http://stockcharts.com/def/servlet/SC.web?c=$vxo,uu[w,a]wallyiay[pb50!b10!f][vc60][iut!La12,26,9!Lh14,3]&pref=G
It has been OVER 2 years since the 50 crossed up thru the 200 SMA of the VIX, that was increased volatility seen as markets were getting washed out for a bottom
It spiked up once in 1998 (crisis) and then several times leading to mkt top in 1999- 2000.
In conclusion, even during GREATEST bull mkt we never saw a period where the volatility stayed so SUBDUED below the moving averages, in contrast, they spent MOST of their ABOVE.
Further leading me to see this rally a cyclical in nature in process of topping.
Monday, May 09, 2005
Sunday, May 08, 2005
TECH SAVIOR?
http://money.cnn.com/2005/05/05/technology/techinvestor/lamonica/index.htm
If other high profile tech bastions have not been able to GEAR the NAZ up, NOW,late in this bull cycle ALL eyes, the fate of techland rests with 2 compnaies?
If other high profile tech bastions have not been able to GEAR the NAZ up, NOW,late in this bull cycle ALL eyes, the fate of techland rests with 2 compnaies?
Saturday, May 07, 2005
Friday, May 06, 2005
The ART of BS
Stocks Are Mixed on Employment ReportFri 1:18PM ET - APWall Street surrendered its early gains Friday, leaving stocks mixed as investors worried that a surprisingly strong employment report, while good for the economy, could result in increased consumer demand and spark inflation.
*When "good" news is bad......stocks are suspect. GM and Ford downgraded to JUNK status......when you look at the stocks of the major companies don't you wonder why they aren't hitting new highs.
D
*When "good" news is bad......stocks are suspect. GM and Ford downgraded to JUNK status......when you look at the stocks of the major companies don't you wonder why they aren't hitting new highs.
D
247,000 jobs The MIRACLE of BS
http://www.bls.gov/web/cesbd.htm 257,000 jobs added which may or may NOT be real. How can anyone tell when these figures cannot be verified. Help wanted index fell 2 points last reading.April is statistically the highest month for job additions.I suppose the markets reaction will be all that matters, incl bond market.
ANything les than a full tilt giddyup a failure
D
ANything les than a full tilt giddyup a failure
D
Thursday, May 05, 2005
JOB SIDS?
FRI we get employment data, I am expecting a LARGE number, because from my research, the net birth death model adds the most jobs in this period.
Knowing that, any WEAK number in reality would be even weaker. And you wonder WHY isn;t the data just reported as it is?
There is a lot going for the bulls, for now I think the rally could continue, phase 2 of the bear market isn't in play until 10K falls at the least.
I do NOT forsee new highs in 2005, large cap and defensive issues could fair much better here. Rates are lower than this time LAST year, and the FED will continue to raise.
D
Knowing that, any WEAK number in reality would be even weaker. And you wonder WHY isn;t the data just reported as it is?
There is a lot going for the bulls, for now I think the rally could continue, phase 2 of the bear market isn't in play until 10K falls at the least.
I do NOT forsee new highs in 2005, large cap and defensive issues could fair much better here. Rates are lower than this time LAST year, and the FED will continue to raise.
D
DEBT BOMB
Greenspan warns on FRE and FNM again
NDX right to underside resistance. DOW broken thru....could the NDX not confirm this move? I am reluctant to say so because of volume and breadth of the move.
We might be looking into summer for a final top....wouldn't surprise me.
Defensive stocks should outperform, but a traders market it is.IMHO
D
NDX right to underside resistance. DOW broken thru....could the NDX not confirm this move? I am reluctant to say so because of volume and breadth of the move.
We might be looking into summer for a final top....wouldn't surprise me.
Defensive stocks should outperform, but a traders market it is.IMHO
D
Wednesday, May 04, 2005
ISM
April non-manufacturing ISM index 61.7 (-1.4 pts).
Key Factors
Index is volatile and independent of its components. Can cause confusion in interpretation.
Modest decline still leaves index in the 60s -- strong level with momentum.
New orders fell off to 58.8 -- weakest since June 2003. Demand provides the forward read on economy.
