Morning Post 10/03/2025 SPX
6 hours ago
Saturday, November 7, 2009
Hmmmm, next?
Wow, I said in my post last week that we'd hit 1025 Monday or Tuesday. Well we got down to 1030 Monday afternoon. I said in my last post that we'd then rally to 1070. Well we hit 1070 on Friday. I said in my last post that at that point that would be it, done, kaput.... I guess now we'll see if I'm 3 for 3 in my Halloween Prognostication...
Saturday, October 31, 2009
BOO!
Well when the wife notices that the blog hasn't been updated and mentions it, I guess it's time to do an update. She already nags me enough about everything else.
:-)
So, last update I mentioned that we'd hit 10,000 and would we stay or just drop right back. We held for about a week and then we're in the midst of a pullback. Down about 6%. A real pullback or just another rest period before another move up???
Here's what's going to happen, bank on it. OK, well don't bank on it, but watch for it. S&P is at 1040 right now. We'll dip down to 1025 Monday, maybe into Tuesday morning, then a move to the 1070 range over the next few trading days. Then we're done. Finished. Kaput. The real move down hits.
GDP for Q3 came out and was a surprise to the upside. The markets rallied 200 points. ONLY 200 points. The reality is that while the GDP number appeared to be good, as soon as you dug into it and realized almost half of the "goodness" was due to cash for clunkers and that's dead and gone now.
The gov't has been trying to buy time until the real economy comes back to life. Problem is it's taking longer than they'd hoped.
Watch the headlines for the CIT bankruptcy. That will have major ripple effects out there.
How was this honey? Let me know when I need to do another post.
:-)
So, last update I mentioned that we'd hit 10,000 and would we stay or just drop right back. We held for about a week and then we're in the midst of a pullback. Down about 6%. A real pullback or just another rest period before another move up???
Here's what's going to happen, bank on it. OK, well don't bank on it, but watch for it. S&P is at 1040 right now. We'll dip down to 1025 Monday, maybe into Tuesday morning, then a move to the 1070 range over the next few trading days. Then we're done. Finished. Kaput. The real move down hits.
GDP for Q3 came out and was a surprise to the upside. The markets rallied 200 points. ONLY 200 points. The reality is that while the GDP number appeared to be good, as soon as you dug into it and realized almost half of the "goodness" was due to cash for clunkers and that's dead and gone now.
The gov't has been trying to buy time until the real economy comes back to life. Problem is it's taking longer than they'd hoped.
Watch the headlines for the CIT bankruptcy. That will have major ripple effects out there.
How was this honey? Let me know when I need to do another post.
Wednesday, October 14, 2009
Took Long Enough
FINALLY! We saw the Dow touch 10,000 today. Now what? We'll see. I've had 10,000 as the goal. Now will we hold above it for a time in order to get everyone sucked back in that's been holding back? Or will we simply say "thanks... see ya" as we head back down.
Third quarter earnings are off to a good start and some more of the big boys report the rest of the week. Still a lot of smoke and mirrors going on. Q2 was all about cost cutting and Q3 is all about the weak dollar which helps multi-national companies.
The big question is, are consumers really spending again? What do you think? I don't see it, but what do I know. Seems to me that everyone is scared to death of losing their job so they're paying down debt and hoarding cash. With the real unemployment percentage hovering around 20% it's very ugly out there.
See what the rest of October has in store for us.
Third quarter earnings are off to a good start and some more of the big boys report the rest of the week. Still a lot of smoke and mirrors going on. Q2 was all about cost cutting and Q3 is all about the weak dollar which helps multi-national companies.
The big question is, are consumers really spending again? What do you think? I don't see it, but what do I know. Seems to me that everyone is scared to death of losing their job so they're paying down debt and hoarding cash. With the real unemployment percentage hovering around 20% it's very ugly out there.
See what the rest of October has in store for us.
Wednesday, September 23, 2009
September 23 - Tidbit of the Day
Nothing much to say lately as I await the market to top out in the next couple of weeks. I expect one more week of flat or upward movement as the end of month and end of quarter window dressing keeps things held up. (Unless the Federal Reserve says something surprising today at 2:15)
But here's a good read.
http://www.realclearmarkets.com/articles/2009/09/21/an_interview_with_doug_kass_97416.html
But here's a good read.
http://www.realclearmarkets.com/articles/2009/09/21/an_interview_with_doug_kass_97416.html
Sunday, September 13, 2009
September 13 - Tidbit of the Day
This one was sent to me by a buddy of mine. Very good stuff and a lot of the same things I've been worried about and bitching about.
And now we're starting a pissing match with China by adding a tariff to imported tires from China and they're now fighting back with tariffs of their own. If this continues it could become an issue.
http://www.huffingtonpost.com/les-leopold/one-year-after-lehman-and_b_285158.html
And now we're starting a pissing match with China by adding a tariff to imported tires from China and they're now fighting back with tariffs of their own. If this continues it could become an issue.
http://www.huffingtonpost.com/les-leopold/one-year-after-lehman-and_b_285158.html
Friday, September 11, 2009
Creeping Up
As I mentioned in my last post I didn't think we'd hit the peak quite yet. We're getting closer... almost hit 1050 on the S&P. I still think Dow 10,000 is the ultimate goal. Get everyone excited again, then pull the rug out.
Here's a good article. Very well worth the time to read it.
http://seekingalpha.com/article/160619-the-coming-consequences-of-banking-fraud?source=article_sb_popular
Here's a good article. Very well worth the time to read it.
http://seekingalpha.com/article/160619-the-coming-consequences-of-banking-fraud?source=article_sb_popular
Wednesday, September 2, 2009
Are We There Yet? Are We There Yet??
Calm down Timmy, we're almost there... Have we hit the peak of what I refer to as P2 (Primary wave 2)? The guru's are saying yes. I'm saying I don't think so. Who am I to argue with those that know better than me (in Elliott Wave Theory that is). Well nothing is cast in stone with Elliott Waves so I could very well be right. It'll all boil down to jobless claims tomorrow and unemployment numbers on Friday.
Have you noticed something the last week? Economic news has been "good" but the markets have been going down. For the past 6 months even when the economic news was bad they continued to move up. What we're seeing is exhaustion and a little bit of reality. What's been considered "good" has been a stretch at best.
Topping of a market is a process, it's not an event. We're going thru the process right now. Was 1039 on the S&P it? We'll know next week I believe. I'm looking for one more spike up towards 1044-1050.
There are so many warning signs and red flags out there it's scary. In the meantime the gov't is enticing people to spend money they don't have. Cash for Clunkers and the New Home Buyer tax credit are the two big ones.
Think about this... the gov't is trying to get people to buy a house with only 3.5% down and can use the $8,000 towards that down payment. So guess what... people don't have any "skin in the game". Why will people feel compelled to do everything they can to make payments if they get a little bit behind? Nothing. They have no money in the house, so they won't lose anything other than a big ding on their credit. I can ramble on this forever... It irks the hell out of me. The number of future foreclosures is going to be amazing for a long time to come. Home prices are continuing to decline and they'll really fall once this wonderful gov't program comes to an end and the fake inflated number of buyers dries up.
Speaking of which, if you're in the market for a car, wait about 2 months. After the Cash For Clunkers mad dash, dealers will be twiddling their thumbs for a while since everyone that was even thinking of buying a car within the next 6 months did in July and August. I have a feeling that in October and November dealers will be willing to do just about anything to sell a car.
Here's how I'm seeing things in the near term. S&P at 995 right now. Rally Thur and Fri and maybe into Tuesday (Monday is a holiday). And then the big P3 begins. Slowly or plunge... I don't know. I'm thinking a slow bleed for 2 years with the usual ups and downs. But we won't see S&P 1000 or Dow 10,000 again for a very long time.
Have you noticed something the last week? Economic news has been "good" but the markets have been going down. For the past 6 months even when the economic news was bad they continued to move up. What we're seeing is exhaustion and a little bit of reality. What's been considered "good" has been a stretch at best.
Topping of a market is a process, it's not an event. We're going thru the process right now. Was 1039 on the S&P it? We'll know next week I believe. I'm looking for one more spike up towards 1044-1050.
There are so many warning signs and red flags out there it's scary. In the meantime the gov't is enticing people to spend money they don't have. Cash for Clunkers and the New Home Buyer tax credit are the two big ones.
Think about this... the gov't is trying to get people to buy a house with only 3.5% down and can use the $8,000 towards that down payment. So guess what... people don't have any "skin in the game". Why will people feel compelled to do everything they can to make payments if they get a little bit behind? Nothing. They have no money in the house, so they won't lose anything other than a big ding on their credit. I can ramble on this forever... It irks the hell out of me. The number of future foreclosures is going to be amazing for a long time to come. Home prices are continuing to decline and they'll really fall once this wonderful gov't program comes to an end and the fake inflated number of buyers dries up.
Speaking of which, if you're in the market for a car, wait about 2 months. After the Cash For Clunkers mad dash, dealers will be twiddling their thumbs for a while since everyone that was even thinking of buying a car within the next 6 months did in July and August. I have a feeling that in October and November dealers will be willing to do just about anything to sell a car.
Here's how I'm seeing things in the near term. S&P at 995 right now. Rally Thur and Fri and maybe into Tuesday (Monday is a holiday). And then the big P3 begins. Slowly or plunge... I don't know. I'm thinking a slow bleed for 2 years with the usual ups and downs. But we won't see S&P 1000 or Dow 10,000 again for a very long time.
Saturday, August 29, 2009
We're Close
We're close... very close to a peak. I said back on March 4 and March 5 that we'd see a heck of a run and that as we got near Dow 10,000 that it would be time to get out. (Look back at those posts) That time is here. Dow 9600 right now with the S&P at 1030. If the S&P breaks above 1050 we have another 10% up move to go. If it doesn't break above 1050 we saw the peak this week. This coming up week and next week will be the tell all. Yes, really.
How will it play out? I don't know. I don't imagine a cliff dropping plummet at least not like Oct 1987. Instead I see a rather gradual decline. Everyone that has been "buying on the dips" the past 6 months will continue trying what has worked so well, but instead we'll continue a slow melting process that keeps them buying in hopes of the move back up. And in the meantime the folks shorting the market that have been getting burned the past 6 months will be too gun shy and afraid to make big bets because they've been screwed over so many times.
Here's the thing everyone, and I know I keep repeating it but NOTHING HAS BEEN FIXED! The gov't has thrown trillions of dollars into the banks and the economy but that's all. Accounting rule changes and smoke and mirrors is not a fix. The problems are still out there... over leveraged banks and consumers. If you look closely at the gov't reports that come out, the consumer is dead. The only spending is being done by the gov't and that can't last forever, nor is it enough to build a strong economy. The consumer is 1) tapped out and 2) scared. Scared of job losses, scared of losing their homes.
The Cash for Clunkers thing was the biggest fiasco. Get people who have cars that are likely paid off to turn them in for one that will require $300-$500 a month car payments for the next 4 or 5 years. And how many of those people thought about the fact that their auto insurance would double or triple also? Those 700,000 people that did this now have less spending money for the real economy. Not to mention the fact that if car dealerships had people lined up out the door of the showrooms, do you really think they came down on the prices of the cars? So guess what, you didn't save a dime.
Anyway, we're close to a peak. Either in the next 2 weeks or after 1 more 10% run. In either case, it's time to start positioning yourself. The bottom of the next wave could possibly just be a test of the lows back in March (S&P 670) or it could be far worse. Have to wait and see how bad things really are.
Commercial real estate will wipe out another 1,000 or maybe even 2,000 banks. Local, state and federal gov't revenue streams are WAY down which will mean higher taxes to make up for it. Don't be worried about inflation yet, that'll come in a few years. Be worried about deflation for the near term.
Now that the baseless rally and euphoria are peaking I'll start posting my thoughts along with tidbit articles that I find. I simply had to wait for this phase to play out.
