile. Among the other supports that are slipping away are federal aid to the states, the Federal Reserve’s program to pump money into the economy and the payroll tax cut, scheduled to expire at the end of the year.
“If we don’t get more job growth and gains in wages and salaries, then consumers just aren’t going to have the firepower to spend, and the economy is going to weaken,” said Mark Zandi, chief economist of Moody’s Analytics, a macroeconomic consulting firm.
Monday, July 11, 2011
STOCK MARKETS SELL OFF IN A 90% DOWN VOLUME DAY
Near term support may be here, any rally will probably just seperate next leg down IMHO unless a debt deal reached rescues market...1332 above should be resistance and 1342 above that. 1294-1296 important support, 1300 comes first.
IGNORE NEWS, we will watch the tape.....
D
WHY THE SOUR PUSS? OBAMA RATCHETS UP RHETORIC
"President Obama challenged Republicans to deliver on their rhetoric about the nation's debt and deficit problems, insisting that "now is the time to deal with these issues."
"In a White House news conference just hours before he's set to meet again with congressional leaders on the $14.3 trillion debt ceiling, Obama warned that if Republicans failed to compromise on a solution, it could further depress the nation's already struggling economy and "throw millions of more people out of work."
DUALING REALITIES. RED OPEN FOR MARKETS, DEBT is 4 letter word.
And why? Euro debt issues? WHAT?????? Last week we rallied like all get out because of all new GREEK? ad nauseum now that same news has gone SOUR????
Here at home as I suggested all the talk about "raising the debt ceiling" was just that. And any cuts would hurt the economy and spending, and do little to change the trend os adding to themassive deficits that continue to build, that HAVE to be funded from massive US TREASURY ISSUANCE.
Now ask yourself, at $14.5 TRILLION and counting, how much MORE debt issuance will it take to cast some question on US DEBT and the fact the yield is a scant 3% over a 10 year period? With world inflation an issue? 3% yield for 10 years is in the direction over DEFLATION worries, not INFLATION, what nube would accpet 3% for 10 years with inflation lurking, or even present we could argue?
BUT SO MANY are crammed in there, and there is so much MORE coming that needs to be bought.....with all the Euro funds needed to keep plugging those holes, where is the money going to come from to buy US DEBT?
Hasn't the major buyer been the FED itself? Hasn't the FED said they won't continue after this month with QE? And the yield for 10 years is what? 3%???!!!
Duratek where's there is SMOKE there is FIRE! market can go higher, might even.....(not today probably) but IMHO what you see is just MOMO based buying, buying cause it is going higher, the fundamentals underenathe is all are crumbling.
Here at home as I suggested all the talk about "raising the debt ceiling" was just that. And any cuts would hurt the economy and spending, and do little to change the trend os adding to themassive deficits that continue to build, that HAVE to be funded from massive US TREASURY ISSUANCE.
Now ask yourself, at $14.5 TRILLION and counting, how much MORE debt issuance will it take to cast some question on US DEBT and the fact the yield is a scant 3% over a 10 year period? With world inflation an issue? 3% yield for 10 years is in the direction over DEFLATION worries, not INFLATION, what nube would accpet 3% for 10 years with inflation lurking, or even present we could argue?
BUT SO MANY are crammed in there, and there is so much MORE coming that needs to be bought.....with all the Euro funds needed to keep plugging those holes, where is the money going to come from to buy US DEBT?
Hasn't the major buyer been the FED itself? Hasn't the FED said they won't continue after this month with QE? And the yield for 10 years is what? 3%???!!!
Duratek where's there is SMOKE there is FIRE! market can go higher, might even.....(not today probably) but IMHO what you see is just MOMO based buying, buying cause it is going higher, the fundamentals underenathe is all are crumbling.
TROUBLE AHEAD FOR NFLX?
"Fast forward to 2011, and online movies and TV couldn't be hotter. Google, Amazon, Hulu and others have jumped into the fray -- putting studios in the power position. They want to be paid more for the content they're providing.
That spells trouble for Netflix's streaming content costs.
"Netflix has another year or two on most of these contracts, and then the game completely changes," says Michael Pachter, analyst at Wedbush Securities."
