Cara's Commentary & Community Chat, Mon., Feb. 2, 2009

I'll leave you guys to your football, be it American or European.

Good luck today.

omphalos- I agree in many ways with your perspective on SF politics and the Chronicle. The deterioration in "the streets of SF" is one reason I live on the Peninsula rather than in the City (the fog is another- I prefer more sun). I spent ten years of my childhood in the Pittsburgh area (three separate times, interrupted by years in Palo Alto and Atherton in the Bay Area), and another 19 years in Ann Arbor (of course, some would argue Ann Arbor is an island also). One girlfriend was Polish/Jewish and from an area not far from the Highland Park suburb of Detroit, so I was around during the Vincent Chin incident, and well aware of the problems the Big Three were having (not the least of which was watching an older sister of a classmate heading to work at a Cadillac plant with a BAC well above the limit- there was no need to measure it, I made that call based on her eyes and speech).

I don't think protectionism helps the US. American ingenuity and our work ethic still rank high. We need global competition to keep us on our toes. I still listen to Springsteen's "Youngstown" all the time, as it takes me back to my days near the Monongahela Valley. Those steel plants can flourish again. I just don't think we need any artificial barriers to accomplish that.

Like your take on today's market action. We'll see.

Price Targets Lowered:

ATVI - from $17.50 to $15 @ Kaufman Bros.
CSCO - from $19 to $16 @ Credit Suisse
TCK - from $21 to $15 @ RBC

crazy action in gold overnight.

pushing back up against the 912 level and gold is creeping back down,
oil getting pushed down as well.

w/ the asian markets down, its looking like the miners will open lower as well, making our previous imbalance of miners vs. the metal worse i suspect.

if they gap down then mount a steady recovery into the close then i will turn optimistic. but ill be watching spot gold for a possible early afternoon plunge below $900 before any optimism prevails.

i guess the miners still lead the metal for sustained bull runs. the hesitation of the stocks to run alongside the metal to me seems to indicate some amount of correlation to the broad market that still exists. hate to sound like a broken record but the true test of the gold stocks will be their behaviour in the event of a market slide. they will fall somewhat but the relative performance will be a big indicator if they are ever to break out to the upside in a major way should gold make a move through its 2007 highs.

I remember the day when Daschle was voted out of Washington by the very voters that seen Daschle for who he really is.
In the mean time he manages to make 5 million (that people know about) just because he is part of the politico mafia.
New York Times just touches the surface on this great American hero!
http://www.nytimes.com/2009/02/02/us/politics/02da...

Sometimes ya gotta keep yer eye on the big picture. What do I mean by that?

America boomed for 50-plus years after WWII in the biggest most historic bubble economy in the history of the world, the Nasdaq bubble being only the tip of the iceberg.

Stocks were sold as being a retirement panacea; the thinking was, at it's most extreme, that "we can all be rich".

Bush got suckered into the war on terror and essentially spent us into a corner.

Stocks 'aint going up. Not yet, not soon, and when they do, probably not abidingly.

shark- that's good...if you were narrating a 20-second version of US economic history, that might do it...right now, though, most of us are more interested in the next few microseconds...;)

2nd_ave,

"... don't think protectionism helps the US. American ingenuity and our work ethic still rank high. We need global competition to keep us on our toes."

I agree, it wasn't until people starting buying enough foreign cars that Detroit began to improve quality. I sold my beautiful 1973 Pontiac LeMans (which sucked gas, coughed and sputtered) and have never been without at least one VW since.

However, this is a chance for our professional politicians to look pro-American — especially if TV face-time is available.

The time to have been "protective" was when legislators were all pushing the move to a service economy. Not to stop globalization, but rather to allow an orderly transition. The move was inevitable just as was the switch from agriculture to manufacturing, but instead of taking a generation it happened in a decade leaving people out of work at their prime earning time and no mentors to train the next age group.

Declaring a trade war at this time is in line the typical follies which emerge when political image trumps reason. Too late to help. Wrong target in their sights. Long term effect can only make things worse for us, for them and cost every one a lot of pain. I wonder how many in Congress ever read history — even the Cliff Notes would help.