A friend of mine kept asking me "Are you back in yet?" Nope... I didn't want to risk my retirement money knowing that at the best we'd still be around 30% below the high that was set in October 2007. Sure, I wish I'd caught more of this rally. Even though back on March 4 and March 5 I said this would happen, it even shocked me how impressive the straight up rally was.
How will it play out? I don't know. I don't imagine a cliff dropping plummet at least not like Oct 1987. Instead I see a rather gradual decline. Everyone that has been "buying on the dips" the past 6 months will continue trying what has worked so well, but instead we'll continue a slow melting process that keeps them buying in hopes of the move back up. And in the meantime the folks shorting the market that have been getting burned the past 6 months will be too gun shy and afraid to make big bets because they've been screwed over so many times.
Here's the thing everyone, and I know I keep repeating it but NOTHING HAS BEEN FIXED! The gov't has thrown trillions of dollars into the banks and the economy but that's all. Accounting rule changes and smoke and mirrors is not a fix. The problems are still out there... over leveraged banks and consumers. If you look closely at the gov't reports that come out, the consumer is dead. The only spending is being done by the gov't and that can't last forever, nor is it enough to build a strong economy. The consumer is 1) tapped out and 2) scared. Scared of job losses, scared of losing their homes.
The Cash for Clunkers thing was the biggest fiasco. Get people who have cars that are likely paid off to turn them in for one that will require $300-$500 a month car payments for the next 4 or 5 years. And how many of those people thought about the fact that their auto insurance would double or triple also? Those 700,000 people that did this now have less spending money for the real economy. Not to mention the fact that if car dealerships had people lined up out the door of the showrooms, do you really think they came down on the prices of the cars? So guess what, you didn't save a dime.
Anyway, we're close to a peak. Either in the next 2 weeks or after 1 more 10% run. In either case, it's time to start positioning yourself. The bottom of the next wave could possibly just be a test of the lows back in March (S&P 670) or it could be far worse. Have to wait and see how bad things really are.
Commercial real estate will wipe out another 1,000 or maybe even 2,000 banks. Local, state and federal gov't revenue streams are WAY down which will mean higher taxes to make up for it. Don't be worried about inflation yet, that'll come in a few years. Be worried about deflation for the near term.
Now that the baseless rally and euphoria are peaking I'll start posting my thoughts along with tidbit articles that I find. I simply had to wait for this phase to play out.
A friend of mine kept asking me "Are you back in yet?" Nope... I didn't want to risk my retirement money knowing that at the best we'd still be around 30% below the high that was set in October 2007. Sure, I wish I'd caught more of this rally. Even though back on March 4 and March 5 I said this would happen, it even shocked me how impressive the straight up rally was.
Monday, August 24, 2009
Sunday, August 23, 2009
August 23 - Tidbit of the Day - Excellent
An excellent read by Nouriel Roubini who saw all of this coming but was ridiculed when he warned everyone.
http://www.ft.com/cms/s/0/90227fdc-900d-11de-bc59-00144feabdc0.html
http://www.ft.com/cms/s/0/90227fdc-900d-11de-bc59-00144feabdc0.html
August 23 - Tidbit of the Day
Don't worry so much about all the numbers in this article, it's the general overview that's important.
http://www.mrswing.com/articles/S_amp_P_Over_Priced_With_of_Companies_Reporting_Q.html
http://www.mrswing.com/articles/S_amp_P_Over_Priced_With_of_Companies_Reporting_Q.html
Thursday, August 20, 2009
Monday, August 17, 2009
August 17 - Tidbit of the Day
A twofer today... residential real estate and commercial real estate.
http://globaleconomicanalysis.blogspot.com/2009/08/brace-for-wave-of-foreclosures-dam-is.html
http://www.abc.net.au/news/stories/2009/08/17/2657785.htm?section=justin
http://globaleconomicanalysis.blogspot.com/2009/08/brace-for-wave-of-foreclosures-dam-is.html
http://www.abc.net.au/news/stories/2009/08/17/2657785.htm?section=justin
Saturday, August 15, 2009
August 14 - Tidbit of the Day
This is troubling on so many levels...
http://www.bloomberg.com/apps/news?pid=20601109&sid=aTTT9jivRIWE
http://www.bloomberg.com/apps/news?pid=20601109&sid=aTTT9jivRIWE
Thursday, August 13, 2009
August 13 - Tidbit of the Day - Part Deux
Since I didn't post a tidbit for 10 days, I'll post two today...
http://www.telegraph.co.uk/finance/markets/6018076/RBS-uber-bear-issues-fresh-alert-on-global-stock-markets.html
http://www.telegraph.co.uk/finance/markets/6018076/RBS-uber-bear-issues-fresh-alert-on-global-stock-markets.html
August 13 - Tidbit of the Day
I couldn't have said it better myself, and I've been trying. The bottom line is that stocks and the economy can not and will not get back to where they were in 2007 any time in the near future. Everybody is tapped out. And the ones without jobs are just trying to survive. The consumer is 70% of the economy, don't ever forget that.
http://market-ticker.org/archives/1327-Retail-Sales-July-They-STINK.html
http://market-ticker.org/archives/1327-Retail-Sales-July-They-STINK.html
Sunday, August 9, 2009
Cash For Clunkers - Sounds Good! Sign Me Up!
I happen to have a 1997 Jeep that my 18 year old step-son drives that we originally bought used in 2001 for my wife. Passed it on to him 2 years ago. Runs great, over 150,000 miles. If I were to try to sell it, maybe I'd get $1,500. I gave a fleeting thought to trading it in to gain an extra $3,000 but then I did some deep pondering.
1) It's a sellers market right now. Do you honestly think the dealerships are giving any decent discounts off the price of cars right now when they have a showroom full of potential buyers? There goes the "extra" $3,000 I get for the trade-in
2) If my step-son were to buy a simple, modest vehicle say with a $15,000 sticker price on it and finance roughly $10,000 for 4 years, he'd pay appox $1800 in interest. There goes over half of the "extra" $3,000 I get for the trade-in on top of the lack of price haggling.
3) Right now, he's only carrying liability insurance on his "clunker". No reason to pay for collision insurance with a deductible on the Jeep. How much extra for insurance on a new car? A heck of a lot more than he's paying right now.
4) He gets saddled with a car payment (he doesn't have one now, we gave him the Jeep free and clear). He gets saddled with probably a tripling of his car insurance.
Back when gas hit $4.00 a gallon he got on a kick about wanting to trade the Jeep in for a more gas efficient vehicle. Makes sense, the Jeep only gets about 17mph. I gave him an assignment. If gas is $4.00 a gallon and he uses 500 gallons of gas a year, tell me how much you'll save per year if you buy a car that gets double your current gas mileage. He did the math and came back to me and showed me what I already knew... it would take 6 years to break even if he bought the used car for $6,000 that he'd found. He never brought it back up again, and of course gasoline drifted back down to where his break even point would have been another couple of years.
Sorry for the rambling, but the bottom line is Do The Math and think things through. I didn't even touch on the fact that of course the gov't (taxpayers) are paying for this.
And the fact that these people buying new cars aren't able to go out to dinner, go to movies, spend in other ways for the next 4 or 5 years as they deal with new car payments and increased auto insurance.
I'll also be curious to see how many reposessions there will be in 6-12 months.
1) It's a sellers market right now. Do you honestly think the dealerships are giving any decent discounts off the price of cars right now when they have a showroom full of potential buyers? There goes the "extra" $3,000 I get for the trade-in
2) If my step-son were to buy a simple, modest vehicle say with a $15,000 sticker price on it and finance roughly $10,000 for 4 years, he'd pay appox $1800 in interest. There goes over half of the "extra" $3,000 I get for the trade-in on top of the lack of price haggling.
3) Right now, he's only carrying liability insurance on his "clunker". No reason to pay for collision insurance with a deductible on the Jeep. How much extra for insurance on a new car? A heck of a lot more than he's paying right now.
4) He gets saddled with a car payment (he doesn't have one now, we gave him the Jeep free and clear). He gets saddled with probably a tripling of his car insurance.
Back when gas hit $4.00 a gallon he got on a kick about wanting to trade the Jeep in for a more gas efficient vehicle. Makes sense, the Jeep only gets about 17mph. I gave him an assignment. If gas is $4.00 a gallon and he uses 500 gallons of gas a year, tell me how much you'll save per year if you buy a car that gets double your current gas mileage. He did the math and came back to me and showed me what I already knew... it would take 6 years to break even if he bought the used car for $6,000 that he'd found. He never brought it back up again, and of course gasoline drifted back down to where his break even point would have been another couple of years.
Sorry for the rambling, but the bottom line is Do The Math and think things through. I didn't even touch on the fact that of course the gov't (taxpayers) are paying for this.
And the fact that these people buying new cars aren't able to go out to dinner, go to movies, spend in other ways for the next 4 or 5 years as they deal with new car payments and increased auto insurance.
I'll also be curious to see how many reposessions there will be in 6-12 months.
Saturday, August 8, 2009
What's Up?
The markets! And they are hanging up there very well. How much longer though? Maybe a day, a week or a month. How high? S&P 1050, 1100, 1150, 1200??? At 1000 right now after bottoming at 666 in March. Dow at about 9300 right now. 10,000 maybe?
In the upper left corner there is a search box. Put in "10,000" and click SEARCH BLOG and refresh your memory of things I was typing in late 2008 and early 2009 about the huge rally that would come once a bottom was hit.
Playing out exactly isn't it? Guess what... after a slight pullback soon there could be one more push up that will get us to the magical 10,000 on the Dow or 1100 on the S&P. Then that's it, we're done. The bigger and uglier wave down will begin.
I have an email drafted and ready to send to friends and family suggesting that if they held on through all of this that it's time to start scaling out. If they miss out on a 10% move up I aplogize, but it could save them from watching what they have left cut by 50%.
Fun with numbers:
Dow peaked at 14,165 October 2007
Dow bottomed at 6,450 March 2009
Dow right now at 9,370 August 2009
Even after a 50% rally from the bottom, it's still 35% below it's peak. Almost 5,000 points down.
I'm sorry to say that my overall prognostications so far have been correct. I'm much better at the big moves than the daily and weekly ones. But the bottom line is this. It is very conceivable that the Dow will be between 4,000 and 5,000 by the end of 2010. The best case scenario is that we'll just drift slowly down for a few years instead of straight down. I guess you could debate if that's better or not. Maybe ripping the bandaid off and being done with it all would be better.
I just ask that you keep an open mind. Don't listen to the cheerleaders on TV. They're the same ones that in 2008 said we wouldn't have a recession!!! The gov't didn't announce we were in a recession until December of 2008 and when they did finally acknowledge it, they said it had started in December of 2007!!!
Be prepared, be nimble, be defensive and cautious. I don't want to see you lose your hard earned savings. Yes, I could be wrong, I know that and I hope that I am in that I want the economy and country to thrive.
Nothing has been fixed. Everything has been smoke, mirrors and accounting rule changes. That's all. The banks have been getting free money and they've been playing the stock market with it! When that well runs dry there won't be anyone to prop up the markets.
Forclosures still climbing, unemployment still climbing, commercial real estate about to be the next shoe. Deflation or inflation? Or both eventually? Real estate pricing going to bounce back? You wish. I'm not trying to be a doomsayer, but think about things, look around... it isn't getting better. We have a lot of years of debt and waste to clean up. It's simply going to take time. The gov't printing money 24x7 isn't going to fix anything. Cash for Clunkers isn't going to fix anything (Hey, I know let's make it really enticing for people to take on more debt! Let's see how many reposessions there are in 6-12 months. Now that those people have car payments, guess what, they can't afford to stimulate the economy on a daily basis for the next 48-60 months.)
Watch, listen, learn.... be careful. Please.
