Daily Trading & Social Commentary for Nov. 3

NEW YORK (Reuters) - Johnson & Johnson (NYSE:JNJ - News) will eliminate about 6 percent to 7 percent of its global workforce, or some 7,000 to 8,000 positions, as the diversified healthcare company restructures and seeks cost savings, the company said on Tuesday.

buffett to buy bni at 100 per share - missed that one - all other transports up premarket

he is also splitting his b shares 50 for 1

I have to think RIMM is setting up for patented Cara triple rsi buy soon,
all the papers are pointing out strength of the competion, monthly rsi is
still above 30..so patience may be required.

Good morning.

BDK - PT Raised from $50 to $58 @ Credit Suisse. Neutral (Thank you for that, Captain Obvious).

TS - Upgraded to Buy @ Jefferies & Co. PT Raised from $30 to $44

From Reuters:
http://tinyurl.com/ylk7cz5

went long qid (short nasdaq) at 24.17 - dollar strong and it seems that good news i.e. m&a is being shrugged off lately

Nov. 3 (Bloomberg) -- Johnson & Johnson, the world’s biggest health-care company, will fire more than 7,000 workers as it tries to eliminate layers of management and invest in more profitable areas of its business.

The cuts will shrink J&J’s workforce by 6 percent to 7 percent and save as much as $1.7 billion by 2011, the New Brunswick, New Jersey-based business said today in a statement.

http://www.bloomberg.com/apps/news?pid=20601087&si...

tn,
i lol on that comment - the greed is my biggest fear - if anything, i tend to cut a profit short of its potential - lately, if someone bought in when i sold and posted, they could've made about 10-15 cents - but het, a win is a win - shooting for 30-50 cents - heading to ac to play some cards after lunch - so if you have any pull, get me my win in the morning session please

NP...question is am I pulling or pushing on that string?

Today looks like a down day at least for the first half day. Yesterday's volume was actually decent, but closing was very weak

I wouldn't be surprised. The lows from a month ago still haven't been broken so technically on the longer term chart its still a series of higher highs and higher lows.

Entering a limit sell on 10% of my SRS. Basis $10, limit set at $10.60.

My Orchid Lady and I are about to make an offer on a house here in Vegas and I need cash for earnest money. I will low ball the bank asking price and probably won't get it. I'm thinking spring next year is better (market and cashflow reasons) but it has almost everything I am wanting and tons of room for almost adult children.

Yes, it is a foreclosure but in fairly decent shape (relatively) at this point. Unfortunately it has already startes to be stripped and when my Lady went back to look at it Sunday a vagrant had kicked in the back door. Pool equipment long gone. It has been vacant 2-3 months. Upscale neighbor on over an acre of land. This sort of thing is everywhere in Vegas.

She is no longer allowed to visit it without me present.

Best of luck trading.

np is no problem

http://www.theglobeandmail.com/report-on-business/...

The little independent from out west beats the big boys of Bay Street yet again. The story here is that Qtrade is relentless in scoping out the best innovations of its competitors and nimbly adopting them. With Qtrade, clients make the fewest compromises in terms of their overall online investing experience. Recently, the firm has added more research on stocks and started allowing U.S. dollars to be held in registered accounts so clients can avoid expensive foreign exchange fees. Qtrade does get demerits for, in some cases, charging electronic communications network (ECN) fees in addition to posted commissions.

Released on 11/3/2009 10:00:00 AM For September, 2009
Prior
Factory Orders - M/M change -0.8 %

Consensus
Factory Orders - M/M change 1.0 %

Consensus Range
Factory Orders - M/M change -0.8 % to 1.4

Actual
Factory Orders - M/M change 0.9 %

Market Consensus Before Announcement
Factory orders in August fell 0.8 percent, following a 1.4 percent rise in July. August's data were pulled lower by durable goods. New orders for nondurables were up, reflecting higher prices for oil & coal. Looking ahead, the advance report on durables orders suggests a rebound in overall factory orders. Durable goods orders in rebounded 1.0 percent in September, after a 2.6 percent drop in August and a 4.8 percent surge in July. Also, higher oil prices will likely boost the nondurables component of factory orders in September.