I would avoid U.S. multi-nationals (maybe too soon to short) and look into consumer non-duables with a large domestic market (too late and pricey right now).

UCO added at $9.80

"That’s pretty costly entertainment. Why do people watch?"

kaimu- I don't think people watch him for investing ideas (at least, not any more)...they watch him for the same reason they watch Charlie Sheen...

shark,

Actually, many of us did "get rich" relative to pre-war. Much of it due to the effects of the GI Bill. I hope to see a comparable deal for our returning vets, many of whom signed on to the Reserve and National Guard programs for the education benefits they advertised. Now if/when they return the job situation is even worse than 1945.

The stock market worked in our favor because of the continuous inflationary trend and switch to a credit economy — buy now, pay later (with cheaper dollars).

My strengthening belief in a global deflation lasting longer and probably more extreme than generally expected will keep a large part of my investments in cash and Treasuries. I''m only willing to risk a small part on active trading unless/until a major shift to reinflate is strong. I doubt the Fed and Treasury can accomplish it.

Bush: IMO neither of the Bushes were genuine fiscal conservatives — I doubt they know the meaning.

Dubya's personality appears to be one which is easily steered and controlled. I feel sorry for him the sense that his strong fundamentalist religious beliefs and personal loyalties allowed behind the scenes manipulation to the extreme detriment of our nation's reputation, both here and globally.

I think he was convinced that, like Lincoln, his ignoring of certain aspects of democracy were justified in pursuit of the greater good (protection against further terrorist attacks). We can never be sure his policies weren't responsible for not having another since 9/11.

Ideals are important, but fanatical idealism has proven to be bad national policy.

CVX - estimates raised at UBS. 2009 estimate increased to $5.24 a share. Buy rating and $91 price target.

XOM - estimates increased at UBS. 2009 estimates raised to $5.30 a share. Neutral rating and $84 price target.

NYU
you inquired about electronic records stocks to play last week.
IBD had an excellent feature write up on a stock in the weekend edition if you didn't catch it.
Cant remember the ticker at the moment however.

back to 80% of allocation...

New Year's Resolution was to turn it off.
- Entertaining? Yes.
- Helpful? No.
- Good decision? I think so.

Qwest finally got their arse in gear and updated our phone system on the island to basic level DSL. I took the opp to try Foxfire. Amazing.
Put a fork in IE whatever version....

Nice to be able to at least play in the slow lane......

Mac- I'm in the midst of reading a book about sewage...one which states that (a) "the biggest medical milestone of hte last two hundred years...is sanitation," which "has added twenty years to the average human life span," and (b) points out that "2.6 billion people don't have sanitation. I don't mean that they have no toilet in their house and must a public one with queues and fees. Or that they have an outhouse, or a ricket shack that empties into a filthy drain or pigsty. All that counts as sanitation, though not a safe variety. The people who have those are the fortunate ones. Four in ten people have no access to any latrine, toilet, bucket, or box. Nothing. Instead, they defecate by train tracks and in forests. They do it in plastic bags and fling them through the air in narrow slum alleyways. If they are women, they get up at 4 A.M. to do their business under cover of darkness for reasons of modesty, risking rape and snakebites." -from "The Big Necessity" by rose George...

There IS gold in (the existence of) sewers...

"There IS gold in (the existence of) sewers..."

Probably more of that SF liberal gibberish! LOL!

After all, more people than live in SF are w/o sanitation......you crazy Californians! :>)

Hey, I moved from CA with standard sanitation to Washington w/o running water, electricity or a sewage system. Hauled in water, had propane everything and a nice outhouse.

Bought UCO, FAS today following others here into the trades.

Just sold FAS for an 8% day trade, and UCO for a 4% gain.

Waiting to reload...

DRYS has a PEG ratio of .01, and it has a forward P/E of 1.3

I guess the earnings forcast has yet to be cut...

Thanks guys for the trade ideas today!

"America boomed for 50-plus years after WWII in the biggest most historic bubble economy in the history of the world, the Nasdaq bubble being only the tip of the iceberg.
Stocks were sold as being a retirement panacea; the thinking was, at it's most extreme, that "we can all be rich".
Bush got suckered into the war on terror and essentially spent us into a corner."