In the upper left corner there is a search box. Put in "10,000" and click SEARCH BLOG and refresh your memory of things I was typing in late 2008 and early 2009 about the huge rally that would come once a bottom was hit.
Playing out exactly isn't it? Guess what... after a slight pullback soon there could be one more push up that will get us to the magical 10,000 on the Dow or 1100 on the S&P. Then that's it, we're done. The bigger and uglier wave down will begin.
I have an email drafted and ready to send to friends and family suggesting that if they held on through all of this that it's time to start scaling out. If they miss out on a 10% move up I aplogize, but it could save them from watching what they have left cut by 50%.
Fun with numbers:
Dow peaked at 14,165 October 2007
Dow bottomed at 6,450 March 2009
Dow right now at 9,370 August 2009
Even after a 50% rally from the bottom, it's still 35% below it's peak. Almost 5,000 points down.
I'm sorry to say that my overall prognostications so far have been correct. I'm much better at the big moves than the daily and weekly ones. But the bottom line is this. It is very conceivable that the Dow will be between 4,000 and 5,000 by the end of 2010. The best case scenario is that we'll just drift slowly down for a few years instead of straight down. I guess you could debate if that's better or not. Maybe ripping the bandaid off and being done with it all would be better.
I just ask that you keep an open mind. Don't listen to the cheerleaders on TV. They're the same ones that in 2008 said we wouldn't have a recession!!! The gov't didn't announce we were in a recession until December of 2008 and when they did finally acknowledge it, they said it had started in December of 2007!!!
Be prepared, be nimble, be defensive and cautious. I don't want to see you lose your hard earned savings. Yes, I could be wrong, I know that and I hope that I am in that I want the economy and country to thrive.
Nothing has been fixed. Everything has been smoke, mirrors and accounting rule changes. That's all. The banks have been getting free money and they've been playing the stock market with it! When that well runs dry there won't be anyone to prop up the markets.
Forclosures still climbing, unemployment still climbing, commercial real estate about to be the next shoe. Deflation or inflation? Or both eventually? Real estate pricing going to bounce back? You wish. I'm not trying to be a doomsayer, but think about things, look around... it isn't getting better. We have a lot of years of debt and waste to clean up. It's simply going to take time. The gov't printing money 24x7 isn't going to fix anything. Cash for Clunkers isn't going to fix anything (Hey, I know let's make it really enticing for people to take on more debt! Let's see how many reposessions there are in 6-12 months. Now that those people have car payments, guess what, they can't afford to stimulate the economy on a daily basis for the next 48-60 months.)
Watch, listen, learn.... be careful. Please.
Monday, August 3, 2009
August 3 - Tidbit of the Day
A good piece. Worded much better than my usual rants...
http://www.stocktiming.com/Monday-DailyMarketUpdate.htm
http://www.stocktiming.com/Monday-DailyMarketUpdate.htm
Saturday, August 1, 2009
August 1 - Tidbit of the Day
A good editorial from a doom and gloomer, but one that has been right for the past 2 years.
The best paragraph is:
The recently passed "cash for clunkers" program (currently on-hold, as it ran out of funding in one week) is a perfect example of how government policy can make the economy worse. By incentivizing Americans to destroy fully paid-for cars so they can go deeper into debt buying brand new ones, the government weakens an already crippled economy. The last thing we want to do is subsidize Americans to go deeper into debt by buying more stuff. Don't they realize that is precisely the behavior that got us into this mess?
http://www.321gold.com/editorials/schiff/schiff080109.html
The best paragraph is:
The recently passed "cash for clunkers" program (currently on-hold, as it ran out of funding in one week) is a perfect example of how government policy can make the economy worse. By incentivizing Americans to destroy fully paid-for cars so they can go deeper into debt buying brand new ones, the government weakens an already crippled economy. The last thing we want to do is subsidize Americans to go deeper into debt by buying more stuff. Don't they realize that is precisely the behavior that got us into this mess?
http://www.321gold.com/editorials/schiff/schiff080109.html
Wednesday, July 29, 2009
July 29 - Tidbit of the Day
A great short article. This is from one of the anchors on CNBC network. She wanted to refinance her home and guess what happened... not what you think....
Her last statement in the article is one to keep in mind when reading any news headlines.
http://www.cnbc.com/id/32194655
Her last statement in the article is one to keep in mind when reading any news headlines.
http://www.cnbc.com/id/32194655
Monday, July 27, 2009
Back To Reality
After a two week vacation, it's back to reality... workin' for "the man"...
I blame my parents for the fact that I have to work for a living. If they'd seen to it that I was independently wealthy I wouldn't have to endure this.
:-)
Anyway, the markets have been rallying hard. Look back at what I was posting last winter as we were nosediving. I said that once we hit bottom that a 50% rip roaring, rip your face off rally would ensue as everyone screamed that the worst was over. I do wish I'd caught more of the rally but it caught me off guard and early on I thought it was yet another fake out. But it was for real. Impressive.
And sure enough the talking heads are all claiming that all is right with the world again. Don't believe it. Think about it... has anything been "fixed"? No. Smoke and mirrors and accounting rule changes simply give the illusion that things are better.
How high will unemployment get? (the REAL unemployment rate)
How high will the foreclosure rate get?
How stagnant will wages be?
How far in the hole will local and state gov'ts get?
I wish that everything was rosey and that we, as a country, would simply snap right back to where we were. Well not really. We'd gotten out of control with spending and this is the payback. Time to get back to reality.
Here is a good read. Easier to read in FULL SCREEN mode. Just some things to keep in mind and look at before falling for the "All is fine" mantra being chanted everywhere.
http://www.scribd.com/doc/17702821/The-End-of-the-End-of-the-Recession
A couple of quick notes about the vacation... 1600 miles driven from Seattle to San Diego was fantastic and beautiful. The top 3 highlights of the trip were Alcatraz, Redwood National Forest and San Diego.
I do look forward to a lazy week at the beach next summer.
I blame my parents for the fact that I have to work for a living. If they'd seen to it that I was independently wealthy I wouldn't have to endure this.
:-)
Anyway, the markets have been rallying hard. Look back at what I was posting last winter as we were nosediving. I said that once we hit bottom that a 50% rip roaring, rip your face off rally would ensue as everyone screamed that the worst was over. I do wish I'd caught more of the rally but it caught me off guard and early on I thought it was yet another fake out. But it was for real. Impressive.
And sure enough the talking heads are all claiming that all is right with the world again. Don't believe it. Think about it... has anything been "fixed"? No. Smoke and mirrors and accounting rule changes simply give the illusion that things are better.
How high will unemployment get? (the REAL unemployment rate)
How high will the foreclosure rate get?
How stagnant will wages be?
How far in the hole will local and state gov'ts get?
I wish that everything was rosey and that we, as a country, would simply snap right back to where we were. Well not really. We'd gotten out of control with spending and this is the payback. Time to get back to reality.
Here is a good read. Easier to read in FULL SCREEN mode. Just some things to keep in mind and look at before falling for the "All is fine" mantra being chanted everywhere.
http://www.scribd.com/doc/17702821/The-End-of-the-End-of-the-Recession
A couple of quick notes about the vacation... 1600 miles driven from Seattle to San Diego was fantastic and beautiful. The top 3 highlights of the trip were Alcatraz, Redwood National Forest and San Diego.
I do look forward to a lazy week at the beach next summer.
Thursday, July 9, 2009
July 9 - Tidbit of the Day
A bit of a rant but the numbers he quotes are eye opening.
http://thehousingtimebomb.blogspot.com/2009/07/its-all-about-housing.html
http://thehousingtimebomb.blogspot.com/2009/07/its-all-about-housing.html
Wednesday, July 8, 2009
July 8 - Tidbit of the Day
A must read and must watch video.... please watch this....
http://www.cnbc.com/id/31775633/site/14081545
http://www.cnbc.com/id/31775633/site/14081545
Tuesday, July 7, 2009
It's Vacation Time!!!
After a 5 year delay, our west coast trip is almost upon us. Flying to Seattle and with multi-night stays in Seattle, San Fran and San Diego we'll be working our way down the coastline during a 13 day trip. We can't wait.
So, where are we as far as the stock market? In no-mans land, that's where. Basically the market has gone nowhere in 2 months.
On May 5th, the S&P closed at 903. Yesterday it closed at 898. In between we peaked at 956, so it's been an up and down ride.
The big question though is, where to from here? And surprise, there are two possibilities. Up or down. No shit, right?
Quarterly corporate results will start coming out soon. But nobody knows what to expect. Will the banks continue with the smoke and mirrors making their balance sheets look better or reality settle in? Reality being that things ain't gettin' no better.
The charts are just as confused. You can look at them one way and see that we're due for a major leg down from here since we've hit a major resistance line and would see new lows below 666. Or we could have one more impressive rally up 1000-1100 on the S&P before the major leg down below 666.
I'm actually favoring the scenario of one more leg up. Euphoria needs to set in before we plummet to the abyss. We're not there yet. A 20% rally from here would have 98% of the people dancing in the streets proclaiming the recession is over and things are back to normal.
I won't get into it again, but we're far from back to normal. There is still a lot of unwinding to do and a lot of fixing to be done.
So, as I head off on vacation I'll be looking to see if I should move the retirement money in for a final move up. Otherwise I'll just keep watching from the sidelines.
If there's any fun in the markets, I'll post during the trip.
============
Here's a quickie from a blog I follow...
David Rosenberg has been on Squawk Box for the past hour.
He has been dropping the unvarnished Truth on the kids, powering through a basic set of reality regardless of dropped jaws and stunned silence.
None of the things he is discussing is at all radical. Its simply clear-eyed, straight forward, reality based analysis. No hope, no cheerleading, no bull. Its like a bucket of cold water versus the feel good warm fuzzies the long-only, fully invested crowd (aka, the pompom squad) that typically comes on TV to talk their books.
• Green Shoots was unsubstantiated nonsense;
• Unemployment Rate will rise considerably higher; this will be the “mother of all jobless recoveries.”
• The rise from the 666 lows was the mother of all oversold bounces due to multiple expansion, not profit gains;
• The S&P500 is likely to have earnings of a modest $50 over the next 4 quarters;
• Unemployment is usually a lagging indicator when we are dealing with an inventory or manufacturing recession; During a credit crisis recession, Unemployment is a coincident indicator cycling back into the economy in a negative way;
• We are going through a massive consumer deleveraging
• The Consumer is not going to save the economy anytime soon.
So, where are we as far as the stock market? In no-mans land, that's where. Basically the market has gone nowhere in 2 months.
On May 5th, the S&P closed at 903. Yesterday it closed at 898. In between we peaked at 956, so it's been an up and down ride.
The big question though is, where to from here? And surprise, there are two possibilities. Up or down. No shit, right?
Quarterly corporate results will start coming out soon. But nobody knows what to expect. Will the banks continue with the smoke and mirrors making their balance sheets look better or reality settle in? Reality being that things ain't gettin' no better.
The charts are just as confused. You can look at them one way and see that we're due for a major leg down from here since we've hit a major resistance line and would see new lows below 666. Or we could have one more impressive rally up 1000-1100 on the S&P before the major leg down below 666.
I'm actually favoring the scenario of one more leg up. Euphoria needs to set in before we plummet to the abyss. We're not there yet. A 20% rally from here would have 98% of the people dancing in the streets proclaiming the recession is over and things are back to normal.
I won't get into it again, but we're far from back to normal. There is still a lot of unwinding to do and a lot of fixing to be done.
So, as I head off on vacation I'll be looking to see if I should move the retirement money in for a final move up. Otherwise I'll just keep watching from the sidelines.
If there's any fun in the markets, I'll post during the trip.
============
Here's a quickie from a blog I follow...
David Rosenberg has been on Squawk Box for the past hour.
He has been dropping the unvarnished Truth on the kids, powering through a basic set of reality regardless of dropped jaws and stunned silence.
