Cara's Commentary & Community Chat, Friday, Oct. 9, 2009

Shoulda' posted the image last night...too late to think...sorry I also noticed support at that 74.50 level from early morning.

Bill said, "The problem is that people read headlines, and little else. Worse, they don’t give it much thought."

The well researched rule for an ad is that ten times as many people read headlines as read body copy.

Therefore put the clincher in the headline.

This has carried over into the sound bite. Works out great for politicians and scam dealers. Oh, but I repeat myself.

here is the usd charted upside down with the spx. Correlation is about as tight as one could imagine. Gold on the other hand at times does it's own thing.

usd fib projection fwiw(maybe nothing) suggests a bottom may be near.

Well, I guess if Jimmy Carter can do it...

But at least he got us Billy Beer.

I agree! He won an exceptional honor for just doing his job.. Diplomacy and reaching out to open intl dialogue is part of his job description. I guess "better than expected' is the new American dream.

With all due respect, its a disgrace and devalues every worthwhile person who has previously won the award.

Shame on those who made the decision. If they couldn't find someone more worthwhile they don't deserve to be in the position to be making the choice.

What is this world coming to?

Released on 10/9/2009 8:30:00 AM For August, 2009
Trade Balance Level
Prior $-32.0 B
Consensus $-33.0 B
Consensus Range $-35.0 B to $-29.0 B
Actual $-30.7 B

Highlights
The U.S. international trade deficit shrank in August on both lower oil and consumer goods imports, reflecting a still sluggish economy. Exports, however, did edge rise, largely on auto shipments to Canada. The overall U.S. trade gap unexpectedly narrowed to $30.7 billion from a revised $31.9 billion shortfall in July. The August deficit was much smaller than the market forecast for a $33.0 billion differential. In the latest month, exports improved by 0.2 percent while imports declined 0.6 percent. The shrinking of the trade deficit was due to a narrower petroleum shortfall which came in at $16.5 billion compared to $17.8 billion the previous month. The nonpetroleum gap expanded to $24.3 billion from $23.6 billion in July.

Overall, the August trade data show modest improvement in real terms and will add slightly to third quarter growth. The dollar should firm on the numbers and equities should like the export gain.

Market Consensus Before Announcement
The U.S. international trade gap in July worsened significantly and oil had only a little to do with it. The overall U.S. trade gap worsened to $32.0 billion from a revised $27.5 billion gap in June. But in the detail, there is good news for U.S. manufacturers as exports posted a gain of 2.2 percent after a 2.1 percent increase in June. However, imports jumped 4.7 percent after a 2.5 percent rise in June. The worsening in the trade deficit was due to a wider nonpetroleum goods deficit which grew to $23.5 billion from $19.8 billion the previous month. Import gains were widespread but led by autos and consumer goods. Meanwhile, the petroleum gap grew to $17.9 billion from $17.3 billion the previous month. Looking ahead to August, don't look for help for the trade gap from lower oil prices. Although crude prices fell notably for the month-that is on a not seasonally adjusted basis. Seasonally adjusted, crude oil prices rose about 1.7 percent.

I think he was given the award based on HOPE. I hope he is successful because that's good for all of us. Unfortunately, so far the hope has been misplaced.

The Nikkei did its part.

buy stop 48.58/48.60 RSI 7 day 31.90, 7 week 21.

do your own homework.

IBM - price target lifted at Barclays to $140 from $119. Maintain 2009 EPS estimate at $9.80, adding 10 cents to 2010 EPS estimate at $10.85. Equal Weight rating.

Doesn’t appear to be any significant data to be released until next week when JNJ, INTC and others reports earnings on Tuesday.

I suspect the market, barring any geo-political event, will trade sideways to slightly down on Friday and Monday until the next quarterly numbers are released. Just my 2 cents.

Hit enter button 2X my bad.

Priceless Ann. Bookmarked. I'm somewhat disturbed by the Nobel Prize being treated like a tin cup at a school fair though. Puts the nail in the coffin of the Nobel committee's credibility. More smoke and mirrors while the swindle of the century is being pulled off. How much of taxpayers money did HB&B use to make this happen? Bon weekend.

"Hit enter button 2X my bad."

Try hitting "Sell to Open" instead of "Buy to Cover." It's happened to me more than once, sorry to say. Like doubling down on a bad bet.

Les- I agree. Nominating panels trying to outdo each other, or outsurprise one another. It becomes less about the nominees, and more about the panel members.

Could someone post the name of that company that manufactures NatGas engines for heavy trucks please. TIA.