Very interesting comments and I have to agree, Shark. But I would also make the case that the United States starting getting "spent...into a corner" as early as the 1960s between the Great Society and the military spending of the period. When you throw in the removal of the dollar from the gold standard (for international debt settlements) during the Nixon years as well as other initially well intentioned programs (OSHA, EPA, etc.) that have grown to levels never imagined when they were initiated you get to the basis of some of today's problems. Manufacturing has largely been removed from the U.S. (after peaking out in the late 1960s) by a combination of seemingly unlimited potential legal jeopardy and constantly increasing regulation. Today we seem to build only new distribution centers and retail strip malls where imported products are sold. We used to build factories.

During the early boom years of the period you refer to the prosperity of the country was based on the actual production of real products. For a variety of reasons (not the least of which was the status of the dollar as the world's reserve currency) we slowly turned outselves into a consumption economy and everyone seemed to think that they could retire based only on ever rising stock and home prices. Economic reality is now dictating otherwise. In many ways we are in entirely uncharted waters today and none of the lessons of the past really seem to apply. Having said that we are also likely in a period where the opportunites going forward are greater for those who actually figure out this new economic reality than they have been for many years.

"..more people than live in SF are w/o sanitation."

craig- that's also no joke...if one ventures off the main paths of Golden Gate Park, homeless encampments/dugouts can be a minefield...i wonder about SF priorities sometimes-> it's tourist dollars that drive a big percentage of the economy, and they're driving them away by spending money on programs that attract runaways from across the country...

Thank you bsi...and CP it's good to see you back!

ALOHA !!

One last thought ...

If you can understand this then you can understand gold ...

Q.: Are ‘quantitative easing’ and the regime of near-zero interest rates a good medicine? Or will they fail to solve the credit crisis as it turns out that their impact on the real economy is nil?

A.: ‘Quantitative easing’ is an empty slogan designed to cover up the black hole of zero interest gobbling up the world economy. Consider that the total outstanding debt is in fact perpetual debt, because under the regime of irredeemable currency total debt can only grow but never contract. Even if all debtors could repay their loans, debt would still not be extinguished. It would be merely transferred to the banks and, ultimately, to the government.

Consider also the fact that the liquidation value of perpetual debt doubles every time the rate of interest is halved. So when under the slogan ‘quantitative easing’ the rate of interest is serially cut in half from 4% to 2, then from 2% to 1, then from 1% to ½, then from ½ % to ¼ , and so on, the liquidation value of debt will double from $1 trillion to 2, then from $2 trillion to 4, then from $4 trillion to 8, then from $8 trillion to 16, and so on. Soon you will be talking real money in the quadrillions of dollars. Mind you, this is just increase due to falling interest rates; additional debt assumed through bailouts would be extra.

The world has already passed the point where one more straw breaks the back of the camel, as witnessed by the collapse of the banking system. The next step is breaking the back of the dollar. ‘Quantitative easing’ is guaranteed to accomplish that, although it is impossible to say when.

The whole idea that the government can keep halving interest rates serially with impunity is insane. Bernanke and Geithner don’t know what they are doing and saying. ‘Quantitative easing’ has another arm, ‘quantitative backlash’, operating with a high leverage. Not only will ‘quantitative easing’ have zero impact on the real economy; it will bankrupt the U.S. government due to the serial doubling of the liquidation value of government debt.

You need gold in the world’s monetary and payments system because gold is the only ultimate extinguisher of debt, without which total debt becomes perpetual debt and the fast breeder of debt starts spinning out of control. As a consequence, the world will be sucked into one or the other of the two black holes: that of zero interest (deflation) or that of infinite interest (hyperinflation).Antal Fekete

The question then becomes, "At what price will those who hold gold be willing to trade for fiat paper?" That question may never be answered ... due to the infinite power to print. The US FED owns the futures ...

Trading is only part of the overall equation of surviving BIG GOVERNMENT and its failed monetary policies!

I'll say "Hello" to Arnold!! HA!!