None of the things he is discussing is at all radical. Its simply clear-eyed, straight forward, reality based analysis. No hope, no cheerleading, no bull. Its like a bucket of cold water versus the feel good warm fuzzies the long-only, fully invested crowd (aka, the pompom squad) that typically comes on TV to talk their books.
• Green Shoots was unsubstantiated nonsense;
• Unemployment Rate will rise considerably higher; this will be the “mother of all jobless recoveries.”
• The rise from the 666 lows was the mother of all oversold bounces due to multiple expansion, not profit gains;
• The S&P500 is likely to have earnings of a modest $50 over the next 4 quarters;
• Unemployment is usually a lagging indicator when we are dealing with an inventory or manufacturing recession; During a credit crisis recession, Unemployment is a coincident indicator cycling back into the economy in a negative way;
• We are going through a massive consumer deleveraging
• The Consumer is not going to save the economy anytime soon.
Thursday, July 2, 2009
July 2 - Tidbit of the Day
Here you go folks, all sorts of charts. More than you'd ever care to see. This should keep you busy over the holiday weekend.
http://www.cnbc.com/id/31524954
http://www.cnbc.com/id/31524954
Wednesday, July 1, 2009
July 1 - Tidbit of the Day
Happy Half New Year! Here we go... how's this... All I can say is HOLY CRAP!
http://www.cnbc.com/id/31685244
This is insane....
http://www.cnbc.com/id/31685244
This is insane....
Monday, June 29, 2009
June 29 - Tidbit of the Day
Even Bloomberg is worried... Not just the many blogs that I read.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aaeSiksLwotY
http://www.bloomberg.com/apps/news?pid=20601087&sid=aaeSiksLwotY
Thursday, June 25, 2009
June 25 - Tidbit of the Day
Hell of an article about Goldman Sachs and manipulation. The latest rage right now for the conspiracy theorists is that Goldman Sachs is the devils workshop. There is some truth to it but I try to keep it in perspective. This article though provides some interesting info.
When you go to the link, the article is easier to read if you make it full sized. See the toolbar just above the article itself? All the way to the right along the line where the page number is there is a symbol that if you click it will make it full screen.
http://www.scribd.com/doc/16752803/The-Great-American-Bubble-Machine
When you go to the link, the article is easier to read if you make it full sized. See the toolbar just above the article itself? All the way to the right along the line where the page number is there is a symbol that if you click it will make it full screen.
http://www.scribd.com/doc/16752803/The-Great-American-Bubble-Machine
Wednesday, June 24, 2009
June 24 - Tidbit of the Day
This is why you need to go beyond the news headlines and dig into the actual information in order to get past the "spin".
http://theautomaticearth.blogspot.com/2009/06/june-23-2009-church-attendance-soars.html
http://theautomaticearth.blogspot.com/2009/06/june-23-2009-church-attendance-soars.html
Monday, June 22, 2009
June 22 - Tidbit of the Day - Article and Video
Worth reading and watching. A guy with a well established track record.
http://finance.yahoo.com/techticker/article/267617/He-Called-the-2007-Top-and-Recent-Rally,-Now-Charles-Nenner-Sees-Trouble-Ahead-for-Stocks;_ylt=ArrAkrKqyqvcfZGN.grkcaexcq9_
http://finance.yahoo.com/techticker/article/267617/He-Called-the-2007-Top-and-Recent-Rally,-Now-Charles-Nenner-Sees-Trouble-Ahead-for-Stocks;_ylt=ArrAkrKqyqvcfZGN.grkcaexcq9_
June 22 - Tidbit of the Day
A tiny tidbit today. This from a post on a message board that I frequent. These are the types of games that are played and 99% of people have no idea. This rally we've been enjoying the past 3 months was manufactured, pure and simple. Whether the following describes what actually is happening this time or not is up for debate.
It's a fact that institutions have not been buying and that insiders of companies are actually selling at these levels. Even those within the companies know that the current stock prices can't be maintained and are selling.
As always, be aware of what's going on.
===
In his book “Reminiscences of a Stock Operator” Jesse Livermore describes the process that large institutions sell large quantities of stock. It is the exact process you describe above. Basically small investors love to buy “bargains”, buy the dips. So the large institutions actually buy the stock to raise prices then let the prices fall. This action gets the buy the dips crowd working and the large institutions sell into this. Once the finish selling, and the buy the dips crowd realizes their strategy no longer works they race for the exits and sell the stock back to the larger institutions at much lower prices. This game has been going on for as long as stocks have been traded.
It's a fact that institutions have not been buying and that insiders of companies are actually selling at these levels. Even those within the companies know that the current stock prices can't be maintained and are selling.
As always, be aware of what's going on.
===
In his book “Reminiscences of a Stock Operator” Jesse Livermore describes the process that large institutions sell large quantities of stock. It is the exact process you describe above. Basically small investors love to buy “bargains”, buy the dips. So the large institutions actually buy the stock to raise prices then let the prices fall. This action gets the buy the dips crowd working and the large institutions sell into this. Once the finish selling, and the buy the dips crowd realizes their strategy no longer works they race for the exits and sell the stock back to the larger institutions at much lower prices. This game has been going on for as long as stocks have been traded.
Sunday, June 21, 2009
June 21 - Tidbit of the Day
This is a good article discussing money supply. Puts it into terms even I could follow... for the most part.
http://www.webofdebt.com/articles/quantitative_easing.php
http://www.webofdebt.com/articles/quantitative_easing.php
Saturday, June 20, 2009
June 20 - Tidbit of the Day - Bonus
Came across this in my Saturday evening reading.
http://goldversuspaper.blogspot.com/2009/06/bear-market-targets.html
http://goldversuspaper.blogspot.com/2009/06/bear-market-targets.html
June 20 - Tidbit of the Day
A quick hit article on CNBC... kind of shocking it's on CNBC actually in that they're generally just cheerleaders.
http://www.cnbc.com/id/31446671
http://www.cnbc.com/id/31446671
Thursday, June 18, 2009
June 18 - Tidbit of the Day
Take it for what it's worth. But it's kind of nice to get a press release before the next big crash. ;-)
In all seriousness... it's coming. Whether it started last week with the peak of the S&P at 960 or in another week or two with one last rally attempt to 975... it's going to happen.
I've spoken about it before. I talked about the bottom around 650 followed by a 50% rip your face off rally... now it's time for the next wave.
The rip your face off rally caught me completely off guard though because it was straight up and I missed a big chunk of it, but I didn't chase it. I'll wait for it to come back to me.
Please folks... watch things closely and be willing to get out with what you have left if you stayed in this whole time. S&P peaked at 1575 in 2007 and it's heading to 500 or below. That's around a 70% decline, or more. If you get out now with the S&P in the 900 range at least you won't watch your savings cut in half again. If these forecasts are wrong, you'll miss out on a 10% rise. Risk versus reward? Be nimble. Be aware.
This bear market rally was nothing more than a way for banks in particular to recapitalize themselves by selling shares at higher prices only to let things tumble once again. Remember, nothing has changed since last fall. Nothing has been fixed. The accounting rules were changed to make things look better on the balance sheets. That's it. Trillions of dollars thrown at this to keep things afloat, but nothing actually FIXED. Same problems exist.
Rising unemployment means rising foreclosures, means surplus of inventory, means lower prices. Higher interest rates also means lower home prices. All of this hits the people that are able to keep their homes. No home equity available, unable to sell if underwater... We have a long stretch ahead of us that will be unpleasant.
Unemployment and housing aren't the only things obviously. There's commercial real estate, deflation or hyper inflation and a whole host of other pieces to the economy. I'm simple minded so I keep it to just a few things that I can understand.
This is the longest post I've made in a while. Don't take my word for it of course. Read the real news, not the manufactured "green shoots" and cheerleader news.
The article below is not meant to be taken as gospel. It's of course just one opinion. But it's one shared by many that I follow. This is the boldest prediction I've seen though in the way it was announced. I'm taking it with a grain of salt but I do know the peak of this fake out rally is near if not already hit two weeks ago.
The second link below is a chart posted in late February showing what the overall wave structure could look like. A little eerie in that he pegged the 950 range for this rally along with the approximate timeframe even though he admittedly was just drawing rough lines. He admits it isn't to scale per se, but pretty damn good so far. He targets S&P at 300 for the upcoming P3 wave. Again, no guarantees, but worth realizing as a possibility.
http://www.prweb.com/releases/2009/06/prweb2537224.htm
https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhNNsQutuYl0ACywSVSrH7oDIdTu9r8Ax18DOsEdHl9JYxPdHGste0pbQ4wviY91RCYPOcVzbsoO1Dy1XH5BDVSKVgj3iMTDq2UtaM3X71EJ1zk-eDNNgNleX3nmsA_uBxbZTOdNlYCXmuh/s1600-h/spxweek.png
In all seriousness... it's coming. Whether it started last week with the peak of the S&P at 960 or in another week or two with one last rally attempt to 975... it's going to happen.
I've spoken about it before. I talked about the bottom around 650 followed by a 50% rip your face off rally... now it's time for the next wave.
The rip your face off rally caught me completely off guard though because it was straight up and I missed a big chunk of it, but I didn't chase it. I'll wait for it to come back to me.
Please folks... watch things closely and be willing to get out with what you have left if you stayed in this whole time. S&P peaked at 1575 in 2007 and it's heading to 500 or below. That's around a 70% decline, or more. If you get out now with the S&P in the 900 range at least you won't watch your savings cut in half again. If these forecasts are wrong, you'll miss out on a 10% rise. Risk versus reward? Be nimble. Be aware.
This bear market rally was nothing more than a way for banks in particular to recapitalize themselves by selling shares at higher prices only to let things tumble once again. Remember, nothing has changed since last fall. Nothing has been fixed. The accounting rules were changed to make things look better on the balance sheets. That's it. Trillions of dollars thrown at this to keep things afloat, but nothing actually FIXED. Same problems exist.
Rising unemployment means rising foreclosures, means surplus of inventory, means lower prices. Higher interest rates also means lower home prices. All of this hits the people that are able to keep their homes. No home equity available, unable to sell if underwater... We have a long stretch ahead of us that will be unpleasant.
Unemployment and housing aren't the only things obviously. There's commercial real estate, deflation or hyper inflation and a whole host of other pieces to the economy. I'm simple minded so I keep it to just a few things that I can understand.
This is the longest post I've made in a while. Don't take my word for it of course. Read the real news, not the manufactured "green shoots" and cheerleader news.
The article below is not meant to be taken as gospel. It's of course just one opinion. But it's one shared by many that I follow. This is the boldest prediction I've seen though in the way it was announced. I'm taking it with a grain of salt but I do know the peak of this fake out rally is near if not already hit two weeks ago.
The second link below is a chart posted in late February showing what the overall wave structure could look like. A little eerie in that he pegged the 950 range for this rally along with the approximate timeframe even though he admittedly was just drawing rough lines. He admits it isn't to scale per se, but pretty damn good so far. He targets S&P at 300 for the upcoming P3 wave. Again, no guarantees, but worth realizing as a possibility.
http://www.prweb.com/releases/2009/06/prweb2537224.htm
https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhNNsQutuYl0ACywSVSrH7oDIdTu9r8Ax18DOsEdHl9JYxPdHGste0pbQ4wviY91RCYPOcVzbsoO1Dy1XH5BDVSKVgj3iMTDq2UtaM3X71EJ1zk-eDNNgNleX3nmsA_uBxbZTOdNlYCXmuh/s1600-h/spxweek.png
Monday, June 15, 2009
June 15 - Tidbit of the Day
Two tidbits for today. One is a video that is fantastic.