2) For an update on the Pickens Plan, I managed to catch the 81 year old Boone’s interview on CNBC yesterday, who spouted out statistics like the University of Oklahoma State University geology graduate that he is. After cutting through the love fest and the softball questions, I managed to get some actual facts out of it. Boone wants to target the country’s 6.5 million heavy trucks, converting them from diesel to natural gas on a replacement basis. These vehicles account for 2.5 million barrels a day of the 9.8 million barrels/day the US currently imports (click here for GOVT. stats) .

To this end, he is pushing for the passage of the Natural Gas Act (HR 1835 and Senate bill 1408) which will create 18 year tax credits and subsidies for the production and use of natural gas vehicles along with the necessary infrastructure, like pipelines and pumps. His chances of success are good, as the last NG related bill, HR 1622, an appetizer sized $30 million five year project to promote NG, passed by an overwhelming 387 to 24. Of course, everything is on hold until health care passes, which may eat up the calendar for the rest of the year, so energy legislation will almost certainly be 2010 business. All of this is not soon enough for the industry, which is desperate for anything to keep their commodity from falling back to the mat.

http://blog.madhedgefundtrader.com/

GIven the strength in the dollar (closing yesterday at 76.10 and now trading around 76.30ish) I'd say SPX today feels like it wants to go up. SPX is flat, but gold & silver are down. That says to me, even though SPX is flying into some headwinds of the slightly stronger dollar, it still has upward lift to it right now.

If the buck goes nowhere, I'd say the bias is up.

Cummins and Westport Technologies (WPT) on the TSX.

I have done quite well over the years with WPT and am looking to get back into it in the future.

long VXX at 47.81

Hi,

As part of that group I don't get much chance to read the blogs and daily reports until late at night. So I tend not to post much.

But here some info and link some of you mining bugs might enjoy.
http://www.mineweb.net/mineweb/view/mineweb/en/page1? you can sign up to a daily mining news feed. Again all articles need to be taken with a grain a salt. All major commodities are covered.

For those wanting to get a better understanding of mining, try
http://www.edumine.com/xedumine/selectacourse.asp scroll down to the Management - Risk - Financial Section.

By the way I just bought my ticket to the Bahamas and booked my hotel for Cara 2010.

"One wonders what the criteria are and if they may have been set up by those same folks who rated the toxic assets as AAA."

Grym- The same folks who rate contaminated soil as safe for children, and sewage sludge as safe for marketing as 'premium' fertilizer.

Les, as Golfer indicated, Westport innovations, WPT.to on Toronto, or WPRT on the Nasdaq. They don't actually make the engines, they develop and manufacture the conversion kits and engine control systems. They have joint ventures with others such as Cummins to make the engines.

You might also add CLNE to that list, thats the Pickens company involved in the fueling station end of it.

Another one was Fuelmaker, which was marketing the Phill home fueling system with Honda. However Honda sold the div in the spring to FFS Fuel Systems Solutions, they are mostly in the European markets and can't seem to find much about them.

FD, I have been in and out of Westport for about 8 years, still own some.

I usually try to avoid the non trading topics, but in this case I have to add my 2 cents. Ever hear of Irena Sendler?

"....Sendler saved 2,500 Jewish children by smuggling them out of the Warsaw Ghetto, providing them false documents, and sheltering them in individual and group children's homes outside the Ghetto."

[http://en.wikipedia.org/wiki/Irena_Sendler]

Amazing woman! The Nazis caught her and tortured her. Broke both her arms and legs and were going to shoot her before her colleagues bribed them not to.

She was nominated for the Nobel Prize in 2007 but lost to Al Gore and his slide show on global warming

Before the downturn the mining industry had ~85,000 job vacancies. There is still a shortage of skilled workers out there. e.g. The oil sands alone were short 25,000 workers to meet expansion requirements. Now they are only short 5,000. My point is that when analyst and miners talk about expansion, most don't happen or take forever, or cost ++50% more to complete because of this shortage.

Two points to my story:
1) New mines take forever to bring to production (The Junior company dilema) and costs will alway be higher than expected
2) Encourage your young to go into mining (Skilled trades, geology, engineering) and learn spanish - there is no shortage of work out there http://www.infomine.com/careers/

Heading to New Orleans this afternoon for weekend visit with friends and a reunion function.

One thing I believe in is observation of what’s going on in local economies while traveling. Restaurants, hotel vacancies, cab drivers, overall attitude of the population (upbeat? downcast? crime? employment opportunities or lack thereof?)) IMO, it’s more accurate barometer than most media reports. I’ll be comparing the last visit about 2 ½- 3 ½ years ago, when things were definitely not good due to Katrina.