Stop out all most my position but DZZ/HNU/HOU. Lost in most stop out position.
I am positive and optimist and believe we may go 9000. And try to play long for day trade to make some.
But have feeling that we will go down lot more. Staying away for now until find some good short term trade that I can hold for day and come out winner.

Very good point. The reverse corollary is a chronically firm dollar during a sovereign debt collapse. Yields have taken a reversal to the upside, so a treasuries sell off may happen in short order. There is a huge derivatives position which has prevented the collapse, but caused a massive treasuries bubble tied to interest rates.

Just who's been buying US Treasuries and why? Talk about change, shouldn't these facts be publicly disclosed? I think US citizens should know who holds their debt and how much exists.

"China’s government now has close to a trillion in Treasuries. OK, not quite a trillion. But darn close. $860 billion or so at the end of November and – if current trends continue — over $900 billion at the end of December.

China also has $550 billion or so of Agencies, which are effectively now backstopped by the Treasury. That works out to an enormous bet by China’s government on US government bonds."

Council On Foreign Relations:
http://tinyurl.com/bwj9vu

Long Drys @ $5.00

We have the same problem in Seattle and surrounding areas/woods/parks/vacant lots/church properties, 2nd.
The question isn't so much encouragement, but how do you employ/rehabilitate/house these people? Unemployment at records, government/the people under extreme duress....Arnold is wondering where Grey Davis is about now.....

They could provide shelters but it costs $ and you know how that is these days....

Does anyone know why MR softy is making a significant move counter market trend.
Bob

Straddles for the entire week are posted at http://straddles.nexalogic.com

There were lots of big straddle winners last week. Note that there is considerable value left on the losing side of the options as there is still lots of time to expiration. This means that the moves required are smaller than the maximum shown (last week roughly only 30%-40% of the max move was needed). I am still compiling results, there is a lot of information and too many movers, too much info to go through.

the dji is below support level (lower low) of the last two weeks. time to buy?

once again uco was a good morning scalp - until it ain't.

tbt is settling down after a 30% rise in the last month.

funny how when a stock zooms into your profit zone (on a 2 to 20 minute trade), it logarithmically works against your desire to sell immediately for the quick profit that you bought it for in the first place. a hard lesson to learn....

return of principle is oh so more important than return on principle. paper trades and exercise are a boon for my need to "do something even if it's wrong".

did holmes earn his paycheck in that late game catch yesterday?
thanks to all,

FD: long nflx

bought more at 4.88.

bigwad1- First time I've heard that story, but it doesn't surprise me. Each one of those guys, of course, has a story. I'm hoping Obama's 'infrastructure plan' somehow ends up allowing most of them to find employment and work their way back to productive lives. Something as simple as cleaning up/maintaining/'patrolling' the streets and parks they now wander/inhabit would have economic benefits that go way beyond the cost of the wages involved, IMO...

Something as simple as cleaning up/maintaining/'patrolling' the streets and parks they now wander/inhabit would have economic benefits that go way beyond the cost of the wages involved, IMO...not the least of which would be the restoration of respect/self-respect, as well as the transformation of an economic drain into an economic plus...

Marc Faber channel on YouTube

http://ca.youtube.com/user/MarcFaberChannel

SiO2 ....... a question.....
Do you pick & choose from this list as to whih ones to trade, or do you trade the whole list in the expectation that the winners will more than make up for the losers?

if you pick & chose, what are some of your criteria?

thx .... very interesting........

sc22, an investor with very deep pockets could afford to buy a good chunk of them and come out with a good profit. A few big winners in the basket will do that (e.g, take a look at BEAV C10s today, MAT P15s, ROK P25s, IP 10Ps, AMZN 50/60Cs. Last week there were lots of these. In practice, you look at the move required, past history, options liquidity, time to expiry. For example, with one week to expiry, you would likely not buy a stock that requires a 40% move. With 3 weeks to expiry, that changes.

Some stocks are favorites for this, like AMZN, SNDK, and AKAM, and many others in high-tech.

