[9:06am ET] A lead article in Bloomberg today reads, “Morgan Stanley-Citi Brokerage may face ‘breakaways’ as Independents beckon”. That’s an understatement. The new firm is already being called Citi-morg.
Christine Harper’s article effectively weaves the latest Citi story with the Spectrum Group results.
http://tinyurl.com/8ylwcu
Says Harper,
Spectrum… conducted focus groups of people worth more than $1 million and did an online poll of more than 750 millionaires in November. The research found that the millionaires had lost 30 percent to 40 percent of their net worth since September and that they had lost faith in their advisers, especially those at bigger firms.
The bottom line is that “Breakaways” will be part of the new Wall Street taxonomy. Not only will clients revolt, but tens of thousands of registered financial advisors will also wave goodbye to their old firms.
http://en.wikipedia.org/wiki/Taxonomy
At the end of every day, the assets of the Wall Street firms leave by the elevator, some never to return. These people are called ‘producers’ for the simple reason that firms like Morgan Stanley rely on them to build Assets Under Management (AUM) or Assets Under Administration (AUA). Assets – your assets -- are something they think they ‘produce’.
At Morgan Stanley 25 years ago, I was one of those producers. People in my position referred to the suits in the executive office as the ‘floaters’. We were paid from 25% to maybe 50% of our production, while the floaters skimmed the rest, some for themselves and their perks, and a lot for the expensive trappings, legal and marketing departments.
A few years later, I formed a registered dealer called William Cara Investment Bancorp, where I earned 100 cents on the dollar and kept my expenses to a minimum. I was in fact a breakaway. My colleagues asked how I could call myself a bank. I told them that the industry and the regulators didn’t have a clue where the industry was headed; they were too busy building fees and other costs into a model that was based entirely on managed conflict of interest, and not client results.
Yes, the broker-dealer model is dead; something, as you know, I always hoped for, but never thought I’d see in my lifetime.
I have always been driven by a single motivation; treat people the way you want to be treated. When it comes to the owners of capital; it is their assets, and it needs to be under their control. People like me are the paid help. I have always understood that. That’s the model I espouse, and have set up for my professional company.
This year I will be devoting much attention to attracting those breakways to work in a multipart agreement with them and their clients. There is the client, the client’s electronic broker and me, the trader. The financial advisor will be paid a portion of my fee, but remain strictly independent. As the intermediary, it is the advisor’s role to help me fulfill the Know Your Client obligations and meet the specific needs of the clients, and also ride shotgun on me for the client. If in fact I am not doing the job of meeting the client’s needs and expectations, then it’s the advisor’s job to pull the plug and find another trader. Based on my performance success, this model is a win-win-win.
The year 2009 will be one where the independent advisory companies will be competing for the breakaways. These are the organizations that charge independent financial advisors a small fee for organizing their FINRA registration and give them a marketing umbrella like the Century 21 real estate model.
http://en.wikipedia.org/wiki/Century_21_Real_Estate
Being a commodity service, those companies will have to pare their own organizations to the bone because, in truth, they don’t play much of a role, and if they do there is another conflict of interest. So, like Century 21, there will be competition and their charges will be minimal.
At the end of the day, the model excludes them because they do nothing for the client, for the client’s broker or me. To repeat, the new model is a partnership of Client-Electronic Broker-Trader-Advisor, each with specific responsibilities.
You know where I stand. It’s up to the client to decide whether they want a three-legged stool or a more comfortable four-legged chair. In my case, it will not cost the client any more to include their adviser.
At the Cara Bahamas 2009 Conference (March 28-30), I have set aside time to work exclusively with independent financial advisors who want to see what my firm is doing. Being a Saturday afternoon and Sunday morning, they won’t even miss a day of work. I think they will be impressed.
In the 2Q09, my firm will start marketing these services with appropriate due diligence information packages. And, by the end of the year, I think you’ll see the evolution of a new model that works best for the owners of capital who wish to retain an independent advisor, and that I am continuing to serve the client right.
These are my values, and I think they are your values.
Comments
January
January is shaping up a a troubled market-month. Will this "rain" on my parade going forward?
Sounds like a manifesto
Bill...
Nortel
I was just told Nortel just announced bankruptcy. Did not hear the news first hand.
colin Twiggs
http://www.incrediblecharts.com/tradingdiary/2009-...
Im glad you were able to see it in your lifetime Bill.
Re: Sounds like a manifesto
http://en.wikipedia.org/wiki/Manifesto
Agreed. I have strong beliefs. I have an open mind only when it comes to trading prices and that's because the market isn't about me; it's about all of us.
gold this morning
gold moving down through yesterday's lows pre-market,
as per my 01/12/2009 - 19:57 comments looking to unload part of my short position below $810. then watch from there.
the 50 MA is about $802 right now, this may act as support. if the price bounces strong off this amount i may have to retool my short plan as a 7 handle may be less likely. if we plunge right through the MA then $780 seems like a reasonable downside target to close out the short.
USD still moving, and i have the feeling there is a need for a strong dollar while the new prez is about to be sworn in imho.
comments/critics welcome as always.
Another gap down day
So what is the culprit today? The disastrous retail numbers? This is really a surprise?