JVS3

Agreed, RE Prices are getting very tempting.

Here is a place where you can get 1/1 condos foreclosures for 20,000. Downside? squatters, break ins and reports of taking tires off of people's cars in the middle of the night.

Madison
2572 ROBERT TRENT JONES DR Orlando florida
http://tinyurl.com/yac7ohd

source: friend who owns there

Error opening link.

I need a lot of room. My immediate family expanded greatly and we also have children who may need to move in at a later date. And we have a lot of pets. An embarressing amount of pets.

Consolidating families makes things ..crowded.

Lol.

The bright side, when the house gets sold the neighborhood should go back to quiet and safe...unless another one comes up. The houses being on large lots makes it easier for the empty ones to be targeted.

Thank you for the link anyways.

Gold going parabolic right now.

http://bit.ly/3kkA87

"Japan is drifting helplessly towards a dramatic fiscal crisis. For 20 years the world's second-largest economy has been able to borrow cheaply from a captive bond market, feeding its addiction to Keynesian deficit spending – and allowing it to push public debt beyond the point of no return."

I've been noticing for the past couple of weeks that the foreign "bailout banks" such as LYG, IRE, AIB have been selling hard. IRE has lost about 50% in a month.

CC

www.chartsandcoffee.com

"Insanity: doing the same thing over and over again and expecting different results" - Einstein

Or in this case: Doing the same thing with other people's money even on a larger scale than before and expecting no repercussions. Every action has a reaction.

We are seeing gold/silver strength alongside (albeit moderate) $USD strength this morning - these kind of days represent "real" value gains.

If this gain can hold for GDX, it will really start looking like the last dip was simply a succesful test of the 100 Day moving average rather than the start of a breakdown.

I wonder if this is squeezing some of the huge commercial short position, like at Goldman?

My IWEB sell limit at .185 for 10,000 was hit, :-), have another at .21 for GTC...must be some news coming...update...that was quick... .21 hir as well.

put in SL @ .25...could that work...3 times is a charm they say.

They are climing into bed with XOM...bit deal for them, among others coming, I am sure.

Hi All - Caught the following on Rueters: Spot gold soared to a record high of $1,080.60 per ounce Tuesday morning after India's central bank bought 200 metric tons of the metal from the International Monetary Fund, heightening speculation about more official purchases. Happy Trading

Well clearly the drop to 666 was a panic low as everyone and their aunt thought we were going into a depression. Panic lows tend to be extreme. I'd argue that the improvement in the jobs situation, the factory orders, consumer spending, industrial production, etc. from March validates a move to 1,050. The markets are waiting for signs of no more job losses to resume its upward march. If yesterday's ISM report is any indication then that might come sooner than people expect, as in by the end of this year. We shall see. For the time being, I'm making my list of small to large cap stocks to start accumulating...not quite done with the list and still waiting on entry points.

I know, thats dangerous, we should base most of our decisions on what the crowd is doing, maybe not, or on our best judgements of the real finnacial situation, but a question I keep having is:

Can the markets move according to their own set of drivers or an approximation of that?

Thanks Chris M
After a late start this morning out here on the west coast, going thru my procedure of news aggregates and opening charts and checking dollar price and gold price, I came straight to this blog to find out why gold did the straight up price jump. I get more true stuff here from the collective than any 10 news sources
Thanks to Bill for this blog and all who post
peace from North Puget Sound

I know this for sure: the farmers that I talk with, who average 3,000 acres, are more concerned about ' disease/pest control ' than constant potash replenishment ( besides, potash does not have nearly the water run-off that other nutrients do )... There is no way around the disease/pest factor... Smaller crops are better than no crops.... But, anyway, just a thought...