2 things missing from streaming? BLUE RAY QUALITY, NEW RELEASES....once that is fixed.....game over, imho
Duratek
Sunday, July 10, 2011
MY LOYAL COMPANION
MY LOYAL COMPANION
FRIENDLY SMILE NEVER BEARING TEETH
GENTLE CREATURE WAS MY FRIEND
TIME HAS SLIPPED BY OUR GRASP
SO SWIFT LIKE A STORMY BREEZE
CARESSING OUR SKIN, PALE COLOR
THE FACE OF WHAT IS TO COME
IT WOULD SEEM TO LAST FOREVER
BUT THAT CANNOT BE
WE RENT OUR DREAMS
PAYMENT WILL COME DUE
WAGGING TAIL ALWAYS FOR ME
GENTLE CREATURE WAS MY FRIEND
SUDDEN TAKING OF TODAY’S DREAMS
LEAVING NO HOPE FOR TOMORROW
AN END MUST COME
FROM EVERY BEGINNING
I WILL MISS YOUR SOFT FUR, AND LIMITLESS LOVE
GENTLE CREATURE WAS MY FRIEND
Poem by M Rosen
SOFT FUR LIKE COTTON BALLS
SHINING EYES GLISTENING LIKE GLASSFRIENDLY SMILE NEVER BEARING TEETH
GENTLE CREATURE WAS MY FRIEND
TIME HAS SLIPPED BY OUR GRASP
SO SWIFT LIKE A STORMY BREEZE
CARESSING OUR SKIN, PALE COLOR
THE FACE OF WHAT IS TO COME
PAWS OF SILK, SKIN SO TENDER
GENTLE CREATURE WAS MY FRIENDIT WOULD SEEM TO LAST FOREVER
BUT THAT CANNOT BE
WE RENT OUR DREAMS
PAYMENT WILL COME DUE
WAGGING TAIL ALWAYS FOR ME
GENTLE CREATURE WAS MY FRIEND
SUDDEN TAKING OF TODAY’S DREAMS
LEAVING NO HOPE FOR TOMORROW
AN END MUST COME
FROM EVERY BEGINNING
I WILL MISS YOUR SOFT FUR, AND LIMITLESS LOVE
GENTLE CREATURE WAS MY FRIEND
Poem by M Rosen
Saturday, July 09, 2011
SPENDING CUTS WILL HURT ECONOMY
http://www.nytimes.com/2011/04/12/business/economy/12econ.html April 2011
"The proposed federal spending cuts, which were decided late Friday, do not amount to much by themselves, about 0.25 percent of annual domestic activity. But they join a growing list of minor problems impeding growth, economists said, including higher fuel prices and bad weather, Europe’s creeping malaise and the effect of the Japanese earthquake.
The impact of those problems, combined with growing cuts in spending by federal, state and local governments, has led some experts who had forecast that the economy would expand by more than 4 percent in 2011 to retreat toward a 3 percent growth rate. And it raises the question of how many more small cuts the president can afford.
Diane Swonk, chief economist at Mesirow Financial, a Chicago investment firm, said she had cut her forecast for 2011 to 3.3 percent, from 4.2 percent. And if growth falls below 3 percent, she said, “You’re just running on a treadmill. You’re not getting anywhere.”
Recent employment numbers show the economy is not going anywhere, commercial property for lease abounds in empty spaces, where are the new businesses? CHEAP money is not attracting those who might borrow, so the FED policies are like "pulling on a string".
Numbers as to the SIZE of proposed cuts in govt spending have been anywhere from $1 trillion to as much as $4 Trilion over 10 years. ANY CUTS come right out of economy, many companies opening offices in DC just to be close to all that spending potential.
Of course the argument is the Govt is inefficient in their spending, and it takes away from small business development almost dormant like the 7 year locust.
jan 2011
"Moving aggressively to make good on election promises to slash the federal budget, the House GOP today unveiled an eye-popping plan to eliminate $2.5 trillion in spending over the next 10 years. Gone would be Amtrak subsidies, fat checks to the Legal Services Corporation and National Endowment for the Arts, and some $900 million to run President Obama's healthcare reform program."
A SHOWDOWN is coming, even if some agreement is made BEFORE THE DEBT CEILING DEBT LINE, a reduction in spending will hurt economy, and the savings will not make muxh difference with $1T-$1.5T deficits each year for what seems eternity.
How much better would YOU feel if instead of owing $100,000 to a bank you owed $150,000? well at least they didn;t cut you off at $100,000. The govt will just PRINT the difference...and keep printing..leaving you and I to pass the SHORT STICK to each other.
D
"The proposed federal spending cuts, which were decided late Friday, do not amount to much by themselves, about 0.25 percent of annual domestic activity. But they join a growing list of minor problems impeding growth, economists said, including higher fuel prices and bad weather, Europe’s creeping malaise and the effect of the Japanese earthquake.