I hope everyone has noticed, I don't focus on politics, politicians, etc. So anything I post that may slam a particular agenda isn't an attack on the party that is behind it, but is an attack on the agenda item itself. Both parties have and will continue to screw things up in their own ways. :-)
http://shankystechblog.blogspot.com/2009/06/put-it-in-perspective.html
http://market-ticker.org/archives/1122-Proud-To-Be-American-You-Should-Be-Ashamed.html
I hope everyone has noticed, I don't focus on politics, politicians, etc. So anything I post that may slam a particular agenda isn't an attack on the party that is behind it, but is an attack on the agenda item itself. Both parties have and will continue to screw things up in their own ways. :-)
http://shankystechblog.blogspot.com/2009/06/put-it-in-perspective.html
http://market-ticker.org/archives/1122-Proud-To-Be-American-You-Should-Be-Ashamed.html
Thursday, June 11, 2009
Tuesday, June 9, 2009
June 9 - Tidbit of the Day
I can't help but point this out... In a post I made on December 14th, I said:
"I have come up with a couple of careers that should do well over the next couple of years or more... Insurance fraud investigator because as people become desperate, they'll either lie about items being stolen or when they can't make payments on their vehicles, they'll mysteriously disappear. The other career I see as being strong is auto mechanic. People are going to hang on to their cars longer than they used to and repairs will be inevitable."
And here's an article I read today...
http://www.financialarmageddon.com/2009/06/changing-times-different-choices.html
"I have come up with a couple of careers that should do well over the next couple of years or more... Insurance fraud investigator because as people become desperate, they'll either lie about items being stolen or when they can't make payments on their vehicles, they'll mysteriously disappear. The other career I see as being strong is auto mechanic. People are going to hang on to their cars longer than they used to and repairs will be inevitable."
And here's an article I read today...
http://www.financialarmageddon.com/2009/06/changing-times-different-choices.html
Monday, June 8, 2009
Sunday, June 7, 2009
June 7 - Tidbit of the Day
More on the housing issue. It's a major thing in my mind. As unemployment continues to worsen, more defaults and bankruptcies to come. As interest rates rise on all of those ARM loans still out there, more defaults and bankruptcies.
Personally I believe that housing prices have a lot further to go on the downside. As interest rates increase, prices decline. That's the give and take. Always has been. The Fed hasn't been able to keep the long term rates down as they'd hoped. A spike in the past month is just the beginning. Also, as more and more people get behind in their payments, foreclosures, etc, the market is going to remain flooded with houses for sale.
http://www.businessinsider.com/henry-blodget-the-five-waves-of-the-housing-collapse-2009-6
Personally I believe that housing prices have a lot further to go on the downside. As interest rates increase, prices decline. That's the give and take. Always has been. The Fed hasn't been able to keep the long term rates down as they'd hoped. A spike in the past month is just the beginning. Also, as more and more people get behind in their payments, foreclosures, etc, the market is going to remain flooded with houses for sale.
http://www.businessinsider.com/henry-blodget-the-five-waves-of-the-housing-collapse-2009-6
Saturday, June 6, 2009
June 6 - Tidbit of the Day
Glance to the left and you'll see that I added two blogs to my blog listing. They are Zero Hedge and The Automatic Earth. My two favorite bloggers to read each evening.
======================
And today we read about false bottoms in the real estate market.
Note: MSA = Metropolitan Statistical Area (I had to google it to find out what it was an acronym for)
http://www.fieldcheckgroup.com/2009/06/04/6-5-beware-real-estate-false-bottoms/
======================
And today we read about false bottoms in the real estate market.
Note: MSA = Metropolitan Statistical Area (I had to google it to find out what it was an acronym for)
http://www.fieldcheckgroup.com/2009/06/04/6-5-beware-real-estate-false-bottoms/
Thursday, June 4, 2009
Wednesday, June 3, 2009
June 3 - Tidbit of the Day
http://www.financialsense.com/editorials/casey/2009/0528.html
A very good article about the alt-prime versus prime mortgage loan issues. Past and future.
A very good article about the alt-prime versus prime mortgage loan issues. Past and future.
Friday, May 29, 2009
May 29 - Tidbit of the Day
The housing hurricane... we're through the eye now...
http://online.barrons.com/article/SB124303112018248371.html
http://online.barrons.com/article/SB124303112018248371.html
Monday, May 25, 2009
May 25 - Tidbit Of The Day
And today finds us discussing the correlation between unemployment rising and foreclosures rising.... common sense, right? Yet supposedly real estate has hit a bottom if you listen to the talking heads.
http://www.ritholtz.com/blog/2009/05/job-losses-foreclosures/
http://www.cnbc.com/id/30929084
Two, two, two articles today.
http://www.ritholtz.com/blog/2009/05/job-losses-foreclosures/
http://www.cnbc.com/id/30929084
Two, two, two articles today.
Sunday, May 24, 2009
Where To From Here Uncle Iggy?
Gather 'round boys and girls and let Uncle Iggy tell you a tale...
There once was a thriving economy, booming in fact. For about a quarter century all was well. Sure there were a couple of hiccups here and there. After the turn of the century there was a downturn that worried many, but alas Americans bounced right back as usual. Another meteoric rise came and the stock market matched it's previous peak in 2007. What had gotten us to that point however is being proven to be smoke and mirrors. Banks (and individuals) over leveraged themselves by borrowing too much and expecting the good times to continue to roll forever.
We all know what happened beginning in late 2007 until March of 2009. Since that lowest of lows in March we've heard the term "green shoots" and other euphamisms to sound the alarm that the good times are coming back.
Folks, think... how can we get back to where we were if unemployment has almost doubled, there are 19 million empty houses out there and those that still have a job and a house are finally starting to pay off debt and actually add to savings?
Sure, America will claw it's way back... eventually. We're in for a few years of wild swings and overall flatness in the markets though. We saw a very serious low hit in March. We'll see a nice bounce, such as we've seen the past 2 months. An even more impressive bounce is even possible as hope springs eternal.
But... where to from here? There are two options. Up or down. Helpful huh?
Well we're due for a pullback. The question is how much? S&P at 887 right now after peaking at 930 a couple of weeks ago. 5% retracement so far. A pullback to the 800-830 range would actually be healthy for the markets and could stimulate another rally. S&P to 1100 (give or take 100 points) is an ultimate target for the current wave we're in.
But... only the market knows what it wants to do and it never tells us in advance.
I'm leaning towards my scenario above with about an 80% probability based my crystal ball guesstimate. The other 20% is clinging to the thought that we may get close to or exceed the lows we set in March (S&P 666) over the course of the next month or two..
My retirement is sitting and waiting. It's getting bored. It's angry that it missed out on a chunk of the recent rally but it's trying to be patient. It's also being cautious...
No matter what the short term does, new lows are coming. I can and will state that with total conviction. 2010 or 2011 will be very unpleasant.
A starting point of a list of things that will cause the next leg down:
1) Residential real estate (yes, it'll continue to decline in price)
2) Commercial real estate (just beginning to be a major issue)
3) City, county, state entities (tax revenues way down)
4) Unemployment, no quick turn around
5) Pension funds getting hammered, thereby affecting retirement
6) Banks far from healthy
7) Inflation... potentially massive inflation (in a couple of years)
There once was a thriving economy, booming in fact. For about a quarter century all was well. Sure there were a couple of hiccups here and there. After the turn of the century there was a downturn that worried many, but alas Americans bounced right back as usual. Another meteoric rise came and the stock market matched it's previous peak in 2007. What had gotten us to that point however is being proven to be smoke and mirrors. Banks (and individuals) over leveraged themselves by borrowing too much and expecting the good times to continue to roll forever.
We all know what happened beginning in late 2007 until March of 2009. Since that lowest of lows in March we've heard the term "green shoots" and other euphamisms to sound the alarm that the good times are coming back.
Folks, think... how can we get back to where we were if unemployment has almost doubled, there are 19 million empty houses out there and those that still have a job and a house are finally starting to pay off debt and actually add to savings?
Sure, America will claw it's way back... eventually. We're in for a few years of wild swings and overall flatness in the markets though. We saw a very serious low hit in March. We'll see a nice bounce, such as we've seen the past 2 months. An even more impressive bounce is even possible as hope springs eternal.
But... where to from here? There are two options. Up or down. Helpful huh?
Well we're due for a pullback. The question is how much? S&P at 887 right now after peaking at 930 a couple of weeks ago. 5% retracement so far. A pullback to the 800-830 range would actually be healthy for the markets and could stimulate another rally. S&P to 1100 (give or take 100 points) is an ultimate target for the current wave we're in.
But... only the market knows what it wants to do and it never tells us in advance.
I'm leaning towards my scenario above with about an 80% probability based my crystal ball guesstimate. The other 20% is clinging to the thought that we may get close to or exceed the lows we set in March (S&P 666) over the course of the next month or two..
My retirement is sitting and waiting. It's getting bored. It's angry that it missed out on a chunk of the recent rally but it's trying to be patient. It's also being cautious...
No matter what the short term does, new lows are coming. I can and will state that with total conviction. 2010 or 2011 will be very unpleasant.
A starting point of a list of things that will cause the next leg down:
1) Residential real estate (yes, it'll continue to decline in price)
2) Commercial real estate (just beginning to be a major issue)
3) City, county, state entities (tax revenues way down)
4) Unemployment, no quick turn around
5) Pension funds getting hammered, thereby affecting retirement
6) Banks far from healthy
7) Inflation... potentially massive inflation (in a couple of years)
Thursday, May 21, 2009
May 21 - Tidbit of the Day
Today's cheery words are about what the Fed is doing and the possible effects.
http://thehousingtimebomb.blogspot.com/2009/05/feds-fiasco.html
http://thehousingtimebomb.blogspot.com/2009/05/feds-fiasco.html
Eye Of The Storm
And no I'm not talking about the Carolina Hurricanes... however... cheer 'em on!
This is how I've been describing this economic storm to people. The initial bands of rain and wind have hit us hard and we are in the direct path of the storm. It just so happens that the eye of the storm is over us now. Calm winds, blue sky. It appears everything is over... but...
http://www.cnbc.com/id/30847981
This is how I've been describing this economic storm to people. The initial bands of rain and wind have hit us hard and we are in the direct path of the storm. It just so happens that the eye of the storm is over us now. Calm winds, blue sky. It appears everything is over... but...
http://www.cnbc.com/id/30847981
Wednesday, May 20, 2009
We've Seen The Bottom?
If you start to think that we've seen the bottom based on the 37% rally from the bottom in March, take a look at this chart. It shows the decline during the 1930's. Note the size of the rallies that occured repeatedly.
http://content.screencast.com/users/Powerpak59/folders/Jing/media/066ab672-cf8c-424c-ae41-e728bd0752c9/2009-04-11_0807.png
http://content.screencast.com/users/Powerpak59/folders/Jing/media/066ab672-cf8c-424c-ae41-e728bd0752c9/2009-04-11_0807.png
May 20 - Tidbit of the day
http://www.businessinsider.com/david-rosenberg-the-short-covering-rally-is-finished-here-comes-the-leg-down-2009-5
Key paragraph in the article:
The fact that the best performing stocks were the ones with the lowest quality ratings and with the largest short interest says a lot about the nature of this rally as well — the 50 heaviest shorted stocks tripled the advance among the 50 least shorted stocks — that its sustainability is in doubt. In other words, this was a rally built largely on short covering, pension fund rebalancing and the emergence of hope wrapped up in ‘green shoot’ data points.
Key paragraph in the article:
The fact that the best performing stocks were the ones with the lowest quality ratings and with the largest short interest says a lot about the nature of this rally as well — the 50 heaviest shorted stocks tripled the advance among the 50 least shorted stocks — that its sustainability is in doubt. In other words, this was a rally built largely on short covering, pension fund rebalancing and the emergence of hope wrapped up in ‘green shoot’ data points.
Tuesday, May 19, 2009
May 19 - Tidbit Of The Day
I'm going to start posting news stories, blog posts or other tidbits of information I come across that I find to be of interest. I'll only post the best of the best.