Looking around, yes, things are not good where Grym resides out in Rockford, IL. I’d say Chicago is doing better than his area as I see some small subtle improvements, although there’s a ways to go yet.

One comment this week caught my ear as a guest on Fast Money (not a regular listener) mentioned the crowded parking lots at O’Hare airport which is indicative of improving business travel. I’ll keep my eye out for that (although today’s flight is from Midway).

Michigan appears to be worse off than the Rockford area based on recent visits.

And then there’s Boston, where I’d say the economy is much better than Chicago based on a recent trip there.

Haven’t been to the West Coast in months, so no recent observations there.

Suspect there will be pockets of incremental improvements throughout the country while other communities may continue to decline or stagnate. And of course the housing market will continue its drag, especially in AZ, NV and FL among others.

LOL...aka Murphy's Law:

http://en.wikipedia.org/wiki/Murphy%27s_law

"The perceived perversity of the universe has long been a subject of comment, and precursors to the modern version of Murphy's law are not hard to find. For example, in 1841 a newspaper in Norwalk, Ohio printed this verse (a parody of famous lines in Thomas Moore's Lalla Rookh):

I never had a slice of bread,
Particularly large and wide,
That did not fall upon the floor,
And always on the buttered side."

Seamus

Any plans to go to Café Maspero on Decatur St?

The deadline for the nomination for the prize was February 1. Was this award given on the come?

2nd
Irena Sendler kept the names of all the children she rescued in jars buried under her neighbor's tree. Her work was almost forgotten until, in the fall of 1999 when four rural Kansas students [3-9th & 1-11th grader]working on a year long National History Day project wrote a play titled "Life In A Jar".

..."The teacher had showed them a short clipping from a March 1994 issue of News and World Report, which said, "Irena Sendler saved 2,500 children from the Warsaw Ghetto in 1942-43." He told the girls the article might be a typographical error, since he had not heard of this woman or story. The students began their research and looked for primary and secondary sources throughout the year."......

“He who changes one person, changes the world entire”

http://www.irenasendler.org/

You are right about McEwan that is why I stayed with UXG for such a long time.

If you do go Café Maspero for lunch, be forewarn the portions are huge and inexpensive.

http://www.frommers.com/destinations/neworleans/D4...

Have fun!

The Yen carry trade which boosted all asset prices all over the world came to an end in October, 2007. As the Yen started rising, the risk of borrowing Yen became too high and speculators rushed to close long positions and paid off their Yen margins.

Today, with the Fed doling out interest free money, we have the dollar carry trade. This will continue until the dollar starts to firm.

I cannot recall WHY the Yen started rising in October, 2007. Can anyone refresh my memory? Based on this information, we can try to envision a similar trigger that would enable the dollar to rise and hence determine an inflection point for worldwide asset prices.

Unless and until the dollar starts to rise, I am long all assets, no matter how over bought markets become.

I am looking for a re-entry in WPT in the $12 to $12.25 CDN with support at $11.

Presently watching it to see its price and volume action near support at $12.

This will be an intermediate to long term play so if I take a $1000.00 loss I will be looking at buying 1000 shares with a STOP LOSS near the $11 mark.

I will use the technical support area between $11.50 to 11.75 as a STOP ALERT and cut my losses if necessary.

Hi Bev - With silver trading in the $17.75/oz range and U.S. Gold's only property of substance being in early stages of development and showing nice thicknesses & grades of Ag it is just getting a boost here with Pan American, Silver Standard, Hecla, et.al. Guess R. McEwen should rename the thing U.S. Silver since the main Au asset in Nevada while having some ounces is refractory and will require expensive autoclave treatment to get the Au to dore, and its probably not high enough grade to justify at these prices. Perhaps the better silver flyer might be Mines Management if they can get the thing permitted & financed (underground Ag/Cu mine under a wilderness area accessed by drift from outside the wilderness)under this regime. Happy Trading

When asked what he thought of Martin Luther Kings receiving the Nobel Peace Prize, Harry Truman said "Hell, I didn't give it to him."

Peace, Economics etc. are all political and subjective. Science no so much. I recall Hitler was in the running for 'Times' man of the year?

Luggie
Thanks for the info on UXG. I was wondering what the latest was on the Nevada gold play. By chance are you holding UXG? If so, do you see more upside? The price volume above starts to get thin once it clears 3.60. For some reason I am leery of this gold rally.

http://stockcharts.com/h-sc/ui?s=UXG&p=D&yr=3&mn=0...