Most unusual that gold moved down overnight as the USD strengthened and then moved down again once the USD weakened over the past few hours. However, during the transition period between USD strengthening to weakening, gold moved upward. I cannot recall this pattern in the past so it is difficult to draw conclusions. Whatever the root cause may be however, there have been unusual trading currents in the gold pits in 2009.

2nd
sold DZZ at 23.25 cost 22.20
VIX is around 50.may be at short term top
UAUA looks interesting again

Take what your given.....tough market even for a trader.

Sell 1,500 shares FITB at 2.19 Limit Day 02/02/09 Filled

02/02/09 13:44 Filled 1,500 at 2.19

>QSII was the ticker I think

3X TMF recommendation...

SR

brought at 9.63 and put order to buy more at 9.25

heavy selling on FDX. Looking oversold short term.

UPS earnings out tomorrow. Not expected to be good. FDX might be getting punished with 'em.

at book value, further selling tomorrow might make an entry point.

UPS and YRCW might be worth a look.

The county in which I live performs annual assessments of property values for tax purposes. I just reviewed mine and to my surprise, they've increased the value by 3.7% for 2009!!! Apparently property values are increasing in my area...

I got mime week ago. They decrease my value of my house by 60k but increase rate per 1000
New bill is 6700 up from 6300

Kerry
I do not play VXX VXZ
i keep eye on vix to see where market might move up or down--my little indicator?

Biotechs holding very strong in this enviroment. When we finally do go higher(with volumee included) look for this group to lead. Specifically GILD has been holding its own. GILD is just shy of a 52.45 buy point off a long cup with handle pattern. If we can turn the market here and get above this overhead supply I think it can fly.

FD: VERY Long GILD in my Kids custodial accounts

Sonuvagun....

Found myself owner of some PG today. Ages ago I set what seemed a very low & unlikely buy limit, at the bottom of two downward spikes. But will I conclude presently I paid too much for it? What a sick looking chart!

Property tax rates here are determined later, usually around mid-summer after the state budget. Payment is due just prior to Christmas (Merry Christmas!).

So are we all going to be "investors" in UCO overnight?

Sold half position here at $27.48.

It trades in a nice range......until it doesn't. : ' )

WASHINGTON (MarketWatch) -- The U.S. government is expected to borrow $493 billion in the current quarter, the Treasury Department said Monday. The borrowing estimate is $125 billion more than estimated three months ago. The increase is due to lower revenue, more spending, and a program designed to strengthen the Federal Reserve's balance sheet, the agency said. For the April-June quarter, the government is expected to borrow $165 billion, the government said. In the three months ending December, the government borrowed a record $569 billion.

"Investing overnight" in UNG.

@ $27.61. Can't stand holding these things overnight.

to 50%...

Despite uncertainty will hold 9.71 purchase over night.

Also will hold overnight. Set a sell Limit so it will sell into any morning spike.

CP is JCP a stock you follow? If so, do you have any comments about it?

Other public players include CERN, MCK and QSII. GE has a medical systems division that has historically been more medical device focused, but they have the potential to be a large player. There are also many small private companies in the space, of which EPIC Systems is notable.

The VA has the largest implementation of any EMR in the US. They developed their own VistA EMR and there has been much talk over the years of making their software publicly available (as the s/w license costs & implementation costs can be large).

Implementing an EMR is far, far easier said than done (in my experience). The govt. definitely can be useful in establishing standards in the space, but I am would be concerned to see them in a direct implementation funding role...lot's of people have thrown money at the problem and not been successful.

What may be interesting from a clinician's perspective is that there is potentially a much larger "bang for the buck" in automating billing, claims and scheduling processes rather than clinical documentation.

Only an opinion...

FWIW......JCP opened up a standalone store in a decently nice strip mall near me. I actually went there recently b/c I needed a new belt and some socks I think.

In the past I was only familiar with seeing JCP in large shopping malls (which I now avoid like the plague). They seem to at least be winning over the "minimalist-male-I-would-rather-die-than-go-to-a-big-shopping-mall" customers like myself. (I'm just not sure we are a big shopping contingent).

But in all seriousness, this standalone store was a much smaller/simpler/slim version of the larger multi-department JCPs I have been to in the past. This is probably a good thing in general for the chain.

