Cara's Commentary & Community Chat, Tuesday, Sept. 29, 2009

Evaluating a 3.5 or so basis for SQNM - the stock dropped big time after-hours on the conclusion of an employee probe. Core businesses seem to have intrinsic value of ~3 or so by my calculation. There is some chance that the new non-invasive pre-natal breakthru of theirs has some legs despite the first mis-start due to employee fraud related issue. Welcome feedback on that.

Certainly did. Rare to see a gap like that on a one minute chart...

Using mental stop. Time horizon tbd. Day trade/swing trade.

Using this public chart as one of my guides.
http://tinyurl.com/ylpwemd

Econoday reports:

Consumer confidence did not improve in September according to the Conference Board's index that fell back to 53.1 from 54.5 (54.1 initially reported). The worse news in the report is the current assessment of the labor market with substantially more saying jobs are hard to get, 47.0 percent vs. 44.3 percent, and less saying jobs are plentiful, a miniscule 3.4 percent vs. August's 4.3 percent. This points to disappointment for Friday's monthly payroll data. And there's more trouble as the rare inversion in income expectations widened with more seeing a decrease, now at 19.8 percent, to more than offset a slight gain in those seeing an increase, now at 11.2 percent. This reading indicates bottom line pessimism and points to weak retail sales in the months ahead. Buying plans for cars tumbled to 4.4 percent from 5.3 percent and offers an early indication that the end of the clunkers program may be the start of new trouble for the auto sector (manufacturers will post unit vehicle sales on Thursday). Those planning to buy a house also fell sharply, down 7 tenths to 2.3 percent and likely reflecting at least to a degree the approaching end of the $8,000 first-time buyer credit. The one positive in the report is a continued decline in inflation expectations, at 5.2 percent vs. August's 5.4 percent and a reflection of lower gasoline prices. Stocks dipped back in immediate but limited reaction to today's report.

Let's see if end of qtr window dressing kicks in at 11am.

As per prediction of chart pattern trader. Waiting for SPY to break 20dma before putting a short in.

QQQQ already has done it.
http://tinyurl.com/ylpwemd

http://tinyurl.com/ybcd7pr
"BY SARAH N. LYNCH AND JOHN KELL

WASHINGTON -- The Securities and Exchange Commission on Monday accused a part owner of a now-defunct firm known as Fast Frank Inc. of persuading more than 800 investors -- many of them elderly -- to refinance their homes and invest millions of dollars in worthless securities."

EDIT: America has been the leader in financial "Innovation" right? Well that also means the bulk of the financial "fraud." I say for those proven guilty, bring back the guillotine.
http://en.wikipedia.org/wiki/Guillotine

Guillotine > SEC

GNK moves better, DRYS

mentioned a couple days ago as capitulation trades. I gave buy limit orders for them since I can't trade intraday every day so I set my entry prices as the close - 10 day ATR. Figure that gives me a fighting chance for a good entry price.

MCO up 11%

NMR up 2.6%

SPX down .2%

do your own homework, GL

No position.

AMZN - Standpoint Research Initiates with a Sell.

WAG - Upgraded to Outperform @ Barrington Research. PT = $60

Scott, here's a link to the write up on RSI at Stockcharts, it provides info on how it is calculated and the various uses.

http://stockcharts.com/school/doku.php?id=chart_sc...

I've also attached a current chart of the RSI M/W/D values for GMCR, sometimes it helps to see how they move together over time, takes a while to get the feel of it. Also I added a 50SMA of the RSI-7 just to help see the longer term direction. Note the RSI values are on the left of the charts, ignore the right side values as they are for the stock price but I've hidden that part.

hope this helps a little, Quasi

Quasi
May I ask what software you used to create the gmcr.png attachemnt?

I notice that today we have just around 25 posts or so. I wonder if this is indicative of anything in the larger picture. I for one am in cash and am waiting for Sept 30 to pass so that the fund managers can do their stuff and the market can show its hand on where it wants to go. But thats me being a chicken :-) In the meanwhile I've lost interest and look at the posts or even economic news at a much lower frequency.
Whats the story with other people (I guess this is like asking "all those not present please raise your hand!")? Why the low volume on the posts?

Bill Cara wrote a while back that "When $VIX is very low, its not a good time to write puts and call options, and when its high it is." Current $VIX is 24.83 low IMO.