I was intending on picking up some SRS at RSI low with perhaps capitulation, but instead picked up some more DZZ when it hit a reisistance at 15.57 and I saw the RSI heading up...I am thinking that mayhaps the super bullish news is convenient for someone to load up on DZZ...why not me? I also adjusted my Stop Loss for the additional shares.

Does anyone see, feel, know, any actionable intelligence regarding the gold dynamic that should/could inform this situation?

TIA

I watched 'Frontline's' 'Close to Home' online the other night and although the Upper East Side of NY is an enclave of wealth the show illustrated the large swath of misery the financial crisis has inflicted.
http://www.pbs.org/wgbh/pages/frontline/closetohom...
This was interesting as well: http://www.nakedcapitalism.com/2009/10/debt-stress...

ALOHA !!

Last night I posted a reply to ChrisM about seeing the POG/AUD basing and close to $1200AUD. Looks as if we have a positive signal that the POG expressed in AUD will rise further as right now it is at $1205.66, up over $32AUD. Lets see if it closes above $1200. This would renew more interest in Aussie gold miners who are already profitable and mining higher grades. If we close above $1200AUD then that should give more upside to Aussie gold miners on the ASX later today. Interesting that the RBA announcement to raise rates did not drive the AUD higher. Is the perception that the rate increase was too minor or is it the perception that the AUD is looking more risky?

I might also add that gold is up over 2% on all other currencies as well except the Real where it is up 1.15%.

According to Kitco the 1 year change for gold is +49.65% ... Another 0.36% and it will be in Roubini's "genius" territory!

Bill,

You mentioned last week about publishing a report on RIMM? When will it be available?

Consistent with my strategy (of shorting the market when $USD will be above its 50-day MA), I have just increased my short position in FCX at $76.87. I do not see a good reason for FCX to rise today, as the copper price is basically flat since yesterday's close and is still below $3/lb. In any case, if $USD keeps rising now, then copper will fall, and FCX will fall too.

Could not take the pain...just sold it at 15.31...maybe not the best thing to do, but I wanted to put my attention elswere and the price action looked very weak to me. I will wait till there is more evidence of dollar price strenghtening, although, the dollar is up marginally today as well. I will have to rethink this and start again if at all on AU.

I hear what you guys are saying and longer term I could be wrong but the long term indicator I look at (S&P vs 200 DMA) says we should be staying long or buying. While its very pessimistic that the market is still down 35% from the all time highs, I look at it from the perspective that we're getting discounts on prices. Can I time the bottom? H*ll no. Do things still look bad? Absolutely. But I believe its easier to make a bearish argument when things are bad just as its easier to make a bullish argument when things are good...

starting to look interesting again.

Hey kaimu, I hear you on getting rid of the Fed and to stay on theme have included a presentation Jim Chanos made recently, he touches other areas requiring attention.

Tech bottomed in Nov 08 and has been leading the market. Today it's underperforming, and has been leading the market on the downside the past 2 weeks, which is why I added to my shorts just now.

Erin Burnett, of CNBC, just stated ( at 2:59 pm ) that although Buffett's deal with Northern Burlington initially helped the market, " the market will finish down today "... Now, this is a sharp lady, who did work on Wall St. ( Goldman )... Now, if she knows, 1 hour before the close, how the DOW will finish, what does ( or doesn't ) CNBC really know ahead of time ? I know she can read the order flows ( which is probably the case ) but still, what kind of tip is that, and in who's favor... I'm probably paranoid, as usual, but, paranoia is, often times, nothing more than heightened awareness...

Dr. Strangelove, I see Denninger sells stuff. Is he credible? I'd like to read this article...send me a link. Given your quote above: his perspective appears to be rehashing the motives of HB&B creating mortgage instruments (ARMS and Option ARMS) which by nature were fraudulent. Enough already.

My sources are on the ground. The write stuff and sell stuff too. News is an what our mutual sources 'sell'.

I asked: "How can this be?" Could appraisal fraud statistics be suppressed by mainstream media? Or is it factual? I got the information from my industry news source that publishes comments daily. You noted their source also sells software, OK. Gee...does the Wall Street Journal sell subscriptions ...do they have HB&B advertisers? What news is credible these days?