Employment fell off to 53.3 after reaching a record (8 yr) high -- 59.6 --in Feb. Non-mfg employment provides all the nonfarm payroll growth.
Key Factors
Index is volatile and independent of its components. Can cause confusion in interpretation.
Modest decline still leaves index in the 60s -- strong level with momentum.
New orders fell off to 58.8 -- weakest since June 2003. Demand provides the forward read on economy.
Employment fell off to 53.3 after reaching a record (8 yr) high -- 59.6 --in Feb. Non-mfg employment provides all the nonfarm payroll growth.
RIGHT Said FED
http://www.elliottwave.com/features/default.aspx?cat=mw&aid=1664&time=pm
Nothing up my sleeve, presto chango......do as I say not as I double speak
Nothing up my sleeve, presto chango......do as I say not as I double speak
SHOW ME SUSTAINABLE ECONOMY
http://stockcharts.com/def/servlet/SC.web?c=$CRB,uu[w,a]dallyiay[df][pb50!b200!f][vc60][iut!Ub14!Ua12,26,9]&pref=G STILL in uptrend, but recent weakness might hold at 200 SMA, a break here has significance to greater economy.
http://stockcharts.com/def/servlet/SC.web?c=$wtic,uu[w,a]dallyiay[df][pb50!b200!f][vc60][iut!Ub14!Ua12,26,9]&pref=G Same here with OIL, recent weakening might get support at 200 SMA, but is the GLOBAL REFLATIONARY EFFORT now cooling off?
As the FED continues to RAISE RATES in the face of a slowing economy. MUCH of the SPX profits have come from ENERGY and FINANCIALS.
Just a correction in XOM? and in JPM?
And HOW is the CONSUMER holding up, especially those on hourly pay? WMT chart
FLAT TREASURY CURVE usually spells out Recession ahead. FED FUNDS 3% 10 YR 4.19% !
And the FED is daft to explain why? REFLATION HAS TOPPED! IMHO
D
http://stockcharts.com/def/servlet/SC.web?c=$wtic,uu[w,a]dallyiay[df][pb50!b200!f][vc60][iut!Ub14!Ua12,26,9]&pref=G Same here with OIL, recent weakening might get support at 200 SMA, but is the GLOBAL REFLATIONARY EFFORT now cooling off?
As the FED continues to RAISE RATES in the face of a slowing economy. MUCH of the SPX profits have come from ENERGY and FINANCIALS.
Just a correction in XOM? and in JPM?
And HOW is the CONSUMER holding up, especially those on hourly pay? WMT chart
FLAT TREASURY CURVE usually spells out Recession ahead. FED FUNDS 3% 10 YR 4.19% !
And the FED is daft to explain why? REFLATION HAS TOPPED! IMHO
D
Tuesday, May 03, 2005
FED SPEAK
...."As tends to be the case, the market was extremely volatile after the Fed announcement, see-sawing back and forth across the unchanged line all afternoon.
But stocks and bonds both rallied in the last five minutes of the session, amid reports that a key sentence had accidently been deleted from the statement.
The sentence, "longer-term inflation expectations remain well contained," did not drastically change the basic message -- that rates will keep rising, that inflation pressures are growing and that the recent slowdown in the economy is not going to change the pace of rate hikes."
http://www.stockmarketplanet.com//directory/Stock-Market-Crash-Chart.html COOL SITE
But stocks and bonds both rallied in the last five minutes of the session, amid reports that a key sentence had accidently been deleted from the statement.
The sentence, "longer-term inflation expectations remain well contained," did not drastically change the basic message -- that rates will keep rising, that inflation pressures are growing and that the recent slowdown in the economy is not going to change the pace of rate hikes."
http://www.stockmarketplanet.com//directory/Stock-Market-Crash-Chart.html COOL SITE
DEFLATIOn IN THE CARDS?
May 04, 2005
Get Ready for Deflation
By Steve Moyer
"If Americans ever allow banks to control the issue of their currency, first by inflation and then by deflation, the banks will deprive the people of all property until their children wake up homeless." ~ Thomas Jefferson
I know. I know. Home prices are skyrocketing. Gas costs $2.79 a gallon. Health care costs are getting out of hand. College tuition is rising to infinity...and beyond! Even interest rates are trying to edge up. According to Elliott Wave International, Proquest's database revealed that the six leading U.S. metropolitan newspapers featured 139 articles about inflation during March; just two having anything to do with deflation. Concerns about deflation - somewhat evident in the media in mid-2003 - have pretty much gone away, wouldn't you agree?