I got a fill on DIG yesterday. Pretty good, I thought, considering where the chart looked to be heading. But now, over the space of a night, it's set to open about 2.5% lower than yesterday's close.
Coincidentally (or maybe not) this just happens to be a support level. I've attached the 60 min chart to illustrate.
TED spread
The TED spread is down back to around 1, about the level it was in mid-august of last year. Can things really be back to normal in the credit markets?
No hablo Senor Chicken!
mordeduras de este mercado
Printing, Founding Fathers, Paulson, and the Fed
http://www.youtube.com/watch?v=dOPF0S7Hss4
I think this one should be in schools [a bit scary though w music]
Dow 8100 for a buy IMO
Pope calls for major changes to financial system
This may have been posted before but it is worthy of a read.
Disclosure: I am not Catholic
Thanks again Bill for all that you do here.
Cheers Yaba
http://tinyurl.com/8h8llt
Pope calls for major changes to financial system
Associated Press
VATICAN CITY -- Pope Benedict XVI challenged world leaders on Thursday to make major changes to the global financial system, saying short-term answers to the financial crisis weren't sufficient.
"It's not enough, as Jesus said, to put patches on an old suit," Benedict said in his New Year's Day blessing to thousands of people huddled under umbrellas in a rain-soaked St. Peter's Square.
Echoing a similar theme in his New Year's Day homily, Benedict said the crisis should be seen as a test-case about the future of globalization.
"Are we ready to read it in its complexity as a way for the future and not just an emergency to respond to with short-term answers?" he asked. "Are we ready to make a profound revision in the dominant development model, to correct it in a farsighted and concerted way?"
BAC down over 4%
I just bought some on the gap down. I'm hoping for the gap to close at least to the extent that I can set a profitable stop. But this thing could get a lot worse, so I have my stop loss a few ticks below the opening low.
I'm afraid I may be getting an answer to my question yesterday about the near term direction of the market. And the answer ain't good.
welcome back
Welcome back GRYM.
Please keep sharing your wisdom.
Mr. Cara, Thank you for the new and improved blog. It is great to be able to be able to read postings where I left off. Some times I am at the computor a lot, other times not all. FWIW - I have no one blocked. When some one rants I move on.
Thank you Mr. Cara! Bear E
Stockcharts .com re. oil
Has anyone else noticed that their charts are suddenly charting what appears to be Brent Crude prices, i checked yesterdays daily report here as well and while the e mini chart is reflective of $wtic the other one is not.
Oh God!...The Humanity!
Oh God!...The Humanity!
sneaking in an entry while at corp hq
watching slw if it will hit and hold 5.30 usd. if it doesnt i will wait to see if 4.75 area is a better re-entry.
cash position now.
$SPX
850 looks like it may not hold...
Re: No hablo Senor Chicken!
Mordeduras y picaduras!!!
storm
oh merde
!
TNA
If/when TNA = SSO I'll be doubling down on TNA.
Merde? Pas de tout!
TZA, come on doooooooown!
Re: $SPX
This is shaping up like one of those days where the selling is relentless. Hindsight being 20-20, the tell was the light volume leading up to this. Then again, I am always most pessimistic at bottoms.
Maybe I have a ways to go yet?
Can You Say Giant TARP???
"consumers were battered by a recession, a severe credit crisis and soaring job losses, none of which are likely to ease anytime soon."
I especially appreciate the last thought here.
CTAB performance since December 1 through the close Jan 13
S&P -2.73% vs our accounts +4.8%
As at the close yesterday, we were:
Long equities: 16.43%
Short equities: 2.68%
(Net Long general equities: 13.75%)
Other (not included in above):
Long gold equities: 5.3%
Short Bonds: 5.0%
Short USO 31 puts: 2.6%
Basically, we are sitting on our hands until the market speaks.
Re: CTAB performance since December 1 through the close Jan 13
All acquired in the first week?
Or continued steady accumulation in the dips?
Re: CTAB performance since December 1 through the close Jan 13
Impressive annualized returns, please keep us informed when you will be able to access Canadian accounts.
Re: Sounds like a manifesto
2nd
Bill's comments "Yes, traders are actors. It's difficult to wait for the market to speak, but there are times when we must."
I take it seriously and will wait
Re: Nortel
'Tis true: http://tinyurl.com/83hpb8
C and NG
There is a race for a 4 handle going on. NG $5.05, C $5.07.
Cara 100 Update (Final)
New Coverage from Janney Montgomery Scott:
AMZN - Neutral. Price Target = $48
ATVI - Buy.
ERTS - Neutral.
Re: CTAB performance since December 1 through the close Jan 13
Our trading is a continuum. All long and short positions are the result of active trading where we buy the dips (long or via put writes and occasionally long calls) and later sell or write covered calls once our near-term targets are met. The prices tell us when it's an appropriate time to buy or sell risk.
My Portfolio
Took a 3.5% haircut this morning, so I'm outperforming the market!!!
welcome back
Thanks, Bear E
Hedging working out for the moment
The gut call on purchasing TZA is working out, as a hedge against TBT falling.
Perhaps if I'd thought to sell TBT at a 5% loss yesterday and load it all into TZA I'd be better off.
