[5:37pm ET] The first week of the year includes many impressive gains. Among the DJIA components, all 30 were up this week, and all ten sectors were up as well. That happened exactly four weeks ago too, but the index levels have not changed much in the interim.
However, the psychology definitely has. At this point, traders are more confident. I expect to see trading volumes increase across the board now, rather than just in Oil (USO) and Treasury Bonds (TLT and the inverse TBT).
In preparing for a stronger equity market in 2009, I made three changes in the Cara Global Best 100 companies list.
http://caracommunity.com/content/changes-cara-global-100-list-jan-3-2009
I removed two integrated energy companies, Norway’s StatoilHydro (STO) and France’s TOTAL (TOT) and replaced them with Houston Texas-based independent energy company Apache Corporation (APA) and oilfield services giant Schlumberger (SLB).
I also replaced toolmaker Stanley Works (SWK) with computer network technology company Juniper Networks (JNPR).
The new companies, I believe, are growing faster, have higher margins and investment returns, with less debt. Besides, they are more active traders, particularly in put and call options.
At the end of the day, the Cara 100 companies list is an exercise in focusing on quality. We still have to trade the stock price for a profit. But, with only so much time for research, it pays to study companies you rate more highly. It’s easier too focus on the things you have more respect for.
Having said that, it is true that (i) the three companies I removed are still very high quality and (ii) every company and the industry they operate in has its ups and downs, and traders buy them too high at the cycle tops and sell them too low at the cycle bottoms. The latter point is the basis of our trading strategy.
In seeking alpha, my trading philosophy is really simple: let the market come to you. If there are line-ups of buyers, then be a seller and if there are line-ups of sellers then be a buyer. But do so only at times when the emotions of the buyers and sellers are high. The financial services industry sell-side plus the media will always stir up the emotions of the public; so the market will always come to you. Be patient.
Also, be flexible in your thinking because markets are volatile. You may be a buyer one hour or day or week or month and a seller the next.
Global Economics Review
Weekly International Economic Report .
I leave the links in here because the Econoday Reports contain terrific charts and other information, and after the report is published, the link leads to the updated report. I strongly advise the Cara Community to avail themselves of research from Econoday because it is objective, educational and solid in every way. The founder and operator Cynthia Parker, who I have spoken to on several occasions and consider a friend, has done wonders with this service.
On January 2, the first key economic report of the year was the US ISM Manufacturing Index:
US Economic Calendar. Econoday reported, “The manufacturing sector is contracting at a severe and accelerating rate, indicated by the 32.4 reading for the ISM's manufacturing index -- one of the very lowest readings in 60 years of data. The previous and consensus numbers were: 36.2 and 35.5. The December report is unfortunately filled with record lows or near record lows. One of the most worrisome is an 18.0 reading for prices paid, a low last exceeded back in 1949. Price contraction reflects a combination of collapsing fuel costs and a collapse in demand as businesses destock. The inventories index fell for a second straight month, down 3 tenths to 38.8… Employment is especially depressing, down more than 4 points to 29.9. New orders and backlog orders are severely depressed in the low 20s, readings that point to deepening trouble ahead. Financial markets showed surprisingly limited initial reaction to the results.”
Here are the key US economic reports on the calendar this coming week and the Econoday analysis from last month.
US Motor Vehicle Sales report. Econoday reported, “Sales of domestic motor vehicles in November came in at a 7.5 million annual unit rate for domestic-made models - little changed from October. Levels unfortunately are at lows not seen since the early 1980s. Sales are not likely to pick up much in December despite incentives from dealers as the job situation has worsened, credit is still tight, and consumers are worried about U.S. manufacturers still facing the strong possibility of bankruptcy… Motor vehicle domestic sales Consensus Forecast for November 08: 7.4 million-unit rate with the Range: 7.0 to 8.2 million-unit rate.”
US Construction Spending for November. After the release of the October data, Econoday reported, “Construction spending dropped 1.2 percent in October, after no change in September. Weakness in the latest month was led by a sharp 3.5 percent drop in private residential outlays. Private nonresidential spending also declined - by 0.7 percent. In contrast, public outlays rebounded 0.7 percent in the latest month. Given the fall in housing starts in October to a record low 625,000 units, residential outlays will likely lead overall construction spending down in November… Construction spending Consensus Forecast for November 08: -1.3 percent with the Range: -2.5 to -0.2 percent.”
US Factory Orders data for November. After the October data was released, Econoday reported: “Factory orders in October plunged 5.1 percent, marking a third straight severe decline. Both durables and nondurables orders fell sharply. However, orders for nondurable goods were pulled lower by a mostly price-related fall in energy goods. Based on more recent durables data and further declines in oil prices, November is going to be another very negative month for overall orders. Durable goods orders fell 1.0 percent in November… Factory orders Consensus Forecast for November 08: -2.5 percent with the Range: -6.5 to -0.3 percent.”
US Pending Home Sales data for November. After the October data was released, Econoday reported, “The pending home sales index for October fell 0.7 percent to 88.9 with the year-on-year rate slipping back below zero at -1.0 percent. But we could see some improvement in November based on a jump in mortgage applications due to the recent, sharp decline in mortgage rates. Most recently, purchase applications in the Dec. 26 week rose 1.4 percent to 320.9… Pending home sales Consensus Forecast for November 08: 88.0 with the
Range: 84.5 to 90.2.”US Weekly Jobless Claims data. After last week’s data was released, Econoday reported, “Initial jobless claims for the week ending December 27 surprisingly fell a sharp 94,000 to 492,000. The 94,000 drop is the largest weekly drop in 17 years. Because of adjustment factors surrounding the Christmas holiday (including a four day work week), however, the four-week average at 552,250 is a much better gauge which, next only to the prior week, remains at the highest level so far in the recession… Jobless Claims Consensus Forecast for 1/3/09: 540,000 with the Range: 490,000 to 580,000.”
US December Jobs Report. After November’s data was released, Econoday reported, “Nonfarm payroll employment in November fell over a cliff with a 533,000 drop, following a revised fall of 320,000 in October. The November drop was the worst since the 602,000 decline in December 1974. Nonfarm payroll employment fell every month in 2008. Average weekly hours edged down to 33.5 hours from 33.6 hours in October. Looking at wage pressure data, average hourly earnings rose 0.4 percent in November after increasing 0.3 percent in October. Turning to the household survey, the civilian unemployment rate spurted higher to 6.7 percent from 6.5 percent in October… Nonfarm payrolls Consensus Forecast for December 08: -500,000 with the Range: -750,000 to -300,000. The Unemployment rate Consensus Forecast for December 08: 7.0 percent with the Range: 6.8 to 7.1 percent.”
For a couple weeks in this space I have written, “The macro-economic data has been painting a dour picture for many months. I continue to say that it’s always a good thing to err on the side of caution, but I would not want traders to miss the good values that are popping up these days. Yes, same old, same old. But you have to make a decision in your own mind; do you believe that the world is headed for a Great Depression or not? I think not. I believe that governments around the world have agreed to reflate, and, at the same time, create new structures for international trade and commerce, capital markets, and regulation… In the US, President-elect Obama has selected a solid team who, I believe, will get the job done. The SEC and CFTC will very likely be merged, and made into a single powerful regulator, while the Fed will be moved back into the private sector with Treasury being made more responsive to Congress, as it should be… Around the world, every country is staring depression in the eye, but I think that steps will continue to be taken that will change the situation.”
After the 1929-1932 market crash, the policies of the Fed in 1933 and 1934 were sufficient to take the S&P 500 index from 4.40 on June 1, 1932 to 13.21 on Oct 25, 1939 for a +200% market gain during the economic period known as the Great Depression.
Despite perhaps the most deplorable time in the economy in the history of the US, there were five bull markets in less than seven years averaging +84.8%. If you work the numbers through four bull markets ending Nov 9, 1938, the average gain was +98.6%.
Every time I hear an economist like Roubini tell you the stock market is going to crash from here based on their assessment of the economy, you are going to hear me tell them to put their head between their legs and blow all the smoke they want because its just foul smelling hot air with little to nothing to do with the equity markets.
The reason traders like you miss fabulous opportunities in the market is because smart people pay economists and media to tell you the sky is falling. So you sell, and they buy.
An economist can say anything; it’s up to us to check the facts. After a while, I’ll assure you that you too will see they don’t know much more about the capital market than the average person.
Sector ETF Summary for the International equity markets
Country ETF’s were all up sharply this week. India (IFN +13.38% this week had a much better week than last -11.29%) and so did Brazil (EWZ +11.89% compared to -8.04%). The biggest losers a week ago were the biggest winners this week. This is the same principle of the Dogs of the Dow Theory or the reversion to the mean concept.
In fact, if an anomaly does not soon correct, affected traders need to go looking for answers.
To repeat a concept from a week ago, “The international equity markets I like best for 2009 are Brazil and Australia, particularly Brazil although Brazil is facing major obstacles like all countries. Canada would typically be in that big winners group, but I expect there will be trade war issues pop up throughout the year that will hurt Canadian manufacturers.”
One final point is that while Friday was a big up day in the market, there were three important Country ETFs that barely moved, which could be a harbinger of weakness in those markets at their open on Monday. These markets, and the price change on Friday, were UK (EWU +0.41%), Germany (EWG (+0.57%) and Japan (EWJ +0.52%). Contrast that to the S&P 500 of the US (+3.16%), Canada (EWC +2.58%), Hong Kong (EWH +4.05%), China (GXC +6.47%), India (IFN +5.14%) and Brazil (EWZ +4.89%).