True, deflation is not creating headlines right now but that monster is quietly lurking in the background as existing pockets of inflation ironically add fuel to the deflationary fire. There is really no way around it, money supply pumping or no money supply pumping. Safehaven readers should take heed and, in some cases, take action - the relentless drag of deflation is coming soon to a theater near you. I hope you'll ready yourself for it.
Understand, deflation does not just mean "falling prices." Automobile, computer and home electronics price-cutting is symptomatic of early deflationary pressure, but in the context of this thesis, I am referring to the coming Big Kahuna - a contraction in credit that, once its psychology takes hold, will change the rules of the asset game for at least a decade.
History has shown that post-bubble economies face overwhelming deflationary pressure as it is, but the Alan Greenspan Federal Reserve's "Let's Get This Party Re-Started By Throwing Gun Powder, Kerosene and Nitroglycerin On The Post Mania Fire" approach to monetary policy all but assured it.
When the tech bubble initially burst, the loss of capital, U.S. jobs and personal income created an immediate demand for cheaper goods, and in very short order the manufacturing sector of our economy moved lock, stock and barrel to China, which was better set up to facilitate that type of demand. American corporations, suddenly in full cost-cutting mode, quickly bought into the new paradigm and the U.S. lost more than 2,000,000 manufacturing jobs by the end of 2002.
The Fed, in an all-out attempt to soften a post-bubble free-fall (and blithely ignoring everything modern financial history had taught them), aggressively lowered interest rates (to 40 year lows), which essentially encouraged Americans to incur debt in order to spend money as a way to give the economy a badly needed boost. We needed a shot in the arm, and given the stock market's free-fall and what can only be described as a preposterously low (just above 0%) national savings rate and miserable job and income numbers, Greenspan & Co. decided there was only one avenue left to travel. The Fed lowered interest rates (to a Federal Funds rate of 1%), furiously pumped the money supply and wittingly enticed people to use their homes as ATM's in a band-aid style, stunningly misguided attempt to get us over the post-bubble economic hump. "Reflation," the experts called it.
Whereupon, intoxicated by low interest rates, Americans went on a borrowing and spending binge the likes of which this planet has never seen.
Perhaps you've grown accustomed to the dozen or so credit card solicitations in your mailbox each week ("2.9% APR for the first 6 months!!"), or one year, no-payments-no- interest at Circuit City (and The Good Guys and Home Depot and Best Buy and Orchard Supply Hardware and Sears and pretty much every other big box retailer in town), or no fee home equity loans up to 100% equity on your house. Perhaps you've purchased a car with zero down and 1.9% GMAC financing, or better still, 0% financing for five years. Consumer credit has become the name of the economic game. So be sure to sit down when I tell you that revolving credit card debt in the United States has increased exactly 58,868% since 1968 (that's right, not 580%, not 5,800%, but 58,868%. Whoa, momma!).
Esteemed market guru Robert Prechter, Jr. writes, "Near the end of a major expansion, few creditors expect default, which is why they lend freely to weak borrowers. Few borrowers expect their fortunes to change, which is why they borrow freely. Deflation involves a substantial amount of involuntary debt liquidation because almost no one expects deflation before it starts."
The problem is, folks used the equity in their homes to back it all up. Refi became the name of the game. Up to your eyeballs in debt? Consolidate it into your home loan! Need cash? Refi, baby! Looking to buy a house? "Hey, buddy, how about a quick 100% (or 110% or 120%) of value loan!" Mailers offering "$1,000,000 loans for $3300 a month, EZ qualifying!" flood my office desk. "100% CASH OUT REFIS!" scream others. Go ahead and read that Prechter quote one more time. Enticingly low interest rates allowed folks to rationalize an entire pot full of financial decisions.