I can only say that from where I sit, mortgage brokers and bankers are being subjected to so many new regulations one wonders outloud which, if any, of them are working. Our Housing Financial Committee in CONgress (Hi Kaimu!) are creating more laws to make them look like they are doing their jobs. WHILE they accept the Friends of Angelo sweetheart mortgages. (Hi Christopher Dodd!)

I liken this discussion to conjecture without 'proof' but the fact that appraisal fraud being up has been raised as a 'fact' will likely create some needed discussion on what is working (or not) and the source. I will let you know what I turn up from my other sources. Mind you, you can count on all industry news being tinged with self interest ...not unlike to the motives of your Federal Reserve or Mr. Denninger

Been reading articles/blogs (and a couple of semi-white papers) the past few days trying to come to a clearer view on long term prospects of film tech vs silicon tech. Unable to conclude anything at this point but will keep at it.

Going over the general market moves of the past year, it seems the green plays have lagged big time. I'm thinking this might might all change fairly rapidly if and when the Administration starts to get involved, as they indicated they would. Could be part of the next trundle.

That is shocking. Basically a $2T hedgefund, funded by taxpayers, who don't see any benefit of it. Fed takes this tax money and destroys free market in favor of amassing more power for itself and driving policy decisions for its own benefit. Sad state of affairs...

I'm wondering why most stock charts don't automatically default to logarithmic view. It seems that's the main one you should look at if you want to see proportionate moves. Yet it seems that a lot of wave counting is done on linear charts. I'm thinking that T.A. is mostly self fulfilling prophecy. Because everyone is following it, it works. It also seems to be based on ex post facto reasoning. DOES ANYONE AGREE? In any event, since it does work to some extent, I suppose it's useful. I admit I pay keen attention myself when Louise Yamada speaks.... whatever the cause. Am interested in other views on this. FD--I am an ex subscriber to two T.A. newsletters.

Loannetter, Vassal to ...

Denninger's blog is well known and free. Just google him.

Do you know of any mortgage brokers that didn't sell ARMS or Option ARMS? Must be all mortgage brokers are fraudsters under Denninger's definition while we have no idea how many appraisals are judged by some software nano firm to be 'wrong' under NAR's definition which is "below contract sale price" and prolmugated by CONgress via the first-time homebuyer tax credit. I'm with you in that there's bias in all opinion but not in facts. Appraisals are inherently objective but with a NAR lobby machine requiring them to ALWAYS INFLATE or be deemed fraudulent under the HVCC appraiser protection program.

Cheers.

pPapa..thank you. I was worried I had missed a salient and basic fact that everyone else knew. Lends credence to the phrase "ignorance is bliss" because I am getting pi**ed off. It also looks like I have change my concepts to view the favored financial institutions (GS,C, BAC) as heirs to my(meager) fortune. I may as well buy their stocks....hmmm

I see that XLF failed to rise today above its October 2 low, and $USD is still above its 50-day MA. In this environment, a drop in FAZ is a buying opportunity, and I just bought some more FAZ at $22.11 and placed a sell limit order on it at $23.

This IS shocking. And a joke. The market is now the ultimate lottery... the gov, being the house, wins every time. An indirect tax... made much worse if the trading business is being given to those who got us into this mess. If we have to have this gov trading, at least keep it away from those guys.

"I'm thinking that T.A. is mostly self fulfilling prophecy. Because everyone is following it, it works."

Only partially right. First and foremost, human behavior in the markets obeys certain natural patterns. TA is simply the way to read those patterns. Not being exact science (just as psychology), it's only as good as is one who applies it. Skill is eccential - would a psychologist be any good if he simply applied formal procedures without deep understanding of underlying behavior?

And only then, yes, second and lesser factor kicks in: patterns become common knowledge, more people observe them and pile up, at first reinforcing the pattern, then overburdening it and reversing its action.

ALOHA !!