The question is (please do not laugh) by writing puts and calls does Bill mean selling puts and selling calls? I want this concept to be perfectly clear in my mind. TIA

Quasi to automate your keystokes, consider www.autohotkey.com . Easy to learn, powerful, open source. I developed a program to allow me to sign in to my websites that utilize physical cards and transposing input.
Thanks for the picture of the 3 together.

buy limit 48.93

long at 6.92

Do your own homework

http://tinyurl.com/yclpzwj

http://www.kfnn.com/ListenLive.asp

He is on live now, everyday at 5pm ET

EDIT: he is talking about S. Baire and the FDIC being in the red, as reported earlier by Zero Hedge here: http://tinyurl.com/y9kxzxg.

His summary is basically:
-FDIC would be in the red by Oct 1, 2009
-Thus the FDIC wants the remaining banks to help with a upfront payment
-This causes a problem since the money leaves the bank's cash reserves
-So FDIC says give us all the money now, but we wont count it as it leaving your reserves all at once. We will amortize it over time, even though the money has left your possession

What is going on with this country?!?

ALOHA !!

Silver Lakes Resources-SLR(ASX)

I tried to get this out last night but there was a power blackout and I lost my post and then when the power came back on I find that the power in Hilo kicked out my remote internet server, so no internet, so I gave up and went to bed!

SLR UPDATE
With the highlights of 415g/t Au(13o/t Au) it catches your eye, but those are smaller veins, yet the mined grades at Daisy East are all over 10g/t Au, with 1,000 Au ounces per vertical foot(see Fig 4). All reported assays were at a 4g/tAu cut off. Lots of high grades listed and as the CEO points out this will move the drilling down to 800 meters to confirm the same geolgics they have found at 500 meters and above. Looks like the five year mine life will extend out much more. Also this boosts up gold production at a faster rate due to the proximity of Daisy East and Daisy Deeps.

LINK: http://www.asx.com.au/asxpdf/20090929/pdf/31kzsj63...

This moved the share price up some 6%-7% yesterday. This NR bounced the share price off support on nearly 1mil volume.

FD: YES

ALOHA !!

DIF

DIF stands for DEPOSIT INSURANCE FUND ...

The FY 2009 is almost over and the DIF is a line item on the US TREASURY DAILY STATEMENT. While the media and the likes of Bill Tatro say stuff like this:

-FDIC would be in the red by Oct 1, 2009
-Thus the FDIC wants the remaining banks to help with a upfront payment
-This causes a problem since the money leaves the bank's cash reserves
-So FDIC says give us all the money now, but we wont count it as it leaving your reserves all at once. We will amortize it over time, even though the money has left your possession

The US TREASURY is saying stuff like this:

Deposit Insurance Fund ..... $39,983(mil)

So while there is a "public media" blitz on about a FDIC fund shortage the US Treasury has been feeding the FDIC funds through the back door into DIF, nearly $40BIL so far. The DIF are the same member banks as the FDIC member banks. So start counting the $40BIL USD the DIF funnels into the FDIC banks, so really there are two "private bank" entities being bailed out by the US Treasury(aka: US Taxpayers) ... the FDIC and the DIF. Once again the US Taxpayer is the one insuring everything!

While we are planning to AUDIT THE FED we should try to do the same at the US Treasury! WE DO ...

Fact of the matter is that there are already enough laws and regulators to prosecute all this fraud right now, but there is a moral hazard.

The GAO has been auditing the US Treasury since forever and so far every year the GAO issues the same warnings to the US Treasury saying their accounting accuracy is poor, their reporting is not done timely and many other issues, yet the US Treasury just returns "lip service" to the GAO. You should read Hank Paulson's reply to the GAO criticisms of the US Treasury ... "YADA, YADA, YADA!" The GAO has no power to levy fines or jail time, so why bother? The GAO is yet another powerless auditing function designed to placate S&P and Moodys but does nothing at all to even slow the fraud, much less stop it. Why else would David Walker-GAO US Comptroller just quit? He has no power ... BIPARTISAN AND ABSOLUTELY POWERLESS!

I cannot imagine the GAO getting much traction against the US FED if they can't even get results at the US Treasury.

Hence ...

-ELIMINATE THE US FED

There is a US Constitutional mandate for the US Treasury to exist but there is no US Constitutional mandate for a central bank, much less a private one.

Mahalo then ...