So what if everyone borrows their way to "prosperity?" Is there a problem, officer? Unfortunately, history says yes - credit bubbles don't have happy endings. Eventually, folks decide they have borrowed enough and they cut back. The credit-driven economy falls of its own weight. Even low interest rates no longer entice people to borrow. The short-term fix ends up adding to the post-bubble, long-term problem, as the increasing burden leads to a braking economy, a credit contraction, falling asset values and not enough liquidity left in the marketplace to prop everything back up. The result is a full-blown liquidity crisis, affecting all asset values - stocks, bonds, real estate, precious metals, collectibles - at least for a time.
"The psychological aspect of deflation...cannot be overstated," Prechter continues. "When the social mood trend changes from optimism to pessimism, creditors, debtors, producers and consumers change their primary orientation from expansion to conservation. As creditors become more conservative, they slow their lending. As debtors and potential debtors become more conservative, they borrow less or not at all. As producers become more conservative, they reduce expansion plans. As consumers become more conservative, they save more and spend less. These behaviors reduce the "velocity" of money, i.e., the speed with which it circulates to make purchases, thus putting downside pressure on prices. These forces reverse the former trend."
Market technician Phillip Erlanger refers to the current phenomenon as "inflation in all the wrong places and deflation in all the wrong places." Yes, there are pockets of inflation evident within the global economic framework but those will prove to be gnats on the back of the slow-moving deflationary elephant. Mostly, those rising costs put the squeeze on producers, who lack the pricing power necessary to pass those cost increases along (go ahead and ask now just-above-junk-bond rated General Motors about that). In fact, while rising crude oil and fuel prices seem to skew the numbers towards inflation now, the squeeze it imposes upon consumers and others will actually be deflationary, as people curtail purchases and start looking for ways to dig their way out of debt (the good news is, deflationary history suggests that oil and gas prices will fall, as well).
Forget the mainstream financial media; the reversal has begun. The again-declining stock market - particularly at this point in the post-bubble wave pattern - is a telling and leading indicator, as is the drop in the money supply and in the velocity of money. Commodity prices are falling. The "flattening" of the bond yield curve (short term interest rates rise; longer term rates don't), a precursor to economic recession, looms large. And given the fact that Americans have spent the last three years using the equity in their homes to "buy stuff," there is really no way around it at this point. Consumers are quietly putting their clothes back on after their three year borrowing/spending orgy. The irresponsible, Fed-encouraged post-bubble borrow-fest is winding down and there simply is not enough savings nor fundamental (read: manufacturing) strength in the U.S. economy to support any investment market - at least for a while. Up to their eyeballs in debt, the rules of the consumer game are about to change and debt reduction is sure to be the coming rage. Deflation is upon us.
Because the credit contraction will be taking place in a post-bubble framework, the result will be a slow, grinding, painful decade-long decline for most, if not all asset classes. As the money supply necessarily contracts (and without a national savings rate to back things up), today's asset values will become downright nostalgic.
Most significantly, when the post-bubble shakeout is winding down, the vast majority of Americans will be unable to play the investment game, and cash will be king.
Those who prepared themselves by holding cash will be able to cherry-pick assets in many cases for literally pennies on the dollar. I sincerely hope you'll be one of them.
Steve Moyer,Ponder-This.net
Get Ready for Deflation
By Steve Moyer
"If Americans ever allow banks to control the issue of their currency, first by inflation and then by deflation, the banks will deprive the people of all property until their children wake up homeless." ~ Thomas Jefferson
I know. I know. Home prices are skyrocketing. Gas costs $2.79 a gallon. Health care costs are getting out of hand. College tuition is rising to infinity...and beyond! Even interest rates are trying to edge up. According to Elliott Wave International, Proquest's database revealed that the six leading U.S. metropolitan newspapers featured 139 articles about inflation during March; just two having anything to do with deflation. Concerns about deflation - somewhat evident in the media in mid-2003 - have pretty much gone away, wouldn't you agree?
True, deflation is not creating headlines right now but that monster is quietly lurking in the background as existing pockets of inflation ironically add fuel to the deflationary fire. There is really no way around it, money supply pumping or no money supply pumping. Safehaven readers should take heed and, in some cases, take action - the relentless drag of deflation is coming soon to a theater near you. I hope you'll ready yourself for it.
Understand, deflation does not just mean "falling prices." Automobile, computer and home electronics price-cutting is symptomatic of early deflationary pressure, but in the context of this thesis, I am referring to the coming Big Kahuna - a contraction in credit that, once its psychology takes hold, will change the rules of the asset game for at least a decade.