Here it is for today:
http://globaleconomicanalysis.blogspot.com/2009/05/effect-of-household-deleveraging-on.html
Here it is for today:
http://globaleconomicanalysis.blogspot.com/2009/05/effect-of-household-deleveraging-on.html
Sunday, May 10, 2009
La la la - Typing To Myself
I haven't bothered with an update lately because best as I can figure, I'm the only one reading what I type. :-)
Anyway... the good news is my overall call of the S&P going to 650 (it hit 666) and subsequent move up to 1000 (at 930 right now) was absolutely right. The bad news is it didn't happen as I had pictured, therefore I missed a good chunk of the move. I NEVER expect a straight line up without a decent pullback. It's been crazy. Truly insane based on normal behavior of the market.
What's next? Damned if I know. I'm still sitting on the sidelines. I don't dare get back in at this point. This rally had no basis. Purely a "hope" rally. Hope that things are bottoming, hope that things are turning around in the economy. Grasping at straws is more like it in my opinion. The bank stress tests were rigged. News this weekend states that the banks "negotiated" with the fed to lower what was expected of them by half, or more. Unemployment news was good?!?!?!? "Only" 540,000 jobs lost in April? Well if you ignore the fact that Feb and Mar numbers were revised worse, sure it could be construed that way. Wait til next month when the April numbers are revised worse.
I'm fine just waiting. Sure, I wish I'd caught more of the 30% rally with the retirement money, but I know, without a doubt that we're far from being done with all of this. I'll have my chances in the future.
Have a good day Scott. Thanks Scott, you too.
Anyway... the good news is my overall call of the S&P going to 650 (it hit 666) and subsequent move up to 1000 (at 930 right now) was absolutely right. The bad news is it didn't happen as I had pictured, therefore I missed a good chunk of the move. I NEVER expect a straight line up without a decent pullback. It's been crazy. Truly insane based on normal behavior of the market.
What's next? Damned if I know. I'm still sitting on the sidelines. I don't dare get back in at this point. This rally had no basis. Purely a "hope" rally. Hope that things are bottoming, hope that things are turning around in the economy. Grasping at straws is more like it in my opinion. The bank stress tests were rigged. News this weekend states that the banks "negotiated" with the fed to lower what was expected of them by half, or more. Unemployment news was good?!?!?!? "Only" 540,000 jobs lost in April? Well if you ignore the fact that Feb and Mar numbers were revised worse, sure it could be construed that way. Wait til next month when the April numbers are revised worse.
I'm fine just waiting. Sure, I wish I'd caught more of the 30% rally with the retirement money, but I know, without a doubt that we're far from being done with all of this. I'll have my chances in the future.
Have a good day Scott. Thanks Scott, you too.
Wednesday, April 22, 2009
And Away We Go
Off to the races. Yesterday was an up day after the big down day on Monday (two steps forward, one step back) as we head downward. Today had both. We started out down, raced upwards and then came falling down late in the day. We've had a successful retest of the upward channel that the markets were riding on the way up.
Next week we'll be seeing the S&P back below 800 again if all goes according to plan. I'm short and hope to hold on for the full move without chickening out. Even though I have target prices I worry about any changes in trend and tend to sell early.
We still have a lot of quarterly earnings to go. Just a matter of which ones are nothing but smoke and mirrors. The outlooks for future quarters aren't looking very good so far for the companies that have reported so far.
Watch the banks. That's what I'm short (a 3x bear fund named FAZ).
And how about them 'Canes!!! A big win with 2 tenths of a second left in regulation. Incredible.
Next week we'll be seeing the S&P back below 800 again if all goes according to plan. I'm short and hope to hold on for the full move without chickening out. Even though I have target prices I worry about any changes in trend and tend to sell early.
We still have a lot of quarterly earnings to go. Just a matter of which ones are nothing but smoke and mirrors. The outlooks for future quarters aren't looking very good so far for the companies that have reported so far.
Watch the banks. That's what I'm short (a 3x bear fund named FAZ).
And how about them 'Canes!!! A big win with 2 tenths of a second left in regulation. Incredible.
Monday, April 20, 2009
It's About Time
Everything is still right on track. The peak I called for at 850 was exceeded by 3%. I can live with that. Today was the first substantial pullback in quite a while. A big 4% down day on the S&P.
My target of 750-770 appears to be right on. The only question is how long it'll take to get there. The usual 2 steps forward (down), 1 step back (up) should take place.
I went short on Friday but when I saw the premarket trading so low I took my 8.5% profit and thought I did well. I missed out on an extra 22%. Amazing. I was in a 3x bear fund (FAZ) and it was up 30% today! That's ok, I'll get back in as soon as the market moves up a little.
Keep an eye on 768 as the magic point. If things feel right I'll put all of my retirement in around that point.
P.S. - The banks earnings that everyone was so excited about were all smoke and mirrors and in a quarter or two it's going to be shown just how horrible shape they're in.
By the way, after we hit 768 we'll resume the rally upwards and get to the 1000 level (remember 10,000 on the Dow is very possible and likely).
My target of 750-770 appears to be right on. The only question is how long it'll take to get there. The usual 2 steps forward (down), 1 step back (up) should take place.
I went short on Friday but when I saw the premarket trading so low I took my 8.5% profit and thought I did well. I missed out on an extra 22%. Amazing. I was in a 3x bear fund (FAZ) and it was up 30% today! That's ok, I'll get back in as soon as the market moves up a little.
Keep an eye on 768 as the magic point. If things feel right I'll put all of my retirement in around that point.
P.S. - The banks earnings that everyone was so excited about were all smoke and mirrors and in a quarter or two it's going to be shown just how horrible shape they're in.
By the way, after we hit 768 we'll resume the rally upwards and get to the 1000 level (remember 10,000 on the Dow is very possible and likely).
One Last Gasp... Maybe
850 was broken on the upside and we peaked at 875 late last week. I won't be surprised by one last gasp up to 881. If it happens, that's it for now... down we go. We could just head down from here. I'm not sure of a target. 810... 770... 750 are all in play.
It's so funny reading the CNBC.COM website on a daily basis. Headlines run the full spectrum "S&P headed to 1000"... "S&P to break down to 600". I'm glad they give equal time to the bulls and the bears, but all it does is confuse everyone. I try to focus on analysts that have been right in the recent past. Nobody is right all the time, but you kind of have to go with who has the hot hand. Knowing when to switch to someone that has what sounds like an outrageous call is hard to figure out. Roubini, Whitney, Schiff all sounded like crackpots in 2006/2007 when they were issuing warnings of what was coming. Now when do you listen to the hairbrained comments that the S&P will hit all time highs by the end of 2009 (yes, there was a guy on CNBC this morning that actually said that). That's why I'm becoming a pure technical analysis and pattern kind of guy. The charts will guide you.
Let's see what Wall Street wants to do with our money this week.
It's so funny reading the CNBC.COM website on a daily basis. Headlines run the full spectrum "S&P headed to 1000"... "S&P to break down to 600". I'm glad they give equal time to the bulls and the bears, but all it does is confuse everyone. I try to focus on analysts that have been right in the recent past. Nobody is right all the time, but you kind of have to go with who has the hot hand. Knowing when to switch to someone that has what sounds like an outrageous call is hard to figure out. Roubini, Whitney, Schiff all sounded like crackpots in 2006/2007 when they were issuing warnings of what was coming. Now when do you listen to the hairbrained comments that the S&P will hit all time highs by the end of 2009 (yes, there was a guy on CNBC this morning that actually said that). That's why I'm becoming a pure technical analysis and pattern kind of guy. The charts will guide you.
Let's see what Wall Street wants to do with our money this week.
Thursday, April 16, 2009
Interesting Pattern
I find this stuff interesting. I'm always looking for "patterns" and that's why I like the Elliott Wave Theory. This article is about a really long term pattern some guy figured out. This weekend lines up with one of his key dates. Again, it's just a curiosity for me and no telling what peaks this weekend, if anything... stock market, gold, other?.
http://www.moneyweek.com/news-and-charts/a-forecaster-you-cant-afford-to-ignore-14722.aspx
http://www.moneyweek.com/news-and-charts/a-forecaster-you-cant-afford-to-ignore-14722.aspx
Wednesday, April 15, 2009
Cold Hard Facts
The pain of the last 10 years spelled out.
http://www.bloomberg.com/apps/news?pid=20601213&sid=aSg6DWkihxUw&refer=home
http://www.bloomberg.com/apps/news?pid=20601213&sid=aSg6DWkihxUw&refer=home
Tuesday, April 14, 2009
Yep, Tuesday Downturn
Today was a good start on the move back down today. Goldman Sachs earnings looked good initially but the stock took a 10% haircut today for a couple of reasons. One of which was the 5 billion in new stock they were selling and the other was that in their earnings release there was an extra month (or a missing month) in there. They changed their calendar year and the month of December which was a huge loss somehow got lost in the shuffle and not included in their numbers. ALSO, in January and February they received huge payments from AIG for bad investments (AIG insured them). Unbelievable. Our tax dollars going to AIG in order to payoff Goldman who also received bailout money and Goldman tries to pass it off as "profit". Manipulation at its finest.
I won't be shocked by one more quick pop up but I don't think it'll actually happen. Intel released their numbers after the bell and are getting smacked down in afterhours trading.
770 is looking like a valid target. Two steps up, one step back. 666 - 864, 50% retrace is typical, would take us to 765.
Check out the new addition to the My Blogs list on the left. Robert Reich, the former Secretary of Labor has some very interesting things to say in his posts. Today he talks about Tim Geithner about to go back, hat in hand to Congress to ask for more TARP money... unbelievable.
We're still a long way from this entire mess being fixed and better. The rally we'll see that takes us to Dow 10,000 will be the last gasp of hope... and then reality will set in.
But we know what's going on and we will be prepared for it. Right? Right.
I won't be shocked by one more quick pop up but I don't think it'll actually happen. Intel released their numbers after the bell and are getting smacked down in afterhours trading.
770 is looking like a valid target. Two steps up, one step back. 666 - 864, 50% retrace is typical, would take us to 765.
Check out the new addition to the My Blogs list on the left. Robert Reich, the former Secretary of Labor has some very interesting things to say in his posts. Today he talks about Tim Geithner about to go back, hat in hand to Congress to ask for more TARP money... unbelievable.
We're still a long way from this entire mess being fixed and better. The rally we'll see that takes us to Dow 10,000 will be the last gasp of hope... and then reality will set in.
But we know what's going on and we will be prepared for it. Right? Right.
Monday, April 13, 2009
Turnaround Tuesday?
I hereby declare this rally temporarily over. My target of the 850 range has been hit, now it's time to backtrack a little bit. I'm sticking to my revised number of 770 as the target.
The talking heads have been having a field day the past 5 weeks proclaiming the recession and the depression over. We've had a nice 25% rally from the bottom. However, if you look back to October, November we had it happen once before and then we continued moving down. We've hit a very interesting resistence line and if we do start moving down it'll be interesting to see how far down we end up going.
I bought some short shares Thursday and today and I'm hoping for the pullback now. And if things look as I expect them to I'll be putting my retirement money in.
Have fun everyone.
The talking heads have been having a field day the past 5 weeks proclaiming the recession and the depression over. We've had a nice 25% rally from the bottom. However, if you look back to October, November we had it happen once before and then we continued moving down. We've hit a very interesting resistence line and if we do start moving down it'll be interesting to see how far down we end up going.
I bought some short shares Thursday and today and I'm hoping for the pullback now. And if things look as I expect them to I'll be putting my retirement money in.
Have fun everyone.
Wednesday, April 8, 2009
Getting Closer
Phase 2 of the Iggy call is getting close. One more little pop up and then the move down is how it appears to be playing out. Daneric and Kenny are calling for it now. If you can't trust Daneric and Kenny who can you trust? :-)
Really, the charts are playing out as planned. So don't be surprised by a move down soon. As it happens we'll see if the charts say we'll bounce back up or continue down.