I recall reading somewhere that the Deposit Insurance Fund had as some of its assets a whole bunch of bad mortgages collected from the banks the FDIC has taken out. Thus, one cannot count on the DIF to stay at its current 39B, since over time that toxic debt will be sold off for much less than full value. Like the Fed, exchanging treasuries for toxic assets.

I'm not 100% sure of these facts, but that's what I recall.

Today I contacted CIBC to convert my Silver Certificate's into the real thing and was told Silver is in short supply check back in 6 month's,I purchased these contracts in 1980,some were purchased for as much as 48 usd per oz(Hunt Bros). I have paid annual Storage fee's plus a handling charge for them to store my non existing Silver.When I asked if I could put my name on a list to take delivery I was told their was no list, please check back daily.

I have three Certificate's that say " The Bank will Deliver **** troy ounces of Silver to ******* upon surrender of this Certificate at the principal Bank of the CIBC in Toronto during banking hours" To this point I have not be able to get a real person on the phone to discuss my options, anyone know where I should start, other than calling the "COPS"

Skylane

I have paid annual Storage fee's plus a handling charge for them to store my non existing Silver.

Smells like litigation... isn't this a breach of contract and fraud, esp. the part where they charge you for storing something that they didn't hold in your name?

Skylane - Here's an idea. Get your lawyer to write the bank President (on his legal letterhead) requesting immediate delivery of your silver, and send a copy of the letter to the Financial Post and Globe and Mail.

I'll bet the bank doesn't want to be seen as failing to deliver.

Skylane,

I have found it most effective in dealing with HB&B in matters of injustice to simply document your situation in point form in an orderly letter to the appropriate party at the bank, and include the clear threat that you will be sending a copy of the letter to the Globe&Mail, Report on Business ( pick your journalist from their website ) if you do not receive your metal in seven business days. Include your phone number so they confirm that you are serious and that they are responding. This will keep the lawyering costs at bay for the present, and you will have the satisfaction of single-handedly taking on Goliath. This worked for me in dealing with GE Capital a few years ago on an unrelated matter. Keep us posted.

TOF,

Did you see the price action in MCGC today? Thanks for the trading idea. I've read your posts long enough to know you aren't one to toot your own horn, so I'm here to toot it for you! Unfortunately, I was out of town today and couldn't close some of the position to lock in some profit (I did my own DD and it looked like a great play to me), but will place a limit order to sell a bit tomorrow, then follow the rest with a stop. Hope you are enjoying your vacation and thanks again for the contributions.

KC

http://tinyurl.com/ydw8kf7

this may impact the koolaid.

I use ( unnamed online broker )... During the banking crisis, I called to see how much of my money in the account was insured... I was told by the branch manager that " the FIRST $ 100,000 was covered, and that up to $ 400,000 Total COULD be covered... " I asked " What do you' mean COULD "? Their answer was that the First $ 100,000 was definitely covered, but any cash amount over that would have to be considered on an account use basis ( total trading use in a yearly period )... I asked what the criteria for that decision was... Their answer....... " I'm not sure, the home office would make that decision "... Scarey, isn't it...

As usual it's a good one. I will prob watch it again before mkts open.

http://tinyurl.com/ydf6xtx

Love Zerohedge's slant on it:
http://tinyurl.com/yeccgmj

If not enough bondholders agreed to the plan, the company could seek to execute the restructuring in bankruptcy court, the person said. The result could potentially be one of the largest Chapter 11 bankruptcy-court filings in U.S. history.

"So there you have it: keeping the zombified living dead walking for a few extra months only leads to the same final outcome. Yet the costs to the taxpayers keep climbing."
"So poor Obama is now in the same place he was in July, when a Hail Mary rescue financing from Pimco, Oaktree and Silverpoint gave the company a few extra months."
Then he proceeds to rip into Cramer about his alledged promotion this afternoon to buy CIT and C.

"I believe a big US broker got called on the carpet recently for pulling the same stunt, ie charging people to purchase and hold metal and not doing so. The broker lost the battle, btw."

That was JPM Cheapy. Yes, if the bank point blank refuses to do anything about it, get a lawyer and some journalistic coverage to get a class action thing happening. You can't be the only recipient who is not being honoured in your contract. GL.

I went short yesterday using SPXU. A little early on the 5 & 15 min. charts, but 60 min. MACDh indicators shows SPY to drop and SPXU concurrently to rise. I noted the backtest which created the channel yesterday and picked up an important point from the chart pattern trader - the need to see SPY move below the 20 dma for 2 to 3 sessions on the 60/15 min. charts. SPY is below 20dma on the 15, but not the 60. The trade closed flat last night, will be watching the to observe whether the downtrend is in and the channel holds or if a bear trap is developing. Looking to hold thru Friday if the trend establishes itself. DYODD.