Traders arb these markets in both directions depending on the differences in market hours.
http://en.wikipedia.org/wiki/Arbitrage
US Equity Markets Review
NASDAQ Composite ino.com chart
NASDAQ Composite stockcharts.com chart
Here is the list of the ten highest-weighted non-financial stocks in the NASDAQ Composite. Put them in a watchlist (see Google Finance Portfolio) and watch them like a hawk:
AAPL MSFT GOOG QCOM RIMM CSCO INTC ORCL GILD EBAY
Daily RSI-7 for the Nasdaq 100 Big-10
Weekly RSI-7 for the Nasdaq 100 Big-10
Monthly RSI-7 for the Nasdaq 100 Big-10
In this holiday shortened, very low volume week, there were 30 of 30 DJIA index components that lifted.
Even a week ago when only 7 of the 30 were up W/W, I reminded you that the character of the market was changing.
As I pointed out a week ago, bad news on the economic or corporate front does not seem to be driving the market further south. At this point, the overriding factor seems to be the confidence of traders. As I pointed out in the opening summary, with the bad news continuum of Wachovia, AIG, Countrywide, IndyMac, Fannie Mae, Freddie Mac, Bear Stearns, Merrill Lynch, Lehman Brothers, and the subsequent TARP-related banker bail-out program, the automaker bail-out, and then the Madoff fraud, there is very little confidence in the market. Traders are awaiting action from the President-elect Obama A-Team.
Also stated the past two weeks, on a purely technical basis, the US equity market is still trading in a side-tracking pattern. I continue to be bullish, and looking at value opportunities that are becoming trading opportunities on the long side. But the Monthly and Weekly RSI studies still make me want to sell the rallies after I buy the dips. There was no change this week as all the Monthly, Weekly and Daily RSI-7 values dropped from the DJIA, S&P 500, NASDAQ Composite and Russell 2000 Small Cap indexes.
Based on all the data I look at, I don’t expect to see a booming equity market until late in the first quarter 2009, and probably not until after earnings season is underway early in 2Q09. In the meantime, as I say, I am bullish and expect prices to gradually lift starting any day now; however, I continue to expect a range-bound or side-tracking market where I am selectively buying dips and selling rallies.
Before committing full positions to the long side, I need to see (i) much more volume come into the NYSE and NASDAQ, and (ii) the Financial sector (XLF) break to the upside on high volume. Then I believe the 2008 Bull Market, which I believe started on Nov 21, the day after the S&P 500 put in a low of 741, will pick up momentum. I don’t think that’s likely until the previous S&P 500 cycle high of 1007 is taken out. That would put the DJIA index break-out at about 9640.
High volume, as I see it, will occur when there are consecutive days of a +100% increase in average daily trading volumes for at least 25 of the Cara 100 stocks, with higher prices on those days. Until then, there is a lot of nervousness among traders based on the weak economic data and a fragile credit market.
If you go to the Saturday Report for the Cara 100 “Portfolio” Volume for Friday, you will see very little volume has returned to the market at this point.
http://caracommunity.com/report/2009-01-03
Sector ETF Summary for the US equity market
Here’s the SPY Monthly, Weekly and Daily data charts:
SPY Monthly data:
SPY Weekly data:
SPY Daily data:
The tables I show are for eleven GICS Sector Index Funds (ETF’s), including two for Technology (XLK and SMH), for a total of ten GICS sectors. They cover the full spectrum of the US equity market.
Table 1: Cara ETF List is sorted by price performance Week over Week (W/W), i.e. 1W%N.
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
You can do this table yourself by entering the following string into the Summary window at Billcara2.com and then clicking on the link for Performance. SPY XLE XLB XLI XLY XLP IYH XLF XLK SMH IYZ XLU . You can also add more ETFs - up to 30 in total.
For a list of components to many ETFs, go to the AMEX.com web site, and click on ETFs.
10 (energy: XLE)
15 (basic materials: XLB)
20 (industrial: XLI)
25 (consumer discretionary: XLY)
30 (consumer staples: XLP)
35 (healthcare: IYH)
40 (financial: XLF)
45 (technology, semiconductor: SMH)
50 (telecom: IYZ)
55 (utilities: XLU)
Individual Sector ETF Review
Sector 10 (energy: XLE, IYE, VDE, OIH, PBW and IXC)
Here’s the XLE Monthly, Weekly and Daily data charts:
XLE Monthly data:
XLE Weekly data:
XLE Daily data:
Table 2: Senior oil & gas equities
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
As you know, I have been focused on the Energy stocks and the USO crude oil ETF lately – even though a week ago $WTIC plunged -11.0% and the Energy sector (XLE) lost -2.48% to 45.16. A week earlier, XLE had lost -4.72%.
But I reminded you that “Oil is not a commodity that can be stored easily. If there is temporary surplus, government petroleum reserves can remove it with increased buying programs. Big Oil will be asking why homeland security is being put at risk by lack of buying at prices that are lower now than for almost five years. They will want to know why the previous Administration was buying at peak prices and, if it’s the case, why the new Administration is not buying at floor prices.”
So what happened this week – Big Oil and the Admin must be reading this blog – was that government decided to re-start purchases for the strategic petroleum reserves – you read the news here in advance – and USO lifted (+22.44% W/W and +7.64% on Friday), $WTIC lifted (+22.89% W/W including +3.90% on Friday), and XLE lifted (+12.52% W/W including +4.98% on Friday).
XLE was, in fact, the #1 performing sector this week.
You might say, we had a good week.
To repeat, “As I say, since oil is a consumable and a hard to store (in vast quantities) product, there will be production cut-backs will soon catch up to the decreased economic demand. Then, after signs of an economic revival, the private sector will take on increased purchases to rebuild inventories. Then as speculative funds return to the commodity trading markets, prices will soon revert to the $60-plus level. The 200-day Moving Average price, which is now $101.61 $100.34 (this week), will likely to continue to fall until oil market stability is found in the 60-75 range.”
I will already have to amend the next statement I made in this space a week ago: “As for my intermediate (say 6 month) and longer-term (say 12-15 month) targets for XLE, it would be about 60, which is about a +33% increase from today’s price of 45.16.”
At today’s price of 50.15, that is now just a +19.6% increase from today’s price.
Blink and see what happens?
But you better be good because the market could (and will at times) go against you.
It’s nice to be right once in a while, but the bigger point is that traders deal in percentages and trends and cycles. I seldom look at the price in determining my buys and sells. That is, I don’t pre-set targets (ie, goals); I only look at the trends and cycles and indications of turns. Then I look at the percentage gain or loss and the time frame.
Also, I never worry about over-trading. Commissions today are peanuts. People who won’t take a small gain are the same ones who tell you that tax considerations are a big deal. Taxes should have nothing to do with trading decisions.
The only people who argue against these methods are the ones who are not good at it. But, like I say, you better be good.
As you know we’ve been trading many of the following stocks: RIG (+23.1% W/W with Friday up +10.1%), SLB (+19.4% including Friday’s +7.8% gain), CEO +16.7%, PBR +16.5%, ECA +16.3%, SU +16.1%, and PTR +15.0%.
Oil & Gas Exploration & Production -Canada
Sector 15 (basic materials: IYM, XLB, IGE and VAW)
Here’s the XLB Monthly, Weekly and Daily data charts:
XLB Monthly data:
XLB Weekly data:
XLB Daily data:
Table 3: Senior Basic Materials:
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
Basic Materials (XLB +7.67% W/W to 23.57), which was a mid-level performing sector.
The one stock I have gone to bat for the most in these pages (other than maybe Brunswick Corp BC) is as you know Teck corp (TCK). Well TCK was up this week +40.0%, including a gain of +16.7%.
Btw, BC was up this week +26.7%, but I’ll cover that later. The point is that as soon as the broad market showed an indication that traders might be turning bullish, and where the S&P 500 jumped +6.76% W/W, these two stocks were up +40.0% and +26.7%, which are the top two performers in the Cara 100 this week.
Call it what you like; but it could be akin to the Dogs of the Cara 100 principle or the reversion to the mean concept.
I love it when a plan comes together.
In this sector, the goldminer prices bounced this week too, but not really with oomph because $GOLD was up just under +1.0%. But, then, do you recall my alerting you a couple days ago that we were selling the goldminers late in the afternoon on a strong day. I did add that we were simply taking profits and looking for a pull-back and re-entry point on those stocks.
Trading is a dance, as you know, and you need to get into the rhythm of the particular dance partner.
Btw, Alcoa (AA +28.97% W/W including Friday’s gain of 7.55%) was the DJIA 30 biggest winner this week. I don’t trade it. But I look to it as confirmation that GM and Ford are doing well because Alcoa ships the automakers a lot of aluminum. And, this week, the US Treasury actually delivered some big dollar sums to GMAC plus instructions to lower their credit tightness on the sub-prime crowd in order to finance the clearing of the cars for sale and kick-start production again. …Made the good people in Pittsburg smile even though Crosby and Malkin aren’t playing that well in the Igloo these days and Cowher is looking at the Big Apple.
http://en.wikipedia.org/wiki/Sidney_Crosby
http://en.wikipedia.org/wiki/Bill_Cowher
Sector 20 (industrial: IYJ, XLI, VIS, and IYT)
Here’s the XLI Monthly, Weekly and Daily data charts:
XLI Monthly data:
XLI Weekly data:
XLI Daily data:
Table 4: Senior capital goods makers and transportation:
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
Industrials (XLI +8.98% W/W) closed at 24.28.