But as someone said somewhere today, hindsight's a wonderful thing
Electronic brokers
Hi Bill,
Congrats on your efforts in creating a modern platform for traders and advisors. The old platform is dead and you are ahead of the game.
I designed one of the first online trading markets. After all these years, it still works on it's own with little human intervention- it is 95% automated. I act as the middle man or escrow service or "bank" and I came up with the idea and the technology for the econtract - (this was the first time ever, 2 people could meet in cyberspace and create a 2 party contract by clicking buttons.)
Now, back to the markets!
VB
DIG finding new depths
What an ugly day. My very "liberal" stop just got hit. Down over 8% on the day. Hello my not-so-good-friend, Mr. November.
And I just closed my position on BAC, too. Out flat on this one.
Re: Electronic brokers
Really VB? What online trading market is that?
And it still functions?
Bill's comments
I'm also happy you're able to see the professional environment that should be serving all the players equally well Bill.
Unfortunately I think I'm young enough to see an eventual turn of the wheel and something even more grotesque being foisted upon the people 50 years from now, if not less.
SLW- adding at 5.17...
to 250% of allocation...
Wholesale market
If I give the website, I will release my identity
hmm. I guess it is okay so here is the site:
http://www.janesdeals.com/aboutus.asp
http://www.janesdeals.com/howitworks.asp
there are live negotiations going on right now. Over 25,000 members ect..
:)
VB
Where is the Obama bounce???
A lot of what I've heard and read in the dominant media is how The Savior would usher in a new era of prosperity and that by inauguration day, we'd see the market roaring....if not at the very least have a rally of some degree. Though I've not seen evidence of such on my charts, I was willing to give the 'DM' the benefit of the doubt since they alone possess the direct pipeline into the dark corners of the Beltway where the day's news is crafted.
Read this and thought I would share:
A laid-off worker made a good comment today. He said "I can probably find another job. But what I can't find is another Country."
This selling is too heavy to be sustainable
There should be an intraday reversal today or tomorrow. I bought TNA and UNG. I know, this is a knife catching so, I understand the risk.
Re: Wholesale market
Jane, is it?
Pleasure...
how low can we go
I'm itching to offload TZA ...
how low can we go today?
OECD report on countries
Speaking of how well countries are doing and expectations for 2009, the OECD, Organization for the Economic Cooperation and Development, has just released a study about countries economic prospect in 2009. It shows dim prospects for the vast majority of countries:
http://3.bp.blogspot.com/_iV5yDiKxCdk/SWznFUVLGAI/...
Brazil is the only country among 34 others whose Composite Leading Indicator remains higher than 100 points and the only one not showing as a strong slowdown. The worst CLIs in November were for China with a reading of 88.5 and Russia 89.8. The best were Brazil with 101.2 and France with 95.9. The US was at 92.2 and Canada at 94.3.
Re: Wholesale market
hi swiss robninson,
yes, it is . (read the scroller on my home page) :)
VB
Re: Where is the Obama bounce???
as i had posted earlier today,
i think people mistake mass-psychology of markets when predicting
certain moves.
the dollar remains the most viable symbol of american power and hegonomy.
some may argue the dollar is simply a paper proxy of america's true power which is its military might, but the dollar's position is considered the barometer in many ways. despite having fallen for years the recent upturn has attracted a wide variety of explanations.
regardless of why exactly the USD is moving up as of late, i suspect that a continuance of this move is whats needed during the run up to a new president.
(if you're of the belief that external forces can manipulate currency)
a rising stock market catches bigger headlines but a stronger dollar gives them more room to pump additional $$$ into the system for the time being. relative to other currencies and other global calamities, the USD is still looking more stable than the EURO which member states are threatening to bring down their collective efforts to create a new global currency.
(if only the US's currency was predicated on the backs of the collective credit ratings of each of its states, then it would be more fair imho)
italy is likely next w/ many of hte same structural problems of spain.
the relative value of the USD to other major currencies still remains somewhat strong during the current crisis. i dont see gold acting well until something more substantial occurs to put the fear into people enough to move away from the safety of bonds.
the gold short continues.
good luck gang.
UCO- adding at 11.45...
to 60% of allocation...
glub, glub
Unfortunately, 6,500 still seems like a good number to me. Stocks climb a wall of worry but a tsunami is another matter. Howsomever, EXAS is battling the market today. Brave little stock! I know it can! I know it can!
Re: Where is the Obama bounce???
That bounce ended 1/6... never believed in it... just hopeful/wishful thinking that coincided with a bounce from an extremely oversold condition.
I'm in the SP 450-600 crowd wondering where earnings come from in the future. Although I expect to be wrong and always am prepared to sell bad positions. I have been neutral for a few days now - earning the dividend on PFE, DOW, INTC, BA and will add a few others after the next slide.
Good trading
Re: Wholesale market
VB- that's great, i'll have to check it out...
USD
USD strength: Other countries have even worse economic and financial problems so why the surprise? Plus, other countries (read China) support a strong $ because they own trillions of them. They could drive the dollar down, but why would they?
Nat gas
Nat gas $4.99.
returns so far....