This just crossed the wires:

11:59 Elliot Wave's Prechter: USD is 'bottoming', should appreciate for at least a year; sees US equities reaching a top and will move below the March lows by end of 2009

I am willing to bet anything that, barring some catastrophic development, like discovery of asteroid coming our way, it's not going to happen (part in bold font). Attendees of CTA conference in Jan may start making bets on who pays for drinks.

"I am willing to bet anything.."

Careful, man.

To win in science or literature, you have to actually deliver the goods, and then wait a few decades.

But in politics, if you deliver a little "hope" of maybe someday delivering, you get the prize!

Also, think how Bebe will react the next time Obama tries to press him on restraining the settlements. "You got your prize, now let me get on with my construction program!"

That's when the Nikkei crested.

Tough trading day. Like a lullaby- I'd be careful if holding.

Vadym, what is you view on gold on short, intermediate and long term? What is your view on the USD (does not always have to be the inverse of gold...).

09Oct2009-U.S. equity market is 'one overvalued market': Gluskin Sheff
------------------------------------------------------------------------------
"The S&P 500 index is way ahead of itself, and every basis point of this 60
percent rally in the U.S. equity market from the lows has been due to an
unprecedented expansion in P/E ratios, David A. Rosenburg, chief economist at
Gluskin Sheff said on Friday."

The rest of David A. Rosenburg note at the top of the page on the following link,He also said the price-to-book ratio for the S&P 500 suggests a potential 20 percent correction.

http://tinyurl.com/yhce22w

The sell short stop limit orders I placed on FCX last night were triggered today. The one for 100 shares was triggered at $74.80, and a few minutes ago, when I woke up, started having my breakfast and looked at the computer screen to see FCX at $73.80 with a strong-looking reversal off the day's low at $73.16, I decided to take profits right away and covered these 100 shares at $73.88.

Next, my order for shorting 500 shares was executed at $74.44, and after seeing FCX reflecting off $74 level a little while ago, I decided to use that as my "line in the sand" for profit taking, and when FCX made another run at that level (instead of collapsing, as a stock in bearish envronment would do), I covered that short at $73.98.

After that, I started thinking that it might be time to go long FCX, as it stubbornly does not want to reflect and go down from the $74 level. So, the third time FCX started heading toward $74 (a few minutes ago), I bought it a $73.95. Will sell this position if it goes down to $73.85 instead of breaking out above $74.

Well the buck has definitely had a nice day, but SPX doesn't seem to mind. USD +0.67 and SPX is still flat. Perhaps HB&B switched off the computer that automatically correlates the two? Or perhaps like I said before, the bias to SPX is up. Or maybe all the money fleeing bonds has to go somewhere. It kinda looks like its all going into semiconductors, actually.

At least TLT is getting its comeuppance. It's been a long time in coming. All that rallying while SPX was rallying, it just wasn't right. Perhaps all this talk about the Fed exiting some of its market supports is more than just talk?

Well, the breakout from $74 happened on the downside. I immediately closed my FCX long at $73.95 (opened at $73.95) and shorted it at $73.91. Alexander Elder in his classic book "Come into my trading room" (which I am reading now) said that some of the best trading opportunities come after false breakouts, and FCX did a few of those a little above the $74 level. Another interesting statement from Elder that I read yesterday was (quoting from memory) "Amateurs take one trade and hope for the best. Professionals, on the other hand, are perfectly fine with making several attempts before nailing the trade they want." I felt it intuitively a few days ago, when I was upset at myself for not being "nimble." Staying nimble, as it turned out, is indeed a necessary skill for professional trading.

"Perhaps all this talk about the Fed exiting some of its market supports is more than just talk?"

I doubt it. This economy and job loss situation is just too bad to be able to do that for some time yet.

Besides the "crisis" is his job security and the banking boys are still milking it for $millions, so why change anything significantly?

Can anyone provide insight on the large rise in yields that began mid-day yesterday and has continued strong into today? Much appreciated

My take on the Nobel is that ,yes it's premature...but it is a reward for restoring diplomacy to the fore in US/world relations. That cannot be stressed too much as a stark contrast to the previous administration's behaviour.
An example is canceling the "star wars" bases on Russia's border. A "cold war-think" reaction with no clear objective but to iritate Russia, and reward defense contractors. Very quickly Russia joined us in pressuring Iran on the nuclear program, to our benefit (and the world's). They also joined us in proposing drastic nuke weapons reduction.
It is just the world is so appreciative that US foriegn policy is now no longer like that of a rouge state.

My quick take...

Ciao, Z.

http://www.barbrastreisand.com/us/home

Congratulations for top-selling albums 5 decades in a row?

Streisand is the only woman I can think of who truly gets more beautiful with each passing decade. Is she really 67? It's called aging well.