The sector winners this week were Boeing (BA +12.79%, including +6.05% on Friday) and Caterpillar (CAT +11.93% W/W after gaining +5.01% on Friday).
Last week’s big loser TXT (-15.34%) was the sector’s big winner (+20.3% including +10.8% on Friday). Still didn’t get the stock up into the Cara 100 though. As you know the company and the stock price are two different concepts.
Also, to return to the largesse of the US taxpayers finally getting into the US Industrial complex this week, I remind you that three weeks ago I opined:
Traders, however, are expecting a pick-up in a few months based on the impact they believe will occur after the various govts start to actually spend the mega billions set aside for economic stimuli programs.
Keep you eye on the status of these payments. When politicians talk, nothing much happens because like many economists, they blow a lot of smoke. But when the wire transfers actually make it from the US Treasury to the corporate treasury(s), the share prices of those companies start to pop. So if you are a US taxpayer you can hedge your pain with some selective investing in these stocks.
Sector 25 (consumer discretionary: XLY, IYC and VCR)
Here’s the XLY Monthly, Weekly and Daily data charts:
XLY Monthly data:
XLY Weekly data:
XLY Daily data:
Table 5: Senior consumer discretionary equities
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
Consumer Discretionary (XLY +10.00% W/W including +5.01% on Friday) closed at 22.65.
A week ago in this space I wrote:
Brunswick Corp (BC +5.0%) was up again. BC was up +15.7% a week ago. Just over a month ago or so, shortly after it hit a low of $1.82, I took a stand on BC. At today’s price of $3.78, the price has more than doubled, but the turnover is very low as the consumer purchasing power problems persist. Yes, how’s that use of alliteration to make a point! As soon as you read about tariffs being considered for foreign made boats from China and Taiwan, you can buy more of the BC.
All that talk this week in Washington circles about protectionism and trade war… bingo, BC jumped +26.7% W/W including +10.5% on Friday.
Just wait until Brunswick starts re-opening plants and actually start making boats again. Maybe we ought to buy a SeaRay and call it “Thank U BC”.
Speaking of boats – ships actually – there were four big ones in port here this weekend, chock full of tourists. Bay Street was busy – no worry about the economy it seems – Roubini must be pissed – and some of those monster ships were from Carnival – both the Fun ships and Holland America. Carnival Cruise (CCL) was up +10.1%.
Retailers JC Penny (JCP -10.03% a week ago was up this week +11.4%), so the jury is still out on their reporting of holiday season sales. If so, I would look for a pop off an oversold condition shortly after these companies report in early January.
A week ago, I wrote that in the interim, “I’d be looking for 15 (JCP) and 29 (TGT), but for short-term trade -- couple months only unless there is a national tax rebate check in the mail”. JCP hit a low this week of just 18.67, and TGT 31.69, and closed at 20.51 and 34.63 respectively, so maybe the holiday sales went ok. We’ll see. Both report December sales on January 8 (Thursday). Higher prices going into Thursday could be setting up a sell-off… Leading to the 15 and 29 prices I was referring to.
You see, you have to know that December was lousy weather, shoppers had no money, yada yada, but after the gazillions of USD that Bernanke and Paulson are handing out to the Great Unwashed, the good quality retailer companies in the Cara 100 have to boom. The lower quality competitors are just hoping to avoid bankruptcy and survive.
Sector 30 (consumer staples: XLP, VDC, RTH and IYK)
Here's the XLP Monthly, Weekly and Daily data charts:
XLP Monthly data:
XLP Weekly data:
XLP Daily data:
Table 6: Senior consumer staples equities
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
Consumer Staples (XLP +3.99% W/W to 24.21) was a much stronger week than the past couple, but this ‘defensive’ sector was still the worst sector performer.
ABV and WFMI were each up +8.8% and WAG up +6.0%, but there was not a lot happening here.
Sector 35 (healthcare: IYH, XLV, VHT, IXJ, and IBB)
Here’s the IYH Monthly, Weekly and Daily data charts:
IYH Monthly data:
IYH Weekly data:
IYH Daily data:
Table 7: Senior healthcare equities
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
The Healthcare sector (IYH +5.30% W/W to 54.68) had been a trader favorite during the early 4Q08 because like Staples, it’s a defensive one. Fund managers were looking for places to invest money that wouldn’t hurt them on the year-end statements. They also recognize that the banking credit market issues are being resolved, so this week the sector leader was once again: Aetna (AET 11.8% W/W after being up +4.2% W/W a week ago and +28.3% the week earlier).
Four weeks ago, in this “defensive” sector (where risk is less a concern), I said I expected the health stocks that have a financial/insurance component to be up. These stocks have performed well for the past four weeks, with AET (+45.16%), WLP (28.44%) and UNH (+35.38%) all soaring. Nothing else in my healthcare monitor comes close to that 4-week performance.
Anyway, you have been reading it here for four straight weeks. As long as the banks are actually lending money, these stocks should do well. But continuously higher stops are required to protect your gains.
Sector 40 (financial: IYG, IYF, XLF, VFH, IXG, VNQ, RWR, IYR, and ICF)
Here’s the XLF Monthly, Weekly and Daily data charts:
XLF Monthly data:
XLF Weekly data:
XLF Daily data:
Table 8: Senior financial company equities
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
Financials (XLF +7.38% W/W to 12.66) had a good, but middle of the pack, week.
The big winners this week were MS +17.%, DB +15.4%, UBS +14.7%, BBD +13.8%, GS +13.5%, and IBN +12.9%. Citi (C +5.31%) was up +6.41% on Friday alone, so the rest of the week was a loser.
But for Friday, XLF was the worst performing of the 10 sectors.
Sector 45 (technology: IGM, IGV, IGW, XLK, VGT, IYW, IGN, IXN, MTK and SMH)
Here’s the SMH Monthly, Weekly and Daily data charts:
SMH Monthly data:
SMH Weekly data:
SMH Daily data:
Here’s the XLK Monthly, Weekly and Daily data charts:
XLK Monthly data:
XLK Weekly data:
XLK Daily data:
Table 9: Senior technology equities
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
Tech (XLK +6.96% W/W to 15.99) and Semi-conductors (SMH +8.98% W/W to 18.38) were good, particularly the semi-conductors, which is what you should expect in a rallying market.
STP +27.5% W/W was up +10.3% on Friday. SanDisk (SNDK) jumped +21.6%, including +15.4% on Friday. One we trade, First Solar (FSLR +13.3%) was strong.
Intel (INTC) gained +6.8%, which underperformed the sector and the industry group.
Sector 50 (telecom: IYZ, VOX and IXP)
Here’s the IYZ Monthly, Weekly and Daily data charts:
IYZ Monthly data:
IYZ Weekly data:
IYZ Daily data:
Telecom (IYZ +8.14% W/W) closed at 17.00.
Verizon (VZ +5.5%) and AT&T (T +5.7%) were unremarkable in a broad market that rallied more.
Sector 55 (utilities: IDU, XLU, and VPU)
Here’s the XLU Monthly, Weekly and Daily data charts:
XLU Monthly data:
XLU Weekly data:
XLU Daily data:
Utilities (XLU +6.07% to 29.71) was a winner, but was just #8 best performer of the 10 sectors.
The big winner this week was Exelon (EXC +8.9%) and FirstEnergy (FE +8.3%). But FE is still down -5.4% over 2 weeks and -12.8% over 4 weeks.
Here is the list of North American Utilities that I follow closely:
AEP D DUK ED EXC FE FPL NGG PCG PEG SO TRP
For study purposes, there is a good mix of electric (AEP, D, DUK, FE, FPL and SO), gas (NGG, TRP) and diversified (ED, EXC, PCG, PEG) utilities.
Table 12: US Utilities
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Bonds & Yields Review
Table 10: US Treasury Yields
| Maturity | Yield | Yesterday | Last Week | Last Month |
|---|---|---|---|---|
| 3 Month | 0.05 | 0.07 | 0.01 | 0.01 |
| 6 Month | 0.26 | 0.23 | 0.17 | 0.31 |
| 2 Year | 0.83 | 0.76 | 0.88 | 0.88 |
| 3 Year | 1.08 | 0.97 | 1.03 | 1.06 |
| 5 Year | 1.66 | 1.55 | 1.51 | 1.60 |
| 10 Year | 2.38 | 2.22 | 2.13 | 2.65 |
| 30 Year | 2.80 | 2.68 | 2.60 | 3.15 |
| Maturity | Yield | Yesterday | Last Week | Last Month |
|---|---|---|---|---|
| 2yr AA | 2.39 | 1.75 | 1.86 | 2.31 |
| 2yr AAA | 2.32 | 1.67 | 1.78 | 2.15 |
| 2yr A | 3.05 | 2.58 | 3.48 | 2.93 |
| 5yr AAA | 2.85 | 2.73 | 2.76 | 2.95 |
| 5yr AA | 2.52 | 2.50 | 2.51 | 3.06 |
| 5yr A | 3.26 | 3.17 | 3.17 | 3.33 |
| 10yr AAA | 3.69 | 5.12 | N/A | 4.16 |
| 10yr AA | 4.05 | 5.51 | N/A | 4.06 |
| 10yr A | 4.36 | 5.79 | N/A | 4.16 |
| 20yr AAA | 4.22 | 3.85 | 5.41 | 5.20 |
| 20yr AA | 4.32 | 3.95 | 5.52 | 5.37 |
| 20yr A | 4.63 | 4.26 | 5.82 | 6.03 |
| Maturity | Yield | Yesterday | Last Week | Last Month |
|---|---|---|---|---|
| 2yr AA | 3.47 | 3.61 | 4.00 | 5.19 |
| 2yr A | 3.85 | 4.12 | 4.49 | 6.04 |
| 5yr AAA | 3.33 | 3.09 | 3.32 | 4.41 |
| 5yr AA | 4.02 | 4.06 | 4.25 | 6.20 |
| 5yr A | 4.90 | 4.67 | 4.79 | 7.31 |
| 10yr AAA | 4.27 | 4.09 | 4.79 | 4.64 |
| 10yr AA | 4.96 | 4.62 | 5.50 | 5.91 |
| 10yr A | 5.37 | 5.27 | 5.52 | 6.74 |
| 20yr AAA | 5.26 | 5.17 | 5.09 | 5.32 |
| 20yr AA | 5.11 | 4.96 | 4.89 | 5.36 |
| 20yr A | 5.84 | 5.73 | 5.66 | 8.67 |
Do you recall?