Here's the article of the day. Roubini and Whitney mentioned. Two of the daredevils that predicted this mess before anyone else.
And an article about rising vacancies in retail space. Something I've mentioned as being a serious issue in the future.
And lastly... the fear of pension funds being in dismal shape.
http://www.reuters.com/article/ousiv/idUSTRE53706T20090408
http://www.bloomberg.com/apps/news?pid=20601087&sid=ag2nw7_BPdCI
http://www.ft.com/cms/s/0/e5558578-23d2-11de-996a-00144feabdc0.html
Really, the charts are playing out as planned. So don't be surprised by a move down soon. As it happens we'll see if the charts say we'll bounce back up or continue down.
Here's the article of the day. Roubini and Whitney mentioned. Two of the daredevils that predicted this mess before anyone else.
And an article about rising vacancies in retail space. Something I've mentioned as being a serious issue in the future.
And lastly... the fear of pension funds being in dismal shape.
http://www.reuters.com/article/ousiv/idUSTRE53706T20090408
http://www.bloomberg.com/apps/news?pid=20601087&sid=ag2nw7_BPdCI
http://www.ft.com/cms/s/0/e5558578-23d2-11de-996a-00144feabdc0.html
Tuesday, April 7, 2009
Up? Down? Flat line?
Wake me up when something happens. We hit the top area of my target. Could still see one last mini-spike to the 855 area of the S&P, but then we should roll over. Earnings season is starting and there's no telling what to expect. Sure, things will be bad, but everyone has known that. The question is, will it be far worse than expected?
There are still so many games being played particularly by the big banks that it's difficult to get a grasp of how things truly are. Don't be suprised if Citi and Bank of America report better than expected earnings but that's only because they received some huge payoffs from AIG. Yep, our tax money at work... bail out AIG so they can pay off their bad bets to the banks that are also receiving our money... it's ludicrous.
I'm in no rush to get back into the market. There is nothing enticing to me at this point. Is there anything as far as data that makes things look promising? Not yet. At least not to me. I may very well be a little late to the party, but I'd rather be late than early in this case. I'll be ready though and I look forward to it.
See ya at 750? Who knows. Could be 900.
I'm sticking to my prediction. 750-770 is the next level.
There are still so many games being played particularly by the big banks that it's difficult to get a grasp of how things truly are. Don't be suprised if Citi and Bank of America report better than expected earnings but that's only because they received some huge payoffs from AIG. Yep, our tax money at work... bail out AIG so they can pay off their bad bets to the banks that are also receiving our money... it's ludicrous.
I'm in no rush to get back into the market. There is nothing enticing to me at this point. Is there anything as far as data that makes things look promising? Not yet. At least not to me. I may very well be a little late to the party, but I'd rather be late than early in this case. I'll be ready though and I look forward to it.
See ya at 750? Who knows. Could be 900.
I'm sticking to my prediction. 750-770 is the next level.
Thursday, April 2, 2009
Iggy Call - Phase 1 Complete
Alright, my Iggy call was for the S&P to hit 835-850. It hit 845 today. Next stop is down if things go according to plan. I called for 710-730 but I think that's way too far now. With your permission I'd like to adjust that to 750-770. We moved too high, too fast for us to go back as far as I first thought.
We'll see if I get close. I'm hoping so, I want to get the big money back in and working for me.
It's been a wild ride this past month. Much sharper rally than I expected that's for sure. I hate that I missed half of it. But I'm happy being in the cautious camp. I don't want to get caught surprised on the downside.
Hopefully my next update will have us in the mid 700's.
We'll see if I get close. I'm hoping so, I want to get the big money back in and working for me.
It's been a wild ride this past month. Much sharper rally than I expected that's for sure. I hate that I missed half of it. But I'm happy being in the cautious camp. I don't want to get caught surprised on the downside.
Hopefully my next update will have us in the mid 700's.
Wednesday, April 1, 2009
Up, down and all Around
With end of month, end of quarter, mark to market, G20 summit, auto gyrations and a number of other events, the market has been jumping all over the place.
We ended March on a good note with an up month for the first time since August. Where to from here? I dunno.
My call the other day is still in play. We never made it up to 835 range, and we dropped to the 780's, but haven't hit either end of my spectrum. I'm sitting on the sidelines until something is definitive. I want some certainty before I get back in. If there's another leg down, fine, get to it already.
If we're heading up, fine, let's go.
Q1 earnings will be coming out soon and they won't be pretty. But has that been priced in already? We'll have to see how the market reacts. If there's bad news and we move up, we're ready to rally.
Wake me up when things start happening one way or the other.
We ended March on a good note with an up month for the first time since August. Where to from here? I dunno.
My call the other day is still in play. We never made it up to 835 range, and we dropped to the 780's, but haven't hit either end of my spectrum. I'm sitting on the sidelines until something is definitive. I want some certainty before I get back in. If there's another leg down, fine, get to it already.
If we're heading up, fine, let's go.
Q1 earnings will be coming out soon and they won't be pretty. But has that been priced in already? We'll have to see how the market reacts. If there's bad news and we move up, we're ready to rally.
Wake me up when things start happening one way or the other.
Saturday, March 28, 2009
Time for an Iggy Call
It's that time boys and girls... time for Iggy to make a prediction....
The markets have had 3 very good weeks in a row. Positive weeks which hasn't been seen in quite some time. The party is going to take a break though. Another up day Monday, possibly carrying into Tuesday, but end of month (also the end of the quarter) marks the end of the party for now. Keeping in line with the 2 steps forward 1 step back, it's time for the step back.
The S&P will peak around 835-850 and then approximately a 15% pullback that'll take a couple or few weeks to take place. That will take us back to around the 710-730 area (very approximate target). The drop will be enough to scare people into thinking we're headed to new lows, but it shouldn't actually happen.
Then we're off to the races. The "bull market" will begin. There will be dancing in the streets, cheerleaders on CNBC predicting the worst is over, the world is happy again. I know I keep repeating myself but please don't fall in love with it. It'll look wonderful, it'll feel great to get some of your money back. But we won't come close to where we were in October 2007.
Hope for the best but prepare for the worst is all I'm saying. Be prudent, be a bit skeptical, be nimble, pay attention to the data, not the cheerleaders. By playing it safe and smart from here on, you can be ahead of the game.
When I say pay attention to the data, I mean read the news. The real news, not the cheerleading news. Here is an example. Sure, some things are speculation, but once you find some sources of information that have been proven accurate (such as Meredith Whitney), listen to what they have to say and make your own assessments.
http://seekingalpha.com/article/127937-credit-card-crunch-creating-a-new-generation-of-subprime
And lastly, a chart of the "Four Bad Bears"... the worst 4 bear markets in history.
http://dshort.com/charts/bears/four-bears-large.gif
The markets have had 3 very good weeks in a row. Positive weeks which hasn't been seen in quite some time. The party is going to take a break though. Another up day Monday, possibly carrying into Tuesday, but end of month (also the end of the quarter) marks the end of the party for now. Keeping in line with the 2 steps forward 1 step back, it's time for the step back.
The S&P will peak around 835-850 and then approximately a 15% pullback that'll take a couple or few weeks to take place. That will take us back to around the 710-730 area (very approximate target). The drop will be enough to scare people into thinking we're headed to new lows, but it shouldn't actually happen.
Then we're off to the races. The "bull market" will begin. There will be dancing in the streets, cheerleaders on CNBC predicting the worst is over, the world is happy again. I know I keep repeating myself but please don't fall in love with it. It'll look wonderful, it'll feel great to get some of your money back. But we won't come close to where we were in October 2007.
Hope for the best but prepare for the worst is all I'm saying. Be prudent, be a bit skeptical, be nimble, pay attention to the data, not the cheerleaders. By playing it safe and smart from here on, you can be ahead of the game.
When I say pay attention to the data, I mean read the news. The real news, not the cheerleading news. Here is an example. Sure, some things are speculation, but once you find some sources of information that have been proven accurate (such as Meredith Whitney), listen to what they have to say and make your own assessments.
http://seekingalpha.com/article/127937-credit-card-crunch-creating-a-new-generation-of-subprime
And lastly, a chart of the "Four Bad Bears"... the worst 4 bear markets in history.
http://dshort.com/charts/bears/four-bears-large.gif
Thursday, March 26, 2009
My Blog List
I've added three of the blogs I follow over there on the left side of the screen. These guys are good with Elliott Wave Theory. If you're interested in some detail as to what I'm talking about with the primary and subwave stuff take a look. Daneric in particular does an excellent job with charts and describing what he sees.
I'm Becoming Bi-Polar
Another very strong move up today on Wall Street... 2%, 3%, 4% depending on which index. The 1/3 of my retirement was in the small caps, so I caught 4% today. And seeing this strong move and the fact that I'm up 11% in just 4 trading days, I got out. Yep, I bailed. I hadn't planned on moving back out, but 11% in 4 days was tough to pass up.
If today wasn't a near term peak, it's close. A normal pullback is expected (remember, two steps forward, one step back). This step back should take the S&P back down to around 750 from it's current level of 830. Right around 10%. When we get there I'll get back in. Again. This time with all of the retirement.
If it works out as I've described, I will have gotten in at the equivalent of near the bottom.
I'm keeping in mind that my first move in and out was with 1/2 of my total portfolio and this recent move in and out was with 1/3 of my total. I made 5% the first time and 11% this time. As a percentage of my total portfolio, I'm up about 6%. In the grand scheme of things, I'm up 6% since August 2007. I can live with that. :-)
I don't want to swing trade like this, but until the primary wave 2 is solid I don't trust it. I'd rather be skittish than complacent right now.
I hope this pullback to 750 is the last one I have to worry about. I'll stay in until we hit 1000 or so.
If today wasn't a near term peak, it's close. A normal pullback is expected (remember, two steps forward, one step back). This step back should take the S&P back down to around 750 from it's current level of 830. Right around 10%. When we get there I'll get back in. Again. This time with all of the retirement.
If it works out as I've described, I will have gotten in at the equivalent of near the bottom.
I'm keeping in mind that my first move in and out was with 1/2 of my total portfolio and this recent move in and out was with 1/3 of my total. I made 5% the first time and 11% this time. As a percentage of my total portfolio, I'm up about 6%. In the grand scheme of things, I'm up 6% since August 2007. I can live with that. :-)
I don't want to swing trade like this, but until the primary wave 2 is solid I don't trust it. I'd rather be skittish than complacent right now.
I hope this pullback to 750 is the last one I have to worry about. I'll stay in until we hit 1000 or so.
Wednesday, March 25, 2009
I'm Becoming A Believer
A couple of the guru's I follow are still holding out hope of another plunge down and even though I was leaning that way I'm starting to feel the hype and the hope of the sustained rally that I've been calling for.
The low was 666 intraday... close to the 650 target folks were looking for.
I have 1/3 of my retirement in. I do expect one last retracement of about 5% or so in the next few days or week and that's when I'll put the rest of the big money in. This rally will last a few months. It'll be the usual two steps forward, one step back. Nothing goes straight up. But I'll be looking to get out when the Dow approaches the 10,000 area.
A little bit of background on the 10,000 number. Not only is it a psychological line in the sand but the fibonacci numbers (which play a big roll in stock technical analysis) line up with that line in the sand too.
Generally speaking, the high in Oct 2007 on the Dow was 14,165. The low a week or so ago was 6,440. The difference between the two is 7725. Retracement moves are usually 50% of the move. Half of 7725 is 3862. Add that to 6440 and you come up with 10,320. That's the target.
Recap: Primary Wave 1 was the move from the Oct 2007 peak, to the recent bottom. It lasted 17 months and was about a 60% move down from peak to trough. Primary Wave 2 has just begun and should last 4-6 months peaking around 10,300. Primary Wave 3 will be UGLY. Wave 3's are usually the ugliest, longest and most devastating.