I got my arse handed to me last year but with Bill's help and a blazing buy the dips and sell the rips finger, I've managed to get 10% return in my and my wife's retirement accts so far. Yes, it's a lot of daytrading.....
Now only holding CHSCP (traded around the current run) and a few shares of Mr. Softy that look about to stop out.
THANK YOU Bill!!!
Re: Where is the Obama bounce???
This poor guy (Obama) gets the job and is handed a flaming bag of dog poop and asked to turn it into gold. Has anyone noticed that he has a little bit of the deer in the headlights look to him lately? And now in these dire times some are trying to tear apart his financial Cabinet over petty issues. I think Geithner should get a pass so Obama is not hindered. We can't afford those kind of shenanigans right now.
Re: Where is the Obama bounce???
"how The Savior would usher in a new era of prosperity and that by inauguration day, we'd see the market roaring"
Nice thought but I haven't seen that claim in some time. Come to think of it I haven't seen it since the election...when the stimulus package was $250B.
Re: Where is the Obama bounce???
I think if nothing else, we (society) should have learned via this mess is character counts for far more than previously thought.
Re: UCO- adding at 11.45...
Brought UCO at 11.16
UNG 20.70
GG at 24.00
Re: Where is the Obama bounce???
"I think Geithner should get a pass so Obama is not hindered."
If Geitner can't figure out how to file his IRS returns, how the heck can I? Once I hear his plan on streamlining the process and making it fair, then I'll consider supporting him... Until then, it seems he's just one of the Beltway insiders (I know them well).
How's everyone doing?
I've been very busy lately and haven't had too much time for the market. I was expecting an Obama bounce too. Luckily I didn't put any money on that expectation.
Has anyone noticed the conflicting Crude prices between Bloomberg and Ino.com?
Ino says Crude is at 43.63 and Bloomberg says it's 36.52.
Which one is right?
Rob.
Re: Where is the Obama bounce???
dr.cosa - "the dollar remains the most viable symbol of american power and hegonomy."
Yep, and meanwhile jobs are lost and economic damage occurs while the USD sits high on it's pedestal. I think this may be causing tremendous economic damage worldwide, but there are yet two opposing stories coming from China.
gaps on the GLD
my ongoing saga w/ gaps on the gold charts, there is a huge gap in the 77-79 area on the GLD chart. GLD passed down through this gap then quickly reversed and leapfrogged over the same gap on its last run. we are approaching this gap and i consider it a very critical event in terms of the intermediate term direction in gold. imho.
i think this gap is acting like a magnet right now on the gold price as the broad market is weakening. im starting to suspect the gap will get filled before reversing higher over the next week or so. this is my evolving suspicion. i will be quick to get out of any short position if this specific gap gets filled just in case things do indeed reverse.
if they dont and continue down i will go long once direction appears to be changing. the Full STO is looking to move through the trough, and the RSI (7)(9) are both still looking ready to move down.
DOWn -260
This is a bit of a surprise to me, wasn't expecting it this early however, this being earnings season it fits.
Re: Where is the Obama bounce???
I think Obama would do well to start defining some longer-term goals for his administration. Instead of branding TARP II as a crusade to save the American homeowner from foreclosure, I think we should be focusing more on the "crisis of mobility". Since we are at a point of change where American labor must be refocused into different areas, we need to upgrade our ability to keep the growing ranks of unemployed "mobile" so that they can more quickly adapt to the changing landscape.
It is downright saddening that for a country that considers itself a breeding ground for technological advance that we can't even come up with a solidified plan to upgrade our own infrastructure. Instead of investing in new local and interstate transportation, we seem more concerned with making car loans more affordable.
We need to use federal TARP money to fund local and national projects with a real long-term economic return - things that will increase mobility and ensure reliability (nuclear power). Developing countries like China are already well into infrastructure development plans.
If we leave it up to the U.S. taxpayers to vote for tax increases to fund these projects, they will NEVER get done and we will just watch our boat sail down the river.
Citi
Does anyone see the Fed holding up C like they did AIG?
It's going on as I type.
Obama didn't ask for the next 350 billion in Tarp money to help by a puppy for his girls.
Bernanke didn't go across the pond with his "Bernanke Doctrine", just to confess there will be more banking institutions that will need help.
Citi isn't selling assets (smith barney)and hiding the cash in managements pockets for no reason.
Citi didn't move earnings up a week because they had enough cash to keep the "business as usual" lie going on.
120billion for AIG, how about 130billion for C.......
it's only the financial future of the next 2 generations of workers that are being lost at the expense of the super rich HB&B.
It's not rocket science anymore.
Interesting Gold comment
From D Gartman:
'Turning then to gold, we remain, as we have remained for months and even years, quietly bullish of gold, but we are cognizant of the huge pattern evolving in the market since March of this year when gold touched $1030 at its best the morning of the Bear Stearns bankruptcy. Since then, each interim high has been lower, and so too each interim low. However, rather than a pattern that is bearish in nature, we see this as a massive, multi-month “flag” formation, which those familiar with Edwards & McGee’s definitive, but old,
textbook on technical analysis, know to be a continuation pattern rather than a trend-ending one. If this is true…and certainly we believe it to be… then it is but a matter of time until gold prices move upward through the top of that pattern and break out to the upside. We shall hold our one single unit position in gold a while long then. We’ll not add to it until this first unit is made profitable. That, we are afraid, shall take some time.'