One of these weeks, TLT will crash. As I stated here a week ago, I suspect it will happen after the banks sell those bonds back to the Fed, absolutely making gazillions in profits in the meantime. Then who’s going to buy the next batch?
Yes, a week ago I was pleased that the 20-year Treasury ETF (TLT) lost -0.68% W/W and I was looking forward to more of that. Well, this week, TLT plunged -3.76% to 116.35, including a loss of -2.51% on Friday.
TIP (down -1.00% a week ago) plunged -3.01% this week to 97.38. The loss was -1.87% on Friday.
You read it here a week ago: “As I say, this is sick. This is Treasury Secretary Paulson’s TARP in action. His department is using hundreds of billions of soon to be hard-earned taxpayer dollars into the banks of which he’s been a lifelong friend, and rather than lend that money to clients, including the taxpayers, the banks are buying Treasuries, knowing the Fed will do a repo.” Treasury Secretary Paulson’s days are numbered. Did he ever do a number on the US public over the past two and a half years.
Despite the major drop in bond prices this week, Bonds are still yielding just +2.80% on the 30-year, +2.38% on the 10-year and +1.66% on the 5-year. A year ago, those rates were +4.58%, +4.15% and 3.59%, which many traders considered to be too low by about 50 basis points.
A couple weeks ago I pointed out that Total Return includes a dividend yield that is very high for several of the high yielding DJIA components like VZ, T, MRK, PFE, KFT, GE and BAC. You will start with a current yield of about +4% and those dividends will increase on average some +7% to +10% a year for these companies, and the share prices in 5 to 10 years (to replace the bonds) will be significantly higher, so your Total Return will likely be over +10% annually on the current cost base. I asked why would you possibly accept and average of +1.73% yield from an average of 5- and 10-year Treasuries two weeks ago?
The point, I remarked, is that you shouldn’t, and that you should have sold those bonds at the top of the cycle. The combined 5 and 10-year yield at the close this week is still just 2.02%. Won’t pay many bills.
Although I timed it earlier than I would have preferred, the Trade of the Generation was to buy Gold and sell Bonds. As 2009 goes forward, the wisdom of that advice will become ever more apparent.
Here is the $USB 30-year Treasury Bond chart.
Interest rates and bond yields.
Interactive Daily data charts:
Interactive Chart of Interest rates and bond yields.
This chart is stunning to long-term observers of the debt markets.
US Bond Funds -- Interactive Monthly Data Charts
SHY Monthly data series chart:
IEF Monthly data series chart:
TLT Monthly data series chart:
AGG Monthly data series chart:
LQD Monthly data series chart:
TIP Monthly data series chart:
US Bond Funds -- Interactive Weekly Data Charts
SHY Weekly data series chart:
IEF Weekly data series chart:
TLT Weekly data series chart:
AGG Weekly data series chart:
LQD Weekly data series chart:
TIP Weekly data series chart:
US Bond Funds -- Interactive Daily Data Charts
SHY Daily data series chart:
IEF Daily data series chart:
TLT Daily data series chart:
AGG Daily data series chart:
LQD Daily data series chart:
TIP Daily data series chart:
Table 11: Interest-sensitive securities
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
As I pointed out a week or so ago, “The corporate bond market is also starting to pick up because the Treasuries have reached ridiculously low yields. In addition, there is now more talk of convertible debentures, which you might wish to look into; however there are many risks to consider, so don’t jump into this blindly.”
Buying high-yield distressed debt makes sense at this point because as the economy improves, and the corporate prospects for refinancing at lower yields, the prices will rise from great depths. But this is a market for professionals. The Great Unwashed have no clue whether the holders of distressed debt are really after the assets they can claim in bankruptcy court. Some of the vulture investors who are in this game are notoriously bad people. My definition of ‘bad people’ is an organization that purposefully buys the debt in order to ruin the company. My advice is to stay away. There are too many legitimate opportunities in capital markets where the rest of us can protect and build our wealth. My advice to the securities regulators is to hire an independent forensic accounting firm to make a report on every corporate bankruptcy where distressed debt played a role. If there is vulture investor collusion among a group that plans these bankruptcies well in advance, they ought to be prosecuted. At the very least they ought to be charged with insider trading. You’d be surprised to see how quickly that regulators could get this problem under control. There are not that many vultures around, and the same ones pop up on my radar screen when I see these bankruptcies.
As for high-yield debt for companies that you can be pretty sure will not go bankrupt, the Wall Street Journal and Barron’s have good lists. If you have the time, find the names of the higher quality issuers, and look into the terms of the contracts. You may find some really good values here.
Unfortunately, I’m not the person to look for you as this is too much long-term fixed income oriented, and I’m a trader.
Consumer Finance -USA -- Interactive Weekly Data Charts
Mortgage Finance -USA -- Interactive Daily Data Charts
Commodities Review
The $CRB index finally had a break-out week, gaining +8.66% W/W to 233.92, up from 215.28. Mostly this was caused by oil, which soared from 37.71 to 46.34, up +22.89%.
It’s a very volatile market, but the net effect over the next few months ought to be a series of higher highs and higher lows.
A week ago in this space, I wrote:
In early July, the $CRB hit a high of 493.97. Then came Lehman Brothers. The ensuing credit market squeeze, and a no short-selling rule on top, sucked the blood right out of hedge fund managers. I think that the index will start lifting again after the oil market starts to rally.
In the past five weeks, the 50-day MA for $CRB fell from 283.11 to 268.60, 257.15, to 248.80 to 242.86 and now to 238.62. The 200-day MA has dropped from 380.30 to 375.94, 371.24, to 366.49 to 362.42 and now to 359.06.
As I wrote previously, “We will be watching in the 1Q09 sometime when this downward trend reverses.” This week was a good start.
After governments around the world actually start delivering on their promised economic stimuli programs, the $CRB ought to move higher. Yes, I buy into the Jim Rogers argument.
http://en.wikipedia.org/wiki/Jim_Rogers
But you knew that already. I was just being a little more selective as to my timing.
You get these things wrong, and you get hurt financially.
Interactive Chart of Weekly CRB Commodities Index:
Interactive Chart of Daily CRB Commodities Index:
Oil Review
$WTIC soared +$8.63/bbl (+22.89%) to 46.34, up from 37.71.
A week ago, I stated in this space:
There are games being played here, while some brain-dead (and presumably well paid-off) analysts have started calling for $10 oil. A rebound to the 60-75 level is likely based on fundamentals.
As the price started to move higher, the cover story was the Gaza war. I strongly believe that was a cover. Follow the money as to who paid whom for the missiles/rockets that started this thing.
Simultaneously, the US Administration says they have re-started buying crude oil for their so-called strategic petroleum reserve.
For $WTIC, the 50d MA has fallen from 73.95 to 67.85, 62.51, 58.03, 54.80, and now to 52.42. The 200d MA dropped from 107.18 to 105.86, 104.49, 103.02, to 101.61, and now to 100.34. The price in mid-July hit a record high of $149.90. When the oil market stabilizes, I expect the 200d MA will be under 75, and possibly lower, so even if there is a sharp bounce, I do expect that the oil market will work through a very long bottom phase.
$GOLD futures are no longer highly correlated to oil. After $WTIC lifts into the high end of a trading range (I say it’ll be about 75), it will fall back a bit and side-track while $GOLD continues to rally. $GOLD is an easily storable community. Send me yours; I’ll store it. :-)
Here is the e-miNY Dec-07 Crude Oil chart.
Interactive Chart of Weekly Crude Oil:
Interactive Chart of Daily Crude Oil:
Gold & Precious Metals Review
$GOLD lifted +$8.30/oz (+0.95%) to 879.50. A week earlier, it gained +$33.80 (+4.04%) to 871.20, and the week before that gained +$16.90/oz to close at 837.40.
I have been on board the yellow brick road.
For $GOLD, the 50d MA has fallen from 798.33 to 785.98, 779.17, 776.08, then a week ago up to 777.66, and now 786.22. …A beautiful sight for the gold bugs. The 200d MA has dropped from 875.05 to 870.77, 866.58, 863.42, to 860.69, and now 858.88.