OK didn't get the Jewish holiday thing. Thought it was a joke. Yom Kippur...

Hmm someone accidently press the buy button at the close in Japan?

ALOHA !!

Skylane - Hummmm??? Quite a dilemma ...

Here is a guy over at GATA trying to take delivery on COMEX gold for a 100oz gold bar.

READ ON:
On taking delivery…

Bill,
Wanted to let you know that I plan on taking dely of a 100 oz COMEX SEP gold tomorrow. I currently hold a mini "receipt" from August that is a piece of paper with ' NYSE Liffe Guardian' as the heading. It appears that this 'New York Stock Exchange Liffe (London International Financial Futures and options Exchange) Guardian' (acc to MF Global "guardian" refers to the name of the exchange's Book System) slip of paper (SOP) is part of a system to track all the paper receipts that are issued in lieu of a receipt for real physical.

The spurious info on this SOP, which I paid $30K for is very interesting. Below are some of the specs listed on the SOP accompanied by definitions provided by MFG's delivery expert to the right :

Vault : 8888 "a generic floating receipt, not really a vault at all"

Vault Receipt# CBTG7928 " a generic receipt"....."computer generated"......"CBTG stands for Chi BoT Gold"

Bars 1

Brand WDR "this stands for Warehouse Depository Receipt" (ie not a real refiner)

The expert said that there are still a few kilo bars in the exchange warehouses but only "1 out of 30" ever "pop up" and become actual deliveries. The bars are not differentiated by size in the warehouse reports.

We converted 3 mini's into a 100oz COMEX which must be delivered upon tonight.(END)

Look at the BS the COMEX puts out.

I love the "8888" Vault ... Is that like the 88888 account at Barings that Nick Leeson started? Is this a joke? Where is this 8888 Vault? Is it some poor sap who is sitting with a GLD chit?

Compare that to what you get when you take delivery of gold bars at GoldMoney or BullionVault or Perth Mint.

We'll see how this guy's COMEX delivery goes ...

In my list of 100 stocks I follow about the consumers:
http://xrl.us/bfpd2v
there are 21 (!) sell alerts after Tuesday, and 5 distribution zones, and 58 (out of 100!) have the RSI7 weekly above 70.
I'm shorting XRT and some of these stocks. But beware, so far I lost some money and was stopped out many times with XRT.

No not the television series. A couple of days ago I posted the following TA of gold, the analyst of which is looking for a reversal in gold in the following week. See the video for more precision on his prognostication.

http://broadcast.ino.com/education/goldcycle921/?c...

JAG investors took it in the hip pocket recently when JAG management went and issued preferred shares or warrants, I don't recall which. Well a couple of weeks later and JAG looks like its holding the rising channel that I drew some time ago.

Daily looks good as well. 50 dma as support. Big volume beginning September. Looks like institutional investors climbing on board (and insider selling?) SLW, UXG telling similar stories. I don't know how far or substantial the next rally in gold is, but I'm certainly taking a closer look.

tof- Since you're headed up the coast, why not catch the '09 series in the Park?

Headliners include Jorma Kaukonen (Airplane), Emmylou Harris, Boz Scaggs, Marianne Faithfull, Lyle Lovett, John Prine, Richie Havens.

All free! (If you can find parking.)

http://www.hardlystrictlybluegrass.com/

jock,

Sounds like a plan. Several times when I had a deadbeat client a bit of loud talk at their reception desk got immediate attention — just mentioning the newspapers should really expedite matters.

When a client was using my artwork without permission their lawyers came around the minute I mentioned the cost of an injunction forcing them to pull their products off the shelves at Lowes, K-Mart, etc. I didn't even need to call my lawyer.

Not sure if this has been posted here, but as of September 18 the $250,000 on m/mkt accounts has expired. My broker didn't even know it.

Like I tell my kids... Nobody cares about YOUR money — but YOU!

Edit:
I found this very interesting. I got the link here, but in case you missed it...

Future of the Dollar, Sept. 25 2009 | 1:00 DT ET
Jim Rickards, director of market intelligence for scientific consulting firm Omnis, shares his outlook for the dollar.

http://tiny.cc/UnhJ7