“As portfolios swell, we start to feel a collective buzz courtesy of dopamine, a feel-good chemical that the brain produces at the mere thought of making money. The more dopamine is produced, the more primitive our decision-making becomes, making it harder to think logically.”

– A new online investor-psychology quiz from personal-finance publisher Kiplinger explains that the herd mentality in the markets is more than just emotional – rallies actually deliver a neurochemical buzz. (Anyone else got a wicked case of the munchies yet?)

(Globe & Mail, Oct 9)

This a post factum report, but maybe someone will find it useful. After seeing FCX collapse down to $73.60's, I noticed that it made a "cangaroo tail" spike down but then reversed and stabilized around $73.70. Its chart for the last 2 hrs started looking VERY much like the copper chart over the past 4 years. After collapsing from $4/lb to $1.50/lb, copper stabilized and then started another parabolic ascent up. So I prepared to go long FCX and went long at $73.77, when the ascent seemed to begin. Unfortunately, right after that FCX dropped down and I sold the shares at $73.71, as I didn't want to be caught at a false breakout. But then, FCX kept stabilizing at $73.71, and consistent with Elder's idea of professionals taking several shots at the trade they liked, I decided to go long FCX again at $73.71. After that, FCX did start the expected uptrend, and I sold these shares at $73.88, after the ascent indeed started looking parabolic.

...

No. The banks want assets, not liabilities ;)

If things go south, this will be hit hard.

...

SiO2 -

Simplified explanation:

Reverse mortgage is just a life estate with endless strings (concessions) attached. Lump sum + accruing interest, rolled in points, appraisal, title, and survey fees, mortgage and hazard insurance are locked in as a rising lien against the home. All owed back in payments with a balloon upon owner's expiration date. Assuming home value dips below the lien amount, the loan will be called before owner's planned demise and, if not paid off, the bank can foreclose on the home and tell grandma or grandpa to head to the local shelter for a hot plate and a cot or to just go drop dead already.

Banks use this to give credit to folks without any credit (no income) by latching onto the clean title of their final asset: the home.

Should be illegal but gov't knows it helps to eliminate inheritance and keep kids working ;)

pwc (proceed w/caution. notice how friendly fcs is with 40 ma in recent times. also, various indicators, incl. volume, are showing lower highs while the price has exceeded recent highs. just something to watch.

$ up

Stocks up

Oil up

I was curious (and suspicious) of how these "reverse mortgages" work and found this link to be very good:
http://tinyurl.com/ylkh25e

Just a couple of comments:
- Can only borrow the actual equity in a home.
- Interest compounds without being paid during the time of the mortgage, thus when home is sold, the mortgage payoff can be very high.
- Fees are very high.

Hope this helps.

Need to be in cash by end of day.

Don't want to be holding longs into the weekend? Neither does anyone else.

I'm not 100% sure, but I think you can only borrow around 50% LTV, so the banks give themselves a lot of leeway.

I was not aware that one could be kicked out of the house if value (my impression was that as long as you lived in the house they could not touch you, maybe Loannetter could clarify)drops below value of the loan. Agree with what has been said, very onerous fees.

Well, say they are charging a modest 5% interest, in 10 years that is 62% of the original amount. At 6%, in 12 years, it's' 100%. This on top of a declining house value. Oh my.

Remember in order to be eligible for a reverse mortgage both borrower and
co-borrower must be at least age 62 (maybe 65 not sure) or older. So around a 25 to 40 year window depending on the health of the borrowers, who knows I'm sure the actuaries have the stats.

In general, I would say it is a last choice for seniors and we all know banks only do things in their best interests not ours.

all saying the S&P 'ahead of itself"; the "need for a strong dollar" and Bev's charts...plus the inverse relationship between gold and the dollar...I would think we should listen...I am. Selling most of my slw and dmm...just keeping a place holder in each.
s
I'm serious Bev...I do appreciate and value your input..and social conscience. Sooo many more deserving that Obama for the prize and you've pointed out one. Thanks.

BillySundance,

I would say it is largely due to Bernanke jawboning about a rate increase.

all saying the S&P 'ahead of itself"; the "need for a strong dollar" and Bev's charts...plus the inverse relationship between gold and the dollar...I would think we should listen...I am. Selling most of my slw and dmm...just keeping a place holder in each.
s
I'm serious Bev...I do appreciate and value your input..and social conscience. Sooo many more deserving that Obama for the prize and you've pointed out one. Thanks.

Dear Dr. Strangelove,

It might interest you to know that FHA Home Equity Conversion Mortgages (HECCM) are government insured and the home cannot be foreclosed upon even if the mortgage value is less than the home is when the owners leave/sell/die. I offer them. I have assisted seniors (you must be 62) save their homes from foreclosure with FHA insured Reverse Mortgages.