Two weeks ago I wrote in this space, “I’m looking for a turn in the MA’s as $GOLD cycles through the bottom.” Then a week ago, there was a turn in the 50d MA, which confirmed my bullish thinking.
Then I added, “However, there are issues I still see with $SILVER and $PALLADIUM that are of concern.” So this week, while $GOLD and $PLAT gained +0.95% and +5.25% respectively, $SILVER and $PALL soared +9.12% and +9.26%. Bingo.
I pointed out two weeks ago,
“During the Great Depression of the 1930’s, gold was the top performing asset class. Some people think that if gold goes up with inflation, it cannot go up with deflation. But gold is a storehouse of value, and as prices tend to overshoot the mark for both inflation and deflation, gold becomes a hedge… During periods of massive inflation, there are many people in the world who will take your gold while refusing your paper money. During periods of massive deflation, money becomes scarce, so holding gold, which all people see as money is desirable. During periods of war and/or the regime of despots, gold can be smuggled easier than paper money, usually… Oil is a consumable, but Gold cannot be consumed, and will never die. Almost all the gold the world has ever produced is still with us. There is only so much of it and the costs of finding it, mining it, processing it and delivering it are big. Moreover, those costs are constantly rising… At the end of the day, it’s wise to own some gold. I think that during periods where real, ie, economic, wealth is being created rapidly, and interest rates are high, I think holding 3% weighting in gold is good. When inflation or deflation is at extremes, a massive weighting, say 30% of liquid assets, is appropriate, particularly when interest rates are very low and the $USD is weakening.
Clearly, the US economy is not on strong footing yet, but everything is relative, so you have to watch the dynamics of the central bank rate cuts, and forex cycles, and relative strength of the various equity sectors before you can comfortably trade gold.
A week ago I wrote in this space, “The $USD dropped -0.32% on Friday, which drove up the price of $GOLD by +$23.20, the biggest part of the week’s gain. Let’s see what Monday brings.” Well, Monday and Wednesday were big winners and even with Tuesday’s pull-back (to shake up the amateurs), the gain in $GOLD was +$13.10/oz. Simultaneously, the $USD was up on the winning gold days (Mon and Wed) and was down on the Tuesday losing day for gold. This was a perfect counter-trend, which I am guessing to mean that somebody big was buying gold those days and using the $USD as a diversion.
Interactive Chart of Weekly Gold EOD Continuous Contract Index:
Interactive Chart of Daily Gold EOD Continuous Contract Index:
Interactive chart of recent trading for the Gold Bullion index.
Spot silver chart for the week
$SILVER jumped +9.12% W/W to lift from 10.53 to 11.49.
For $SILVER, the 50d MA is now down from 10.54 to 10.15, 9.96, 9.91, then up to 9.92 and now to 10.04, so there silver moved off the plateau and has begun to lift. The 200d MA has dropped from 15.26 to 15.05, 14.81, 14.58, 14.39, and now to 14.23.
I wrote in this space two weeks ago, “Now that the current price is above the 50d MA, any stabilization at or improvement from these levels will see the 50d MA reverse direction. It could be sometime, however, before the 200d MA is traversed.”
I added here two weeks ago, “After hitting a cycle low around US$2.50 a few weeks ago, Silver Wheaton (SLW) managed a high of $6.98 this week before closing at $5.69. This has been a good trader for me. I am building bullish positions using long and short put and call options tactics in SLW.” Then SLW gained +8.69% on that Friday, lifting it to a W/W gain of +7.73%, closing at US$6.13. This week, SLW gained +$0.45 (+7.34%) to close at $6.40. If the price cannot take out the $6.98 recent high soon, traders will likely see a pull-back.
We have a lengthy SLW report about to be published on Tuesday or Wednesday. My purpose was to show the extent to which we get to know many of the companies whose shares we trade professionally. Please feel free to send the report link to anybody because these CTAB Briefings represent my marketing. I believe in showing people by example rather than publishing glossy ads. I want to show people that I pay attention to detail because in the capital management business, it is a crucial factor.
In this and all my Briefings, you will see a collection of independent analyses and comments made by my team. I not only permit it, I encourage it. The fact is we have nothing to sell except or ability to make a profit when trading, and to do our best, we may be long at 10am and short at 11am. We trade prices. We can best do that when we have an objective view of the companies and an unbiased analysis of the price series data.
In fact, this is the only business model that works. Everything else you see involved with Humungous Bank & Broker is so thoroughly conflicted I wanted to scream all those years I was in the industry.
Maybe you don’t realize it, but securities industry rules are written by people who purposefully break those rules, and hope you don’t notice. There are house rules, for example, that Broker-Dealer A wealth managers cannot buy any of its own underwritings, so they arrange to buy Broker-Dealer B’s underwritings and vice versa. Then these firms get into selling syndicates, where the executives of those companies seem to think it’s ok to push their staff to sell them into client accounts to the max in order to show the corporate client the firm has strong distribution and ought to get the lead or a bigger piece of the next one. Every front office sales person knows where the bread is buttered and where careers get side-tracked if they fail to meet expectations (don’t even call them quotas). That’s the business – selling risk to the public – and loading commissions to the hilt. A new issue is said to be sold net, that is, the buyer pays no commission. That’s a joke on the buyer because the gross price is merely raised by the amount of the commission. Anyway, it’s not rocket science to see why the sell-side of the securities industry, including the Fund of Funds – those masqueraders who try to look like the buy-side – are in a heap of trouble.
Anyway, I’m a trader, and I have no conflicts, so I sleep well at night. I just have to perform well, but that’s based on skill and experience, not somebody’s silver spoon, or insider trading, or whatever. In fact, any fees we make raises the high water mark.
Hopefully the SLW will exceed your expectations given that I have a very tiny firm. We should all know by Wednesday. I love the challenge. I haven’t even started to write my summary of the report, which I won’t do until just before the report gets published. Keeps me honest that way.
Interactive Chart of Weekly Silver EOD Continuous Contract Index:
Interactive Chart of Daily Silver EOD Continuous Contract Index:
Interactive chart of the Silver Bullion index.
$PLAT closed at 941.50, up +5.25% from 894.50.
The 50-day MA had dropped all the way from 1047.19 to 989.45 to 947.92 to 928.29 to 888.38 to 869.87 to 852.35 and then to 841.31 over seven weeks. A week ago, I wrote, “Perhaps next week will see a turn.” I must be on a roll because the 50d-MA is now up to 843.66.
The 200-day MA has fallen from 1711.39 to 1690.15 to 1661.38 to 1646.07 to 1614.63 to 1588.08 to 1547.12 to 1522.73 and now to 1505.36 in that span.
There does appear to be a mid-Oct cycle bottom.
A week ago I wrote, “Something is happening here. Two weeks ago in this space I stated, But as the current price is up to 849 and rising and the 50d MA is 869.87 and falling, the point of intersect is right ahead. That is usually a time to focus on market strength (in the case of rising prices) or weakness (in the case of falling prices when the current price is above the rising 50d MA). The recent price of both gold and silver did manage to stay strong and rise up above their falling MA’s (ie, resistance), and platinum and palladium have not done it yet. The latter two are precious metals, but also have more industrial (ie, economic) uses, as in catalytic converters in automobiles… So, I’m looking for plat and pall to confirm the recent moves in gold and silver, or for the gold and silver to come off once again.”
The four precious metals have all moved up and the 50d MA turns are confirmation that “something is happening here”.
Spot platinum chart for the week
Interactive Chart of Weekly Platinum EOD Continuous Contract Index:
Interactive Chart of Daily Platinum EOD Continuous Contract Index:
Interactive chart of the Platinum metal index.
$PALL soared +9.26% to 192.30 from 176.00.
The 50d and 200d MA is at 190.92 (up from 192.43 W/) and 331.78 (vs 338.15 a week ago), respectively.
A week ago I added in this space, “I still don’t have much comment other than traders who can watch their monitors by the minute might catch a bounce here, particularly if silver starts to move higher like the gold and plat prices.” Yes, the pall and the silver had real big weeks.
Spot palladium chart for the week
Interactive Chart of Weekly Palladium EOD Continuous Contract Index:
Interactive Chart of Daily Palladium EOD Continuous Contract Index:
Interactive chart of the Palladium metal index.
$COPPER this week lifted +12.08% to close at 146.10.
The 50d and 200d MA’s were 159.78 (vs 165.95) and 302.05 (306.85), respectively.
I added a week ago in this space, “There is clearly no break-out coming according to the charts. I usually say, “No further comment. If you really need an answer call Glencore in Zug or London.” But when you see Rio Tinto (RTP) continue to collapse, you need to pay attention.”
This week, the RTP soared +21.9%, and the RIO was up +16.9%, so you had to know copper contracts would be up as well.
Interactive Chart of Weekly Copper EOD Continuous Contract Index:
Interactive Chart of Daily Copper EOD Continuous Contract Index:
Interactive chart of the Copper metal index.
Table 12: Senior gold equities
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
The Goldminer indexes and ETFs were all stronger W/W, but took losses on Friday (in brackets): $XAU +4.27% (-0.34%), GDX +3.32% (-1.65%), and XGD +9.35% (-0.57%).
I wrote the following in this space a week ago, which has not changed:
Traders continue to be confused by the volatility, but there is not much more to say other than Buy the dips and after the rallies either sell the stock or sell covered calls to reduce the cost basis. I prefer to more complex option strategies and tactics.