Re: This selling is too heavy to be sustainable
So far so good. This could be even a short term low point if (if ???) it holds.
Re: Where is the Obama bounce???
Ha ha....and I thought I had cornered the sarcasm angle.....you ARE kidding, aren't you?
Executive Compensation
It seems that a large amount of the abuses of executive compensation (among other things) have revolved around the existing system of stock-based compensation. Stock-based compensation was originally thought to be a great way to align the goals of company management with the shareholders.
But as we have seen, this system has been rife with abuses as management has foregone actions that fit long-term corporate goals and instead focused on short-term endeavors to boost share prices, etc.
So, one idea that I have been thinking about is a regulation that would require each stock option issued to an employee to be couple with a call option that is retained by the corporation. I.E. if a stock option is issued at a price of $60, the company will still maintain a call option with the same date maturity at a higher price, say $80 (or whatever the corporation chooses). It seems to me that this would allow corporations to more accurately disclose the long-term potential for dilutive activities down to a specific dollar value in their regulatory filings. It would also give potential investors more clarity and thus perhaps more confidence in making long-term investments.
Has anything like this ever been discussed or proposed?
RE TED SPREAD
Ted is below 1 but there is nothing normal about it whatsoever.
When it blew out it was because of denial between interbanking of the USA and the EU. The was a difference in opinion between the coasts which helped fuel the blowout. Make no mistake about it, the TED is totally manipulated and the credit markets are not recoving.
As I have said, the US banks are not the only ones in trouble - actually we could argue that they are better off. The libor must stay low for interbank lending and liquidity.
Since the FED and ECB/BoE will be the first only lender of choice the credit crisis is probably at the end of the begining.
Hate to blow anyone's opitimsm here but truly the credit markets are not easing when the only lender is the FED... Falicy and we are waiting for the next phase of this crisis to blow out. Which it will come, when we least expect it.
Sell should slow and mini rally should start soon, I hope.
Re: Citi
"Does anyone see the Fed holding up C like they did AIG?"
Not to mention ALT-A, Option ARM resets, and the coming wave of retail shutdowns. Think of what's coming if the markets fall 10% just on poor earnings news.
ETFs - online or telephone trades?
Help me out here.
I've got a rep from Chuck chasing me up on an interest I've shown in opening a dollar account.
I've rang up my broker here in switzerland to sell TZA. Being a US ETF it can only be traded over the phone. But they were bloody slow opening the order and I've presently missed out on the limit price I was looking for.
Are ETF's bought and sold online in the US or must they also require a telephone to the broker?
If they're electronic I'll jump over to chuck. I'm generation playstation - hate calling people...
Re: ETFs - online or telephone trades?
Bought & sold online in the US, just like any stock. Suggest you look at Interactive Brokers before moving to Chuck. Full, no-hold-barred international trading...on any exchange, anywhere, anytime. Stocks, bonds forex, options, you name it. ~ OG
Market is Forward Looking???
Yea, by how much, 72hrs???
Re: ETFs - online or telephone trades?
If you have no luck in the states try a Canadian broker.
Re: ETFs - online or telephone trades?
OG has it right, I have no direct experience with IB but if Bill likes it(and he does), it must be good. Come on - trading by telephone? No way!!!
Re: Market is Forward Looking???
It's facing backwards with a mirror in it's hands
Re: ETFs - online or telephone trades?
Good call OG.
I recall an analyst recommending the purchase of a particular Indian stock I hold direct from Bombay and not the US ADR due to currency issues with the USD anticipated in the future.
I didn't think a no holds bar trader existed.
LE.s
swissrobinson: you should
swissrobinson: you should definitely look at IB before doing anything else.
January indicators
There are a number of January indicators that are watched that are not pointing to "be careful" in 2009. Some haven't triggered yet, but are close. These points were taken from Jeffrey Saut's Jan 12 comments for Raymond James http://www.raymondjames.com/inv_strat.htm
"The January Barometer is an indicator where the stock market’s performance during the month of January is supposed to be indicative of its performance during the rest of the year. So, when the market is up in January, the rest of the year is typically up, and when the market is down during the month of January, you can expect a down year.
In recent years, a derivative of the January Barometer claims that trading during the first week of January is a preview of what you can expect to see for the rest of the month, and therefore the rest of the year.
While it’s true that the January Barometer (so goes January, so goes the year) has a much better track record of predicting the year ahead (a 74% success ratio), we have always preferred to combine the January Barometer with the December Low Indicator.