Wow ... look at that guy ... he looks like he just stepped out of a time machine from 1940! Does he wear suspenders and spats?

Bill, I think you need to go further and read the farce that is entitled "WHAT WE DO" ...

It starts this way then lists all the US FED's accomplishments.

"In order to foster the safety, soundness and vitality of our economic and financial systems, the Federal Reserve Bank of New York works within the Federal Reserve System and with other public and private sector institutions to:

- Execute monetary policy
- Support financial stability in the U.S. and abroad
- Operate and oversee payments systems
- Provide banking and financial services to international institutions

Wow ... so how has that worked out for everybody? It would be great if we could all get jobs at Goldman Sachs. Then we'd have some equality.

Why would we need a private entity whose exclusive members are large private banks to create a MONOPOLY? It would be like Exxon, Chevron, Cheasepeake, Marathon, Imperial, PetroHawk and all other oil companies creating a group to corner the oil market. How would motorists like that cartel? Yet somehow a MONEY MONOPOLY is okay? Hummmm??? The US FED has cornered not only the MONEY market but also the banking markets and trading markets. Believe me the PPT is an old story for those who have been around the gold markets.

There is nothing listed above that the US FED does that the US Treasury and the US Mint cannot do.

LINK: http://www.newyorkfed.org/aboutthefed/whatwedo.html

federico -

My impression is that arithmetic scale is used for dailies (since swing traders think in points) and longer-term charts in logarithmic (because trend traders think in % gains).

Does TA "work" because people believe it works? Or does TA sketch out the sheeps' expectations, in light of which nimble "sheltis" counter their moves to herd them?

http://www.voteronpaul.com/newsDetail.php?Rick-San...

Hey Vadym,

Just wanted to say thanks for pointing us to your cup and handle setup in your daily log. Read it with great interest, and feel like I'm seeing cup and handles all over the place now :)

http://www.voteronpaul.com/newsDetail.php?History-...

Out of interest watched this stock a bit today, and I don't think I've ever seen a stock flatline to that extent.

Thought I'd try my hand at some TA on it, so here's a sprinkling of everything (except cup and handle ;)

Looks like it's forming a symmetric wedge (don't know which way these normally brake, but i suspect in direction of prevailing trend, i.e. down)

But it did squeeze out of the bollinger band with this latest plunge and got down to a daily RSI of about 14 (not quite bsi capitulation)

The plunge looks like it was a 5 wave down move, which I think means it's due for an ABC correction back up.

At any rate, given the obvious stop point I took a medium size position and we'll see how it plays out. If I get stopped out, I'll keep it on my radar, thanks baz22!

Fundamentally this story sounds a bit like Philip Morris, and when I followed it a few years back, it did pretty well despite a lot of bad press...

Loannetter--

Re "HB& B got Barney Frank to raise the loan risk limits which seems designed to put smaller banks out of the lending business essentially limiting the competition". I opened the bill that you posted to try to sort out exactly what they're doing but I couldn't find anything specifically on loan risk limits. The bill is so lengthy I thought I'd ask if there is a specific relevant section I could read to figure out exactly what's happening in this area. Thanks.

Ditto here Doc, the higher gold goes the more ripped off I feel with many of my gold miner shares.

As a matter of fact though, the oil shares suffered even worse from late 1999 to mar 2003 as oil went from 10.35 to 39.99. So we are not alone.

How about the xoi going from 450ish to 406 as oil nearly quadrupled? The xoi ran to 500 in 2003 and built an ascending triangle which broke out when the gold stock leverage ended at hui 258.60

Since 1988 the xoi has been kicking xau's butt in the ratio chart. That 258.60 high in 2003 for the hui was the third touch of that downtrend since 1988.
It has been in a defined downtrend since then but recently broke out in late 2008.

We all know what oil stocks did post 2003 for 5 straight years(just when things seemed so bad) Perhaps that is what is needed to drive the next leveraged run in gold stocks? I have no idea, just looking at the past for possible clues.