The question is do you get trapped if the price breaks out of the range, which is why I think the bias should be bullish for the market and for the goldminers. I think that the $USD will weaken as higher volume and more risk comes into the market due to the trillions of dollars of bail-outs and economic stimuli programs.
I think the goldminers will move two steps forward and one back, or maybe three steps fwd and two back for a while, which is what I remarked the past two weeks.
To watch the moves in precious metal miners, you will have to monitor the individual stock charts, preferably in real-time, as follows:
NEM ABX AU GFI GG HMY AUY KGC BVN
Interactive Daily data
Interactive Weekly data
MDG LIHRY AEM BGO IAG EGO RGLD GOLD CDE GRS
Interactive Daily data
Interactive Weekly data
SSRI SIL NG KRY UXG GRZ TSE_HRG TSE_GUY TSE_AGI
Interactive Daily data
Interactive Weekly data
NXG GSS MNG DROOY MFN RNO RANGY MRB CLG
Interactive Daily data
Interactive Weekly data
Here are the key Silver miners and the SLV ETF:
SLV SIL CDE HL PAAS SSRI SLW MGN
Interactive Daily data
Interactive Weekly data
Here are the Weekly and Daily Data charts of the indexes:
Interactive Chart of Weekly U.S. Goldminers Index:
Interactive Chart of Daily U.S. Goldminers Index:
The U.S. goldminer share trust ETF trades under the ticker symbol GDX.
Here are the U.S. Goldminer ETF (GDX) index Weekly and Daily data charts:
GDX Weekly data:
GDX Daily data:
The Toronto Exchange-listed goldminer iUnits S&P/TSX Capped Gold Index ETF trades under the ticker symbol TSE:XGD. Yes, just like GDX on the AMEX, you can trade XGD on Toronto.
Here are the Weekly and Daily data charts for the TSX Goldshares (XGD) index:
Interactive Chart of XGD Weekly data:
Interactive Chart of XGD Daily data:
Forex Review
You cannot trade commodities that are priced in $USD without studying forex movement. The Forex market is a multi-trillion dollar marketplace every day, which dwarfs the size of the stock and bond markets. In this market, the Euro/USD is the highest volume trader. The $USD is a trade-weighted US Dollar index, we used to call the Morgan Dollar.
The current value of $USD is a mean value of rate fluctuations of six world currencies (Japanese yen, Euro, British pound, Canadian dollar, Swiss franc and Swedish krona) that each trade against the USD.
This week the $USD gained +1.20% to 81.86, including a gain on Friday of +0.80%.
Still, four weeks ago, the price was 86.95.
The 50-day MA for the $USD has moved from 83.42 to 84.42 to 85.02, 84.96, to 84.89, and now to 84.75 this week. The 200-day MA had moved from 76.22 to 76.49 to 76.75, to 76.93, to 77.10, and now to 77.29.
I expect to see more weakness after the volume and price in international markets pick up steam this month, which would move USD to foreign stocks.
Interactive Chart of Weekly U.S. Dollar Index:
Interactive Chart of Daily U.S. U.S. Dollar Index:
The Euro ($XEU) lost -0.78% this week, closing at 139.21. It had moved up from 127.19 in recent weeks, which was a major rally, and needed to rest.
The Euro futures contract 50day MA had dropped from 132.70 to 130.77 to 129.69, then reversed to 130.12, and to 130.48 before moving up to 131.01 this week. The 200day MA has come from 148.46 to 147.95 to 147.47 to 147.17, to 146.87 last week, and now to 146.53.
Interactive Chart of Weekly Euro Dollar Index, priced in USD:
Interactive Chart of Daily Euro Dollar Index, priced in USD:
The Pound lost -0.22% to 145.50 due to the loss of -0.0.71% on Friday.
The 50-day MA fell from 165.16 to 161.49 to 158.44, to 156.31, to 154.26 and now to 152.16. The 200-day MA has moved in recent weeks from 187.51 to 186.32 to 185.08 to 183.91 to 182.81, and now to 181.70.
Yes, even with the bigger loss this week in the Euro, the Pound still has some catching up to the Euro.
Weekly British Pound Index:
Daily British Pound Index:
Weekly Japanese Yen Index:
The Japanese Yen ($XJY) lost -1.14% this week, closing at 108.85.
The Yen’s 50-day MA is now 106.63 and the 200-day MA is 97.78.
Daily Japanese Yen Index:
The Loonie (Cdn Dollar) rebounded +0.95% to 82.61.
The Loonie 50-day MA and 200-day MA are now at 81.34 and 92.77, respectively.
The Cdn equity market had a very good week with the Toronto Composite up from 8310.6 to 9234.1, which is a W/W gain of +11.1%. That helped the Loonie fly.
Weekly Canadian Dollar Index:
Daily Canadian Dollar Index:
Here is the China Yuan (CNY) chart.
International Equity Markets Review
International equity market prices all soared this week:
UK FTSE, after falling from 4288.0 to 4049.4, rallied to 4280.4 and then to 4286.9 before pulling back to 4216.6 a week ago, and then up to 4561.8 this week
German DAX, after falling from 4669.4 to 4381.5, rallied to 4663.4 and then to 4696.7 before pulling back to 4629.4 a week ago, and then up to 4973.1 this week
Aussie All-Ords, after falling from 3672.7 to 3427.2, lifted to 3452.5 and then stalled at 3547.2 before dropping to 3515.0, and then lifting to 3655.7 this week
HK Hang Seng, after moving from 13888.2 to 13846.1, rallied to 14758.8 and then to 15127.5 before dropping to 14184.1 in just three days one week ago, and then soaring to 15042.8 this week
India’s BSE 30, after moving from 9092.7 to 8965.2, rallied to 9690.1 and then to 10099.9 before plunging to 9328.9 one week ago, and then soaring to 9958.2 this week
Japan’s Nikkei 225, after falling from 8512.3 to 7917.5, rallied to 8235.9 and then to 8588.5 before rallying to 8739.5, mostly Friday, last week, and then to 8859.6 up to Wednesday this week. It will likely open strongly on Monday, which is just a few hours away
Brazil’s Bovespa, after falling from 36595.9 to 35347.4, rallied to 39373.9, but pulled back to 39131.2 a week ago and then plunging to 36864.1 one week ago and then soaring to 40244.2 this week.
There are 16 country index charts from StockCharts.com (with their formal approval btw) because I think it is important to be watching these markets move through a trend juncture together, and in relation to currency and commodity strength or weakness.
I also made some additions to the country-based ETF tables as I intend to focus more on ETF’s next year. In time, I will also set up more tables and track the domestic market prices. This will come after we switch to the Drupal platform later this month.
Here is the latest session data for the exchanges of the Americas.
Here is the latest chart for the Brazilian Bovespa stock exchange in Sao Paulo.
Brazilian Bovespa stockcharts.com chart
Here is the latest session data for the Toronto Stock Exchange composite index.
Toronto 300 stockcharts.com chart
Toronto CDNX stockcharts.com chart
Europe
Here is the latest session data for the bourses of Europe.
Here is the latest session data for the London stock exchange FTSE.
FTSE 100 stockcharts.com chart
Here is the latest session data for the German DAX.
Here is the latest session data for the French CAC 40.
Here is the latest session data for the Milan Italy stock exchange MIBTEL.
Italian Milan Index stockcharts.com chart
Here is the latest session data for the Swiss market index.
Swiss Market Index stockcharts.com chart
Asia-Pacific
Here is the latest session data for the Asia-Pacific stock exchanges.
Here is the latest chart for the Japanese Nikkei 225 index.
Tokyo Nikkei 225 Index stockcharts.com chart
Here is the latest chart for the Singapore index .
Singapore Straits Times Index stockcharts.com chart
Here is the latest chart for the Shanghai Composite index .
Shanghai Composite Index stockcharts.com chart
Here is the latest chart for the Hong Kong Hang Seng index .
Hong Kong Hang Seng stockcharts.com chart
Here is the latest chart for the India BSE 30 index .
Mumbai BSE 30 Sensex Index stockcharts.com chart
Here is the latest chart for the Australian All Ordinaries index .
Sydney All Ordinaries Index stockcharts.com chart
Russia (RTS) stockcharts.com chart
Table 13: International equities via an ETF perspective (in $USD)
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
Japanese equity market ETF: EWJ
Here is the Japanese (EWJ) equity market ETF Monthly, Weekly and Daily data charts:
U.K. equity market ETF
Here is the United Kingdom (EWU) equity market ETF Monthly, Weekly and Daily data charts:
EWU Daily data:
Canada’s equity market
Here is the Canadian (EWC) equity market ETF Monthly, Weekly and Daily data charts:
Taiwan’s equity market
Here is the Republic of China/Taiwan (EWT) equity market ETF Monthly, Weekly and Daily data charts:
US Equity Markets Review
All four major US equity market indexes were very strong this week.
After a downer week last week, I wasn’t dismayed. In fact I wrote in this space:
I still believe that the money flow is not showing a bearish trend. As opined in this space a week ago, “the market continues to shrug off bad news overnight and close higher - this is bullish action plain and simple. But, volume is so low, I would not think current prices are remarkable. I’m waiting until the first week in January to see if volume starts to escalate. If not, it must mean the mega-trillion mutual fund industry has gone into hibernation, rather than a mild sleep. If these sales people want to start 2009 off on a good footing, they had better start pumping the well. That well, of course, will need to be primed by the money managers for those funds. I expect all this to happen, based on my understanding of people. In other words, it’s time to put “fear” to rest, and wake up “greed”.”