I was out shopping today and missed today's action in UCO. So I am placing a buy limit order for tomorrow at $9.5.

"California delays $3.5B in payments."
http://tinyurl.com/ck2gyh

I should really file asap as NJ is also cashless. damn this is getting crazy. They better pay me 9% interest for any delays on my tax return.

Yep, all the lawyers will get the remaining assets.

It is starting to seem to me that all of these crooks were living in Conn --

"MAXAM had been headed by Sandra Manzke

The other day, Manzke told The Wall Street Journal she had put every dime with Madoff and had been wiped out. Yet Barrons business magazine did a laudatory profile of her not long ago where she boasted of her careful, diverse investments. Ahem."

Here is more of the article:
http://www.projo.com/home/content/Mark21_12-21-08_...

1st i want to apologize to experts here who can read charts like reading the time on your watch. the vertical lines on the attached and boxes are making me dizzy too. but its just the way my novice eyes read the charts at this stage in the game.

So i had the trigger on 100% allocation on April GG calls but didnt make the bet. big bet on Red at the roulette table i know. And looking at the attached chart it is evident to me (please slap me if i am seeing things), that each time GG penetrated the Stoch 80, while rsi was above the 50 line, the pps would make a move to the upside. the only times this didnt work was when rsi was under the 50 line.

However it also shows the big moves were also very definable by when stochastic was crossing up through the 20 line. it was basically a guaranteed move.

My gatherings are that when the 30&50dma crosses up through the 200, its going to be gold mania. but i have to wait until i see stochastics fall again for the big money bet on call options, or place very small stock trades on breakouts.

its too risky here for me at this second.

I really would appreciate feedback if i am off base or ways i can improve my reading of the situation.

Good luck with UCO David. It has been so nice to me for so long that it's hard to break the addiction. But today was particularly wild. I've started the search for a new best trade.

I would pare down RSI "crossings and sightings" down to +70 and -30. Once the RSI crosses below 30, you watch on the weekly chart for the crossing above that level. As for the 70, you watch as it goes over 70 and get a typical sell signal when it drops below. But I would depend on the weekly chart. A monthly chart would confirm the end or the beginning of the trend.

Note that the G.TO chart is forming a very large inverted head and shoulders pattern. One should be able to visibly make out the same on the weekly chart.

I can feel the suspense building. I sure hope the market rises on the news until Geithner's speech next week, so those 3X bear funds will be a tad less expensive.

Vanilla, what an eye opening article. I had no clue stuff like this was going on. Shouldn't all of this she-nan-i-gans have been open for scrutiny based upon the prospectus and quarterly/annual reports these people should have sent to their clients? How do funds "manage" millions and billions of dollars by placing much or even all of it with other funds, so they in effect do nothing but collect a cut of the "winnings", all without any disclosure to their clients?

It must be legal right? The SEC approves of this sort of thing. Perhaps there is no regulation that covers any of these "DIS"investment vehicles.

Whatever you do, don't read Mish's expose' on Wells Fargo today...it could send you over the top.

8000 is psychological support.

It has been brought to my attention that today was the third time that we have closed below 8000. If tomorrow closes below 8000 the beating will pick up. If not it will be delayed. I don't believe there will be an Obama rally until everyone swears off stocks. The call put ratio is to bullish for that.

Gold seems to have topped for a while too... 91% bullish survey. Who is left to buy? last time it got this high was the last major top months ago.

Stay nimble and use stops.

Bill-

(a) I notice only the villagers who attempted to scam the first buyer ended up getting jammed up in return. Just further evidence of PT Barnum's famous words. Those who rounded up the monkeys for $10 to $ 20 each and saved/invested the money are still OK.

(b) It takes serious capital to play that game. The scam involves an outlay of about half the amount one expects to rake in.

(c) The monkeys can't be entirely worthless, or the game doesn't work.

(d) So the hapless holders have a few options. They can use and/or sell the monkeys for 'intrinsic value,' thus reducing their losses. They can (artificially) jack up demand for the monkeys, passing losses on to neighboring villages. They can truck the monkeys to lower Manhattan, and at least have some fun.