History has shown that post-bubble economies face overwhelming deflationary pressure as it is, but the Alan Greenspan Federal Reserve's "Let's Get This Party Re-Started By Throwing Gun Powder, Kerosene and Nitroglycerin On The Post Mania Fire" approach to monetary policy all but assured it.
When the tech bubble initially burst, the loss of capital, U.S. jobs and personal income created an immediate demand for cheaper goods, and in very short order the manufacturing sector of our economy moved lock, stock and barrel to China, which was better set up to facilitate that type of demand. American corporations, suddenly in full cost-cutting mode, quickly bought into the new paradigm and the U.S. lost more than 2,000,000 manufacturing jobs by the end of 2002.
The Fed, in an all-out attempt to soften a post-bubble free-fall (and blithely ignoring everything modern financial history had taught them), aggressively lowered interest rates (to 40 year lows), which essentially encouraged Americans to incur debt in order to spend money as a way to give the economy a badly needed boost. We needed a shot in the arm, and given the stock market's free-fall and what can only be described as a preposterously low (just above 0%) national savings rate and miserable job and income numbers, Greenspan & Co. decided there was only one avenue left to travel. The Fed lowered interest rates (to a Federal Funds rate of 1%), furiously pumped the money supply and wittingly enticed people to use their homes as ATM's in a band-aid style, stunningly misguided attempt to get us over the post-bubble economic hump. "Reflation," the experts called it.
Whereupon, intoxicated by low interest rates, Americans went on a borrowing and spending binge the likes of which this planet has never seen.
Perhaps you've grown accustomed to the dozen or so credit card solicitations in your mailbox each week ("2.9% APR for the first 6 months!!"), or one year, no-payments-no- interest at Circuit City (and The Good Guys and Home Depot and Best Buy and Orchard Supply Hardware and Sears and pretty much every other big box retailer in town), or no fee home equity loans up to 100% equity on your house. Perhaps you've purchased a car with zero down and 1.9% GMAC financing, or better still, 0% financing for five years. Consumer credit has become the name of the economic game. So be sure to sit down when I tell you that revolving credit card debt in the United States has increased exactly 58,868% since 1968 (that's right, not 580%, not 5,800%, but 58,868%. Whoa, momma!).
Esteemed market guru Robert Prechter, Jr. writes, "Near the end of a major expansion, few creditors expect default, which is why they lend freely to weak borrowers. Few borrowers expect their fortunes to change, which is why they borrow freely. Deflation involves a substantial amount of involuntary debt liquidation because almost no one expects deflation before it starts."
The problem is, folks used the equity in their homes to back it all up. Refi became the name of the game. Up to your eyeballs in debt? Consolidate it into your home loan! Need cash? Refi, baby! Looking to buy a house? "Hey, buddy, how about a quick 100% (or 110% or 120%) of value loan!" Mailers offering "$1,000,000 loans for $3300 a month, EZ qualifying!" flood my office desk. "100% CASH OUT REFIS!" scream others. Go ahead and read that Prechter quote one more time. Enticingly low interest rates allowed folks to rationalize an entire pot full of financial decisions.
So what if everyone borrows their way to "prosperity?" Is there a problem, officer? Unfortunately, history says yes - credit bubbles don't have happy endings. Eventually, folks decide they have borrowed enough and they cut back. The credit-driven economy falls of its own weight. Even low interest rates no longer entice people to borrow. The short-term fix ends up adding to the post-bubble, long-term problem, as the increasing burden leads to a braking economy, a credit contraction, falling asset values and not enough liquidity left in the marketplace to prop everything back up. The result is a full-blown liquidity crisis, affecting all asset values - stocks, bonds, real estate, precious metals, collectibles - at least for a time.
"The psychological aspect of deflation...cannot be overstated," Prechter continues. "When the social mood trend changes from optimism to pessimism, creditors, debtors, producers and consumers change their primary orientation from expansion to conservation. As creditors become more conservative, they slow their lending. As debtors and potential debtors become more conservative, they borrow less or not at all. As producers become more conservative, they reduce expansion plans. As consumers become more conservative, they save more and spend less. These behaviors reduce the "velocity" of money, i.e., the speed with which it circulates to make purchases, thus putting downside pressure on prices. These forces reverse the former trend."