The four major US equity indexes were soaring +6.66%, +6.76%, +6.09% and +6.10% this week, so I was on the mark.
A dozen NASDAQ stocks to watch.
Here is the Monthly data chart of the Interactive Chart of Nasdaq Composite, S&P 500, Dow30, and Russell 2000 (small cap) indexes.
Here is the Weekly data chart of the Interactive Chart of Nasdaq Composite, S&P 500, Dow30, and Russell 2000 (small cap) indexes.
Here is the Daily data chart of the Interactive Chart of Nasdaq Composite, S&P 500, Dow30, and Russell 2000 (small cap) indexes.
Table 14: Dow 30 List
| Symbol | Close | 1Day Change |
1Day %Change |
1W %Change |
2W %Change |
4W %Change |
YTD %Change |
3M %Change |
6M %Change |
12M %Change |
You can do this table yourself by entering the following string into the Summaries window at www.billcara2.com and then clicking on the link for Performance.
AA AXP BA BAC C CAT CVX DD DIS GE GM HD HPQ IBM INTC JNJ JPM KFT KO MCD MMM MRK MSFT PFE PG T UTX VZ WMT XOM
Here are the links to interactive Dow charts from Billcara2.com that I broke into groups of ten, which you can add technical indicators for as well. (list one) (list two) (list three)
Value Line Report(s) this past Friday
This week, Value Line reported on two DJIA components, Cara 100 Procter & Gamble (PG) and Home Depot (HD).
Procter & Gamble Co. [GICS 30, Dow 30, Cara 100]
(PG: Google Finance file)
(PG: Yahoo Finance file)
(PG: StockChart chart)
(PG: Billcara2 chart)
(PG: ADVFN Financial Data)
(PG: Value Line Report Jan. 2: next one is due Apr. 3)
Home Depot [GICS 25, Dow 30]
(HD: Google Finance file)
(HD: Yahoo Finance file)
(HD: StockChart chart)
(HD: Billcara2 chart)
(HD: ADVFN Financial Data)
(HD: Value Line Report Jan. 2: next one is due Apr. 3)
In the WIR#40 (Oct 4), I wrote about Procter & Gamble and Home Depot as follows:
With respect to Home Depot, there is very little I like about this company – from the Ken Langone crowd involvement down to plummeting earnings and rapidly slowing momentum for revenue, cash flow, book value and dividend growth.
This company hit the wall almost ten years ago. It was my mistake in not recognizing the facts sooner even though whenever I went into their stores I would usually walk out disappointed. As the important financial metrics declined and management compensation rocketed to ridiculous levels under ex-CEO Robert Nardelli, I should have offed the company from my Cara 100 much sooner than I did. But I kept reading Wall Street research, including from Value Line, that touted the stock as a turnaround, re-org, or whatever else the insiders needed to pump and dump. Fool me once ok; fool me twice, then I’m the fool. Now I realize that what almost assuredly happened was that somebody was paying off Wall Street to keep HD top of mind, while insiders were getting what they could out of the company.
Looking at the Value Line report, where do I start? Firstly, despite the VL forecast, I don’t believe earnings, revenue or cash flow in 2009 will be even as good as the pathetic results for 2008. Margins on operations and for net profit continue to decline.
Even VL analyst Matthew Spencer doesn’t like the situation: “Indeed, comparable store sales fell over 7% in the June interim, a trend we expect to persist over the next several quarters, as the housing market shows few signs of a near-term recovery. In fact, the recent turmoil in the financial markets could make it more difficult for potential home buyers to obtain financing, which may prolong the housing downturn. On top of these factors, consumers are cutting back on nonessential spending…”
So, if you are looking for a beaten down stock of a high quality company, don’t look here.
Procter & Gamble is on my Buy list for now, but believe me, the stock is relatively over-priced. So, call it insurance in a defensive stock in the Consumer Staples area. In fact, because many people think I should place Wal-Mart into the Consumer Discretionary sector in my studies, P&G would be the 800-pound gorilla in Consumer Staples if I did.
Just like Wal-Mart, I like P&G. Hard working people from Cincinnati, producing great products, with an excellent distribution system. I do have issues with a slightly weakening balance sheet and lower Return on Shareholder Equity percentages in the past couple years, but I like the stability and financial strength. I look to this company for income, largely by writing put options to add to the dividend.
With the high share price today, and the rough consumer environment – even for Staples – I would exercise extreme caution when buying this stock. The price has popped from 66 to 71 in the past few days in what is a safe-haven move.
I’m guessing here because I can’t remember – somebody please check – but I think there would have been a Buy Alert from my simple little system in late June in the very low 60’s, and the +12% to +14% gain in the past three months would be pretty much all she wrote. You get greedy, you get hurt.
As much as I love P&G, PG is not my child. Stocks are not children; they are merely prices. The value in understanding them is in the understanding of trends and cycles.
Hopefully, the next couple of weeks will see broad market forces or insiders or selling by institutions bring PG back to earth, and then we’ll buy it again, maybe at ~65 this time.
If so, I’d count on dividends of $1.55 (2008), $1.78 (2009), and $1.99 (2010). With a price of say 65, you’ll probably average +2.75% dividend yields for the next couple years. Then, if you support that with put write premium income, you can improve that. Let’s say you want capital growth; you’d apply the put premium and dividend income to your cost base, which would take your cost to the high 50’s. Then if you could sell the stock at its peak in 2011 say at $105, you could hit an annualized return of about (say) +22%, which isn’t bad for a defensive stock. A balanced portfolio includes these types of stocks along with the GOOGs and RIMMs.
This is like a chef working in the kitchen with the ingredients that happen to be on the shelf. It all depends on what you want to make for dinner. PG is not beef steak – more like broccoli. Always healthy. But your kids will hate you for it if they are looking ahead to their inheritance.
Anyway, what do kids know?
(smiley goes here because they really do know more than adults care to accept. They know that Washington is screwed up, that politicians are on the take from Wall Street and Big Business. You ask the average teenager today, and they’ll likely tell you that Fannie and Freddie are a mess because they were being protected by Obama and Frank and the President and lawmakers like that. They will tell you they regret not being old enough to get those Liar Loans.)
I was wrong relative HD vs PG as the performance of HD as it moved from the Oct 3 price of $23.56 to Friday’s (Jan 2) $24.13 whereas PG dropped from $70.57 to $62.80 over that time.
But my lenses can now only see a week out anyway. :-) That was therefore a great call because on Oct 10, a week later, HD had plunged from $23.56 to a low of 16.87, whereupon it was looking like a buy after that. PG also plunged but nearly as much, falling from $70.57 to the cycle low of $54.57 on Oct 10.
No matter, Procter & Gamble will stay on the Cara 100 list, and Home Depot will not make it there for some long period of time.
I wish I had more time to discuss the VL reports here and also to discuss the options trading, but I am pushing to get this report finished before dinner. Sorry.
If I hadn’t spent so much time adding to and removing three companies from the Cara 100 list today, I’d have had the time. But, I think you get the point that now is the time to avoid the defensives like PG in favor of the higher beta higher risk stocks in my list.
The Dow 30 Company links in chronological order of the upcoming reports.