Note oil broke out of it's 20yr range high convincingly in early 04 and gold has only recently held at the 1981 high (875) and broken out convincingly. This break out coinciding with the long term xau:xoi chart breakout.

Cheers

Bill - Not sure what you're getting at here...do you think the government put pressure on Buffett to do this deal?

http://articles.mercola.com/sites/articles/archive...

There is good reason for the miners to lag, my friends.

What will the desperate governments of the world do if gold goes zooming to say $1500 or even $2000 or $3000?

They will either confiscate the mines (ala VZ), quintuple the price of power which is a huge cost component (ala Ghana), triple the price of oil, steel, or consumables via inflation, establish or increase "exploitation" taxes or lease prices, or just simply throw on "windfall profits" taxes like the U.S. did to oil co's at one point.

And all the profits expected will have disappeared into the pockets of the politicians and their corrupt government machines...

In 1788 England bankruptcies would have referred to banks going bust and coins were something made of 22 ct gold or sterling silver, not plated crap like we have now. But look at the similarities with today, just adjusting the numbers by a factor of a million or billion...

"The bankruptcies in London have recommenced with new force. There is no saying where this fire will end. Perhaps in the general conflagration of all their paper. If not now, it must ere long. With only 20 millions of coin, & three or four hundred million of circulating paper, public & private, nothing is necessary but a general panic, produced either by failure, invasion or any other cause, and the whole residuary fabric vanishes into air & shews that paper is poverty, that it is only the ghost of money, & not money itself."

-- Thomas Jefferson 1788

Me thinks we might learn that lesson yet again...

Proudpapa,

very welcome, glad you find it useful... just beware of "man with hammer and nail" syndrome :)

So should we be buying Wells Fargo, GE, and American Express, knowing they are too big to fail...Especially now.

Obviously Mr. Buffett is not doing this for the goodness of the American taxpayer. Here are a few angles of consideration

- Berkshire had $25 Billion in cash at the end of June, the amount he spent is $26 Billion for the rest of this company. SO he spent equivalent to the entire cash balance of Berkshire ALL on a railroad. He spent $15.6 Billion in cash (60% cash 40% shares). Yet he says in that ho hum, steak and beans way, "I like cash."

- How much are they borrowing for this? $8 BILLION IN CASH from banks. Why would you borrow money in deflation? Why would you spend this money in deflation? WHAT DOES HE KNOW? THIS IS CRITICAL FOR YOU TO KNOW.

- When I was young Railroad Tycoon was a famous video game that helped win you fortunes. Yet Railroads aren't for modern day Tycoons...that's financial engineering ala WFC. Unless ITS MORE IMPORTANT TO OWN ASSETS THAN CASH NOW. HMM. Yet Buffet gives the misdirection "I love cash."

- What does Warren believe about OIL PRICES? Is trucking going to be not so profitable? Where is oil supply going to be in 3-5 years and where is the oil price going to be? What will it be priced in?

- What does Warren believe about STIMULUS? It would stand to reason that BNSF is going to benefit from industrial production increases, which don't look to be on the horizon....unless Stimulus 2.0 is on it's way?

- What does Warren know about ALTERNATIVE ENERGY? Probably that is isn't the real deal. BNSF moves 10% of the coal for electricity production in the US.

Finally, what does Warren know about FED POLICY. PERHAPS THEIR WEAPON TO KILL OUR SAVINGS AND THE GAME IS ON FULL FORCE ...OR MAYBE BERKSHIRE WILL TAKE A HIT IF SOME BIG BANKS LIKE WFC GET HIT SO HE'S USING THOSE SHARES NOW? CURRENCY DEBASEMENT WITH NO END!??? WHAT DOES WARREN BELIEVE ABOUT THE DOLLAR? Would you go spending and borrowing in a deflation if YOU COULD GET THESE assets for far cheaper in the future?

Warren Buffet, I am sure is all these steps ahead of US, and the idea that "he loves these bets" on America will be shown to be a COMPLETE DISINFORMATION CAMPAIGN and ultimately A FRAUD - MAKING IT LOOK LIKE HE IS BUYING INTO AMERICA WHEN HE IS MOVING HIS EMPIRE TO SAFETY.