Market technician Phillip Erlanger refers to the current phenomenon as "inflation in all the wrong places and deflation in all the wrong places." Yes, there are pockets of inflation evident within the global economic framework but those will prove to be gnats on the back of the slow-moving deflationary elephant. Mostly, those rising costs put the squeeze on producers, who lack the pricing power necessary to pass those cost increases along (go ahead and ask now just-above-junk-bond rated General Motors about that). In fact, while rising crude oil and fuel prices seem to skew the numbers towards inflation now, the squeeze it imposes upon consumers and others will actually be deflationary, as people curtail purchases and start looking for ways to dig their way out of debt (the good news is, deflationary history suggests that oil and gas prices will fall, as well).
Forget the mainstream financial media; the reversal has begun. The again-declining stock market - particularly at this point in the post-bubble wave pattern - is a telling and leading indicator, as is the drop in the money supply and in the velocity of money. Commodity prices are falling. The "flattening" of the bond yield curve (short term interest rates rise; longer term rates don't), a precursor to economic recession, looms large. And given the fact that Americans have spent the last three years using the equity in their homes to "buy stuff," there is really no way around it at this point. Consumers are quietly putting their clothes back on after their three year borrowing/spending orgy. The irresponsible, Fed-encouraged post-bubble borrow-fest is winding down and there simply is not enough savings nor fundamental (read: manufacturing) strength in the U.S. economy to support any investment market - at least for a while. Up to their eyeballs in debt, the rules of the consumer game are about to change and debt reduction is sure to be the coming rage. Deflation is upon us.
Because the credit contraction will be taking place in a post-bubble framework, the result will be a slow, grinding, painful decade-long decline for most, if not all asset classes. As the money supply necessarily contracts (and without a national savings rate to back things up), today's asset values will become downright nostalgic.
Most significantly, when the post-bubble shakeout is winding down, the vast majority of Americans will be unable to play the investment game, and cash will be king.
Those who prepared themselves by holding cash will be able to cherry-pick assets in many cases for literally pennies on the dollar. I sincerely hope you'll be one of them.
Steve Moyer,Ponder-This.net
Monday, May 02, 2005
NET BIRTH MAGIC
http://www.bls.gov/web/cesbd.htm
April of 2004 added 225,000 jobs, the MOST that year. 10 yr 4.19% !!! turned right at the .786 FIB retrace.
D
April of 2004 added 225,000 jobs, the MOST that year. 10 yr 4.19% !!! turned right at the .786 FIB retrace.
D
FED ACTION MARKET REACTION?
Market leading up to FED meeting has a nack of reversing AFTER the announcement, so my guess is the market will be up slightly to tread water ahead of that.
And maybe ahead of labor report this FRI we might just move net sideways. I am going to dig up what the AVG NET BIRH DEATH MOdel migth be adding to the number
And maybe ahead of labor report this FRI we might just move net sideways. I am going to dig up what the AVG NET BIRH DEATH MOdel migth be adding to the number
DIVIDENDS DON'T LIE
http://safehaven.com/showarticle.cfm?id=2998&pv=1
6 to 7% SPX DIV yield at prior Bear BOTTOMS. We are at 1.7% !
D
6 to 7% SPX DIV yield at prior Bear BOTTOMS. We are at 1.7% !
D
Sunday, May 01, 2005
KUDLOW 101
http://news.goldseek.com/EuroCapital/1114968203.php
At least I am not the only one who thinks this guy is oFF!!
At least I am not the only one who thinks this guy is oFF!!
SOFT PATCH?
GAS PRICES TAKING THEIR TOLL?
N.Korea fired a missle test this weekend, see if ANOTHER news story matters to markets,as we go from STORY to STORY....and then there was the FED, I think NO accident $53 B CRISIS liquidity added last reporting week.
D
N.Korea fired a missle test this weekend, see if ANOTHER news story matters to markets,as we go from STORY to STORY....and then there was the FED, I think NO accident $53 B CRISIS liquidity added last reporting week.
D
Subscribe to:
Posts (Atom)