The 'other kind' of Reverse Mortgage was often employed by Financial Advisors seeking to fleece the homeowner and implore them to buy Annuities, etc., and are not FHA insured are illegal in my state of Washington. FHA will not allow a senior to use their equity to purchase Annuities or be influenced in this way.

Might I suggest you ask your State Attorney General to protect consumers by outlawing the bad kind in your state.

All my best to you.

all saying the S&P 'ahead of itself"; the "need for a strong dollar" and Bev's charts...plus the inverse relationship between gold and the dollar...I would think we should listen...I am. Selling most of my slw and dmm...just keeping a place holder in each.
s
I'm serious Bev...I do appreciate and value your input..and social conscience. Sooo many more deserving that Obama for the prize and you've pointed out one. Thanks.

all saying the S&P 'ahead of itself"; the "need for a strong dollar" and Bev's charts...plus the inverse relationship between gold and the dollar...I would think we should listen...I am. Selling most of my slw and dmm...just keeping a place holder in each.
s
I'm serious Bev...I do appreciate and value your input..and social conscience. Sooo many more deserving that Obama for the prize and you've pointed out one. Thanks.

I would say that gold held up VERY WELL today, considering the sharp rise in $USD above the 76 level. Gold is much higher now than when $USD got to 76.4 level for the first time. I can only imagine what gold will do once $USD weakens below 76 level. Unless, of course, this was the REAL double bottom in $USD at 76, and now it will move to 80 as Bill was predicting.

bought some AH at $3.29

2nd... let's make it interesting, shall we?? :)

If no new lows within 2009, you attend Freeport conference... and I like Glenglivet or Glenfiddich, neat.

Wooooow.. thank you very much for those 9 posts! You made my day. ;-)

Vad- I can only bet on events I believe in, like DJIA 10000 before the end of October. I'm not predicting new lows in 2009.

If I run into you at Freeport, or Vancouver, or on a private jet to the 2019 conference in the Little Manhattan section of Dubai, I'll be happy to cover your drinks anytime.

If we added up the amount of money your posts have saved the community, it would certainly be enough to fund a Graifer Bottoms Up Perpetuity.

As for me, I'm thinking of starting the 2nd Avenue Seven-Out Fund, and tweeting the daily P/L statements from Vegas.

Enjoy the weekend! I'm going to buy a bottle of Glenlivet or Glenfiddich and find out what single malt is all about.

As much as the major media will try to discount the significance of this event by painting these people as misguided or even "racist" (as they did with the Tea Parties); I'm all for this "3rd" Contintental Congress being held, and look forward to seeing what they produce. Maybe we could nominate some fellow "Caristas" to represent a few of our states?

If I objectively look at the S&P chart and approach it with my newly formed objective "trade what I see" mentality, I see a third higher low since the beginning of August and nothing that would tell me that a short position is in order. Moreover, even if S&P declines to 1045, it will most likely bounce from there and keep moving up -- that's what my "chart feeling tells me." A real bearish setup will appear only when the low at 1025 is taken out, but then a strong support at 1000 will be nearby and a lot of fluctuation might happen at those levels, hitting all stops. If one feels lucky, one can try opening an "opportunistic short" if tomorrow is a down day and place a buy to cover stop order at today's close of 1070. I might do that just for fun if Monday is a down day. :) In fact, if $USD continues going up on Sunday night, I'll probably place a buy stop order on SRS on Sunday night.

Oh, I know you don't think we will retest March lows anytime soon... I was just looking for an excuse to bet on something, and this one looked the best :)

David- I can see you're turning a corner on your trading. Whether it's into a good neighborhood or a bad neighborhood remains to be seen.

If you're planning on attending the Freeport conference, let me know. We can get together for sushi a few weeks before. I'll tell you my best jokes with the second bottle of sake, and you can be my stand-in at Vad's presentations.

My daughter tweeted from London:

If Obama gets the peace prize, Ahmadinejhad should one for "traffic management"

Nxt time the US bombs S. Wiziristan, leaflets should be dropped, saying "courtesty of the Nobel peace prize winner"....

San Mateo it is. I'll set it up.

5 years ago, when everyone was debating small issues, I was asking who will be the first global leader.

Now we know and I am proud to be supporting OBAMA. He is the first leader we have have (the US) for many years. If you don't see it now, others will look back and see it.

We MUST to unite globally in order to TRADE - we MUST have one currency in order to do it.

Yes, fed must be abolished and new government. in the end, it is all good for the world.

support our president

vb

and I almost choked.