Good points...

If I was to guess, it suggests he sees a lot of inflation within a few years, and good demand for moving coal either here or to china.

Borrow while rates are cheap.

Use your shares as currency if you think they are more fairly valued than what you are acquiring.

If rates rise, stocks will fall, but that's ok, so would railroad share prices.

If dollar falls we will be able to be more competitive selling coal or other commodities globally. We might also need to use a higher percentage of coal replacing any imported oil possible.

I agree his other comments were just bs to feed the cameras and cause silly speculation. He must feel he did well because BRKA and BRKB rose, which is abnormal IMO.

Thanks Vad--

Thanks for that. I agree but I have to think about that reinforcing/overburdening part some more. I also think that the original Elliott wave guys had a purer canvas to study and they found relationships that were, by and large, independent of the self-fulfilling type until it started to catch on.

I don't know your opinion on this related point, but I don't buy that there is a grand wave from the tulip mania, or earlier, that is meaningfully impacting us now (as traders).... unless people think it is. To believe in the value of these multi century waves presupposes (among MANY other things) that the West's economy/psychology has trumped the rest of the world, and they are now miraculously bound to follow in the wake of these decades old US hypothesized waves. Very egocentric. On the other hand, short term I can see how very astute T.A. can find relationships in markets throughout the world and in a variety of ways. Interested in your comments on these super waves.

Hi, dr.

Fleck made an interesting point in tonights column: that Gold may not see any meaningful correction untill the miners are embraced with the same enthusiasm as the metal (itself) receives. ( he also wondered who bought ' the other ' 200 tons of Gold .... perhaps China ? ).... best of luck...

No Problem

What I find curious, no, shocking, is his timing.

After this rally, with the debt situation of both the consumer and government deleveraging would begin in earnest as we get the next wave down. Equities should meander, or perhaps fall! Even a difference of 3-4 months, when transports http://stockcharts.com/h-sc/ui?s=$TRAN&p=D&yr=0&mn=6&dy=0&id=p92902296894 should go down as one would expect after this latest round of inventory restocking is over.

What I am saying is that he Buffet could have got a cheaper price in stock liquidation. On this type of deal that would be huge. WHY NOW?

I don't have the answer to this, but there is a reason.

Navid -

You make some interesting points but I don't agree with a number of your conclusions.

I think it would be correct to say that Buffett is not doing the deal for the goodness of the American taxpayer, but he didn't claim that he was.

He does like cash, who doesn't. Look at his reasoning for using it, and splitting B shares (link below).

He might be thinking it's not deflation he needs to be worried about, it's inflation. He's a long term guy. Either way, putting up this much cash isn't comforting for him, as his interview shows. Also, don't forget he has been wrong many times before, sometimes majorly. It could happen on this deal, no one knows for sure.

Like you, I'd like to know what he knows re oil prices, stimulus and alt energy and you might well be drawing the right inferences there. But none of that is a criticism of Buffett.

He has expressed doubts about the dollar many times over the past few years. Do you read his annual letter to SHs?

I don't get you about the weapon to kill our savings, but I could see that Buffett might feel he needs to put a lot of that cash to work and his strategy on acquisition is to do big deals because of the size of Berkshire and efficiencies.

He knows everything we know and, as you say, probably a lot more. He has the same worries. He's made many of the same mistakes. He's far from perfect, but he has done a lot of good things. Such as his 37 billion or so gift to the Gates Foundation, the largest gift by any philanthropist ever. This year approx 1.25 billion is going out. It's front loaded so the largest gifts are the earliest. It's his money, not Berkshires. Yes, he's trying to protect companies that he's invested in. Who wouldn't. As long as it's fair and square. Look at how he treats people and what he thinks is important in life. I think he really does love and believes in, America, and I think we should all give him the benefit of the doubt on his character and successes, unless facts prove otherwise.