A true, down and dirty thief never gives up!
Moral of the story is......Buy all the high powered rifles you can possibly afford and teach those monkeys to shoot with deadly accuracy at life size posters of those two banker type thieves. After a few months of relentlessly training from morning until night those monkeys will become the most reliable source for justice.
Sooner or later the two thieves will come back for a second round of monkey business.
All you have to do now is teach those monkeys to dig a 6' whole.
A thief is a thief is a thief.

This is exactly it. We have 100's of thousands of minkeys all typing at their computer screens. Its just a matter of time.

NYU Grad.

Hi, just wanted to share a link, thought it might be better to bet on those options and bet some on the stock itself. Here's a link you might like:

http://www.leavittbrothers.com/chartspeak/

(I'm not a trader)

note that the proposal would apply to refinancing as well...that would jack up the value of those monkeys pretty quickly, IMO...

"Officials said the GOP was coalescing behind a proposal designed to give banks an incentive to make loans at rates currently estimated at 4 percent to 4.5 percent. Fannie Mae and Freddie Mac, which were seized by the federal government in September, would be required to purchase the mortgages once banks have made them to consumers.

Officials said loans to credit-worthy borrowers on primary residences with a mortgage of up to $625,000 would qualify, including those seeking to refinance their current loans."

This GOP (my former party) idea is not a good idea. Even if it applied to refis...

"Officials said loans to credit-worthy borrowers on primary residences with a mortgage of up to $625,000 would qualify, including those seeking to refinance their current loans."

Key phrase is credit worthy borrowers. We can artificially make rates to 1% on mortgages, the only people it would help are those who, #1 have a job or capacity to pay back, #2 credit worthy, #3 have that thing called equity in their home, #4 have reserves of cash (not as important in refis).
This won't help those who are underwater, losing jobs and are in situations that are difficult. They should default and move on.

Here is the problem, it isn't that rates are to high, because those who will benefit from this (i hope the majority who post here will!) are those that probably caught the last refi wave and/or are in a good financial situation. It won't stop the paradox of thrift as everyone's job is at more risk than it was months ago... Consumer is dying or has already spent their savings and borrowed to much.

The problem I HAVE WITH THIS is, making rates artificially low PULLS DEMAND FROM THE FUTURE. This is bad and won't help out LONG TERM Solution. What is the encore? Rates are 3%, 2%??? What happens when rates go up? How will that help? if they don't, they don't.

Housing started to decouple from wages in the 90s and got real stupid after Greenie begun to inflate the housing bubble. We build a quarter century of homes in 5 years, make a quarter century of purchases in 10 years and gave anyone who had a pulse financing during those times.

The solution to housing is painful, prices must come back to wages or use the rent/own ratios. Either way there is much downside to come. People do not want to own an asset that will be worth less in the future.

Off loading this crap onto Fannie and Freddie is giving the alcoholic more whiskey. That does not seem to be a solution to get the drunk to stop drinking.

Fannie and Freddie should be filing for CHP 11 not in business.. Our biggest mistake was letting the madness continue.

Tax cuts are worthless in this, Keynesian spending will not solve the problem but only add to the burden down the road with higher taxes and eventual inflation YEARS from now, not a year, years...

Another problem with a plan like this is that it essentially tempts a few lemmings to jump into the market with the hope of creating some short term demand. The ones that do jump are rewarded with a good mortgage on an overpriced home. In the long run they will have to watch their new home's value turn south as the artificially low rates will not be sustained.

The other people who are hurt are people like me. I'm waiting for prices to revert to their norm and now I'll have to wait longer.

NYUGrad- We will get 5% in CA. Instead of cash payments, how about setting up an automatic DRIP program to buy CA bonds instead! Wouldn't that be the fastest way to roll this whole thing over to my kids?

that is wild! thanks for sharing and i hope you get your refund asap.

At this point i feel like i should go back to my employer and ask for payment in gold, not usd.