General Electric [GICS 20, Dow 30, Cara 100]
(GE: Google Finance file)
(GE: Yahoo Finance file)
(GE: StockChart chart)
(GE: Billcara2 chart)
(GE: ADVFN Financial Data)
(GE: Value Line Report Oct. 10: next one is due Jan. 9)
Hewlett-Packard [GICS 45, Dow 30]
(HPQ: Google Finance file)
(HPQ: Yahoo Finance file)
(HPQ: StockChart chart)
(HPQ: Billcara2 chart)
(HPQ: ADVFN Financial Data)
(HPQ: Value Line Report Oct. 10: next one is due Jan. 9)
IBM [GICS 45, Dow 30, Cara 100]
(IBM: Google Finance file)
(IBM: Yahoo Finance file)
(IBM: StockChart chart)
(IBM: Billcara2 chart)
(IBM: ADVFN Financial Data)
(IBM: Value Line Report Oct. 10: next one is due Jan. 9)
Intel [GICS 45, Dow 30, Cara 100]
(INTC: Google Finance file)
(INTC: Yahoo Finance file)
(INTC: StockChart chart)
(INTC: Billcara2 chart)
(INTC: ADVFN Financial Data)
(INTC: Value Line Report Oct. 10: next one is due Jan. 9)
Alcoa [GICS 15, Dow 30]
(AA: Google Finance file)
(AA: Yahoo Finance file)
(AA: StockChart chart)
(AA: Billcara2 chart)
(AA: ADVFN Financial Data)
(AA: Value Line Report Oct. 17: next one is due Jan. 16)
Dupont [GICS 15, Dow 30]
(DD: Google Finance file)
(DD: Yahoo Finance file)
(DD: StockChart chart)
(DD: Billcara2 chart)
(DD: ADVFN Financial Data)
(DD: Value Line Report Oct. 17: next one is due Jan. 16)
Merck [GICS 35, Dow 30]
(MRK: Google Finance file)
(MRK: Yahoo Finance file)
(MRK: StockChart chart)
(MRK: Billcara2 chart)
(MRK: ADVFN Financial Data)
(MRK: Value Line Report Oct. 17: next one is due Jan. 16)
Pfizer [GICS 35, Dow 30]
(PFE: Google Finance file)
(PFE: Yahoo Finance file)
(PFE: StockChart chart)
(PFE: Billcara2 chart)
(PFE: ADVFN Financial Data)
(PFE: Value Line Report Oct. 17: next one is due Jan. 16)
United Technologies [GICS 20, Dow 30, Cara 100]
(UTX: Google Finance file)
(UTX: Yahoo Finance file)
(UTX: StockChart chart)
(UTX: Billcara2 chart)
(UTX: ADVFN Financial Data)
(UTX: Value Line Report Oct 24: next one is due Jan. 23)
Caterpillar [GICS 20, Dow 30]
(CAT: Google Finance file)
(CAT: Yahoo Finance file)
(CAT: StockChart chart)
(CAT: Billcara2 chart)
(CAT: ADVFN Financial Data)
(CAT: Value Line Report Oct 24: next one is due Jan. 23)
Coca Cola [GICS 30, Dow 30]
(KO: Google Finance file)
(KO: Yahoo Finance file)
(KO: StockChart chart)
(KO: Billcara2 chart)
(KO: ADVFN Financial Data)
(KO: Value Line Report Oct. 31: next one is due Jan. 30)
Kraft Foods [GICS 30, Dow 30]
(KFT: Google Finance file)
(KFT: Yahoo Finance file)
(KFT: StockChart chart)
(KFT: Billcara2 chart)
(KFT: ADVFN Financial Data)
(KFT: Value Line Report Oct. 31: next one is due Jan. 30)
Wal-Mart [GICS 30, Dow 30, Cara 100]
(WMT: Google Finance file)
(WMT: Yahoo Finance file)
(WMT: StockChart chart)
(WMT: Billcara2 chart)
(WMT: ADVFN Financial Data)
(WMT: Value Line Report Nov. 7: next one is due Feb. 6)
Disney [GICS 25, Dow 30, Cara 100]
(DIS: Google Finance file)
(DIS: Yahoo Finance file)
(DIS: StockChart chart)
(DIS: Billcara2 chart)
(DIS: ADVFN Financial Data)
(DIS: Value Line Report Nov. 14: next one is due Feb. 13)
3M Company [GICS 20, Dow 30, Cara US 100 June 25-06]
(MMM: Google Finance file)
(MMM: Yahoo Finance file)
(MMM: StockChart chart)
(MMM: Billcara2 chart)
(MMM: ADVFN Financial Data)
(MMM: Value Line Report Nov. 14: next one is due Feb. 13)
American International Group [GICS 40, Dow 30]
(AIG: Google Finance file)
(AIG: Yahoo Finance file)
(AIG: StockChart chart)
(AIG: Billcara2 chart)
(AIG: ADVFN Financial Data)
(AIG: Value Line Report Nov. 21: next one is due Feb. 20)
American Express [GICS 40, Dow 30]
(AXP: Google Finance file)
(AXP: Yahoo Finance file)
(AXP: StockChart chart)
(AXP: Billcara2 chart)
(AXP: ADVFN Financial Data)
(AXP: Value Line Report Nov. 21: next one is due Feb. 20)
Bank of America [GICS 40, Dow 30]
(BAC: Google Finance file)
(BAC: Yahoo Finance file)
(BAC: StockChart chart)
(BAC: Billcara2 chart)
(BAC: ADVFN Financial Data)
(BAC: Value Line Report Nov. 21: next one is due Feb. 20)
Citigroup [GICS 40, Dow 30]
(C: Google Finance file)
(C: Yahoo Finance file)
(C: StockChart chart)
(C: Billcara2 chart)
(C: ADVFN Financial Data)
(C: Value Line Report Nov. 21: next one is due Feb. 20)
JP Morgan [GICS 40, Dow 30]
(JPM: Google Finance file)
(JPM: Yahoo Finance file)
(JPM: StockChart chart)
(JPM: Billcara2 chart)
(JPM: ADVFN Financial Data)
(JPM: Value Line Report Nov. 21: next one is due Feb. 20)
Microsoft [GICS 45, Dow 30]
(MSFT: Google Finance file)
(MSFT: Yahoo Finance file)
(MSFT: StockChart chart)
(MSFT: Billcara2 chart)
(MSFT: ADVFN Financial Data)
(MSFT: Value Line Report Nov. 21: next one is due Feb. 20)
General Motors [GICS 25, Dow 30]
(GM: Google Finance file)
(GM: Yahoo Finance file)
(GM: StockChart chart)
(GM: Billcara2 chart)
(GM: ADVFN Financial Data)
(GM: Value Line Report Nov. 28: next one is due Feb. 27)
Johnson & Johnson [GICS 35, Dow 30, Cara 100]
(JNJ: Google Finance file)
(JNJ: Yahoo Finance fle)
(JNJ: StockChart chart)
(JNJ: Billcara2 chart)
(JNJ: ADVFN Financial Data)
(JNJ: Value Line Report Nov. 28: next one is due Feb. 27)
McDonalds [GICS 30, Dow 30, Cara 100]
(MCD: Google Finance file)
(MCD: Yahoo Finance file)
(MCD: StockChart chart)
(MCD: Billcara2 chart)
(MCD: ADVFN Financial Data)
(MCD: Value Line Report Dec. 5: next one is due Mar. 6)
Chevron Corp [GICS 10, Dow 30]
(CVX: Google Finance file)
(CVX: Yahoo Finance file)
(CVX: StockChart chart)
(CVX: Billcara2 chart)
(CVX: ADVFN Financial Data)
(CVX: Value Line Report Dec. 12: next one is due Mar. 13)
ExxonMobil [GICS 10, Dow 30, Cara 100]
(XOM: Google Finance file)
(XOM: Yahoo Finance file)
(XOM: StockChart chart)
(XOM: Billcara2 chart)
(XOM: ADVFN Financial Data)
(XOM: Value Line Report Dec. 12: next one is due Mar. 13)
Boeing Co [GICS 20, Dow 30. Cara 100]
(BA: Google Finance file)
(BA: Yahoo Finance file)
(BA: StockChart chart)
(BA: Billcara2 chart)
(BA: ADVFN Financial Data)
(BA: Value Line Report Dec. 19: next one is due March 20)
AT&T [GICS 50, Dow 30]
(T: Google Finance file)
(T: Yahoo Finance file)
(T: StockChart chart)
(T: Billcara2 chart)
(T: ADVFN Financial Data)
(T: Value Line Report Dec. 26: next one is due Mar. 27)
Verizon [GICS 50, Dow 30]
(VZ: Google Finance file)
(VZ: Yahoo Finance file)
(VZ: StockChart chart)
(VZ: Billcara2 chart)
(VZ: ADVFN Financial Data)
(VZ: Value Line Report Dec. 26: next one is due Mar. 27)
Procter & Gamble Co. [GICS 30, Dow 30, Cara 100]
(PG: Google Finance file)
(PG: Yahoo Finance file)
(PG: StockChart chart)
(PG: Billcara2 chart)
(PG: ADVFN Financial Data)
(PG: Value Line Report Jan. 2: next one is due Apr. 3)
Home Depot [GICS 25, Dow 30]
(HD: Google Finance file)
(HD: Yahoo Finance file)
(HD: StockChart chart)
(HD: Billcara2 chart)
(HD: ADVFN Financial Data)
(HD: Value Line Report Jan. 2: next one is due Apr. 3)
Wrap-up:
I am still trying to recover from New Year’s Eve at Sandals Resort. Knowing I had a short walk to my home next door, I probably imbibed a little more than usual.
However, after hearing the horror stories of friends who went to other (far less expensive) places, which I declined because I don’t like to be driving on streets with drunk drivers, I know I made the best decision. And, I know that they will all join me next year. I should get a sales commission.
I did miss the major Junkanoo this year. But, last year, we departed the party held by the US Embassy over top of Bay Street at the hour of 8:30am. Yes, it was sun up and we hadn't even watched the eventual winners, the Valley Boys.
So we missed the opposing chants: Valley Boys, Saxons, Valley Boys, Saxons... from opposite sides of the street. Quite a remarkable scene.
This year, Saxons won. The server in the restaurant told me he was in the Saxons and couldn't wait until shift change so he could head downtown and get into costume. Now I know why the parade starts at 3:00am -- because so many of the dancers are still serving people like me at 2:00am. That fact never hit me before.
The drunk driving concern here is a reality because drivers can legally drink and drive, and I do mean drink while driving here. It’s the only place in the world where the words, “Have one for the road” actually does mean “Take one for the drive home”.
There are people who simply do not believe me when I say that this is the most laid-back place possible. Nobody seems concerned about much. I suppose if you manage your behavior, it’s the place to be. No taxes, nobody telling you what you have to do, extremely sociable people. Booze at ridiculous prices, which I define as when the booze costs less than the mix. Unfortunately, I can’t get around to drinking the stuff with water. I need coconut water (my favorite), but the stuff costs $1.39 to $1.79 a (large) can and the good rum and gin is just 40 cents a shot.
So, when the guests leave, it’s really not a costly thing to offer them “one for the road” – if they look to be vertical. You can see why we're so sociable here.
Watch the Daily RSI 7’s on the Cara 100 stocks. Don’t let the unrealized gains go to your head. That’s one headache you don’t want to wake up to. Excedrin doesn’t help much if you don’t protect your wealth with stops.
Enjoy the rest of the weekend – all six hours that remains. Man; I have been busy this weekend. At least I managed to get WIR #1 under my belt.