Navid, I'm not saying you're mad at him because of his past support of higher taxes and the TARP, but many people are and I think they need to separate that from his actions. I was totally faked out by Paulson... I thought yes....just agree to give him whatever he wants.... the blank check. Now I see the result. I still think intervention was needed but I don't like what's happened. Also, I liked Obama... still do, but I don't like a lot of what his administration has done on the financial front so far this year. Same old same old. I get infuriated by the continuing conflicts of interests and pure greed. It's great that we can all talk it over on Bill Cara's site.

http://www.cnbc.com/id/33603477

ALOHA !!

What ever happened to FranSix?

While I tend to believe that his gift to the Gate foundation is great and a rare thing - I believe he is most appreciative of the America that allowed him to create such wealth...that is what he cares about...but isn't doing anything about!

What I believe is that the very spirit and soul of America is under attack by corporatism. They are willing to throw the US under the bus to protect private corporations. The idea of bankruptcy for a few banks is aligned with apocolypse. We are being terrorized by financial overlords. What do you think the masses in this country will do when they realize that they've been indebted beyond belief - having spent amounts never seen in the history of the world - with little long term benefit to benefit a few insiders? ...When this money could have created 700 000 $1 million businesses (for example) or could have been put into the future of this country. The gravity of the situation is not yet apparent to us, so we're still debating points like whether Buffet is a nice guy. Bluntly, that is irrelevant.

Some facts
- Warren has been the benefit of taxpayer support for many billions of dollars. 30% of his portfolio is from TARP companies. 30%! Do you realize these are bankrupt companies? The tax payer is creating the conditions to keep them alive.

- Warren has the ear of the administration. In the heat of the crisis he is being called by the administration to purchase this or that bank.

Given the above two points, What I object to his is public persona of being happy go lucky Warren marketing himself as the uber-Patriot when he is a shark and trades on insider information and intervention. I have no problems with sharks, but if he feels the pangs of responsiblity what is he doing about it (haha higher taxes to pay for TARP is not going to win points in anyones book). If Warren REALLY loved America he would do amazing service to it by talking about the need to stop intervening from the Fed, he would talk about corporatism, bailouts, ...many other things....I wish Volker would do the same, but alas he was part of the Fed.

I have watched Monger but a few times, but I sense he cares about this deeply as we do but bites his tongue more or less.

Navid -

I agree with your major point.... the debt is a huge problem and we all have to try and do something about it.

But I can't jump from there to saying what Buffett should now be doing about it. That friendly shark is Innocent until proven guilty! We just perceive him differently I suppose.

Well put, to say the least. Your hair would stand on end if you took the time to read some of the super or grand wave cycle predictions made by some Elliott Wave "experts". Maybe the fear aspect keeps up subscriptions.

federico,
the posted bill keeps getting new amendments added in committee so I'm not sure if that link is up to date. The risk area is well buried in a section relating to default ratios. B Frank proposed 10% capitalization requirements against ALL loans (not just those deemed risky) which means the bank itself must have that level of cash on deposit to cover potential defaults and the only banks with that kind of liquidity are those deemed too big to fail.

I was taking BC's advice and looking. I noticed:

China & UK are N

Strong:
Hong Kong
India...reliance,infosystch
greece...ase,alpha,ete
france...alu,aca,ete...these are banks
UK...barc,bay,rbsc...these are financial
Ireland...ilb,bir(+20),aib (+15%),ilb(+18%)

weak:
japan
china
australia...bbi,mgr

these are delayed and I could be innacurate in many ways...it may help me some today, but everything is relative.

edit: this was at approximately 0830 eastern US

down against EUR & GBP, but up against JPY and neutral with HK

What did bill say about a rising yen and gold? Was that after strengthening or weakening in the immediate period or does that matter?

anyone?

We seem to have comments on two threads thismorning, Bill opened a new Nov 3 addendum, link below. It makes things a little difficult with new comments appearing on both threads.

http://caracommunity.com/content/daily-market-and-...