As described in The Stock Traders’ Almanac:
“When the Dow closes below its December closing low in the first quarter, it is frequently an excellent warning sign. Jeffrey Saut, managing director of investment strategy at Raymond James, brought this to our attention a few years ago. The December Low Indicator was originated by Lucien Hooper, a Forbes columnist and Wall Street analyst back in the 1970s. Hooper dismissed the importance of January and January’s first week as reliable indicators. He noted that the trend could be random or even manipulated during a holiday-shortened week. Instead, said Hooper, ‘Pay much more attention to the December low. If that low is violated during the first quarter of the New Year, watch out. . . . If the December low is not crossed, turn to our January Barometer for guidance. It has been virtually perfect, right nearly 100% of these times’ (view the complete results at http://www.hirschorg.com/declow).” end
bobj again - Neither indicator is spelling disaster yet. The 5 day indicator is inconclusive in my mind as the 5 day close was virtually the same as the end of Dec close (depending on what is used, -.1% to -.3%). At the low today, the DOW was flirting with the lows of December, but didn't break.
Re: gaps on the GLD
dr.cosa,
This gap is only present in the GLD ETF and not on the gold continuous contracts, which trade for an extended session. Are you implying that it's the ETF that drives the play as of now?
Geithner's tax issue
In 2006 Henry Paulson got a $200 million tax break, Geithner was notified of his Social Security/Medicare tax due, and my account (since 1963) told me in 2006 that, for the first time ever, I not only would owe no tax, but did not even need to file.
In 2008 the IRS sent me a notice of failure to file a 2006 Form 1040 along with a multiple choice for why I did not. A month later they wanted more proof. (In each case the threat of penalty was clear, immanent and significant.)
To prove I didn't need to file a return we essentially had to file a return — that they accepted (and I paid for).
I have no doubt he will be made Treasury Secretary, but no matter how bright he may be or honest the oversight in 2001, I see no excuse for not having paid the bill between 2006 and last month when his name was offered for the position.
I thought I could not have my trust in our government further diminished... I see I was too optimistic.
The aristocrats reign supreme.
----------
P.S. I loved the Citi-morg comment, Bill.
God sure do hate easy profits
Hey there Fellas,
What a tough few days! Today is a bummer, so was yesterday. At this rate I will be snorkling to the Bahamas.
Re: CTAB performance since December 1 through the close Jan 13
Bill,
learning to wait.....a year ago this was not my posture.....thanks again
Re: Where is the Obama bounce???
His sin wasn't on his returns, he simply didn't pay. The excuses attributed thus far are as laughable as the balance of the Savior's Economic lack of brain trust. And yes, he's a Beltway lackey.
bought some dips
long TRA @ 14.60
long FST @ 15.10
new low on WY - no position
Re: Geithner's tax issue
It seems the only reason he paid the tax was that he was in line for the treasury job. He also must have known about the payroll tax withholding on his domestic help and thought he would get away with it. If he didn't then he doesn't deserve to be treasury secretary. I want someone who is a little more in touch.
I remember not to many years ago a woman, Baird I think her name was, got tripped up on the same issue and she was castigated for it and denied the appointment. I remember several senators saying a lack of knowledge was no excuse. I guess the bar has been lowered several rungs since then.
Re: Geithner's tax issue
Obama can begin with a zero tolerance message vs the loyalty message of his predecessor. Geithner was a good choice, but the message is more important (especially in light of the recent failures of our leadership across the board).
Re: Geithner's tax issue
most appointments may breeze through......republican lawmakers s look like a toothless, fight weary bunch....
oil
Oil just recovered more than a buck in about five minutes. Back up within a $0.25 of the open.
Oil and gold stocks also
Oil and gold stocks also popping a little
Re: Where is the Obama bounce???
Chickenpookie,
If we are lucky, Geithner's tax problems will make fixing the tax code an important issue over the next 4 years!
near term market direction
posted by number2son: "I'm afraid I may be getting an answer to my question yesterday about the near term direction of the market. And the answer ain't good."
number2son, unless you think that the recent drop in the market is an indication of a new crisis that will take S&P 500 below 600 and keep it there for several years, this drop in prices should be welcomed as a buying opportunity. Over the past couple of years we have grown accustomed to taking quick profits. My real fear is the start of a new bull market that I will not recognize and will take profits too soon. As long as the market oscillates, the simple "buy low, sell high" strategy will keep making money.
Re: gaps on the GLD
case:
im shorting the GLD so yes im looking at the price action on the GLD for its movements. but i dont believe the GLD itself moves gold and PM markets, just part of the influence of factors.
Re: gaps on the GLD
European Central Bank to cut rates tomorrow causing Euro to rally against the Buck causing PM to rally, IMO.
http://online.wsj.com/article/SB123187775733278321...
Bill's Daily report today highlights the big European banks going all wobbly which practically insures a big ECB rate cut tomorrow along with some more foreign stimulus.
ECB rate cut
Dr. Strangelove - the ECB cuts rates so the Euro rallies?
I thought currencies tended to fall when their interest rates were cut.
Where's the Obama Bounce?
The ball's got to hit the floor before it can bounce. It's coming soon.... just a matter of patience, IMO. Just when you thought it wouldn't, maybe it will.
Re: CTAB performance since December 1 through the close Jan 13
Bill, with respect to returns, are they the returns of the Dynamic or Moderate Strategy? TIA
Re: gaps on the GLD
I am of the understanding that rate cuts weaken your currency against all others ie. $USD, since the usd is a basket dollar it would strengthen and gold would go down, not that this is going to be the case of course.
Re: Where is the Obama bounce???
korvus - "If we are lucky, Geithner's tax problems will make fixing the tax code an important issue over the next 4 years!"