The impact of those problems, combined with growing cuts in spending by federal, state and local governments, has led some experts who had forecast that the economy would expand by more than 4 percent in 2011 to retreat toward a 3 percent growth rate. And it raises the question of how many more small cuts the president can afford.
Diane Swonk, chief economist at Mesirow Financial, a Chicago investment firm, said she had cut her forecast for 2011 to 3.3 percent, from 4.2 percent. And if growth falls below 3 percent, she said, “You’re just running on a treadmill. You’re not getting anywhere.”
Recent employment numbers show the economy is not going anywhere, commercial property for lease abounds in empty spaces, where are the new businesses? CHEAP money is not attracting those who might borrow, so the FED policies are like "pulling on a string".
Numbers as to the SIZE of proposed cuts in govt spending have been anywhere from $1 trillion to as much as $4 Trilion over 10 years. ANY CUTS come right out of economy, many companies opening offices in DC just to be close to all that spending potential.
Of course the argument is the Govt is inefficient in their spending, and it takes away from small business development almost dormant like the 7 year locust.
jan 2011
"Moving aggressively to make good on election promises to slash the federal budget, the House GOP today unveiled an eye-popping plan to eliminate $2.5 trillion in spending over the next 10 years. Gone would be Amtrak subsidies, fat checks to the Legal Services Corporation and National Endowment for the Arts, and some $900 million to run President Obama's healthcare reform program."
A SHOWDOWN is coming, even if some agreement is made BEFORE THE DEBT CEILING DEBT LINE, a reduction in spending will hurt economy, and the savings will not make muxh difference with $1T-$1.5T deficits each year for what seems eternity.
How much better would YOU feel if instead of owing $100,000 to a bank you owed $150,000? well at least they didn;t cut you off at $100,000. The govt will just PRINT the difference...and keep printing..leaving you and I to pass the SHORT STICK to each other.
D
MORE COMMENTS ON POSSIBLE MEGAPHONE TOPPING PATTERN
I spotted this pattern on my monthly chart. ALL too often traders disregard Monthly or longer term trends. I could not find another period where a RECESSION (BEAR MKT) low as was case in 2002/3 was cleared by the next Recession LOW (BEAR BOTTOM) certainly not on this chart back to 1982. There were NO divergences at the lower low bottom, this leads me to believe we are STILL in a Secular Bear market, however enjoying the rally from CYCLICAL BULL. A higher high is certainly possible, but from here on out it would be a GOOD INVESTMENT idea not to fall asleep.
Corporation are now MORE indebted than 5 years ago! how? Borrowing money to buy STOCK to make earnings appear better, NOT used to grow or expand business or hire new employees. We are experiencing the weakest stats from any Recessionary bottom, and at some point the musical chairs will stop. 2009 was a GREAT buying opp, there really isn't much sign of sellers picking up their game, as Lowry's stats point out. So, the trend is up until it isn't, when it isn't might be the selling opp of the decade.
The "easy" money has been made, business cycle has peaked, ECRI index (well respected) predicts 2nd half weakness, NOT sustainable economy as almost every economist and CNBC guest predicts and implies. There is NO proof of much more than the stock mkt is about only game in town for returns as FED fixes rates at 0%.
Cheap 2012 puts may be in order. HF and program trading now mass majority of shares traded...IMHO the voting mech of mkt is broken and even so, the mkt is at best short term indicator
CLOSEUP OF POTENTIAL BROADENING TOP PATTERN
RICHARD RUSSELL "THE VALUES AREN'T THAT GOOD"
5 July 2011 by Cullen Roche
http://pragcap.com/richard-russell-the-1-reason-to-be-underweight-equities
"Richard Russell’s latest letter is something that most investors can probably empathize with to some degree. While it’s clear that the equity markets are in the midst of a bull market, it’s less clear whether now is still a good time to be buying. Russell, while acknowledging that this is certainly a bull market, prefers not to be overweight equities for one single reason – the values just aren’t that good"
http://pragcap.com/richard-russell-the-1-reason-to-be-underweight-equities
"Richard Russell’s latest letter is something that most investors can probably empathize with to some degree. While it’s clear that the equity markets are in the midst of a bull market, it’s less clear whether now is still a good time to be buying. Russell, while acknowledging that this is certainly a bull market, prefers not to be overweight equities for one single reason – the values just aren’t that good"
Friday, July 08, 2011
GOV'T DEBT WAS $6 TRILLION IN 2000
What kinda upside down world are we living in?
D
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