Sure. So your kids usually come home with A- and ocassional C. But now they are bringing home all Ds for 1+ yrs. Is it still simply a lagging indicator or an "oh wow this is trouble. My kid may be stupid and have no future" moment? We are adding over half a million adults to unemployment every week! That is the news, that is the real trend right in front of your eyes! Not a delta of 10k +/- in a given week.

On a positive note on my commute home I overheard a very loud cell phone conversation. A woman who was victim to the lehman failure just now got hired. Several people overheard it and when she finished the call a group clapped out loud congratulating her. That's 1 less for next week's total for unemployed.

NYUGrad- Not sure I understand your analogy. Let's say your kids bring home all Ds for a year. That certainly indicates a problem. Let's say the problem was you (unavoidably) had to relocate them to an inner city public school in a bad area for a year (for whatever reason), and they were being harrassed and intimidated on a daily basis. And you've since moved to another state. Are those grades a leading indicator, or a lagging indicator?

Unemployment is generally considered a lagging indicator.

A leading indicator might be a marked change in the kids' personalities/behaviors in the first few weeks after moving to the inner city.

My issue is unemployment has become marginalized like some sports score vs a real problem. Where a 10k employee better than expected suprise moves mkts when the bigger trend is 500k new unemploed per week.

To me unemploymet is no longer an indicator. It is a crisis situation in this country. It is reshaping this country. Many of these jobs won't be coming back.

jock,

When the Soviet Union was invading Finland in 1937 my wife's uncle was a Swedish volunteer aiding the Finlanders. Molotov claimed the USSR was dropping "bread" (bombs) for them.

The response from the defenders was to jump up on their Soviet tanks and drop a flaming gasoline bottle into the turret. They said they were giving a "Molotov Cocktail" in return.

The Nobel "Peace Prize" has lost all meaning, IMO.

NYUGrad, 2nd_ave,

"Unemployment is generally considered a lagging indicator."

People keep saying this, but I have never seen any real documentation.

There was a time when it was discovered the world was not flat and never was.

Forget what "they" say and simply think about it.

My business evaporated as manufacturing left the country. I stopped buying anything we didn't need. No vacations, no new car, only those computer upgrades absolutely necessary to do what little work I had left.

In my own experience I can tell you my job was not only a leading indicator — it was the ONLY indicator.

I value anecdotal evidence above what some talking head sees as reality. Our city is over 15% unemployment and houses are nearly impossible to sell. The city is laying off police, firefighters, nurses. Our real estate taxes are the only reliable source of revenue since sales taxes are in the tank.

I have a list of over 70 individuals I know and many more who friends have told me about who have lost their incomes. The most recent is my accountants kids where of two couple — 3 people are currently unable to find work and in danger of losing both their homes.

If we don't see some of those Obama promised jobs soon it is hard to predict what will happen. Nobody I talk to gives a damn about a massive health care plan — they want work.

How do you feel about getting .05% on your Savings account ( gee.... isn't that what their borrowing costs are from, well, you, me, the entire taxpaying public that the Fed is living off of... gotta love that paradox..), and getting loans where They charge you TEN TIMES that amount... And, I still don't recall BAC, STI, etc.. re-raising their dividends...

The attached charts show the last 20 years of month-end yields for 1yr, 6mos, and 3mos Notes. The slightly darker horizontal line at the bottom of each chart is the 0.0000 line for yield. That’s right - you give me at least $10,000 of your money, and after a period of time I will give you back nothing except your original $10,000 less any value depreciation that takes place. Such a deal ...

You might also notice that during the last 20 years, each dip in yields has approached closer to the 0.0000 line, and that in recent months the 3mos yield has already hit that line. The 6mos and 1yr have little room to move further downward before they too are at (or below) the zero line for yield paid.

Here's one possible conclusion for this madness. I’ve read that our Gov wants (ie: will force?) your Money Market Fund to trade your Dollars for Treasuries (at no yield?). Guess the next step could be that any MM withdrawals you make would be paid in Treasuries, and then you could go an buy your loaf of bread. Wonder how many loaves of bread would be bought with a $10,000 Note? Zimbabwe comes to mind.

We live in interesting times.

Grym- I don't know about the ones in Chicago, but an attitude adjustment is exactly what the ones in San Francisco need.

Some summers just go down in history, personal or otherwise. Almost every summer in the late sixties, for instance. For me, '09 will always be the Wall of Worry.

Grym- Through 'no fault of their own,':

(a) Some people are born into poverty.
(b) Some people are born crippled.
(c) Some people are born disfigured or just plain ugly.
(d) Some people are born mentally retarded.
(e) Some people are raised in orphanages.
(f) And some people lose their jobs.