Oh yea, duh. Now there's a whole new reason for living... But don't hold your breath my friend. ;)
Re: gaps on the GLD
If I remember right...last time ECB rate cut...USD does not rally at that day since it's been fermented few days ago?
what I want to say is: it could go up or down...who knows...big hands will always find tons of reasons to cheer it up or down.
that's why Bill mentioned we need to stay with our hit button whether it's up or down.
just a novice opinion :-)
Buying low selling high
David, if you mean buying dips and selling rallies, then you - like me - are a bear. I wouldn't worry about missing the early stages of the next bull, whenever it comes. Taking profits "too early" is simply "taking profits" period. There's always time to climb on the gravy train. Anyway, I believe the final low is ahead of us, not behind us. The money on the sidelines is so far no help - it's just staying there. And there's lots more bad news to come - state and municipal government bankruptcies, a treasury bond bubble forming, credit card company failures, eventual inflation etc. etc. etc. that has not yet been accounted for in current prices. So, like you, I prefer to buy dips and sell rallies.
Re: gaps on the GLD
i wonder if the recent dump in gold was an anticipatory move, making gold likley to jump on news of a less than expected rate cut????
S&P 850
So if we don't close above S&P 850 that will break the cycle of higher lows since November.
I would expect test of the November lows in that case.
But I've learned not to put too much money on any expectations in this market.
Rob.
Re: ECB rate cut
davefairtex -
Fed Funds Rate was cut to zero-0.25% on 12-16-08, lowest on record, and the USD has been climbing ever since ...
http://www.kitco.com/gold_currency/charts.htm?GBP
Click Euro, currency charts, and 60 days for the chart.
Cheers.
Buying C here.........will sell tomorrow for sure.
Or be stopped out.
Will buy again Friday after their pre-market quarterly is announced, sell again Monday.
It's not investing anymore, it's all out gambling.
At least I'm not a tax dodger like gunner Geithner.
If I do take the short road on paying taxes, I can just plead for Obama's stamp of approval.
SLW Back in at $5.26 usd
trigger on the sell button but not as worried as i was at 5.78. if it fails i would think 4.75 is next hard support. hope tomorrow will bring a reversal. the equity markets in general seem oversold today.
Just my opinions.
citi and GE
Check C and GE chart..very similar.
Follow The Leaders
I'm having a difficult time resisting the urge to spend OPM and fail to file my IRS forms.... Wonder if the IRS would wave penalties for me too...
Scottrade Elite
Curious if anyone uses this platform and if there is a "symbol list" available from Scottrade for indices (eg VIX, GoldBugs...) that may need the "$" before the symbol for realtime data.
Just curious if anyone might be able to help
new use for silver
Here is a new use for silver I hadn't heard of before. Seal Shield (www.sealshield.com) has developed mouse/keyboard/remotes that have silver embedded in the plastic to make them antimicrobial. Plus, they are dishwasher safe.
Re: Scottrade Elite
From the Elite "Help" "Content" menu:
If you click on the symbol lookup button - tiny pair of binoculars - you can then get a list of these symbols (238 of them) by entering something in the text box and choosing "index" from the "search by" drop down box.
dr. cosa aka
Goldfinger :-)
Re: Scottrade Elite
Thanks Chris. I made the mistake of calling the local branch to ask the same question - the reply was no. I should have known to come here first.
Apple
Steve Jobs stepping down until June for Medical Reasons.
Apple is currently down 10% after hours. Looks like more pain for the longs tomorrow.
Rob.
IRIS - BSI87
IRIS - watching only at this point.
this stock has "capitulated" as BSI87 likes to say. RSI (7) < 10.
I am not saying buy it here but it has had 9 straight down days and has no negative news. I would wait for some upside volume to appear before considering it. I did ok with AMCN (bought at 4, sold at 5.25) and TBT (bought at 36.50 sold some at 40.80 some at 40.32). Balance sheet and cash flow seem ok too.
DYODD
no current spec holdings.
core holding of WMT and CL.
preparing to buy GG, postponing purchase of UYG
Even though I have WGW shares, I see that GG has been underperforming WGW over the past 5 days, which increases the likelihood of GG outperforming WGW in the near future. So I have just placed a buy limit order for GG at $22, for about 1.5% of my portfolio (and canceled the buy limit order I had on WGW at $1.25). This is just a starter position, to which I will keep adding if GG keeps going lower.
Also, I canceled my buy limit order on UYG at $4.1 and decided to keep only the one at $3.75 (Nov 20 low). In the past, when fears about the banking industry have "re-surfaced" after some period of optimism, the banking stocks kept falling for at least a month. So instead of doubling down at $3.75, I'll just increase my number of UYG shares by 50% at $3.75.
BAC
U.S. negotiating more aid to BAC. Honestly...who couldn't see this coming?
Is it "Advising," Wealth Mgmt," "Selling" or "_____"?
I for one am elated for the avg investor, that the traditional broker model is dead. Maybe the avg investor will one day be able to make profits. I truly applaud CTAB, and Bill, for taking the stance of "Profit is the only product" and wish the team all the success. So many people need your help!