I'm a believer of the Elliot Wave theory. It's not perfect and it doesn't predict exact moves in advance, but it's amazingly accurate in the grand scheme of things. It's proven itself to me and I want to help you preserve your money.
I'm ready for us to start moving up for a while. Let's make some money.
The low was 666 intraday... close to the 650 target folks were looking for.
I have 1/3 of my retirement in. I do expect one last retracement of about 5% or so in the next few days or week and that's when I'll put the rest of the big money in. This rally will last a few months. It'll be the usual two steps forward, one step back. Nothing goes straight up. But I'll be looking to get out when the Dow approaches the 10,000 area.
A little bit of background on the 10,000 number. Not only is it a psychological line in the sand but the fibonacci numbers (which play a big roll in stock technical analysis) line up with that line in the sand too.
Generally speaking, the high in Oct 2007 on the Dow was 14,165. The low a week or so ago was 6,440. The difference between the two is 7725. Retracement moves are usually 50% of the move. Half of 7725 is 3862. Add that to 6440 and you come up with 10,320. That's the target.
Recap: Primary Wave 1 was the move from the Oct 2007 peak, to the recent bottom. It lasted 17 months and was about a 60% move down from peak to trough. Primary Wave 2 has just begun and should last 4-6 months peaking around 10,300. Primary Wave 3 will be UGLY. Wave 3's are usually the ugliest, longest and most devastating.
I'm a believer of the Elliot Wave theory. It's not perfect and it doesn't predict exact moves in advance, but it's amazingly accurate in the grand scheme of things. It's proven itself to me and I want to help you preserve your money.
I'm ready for us to start moving up for a while. Let's make some money.
Monday, March 23, 2009
Holy Moly!!
How about 6 or 7 percent in a day! Very impressive! Tim Geithner broke his streak of disappointing Wall Street. We broke thru some major resistance lines today on the way up. I'm glad I at least put a little of the retirement money back in on Friday.
This is looking like it's for real but lets keep a level head. The last half dozen or so times that the gov't has announced a magic pill to fix everything, there has been dancing in the streets for a day but then reality set in. I'm in no rush to put the rest of my money back in. Every bounce and rally has it's limits and we'll trade in a range for a little while.
It'll be nice to stop dropping for a change. We haven't had a single positive month since August. We're overdue. Let's enjoy it if it lasts thru to the 31st.
This is looking like it's for real but lets keep a level head. The last half dozen or so times that the gov't has announced a magic pill to fix everything, there has been dancing in the streets for a day but then reality set in. I'm in no rush to put the rest of my money back in. Every bounce and rally has it's limits and we'll trade in a range for a little while.
It'll be nice to stop dropping for a change. We haven't had a single positive month since August. We're overdue. Let's enjoy it if it lasts thru to the 31st.
Saturday, March 21, 2009
Ta Da! - The Latest Rabbit
Our Treasury Secretary is ready to make an announcement early next week, probably on Monday. The big question is will there be details this time. Rumors are out and there isn't enough confirmed information yet to know if the new plan will be of benefit or not. We'll have to wait and see. So far I'm not reading much excitement.
With this big question mark hanging over the markets I don't have a clue what to expect next week or for the next month. As I said in yesterdays post, something just doesn't feel right. I've seen several charts showing weakness rather than strength. My gut says we're headed down. How low, I'm not sure. I don't think we'll hit new lows but we may get close. If that's the case, we'll be establishing a base by which we can truly rally.
I'm ready for that time to come. We need a little run up to ease the overall doom and gloom. Unfortunately it won't last long. We still have a lot of deleveraging to get through and there are still a lot of skeletons in the closets of the big banks and companies like AIG.
We also have a problem with housing prices, unemployment, commercial real estate to get through. This is going to take time and there's no way to rush it.
I'm ready to play the market on the upside. I hereby request the bottom be put in within the next 3 weeks. Of course after one last drop so I can get back in. I'd appreciate it.
With this big question mark hanging over the markets I don't have a clue what to expect next week or for the next month. As I said in yesterdays post, something just doesn't feel right. I've seen several charts showing weakness rather than strength. My gut says we're headed down. How low, I'm not sure. I don't think we'll hit new lows but we may get close. If that's the case, we'll be establishing a base by which we can truly rally.
I'm ready for that time to come. We need a little run up to ease the overall doom and gloom. Unfortunately it won't last long. We still have a lot of deleveraging to get through and there are still a lot of skeletons in the closets of the big banks and companies like AIG.
We also have a problem with housing prices, unemployment, commercial real estate to get through. This is going to take time and there's no way to rush it.
I'm ready to play the market on the upside. I hereby request the bottom be put in within the next 3 weeks. Of course after one last drop so I can get back in. I'd appreciate it.
Friday, March 20, 2009
Something Just Doesn't Feel Right
I'm just not convinced. Something doesn't feel right. There are a couple of the guru's that I follow that haven't given up on primary wave 1 being done. The rally we saw that took the S&P from 666 to 800 was impressive, 20%, but it just didn't have the feel of a rally that had any oomph to it.
I do know that the big boys weren't jumping in and that's a big issue. If the institutional buyers aren't biting, then it was just a relief rally.
I'm at a personal crossroads. We've come down from 800 to 765 (as I'm typing this). I had posted before that I was looking for this pullback and would move all of my retirement back in at 750. So, do I do it? Do I pull the trigger? Do I maybe just put 50% in and then if we drop back to 700 or lower I can put the rest in?
I hate that I missed out on a chunk of this recent rally but I don't want to make a mistake by not taking advantage of this pull back.
A big chunk of the recent rally was from gov't shenanigans (buying of treasuries).
I have 90 minutes to decide what to do... Hmmmmm
===
Alright, I split the difference... I just placed the order to put 1/3 of my overall retirement back in at the end of the day today. If we continue down I'll do another 1/3 and then the final 1/3. If we head back up and it feels for real I'll do the same thing on the way up.
Totally on the fence as to where we are in the grand scheme.
I do know that the big boys weren't jumping in and that's a big issue. If the institutional buyers aren't biting, then it was just a relief rally.
I'm at a personal crossroads. We've come down from 800 to 765 (as I'm typing this). I had posted before that I was looking for this pullback and would move all of my retirement back in at 750. So, do I do it? Do I pull the trigger? Do I maybe just put 50% in and then if we drop back to 700 or lower I can put the rest in?
I hate that I missed out on a chunk of this recent rally but I don't want to make a mistake by not taking advantage of this pull back.
A big chunk of the recent rally was from gov't shenanigans (buying of treasuries).
I have 90 minutes to decide what to do... Hmmmmm
===
Alright, I split the difference... I just placed the order to put 1/3 of my overall retirement back in at the end of the day today. If we continue down I'll do another 1/3 and then the final 1/3. If we head back up and it feels for real I'll do the same thing on the way up.
Totally on the fence as to where we are in the grand scheme.
Saturday, March 7, 2009
So Far So Good
Well, I'm up 12 hundreths of a percent so far! :-) Seriously, the markets did drop on Friday, the S&P hit 666 and rallied in the afternoon to close barely positive. However... there is still another wave down to come and it may be where we get to 650 or possibly even below. In any case, that's when I'll put the rest of my retirement back in.
It's kind of funny, a friend of mine and I are emailing back and forth with links to articles that talk about "the other shoe to drop" and so far I think we have a dozen pair of shoes accounted for... commercial real estate, credit cards, reduced wages, etc, etc.
It really is a bit scary if you read it all. But sticking your head in the sand isn't a good choice either. Just be aware of whats going on and make wise decisions. Buy and hold is no longer the way to invest. You'll have to actively manage your money now and be willing to make changes, trades, swings. Otherwise you may see your investments go sideways at best.
The S&P is down over 50% from it's peak. That means you have to double your money to get back to break even. At 8% a year compounded, it'll take 11 years. I have news for you, we won't be averaging 8% a year for a while. I'll try to alert you to the swings so you can make money on the way up and not lose any on the way down. The waves are your friend. You won't hit things exactly at their peaks up or down, but even if you're close it'll save you some serious money.
Well, I have a ton of errands and tasks to get done today so let me get at 'em.
It's kind of funny, a friend of mine and I are emailing back and forth with links to articles that talk about "the other shoe to drop" and so far I think we have a dozen pair of shoes accounted for... commercial real estate, credit cards, reduced wages, etc, etc.
It really is a bit scary if you read it all. But sticking your head in the sand isn't a good choice either. Just be aware of whats going on and make wise decisions. Buy and hold is no longer the way to invest. You'll have to actively manage your money now and be willing to make changes, trades, swings. Otherwise you may see your investments go sideways at best.
The S&P is down over 50% from it's peak. That means you have to double your money to get back to break even. At 8% a year compounded, it'll take 11 years. I have news for you, we won't be averaging 8% a year for a while. I'll try to alert you to the swings so you can make money on the way up and not lose any on the way down. The waves are your friend. You won't hit things exactly at their peaks up or down, but even if you're close it'll save you some serious money.
Well, I have a ton of errands and tasks to get done today so let me get at 'em.
Thursday, March 5, 2009
I Did It... Well Half Of It
I put my right foot in and I'm shaking it all about... yep, I put 1/2 of my retirement back into the market. We got down to the 680 range on the S&P and if my target of 650 is accurate, this is close enough. When a bottom does happen, there will be a sharp upward move during that day and since my retirement money goes in at the end of the day I figured I'd just go for it. If I were smart I'd have waited for that big bottoming and upswing day, but nobody ever said I was smart.
I'm also expecting the gov't to come up with another rabbit and figured I'd beat them to the punch. They're going to review and discuss the mark to market rule on the 12th. I don't think they'll do anything but they could feel enough pressure by then to change the rule for a period of time.
How about Citigroup selling for a buck a share now. Amazing. It was $55 at it's peak, one of if not the largest conglomerate banking institution in the world and it's on the verge of disappearing. General Motors can be had for under two bucks along with Ford. So many stocks selling for under $10 or even $5. Four or five of them part of the Dow 30.
I did save 1/2 of my retirement in case I was way off the mark. I'm comfortable if I hit the low withing 10%. I got out at the high within 7%.
Keep in mind, this is only a "temporary" bottom. The rally we get will last a few months and will take us up near 10,000 on the Dow, but then it'll be time to pull out and watch from the sidelines.
I hope I didn't mis-time this in a big way. I don't see the S&P going below 600 during this set of waves. But quite honestly I don't see anything to turn things around at this point. I'm hoping for bargain hunters. The big boys are all waiting for 650. That's another reason I got in at 680. As soon as everyone has the same target, it tends to not quite get there.
I'm also expecting the gov't to come up with another rabbit and figured I'd beat them to the punch. They're going to review and discuss the mark to market rule on the 12th. I don't think they'll do anything but they could feel enough pressure by then to change the rule for a period of time.
How about Citigroup selling for a buck a share now. Amazing. It was $55 at it's peak, one of if not the largest conglomerate banking institution in the world and it's on the verge of disappearing. General Motors can be had for under two bucks along with Ford. So many stocks selling for under $10 or even $5. Four or five of them part of the Dow 30.
I did save 1/2 of my retirement in case I was way off the mark. I'm comfortable if I hit the low withing 10%. I got out at the high within 7%.
Keep in mind, this is only a "temporary" bottom. The rally we get will last a few months and will take us up near 10,000 on the Dow, but then it'll be time to pull out and watch from the sidelines.
I hope I didn't mis-time this in a big way. I don't see the S&P going below 600 during this set of waves. But quite honestly I don't see anything to turn things around at this point. I'm hoping for bargain hunters. The big boys are all waiting for 650. That's another reason I got in at 680. As soon as everyone has the same target, it tends to not quite get there.
Subscribe to:
Posts (Atom)
.jpg)