I've met people in all of the above categories, and count many as close friends. The parents/foster parents all loved/love their children. Now how do you think they all ended up succeeding in life? Waiting for someone to change things for them, or just doing what it took to succeed?

On Nobel, it seems to me that the continued focus by some posters in effect criticizing Obama for getting the prize is wrongheaded. It is not something that Obama asked for in which case he should get the criticism. It is the independent decision by the Nobel committee to give him the award that should be criticized, if you don’t agree with it, not anything Obama did or did not do. And the president's public comment to the effect that he has done nothing up until now to deserve this award shows that he is not the one to be criticized here. Yet most of the posts seem to focus some kind of blame on Obama. Why? On the one hand, in granting this award the Nobel committee did a disservice to the president as he faces US citizens, since most of us think that he has done nothing to deserve the award. On the other hand, the prize may be considered a positive in that it may show that our nation’s standing in the eyes of the rest of the world has improved since Obama came into office.

Obama's achievements??? Are you kidding?

2nd, as you well know, folks still cannot service their debts. Default is just a matter of time. Moving the bad debts from private to government doesn't change this fact. And instead of making the bondholders of the banks take the hit, we're spreading it out to the entire country. The "default" chickens will eventually come home to roost, simply because they have to, whether it be in terms of massive loan mods reduction in principal, or massive losses due to walkaways.

Certainly extending and pretending will take a long, looooong, loooooooong time as we've seen in Japan. On the other hand, serving the bondholders out will be fast, dramatic, and severe, and afterwards the recovery can really begin. Or so the theory goes anyway.

So do you want to rip the band-aid off hair by painful hair over the course of hours, or would you prefer to rip it off fast, all at once? We've chosen the long, slow, painful way - and with this way, everyone gets to share in the pain, not just the bondholders. Bank bondholders thank you, Bush & Obama!

As for Mr. Market, God only knows what he will do.

Of course there are many people in the categories you list.

Somebody did change things for the people I'm talking about — not for the better and certainly not what any of them ever expected to happen in the US.

Maybe it will get to you or someone you care about and you will be more understanding. But for now it looks like you are beyond reach.

Slide show of countries holding the shiny yellow metal

http://www.cnbc.com/id/33242464/?slide=1

Working on a gold chart which I'll post later.

Also an easy read: End the Fed, Save the Dollar: Ron Paul

http://www.cnbc.com/id/32881898/

Slide show of "Cheaper Million $ Cribs" : http://www.cnbc.com/id/33212052/

Not sure whether or not this has been posted previously. It was passed along to me by one of my American friends in Florida. Grym I think your post is well founded re: the many failed promises by Obama.

You've got to take 2 minutes to watch this comparison between
George Bush's visit to the Marines vs. Obama's
recent trip. It is incredible. There is word this will be
removed from You Tube so go now. Pass it around quickly.
Try to get this to people as it may not last long on you
tube. OH it is so good ....

Subject: Two Presidents Meet the Marines.
The Marines Show You How They Feel.... There's a 'message' in this video.
You might want to view it ASAP as it's not
likely to last very long on YouTube

http://www.youtube.com/watch?v=xIHz5tevLAw

2nd, I don't agree with your "easing back into the workout routine" metaphor at all. I am much more persuaded by Black, the former bank regulator who insists its both possible, necessary, and indeed is the approach mandated by law. Assessing the damage for the bad loans against the risk investors (bondholders and stockholders) instead of against the American people at large seems more fair, and more in line with the set of principles our nation allegedly holds dear. Zero out the stockholders, convert the debt to equity, write down the bad assets to current market value, and spin the cleaned up companies back out to the public market. I suspect they'd fetch a nice price.

Do you take issue with Black and what he's proposed? Do you prefer the extend and pretend plan that Obama is supporting at this point? "If we all pretend hard enough that the banks are sound, why everything will eventually be fine, right?"

Spoken like true Republicans. How many dead soilders later now is this? It is a totally irrelevant video. All it does show is what some creative brainwashing instigated by an idiot Republican administration that has led to countless deaths of sons and daughters being fought in the wrong place. If anything Saddam as brutal as he was still kept Iran in check. All those billions spent on a stupid war. Obama at least it trying to end conflict around the world by talking instead of carrying the big stick. Also you should be loving Bush as well for the wonderful economic situation we are in now. Unreal. Makes you wish you were a Canadian

What I think is to not talk about it here. It is an endless argument considering both political sides will stick to their points and then it gets heated. better to just drop it and realize we can't stand each others stance on things. Make sense?