My time spent interning at a top 3 broker as a college student was eye opening. Not much "advising" going on in my view. Mostly a sales focused environment and cookie cutter advisement binders created for any joe.
How ironic that after i decided not to go work on wall st after being appalled at what i was seeing, i end up using the top tier sales training i subliminally picked up in the cubicles of this former top 3 brokerage, to excel at my current client facing role. I still believe til this day, a Financial Advisor who knows how to pull in his/her fangs and pick and choose his spots, is the best trained sales force. well used to be. moving fwd it will be past performance and incentive structure. Examples of the full spectrum below.
Marcus Schrenker - I guess it's the anything-you-can-do-i-can-do-better show, what will the next "advisor" stunt be? I am sure this and stories like this ie Madoff are only the tip of the iceberg.
http://tinyurl.com/9ud2rn
Edward Jones' "Advisors" still go door to door! according to this article in WSJ, their internal lingo is "1 sale per day". What happened to the advising?
http://tinyurl.com/7zmjpl
*the above are only my opinions and experiences from my first hand observations from 1995-2001.
More Dirt - ED
Here goes ED:
http://www.nytimes.com/2009/01/15/nyregion/15coned...
tough day..
Re: Is it "Advising," Wealth Mgmt," "Selling" or "_____"?
This
OEX
2nd
plan is to buy some february call at strike of 400 or 410 if we gap down tomorrow. my speculation may work?
Goldman Goes Shopping
It is nice to see those taxpayer gift cards being put to good use. I guess this latest transaction will go a long way to stimulate (cough cough) the "domestic" economy...
Goldman Sachs Group Inc. plans to make a takeover bid for full control of USJ Co., operator of the Universal Studios Japan theme park in Osaka, a person familiar with the plan said.
Goldman’s Tokyo-based Crane Holdings fund that now holds a 41 percent stake is preparing to acquire the remaining shares in the company by March 31, the person said, declining to be identified because no announcement has been made. The 59 percent stake to be purchased would be worth about 51 billion yen ($568 million) at today’s closing price on the Tokyo Stock Exchange.
“The current economic environment allows Goldman to acquire full control at a reasonable price,” said Daisuke Seki, chief executive officer of Tokyo-based IB Research and Consulting Inc. “Now they’ll need a catalyst to get more customers by adding more popular attractions, enabling them to pay a return to investors and sell shares to the public in the future.”
http://tinyurl.com/73w2p3
China Responds Sharply
After this little outburst, I guess one can safely assume that China will not be purchasing additional U.S. Treasuries anytime soon...
US mistakes are the root cause of the global financial crisis, a senior Chinese central bank official said overnight, rejecting criticism of China's high savings rate and booming trade surplus.
"Errors made in US economic policy-making, financial supervision and markets are the ultimate causes of the crisis," said Zhang Jianhua, research head at the People's Bank of China, in an opinion piece carried by the People's Daily.
Some observers in the West are blaming China and other nations' high savings rate and trade surplus for fuelling excess consumption and asset bubbles in the United States, he said.
"Such views are ridiculous and irresponsible in the extreme," Mr Zhang wrote in the harshly worded piece in the Communist Party's mouthpiece.
http://tinyurl.com/9hcuaq
Re: China Responds Sharply
Fireworks, man tell me thats not as scary as I think it is. Not bad enough they think that (with maybe some justification) we have some ownership, but we have to piss them off with posturing. How far a leap is it till some america-phob chinese patriot thinks its worth the pain needed to bankrupt the west. Simplistic but...scary none the less.
peace from north Puget sound
Quick and Dirty chart read on my slw buy today
http://tinyurl.com/99wns3
The main reason i bought at the close $5.26, was because i felt the fib retracement of 38.2% was near the 5.25-5.30 usd area, and concluding the next stop on fib was the $4.75 range i took a shot. We are near tech support area for gold and since slw/slv trade in correlation to gold, my thought process was gold would try to hold after today. then looking at overall markets, everything was obviously down so i didnt think this selloff in metals was being singled out, rather a bystander victim on broad selling.
As you can see in stoch, i may have been a little early as its just kissing the oversold line. 30 dma is 5.25, 50 dma is 4.45. so i am thinking it will bounce up from here, or 4.75 or 4.45. But i would prob take the loss if we reach $5usd. Sellers are there, but the volume isnt full blown panic selling.
I have my 09 territory review in the morning and layoffs at our co are prob happening next week. Some good people who were just adversely affected by shrinking budgets in 2008. I was fortunate.
then heading back to my home office. I am hoping i can make it back before market closes thursday.
Good luck everyone.
EDIT: Just re-read my comments. thanks to Bill and other contributors here. however flawed my logic may be, i couldn't have even understood what i just wrote above 1 yr ago, before i found this blog and what i am continuing to learn by visiting this blog daily.
Re: Buying low selling high
tango6, I think a bear would short the rallies and cover AFTER the previous lows were broken. That's what I was doing starting October 2007 for 10 months (should have done it for 12 months!). Now I am keeping at least 80% of my portfolio long-term and trading only with the remaining 20%, so I would say I am a trader-bull at this point...
Apocalypse Now?
http://tinyurl.com/7auhnh