Thanks Ross,
I did a quick scan of JCP fundamentals. The most worrisome aspect is management efficiency. I got this from msn money central stats and there is no date listed, so I don't know if this is current info or from 2007? 2008? But,income and revenue per employee is < 1/2 the industry avg. Receivable turnover is < 1/3 industry avg, with inventory & asset turnover also less than the industry avg.

I do like the bookvalue @ 23.41 with the stock closing 16.50 today and I like the current ratio of 2.0 but then the quick ratio is 0.7 (1+ is preferrable). And that tells me they are carrying extra inventory and ties in with the JCP low inventory/asset turnover figures and increased inventory reported for the entire US.

On Google JCP has a lot of negatives in Cashflow for the latest qtr. But they are still solidly in the black and making money.

JCP was 14.38 on 11/20 and closed 16.50 today.

So, my 5 minute analysis and opinion is, I will wait a bit. They have a nice 4.85% yield (for as long as it lasts) and paid a 20 cent qtrly dividend on January 7th.

omphalos- I am always amazed when people take the time to respond so thoughtfully to my questions/comments. I have not be as lucky as you and 2nd. Yes, I have lived my entire life in Ca. Marin County and Santa Barbara. As an engineer/builder, my thought process is very linear by necessity. That is exactly why I look for others to comment. Thanks for responding.
However, I must not be smart enough to understand your comment. Are you saying that protectionism IS an appropriate step to take now? I can't get my head around the idea that putting the hammer to our trading partners who own so much of our debt (or not) is a good idea.
Love Seattle, one of my best friends lives there. Great Brew-Pubs.

Johnny - Good analysis, I'm suspect of any divided yielding equity that hasn't already chopped their divy...especially retail. Earnings report 2/20, then we'll see what happens.

I'm going to throw this one out here again. Anyone following V? It has had a nice run the last week or so. + 13.58% so far for my trade.
FD- also SOLD V about a 3 months ago @58 for a HUGE loss.

Everything needs to be taken in context. My question is if Daschle knew his limo service "gift?" was taxable, or if he made an honest mistake. He does bring big political capital with him, no doubt.

When you read about the things that Daschle has done with his time since holding office (here) you think that he is the exact kind of person that Obama would want to keep out of this position. But this is after all a payback for Daschle's help in the primaries (a payback of the legal variety).

Thanks CP. You put JCP on my radar and I appreciate it.

http://tinyurl.com/ajvrol
Above is the link to
"MINEWEB GOLD PRICE COMPETITION
2009 gold price estimates - High $1345, Year End $1172, Average $992
This year's Mineweb gold price competition closed on Jan 31st with readers on average fairly bullish on the yellow metal's price prospects for 2009.

Author: Lawrence Williams
Posted: Monday , 02 Feb 2009"

So, there you have it Dr. Cosa.. Gold will hit $1345 this year. Just buy and hold until it gets there and sell before it falls back to $1172 :) Just kidding you. It's late and past my bed time. I figure your the resident PM expert (after Bill) and that's why I mentioned your name, which wasn't detectable on the names listed in the "tabulation of entries list".

http://tinyurl.com/arepxo
"UBS AG, the Swiss bank under investigation for allegedly helping wealthy Americans evade taxes, hired more than 200 brokers in the U.S. in the fourth quarter as it sought to counter client defections.

UBS hired a team of five in Dallas from Goldman Sachs Group Inc. with $4 billion under management, and a group of the same number from Morgan Stanley in Houston with $2.1 billion in assets, Karina Byrne, a spokeswoman for the Zurich-based bank, said in an interview yesterday.

The largest Swiss bank lured employees from those and other competitors by offering signing bonuses of as much as 260 percent of the revenue the brokers brought in over the previous 12 months, said two people with knowledge of the matter who declined to be identified. By contrast, Merrill Lynch & Co. brokers were offered up to 100 percent of the revenue they brought in to stay following the sale to Bank of America Corp."

Form an appropriate sentence to include the following words:

dog, new, can't, teach, old, tricks

This one will see some nice action today - not sure how to play a nice news release at open or later. Happy Trading

I'm a dog trainer and I can confirm, old dogs learn faster than old bankers....by far. Dogs are loyal, honest and hard working.

Bankers are none of those things. That's why bankers aren't man's best friend.