A TV AD

Why start with A TV ad? Because its the most memorable minute long TV add I’ve ever seen. Its based on a movie The ExorcistMany Thanks to subscriber ER for sending it in.

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Screen Shot 2010-04-05 At 11.32.49 Am

#37

This is no surpriseAnother major scientific study of our health care system in the USA ranks us as #37 in the world WE, again no surprise, pay 50% more for this health care than the European Democracies. If you can get into one of the top hospitals you’re in luck, otherwise hope you are in another major democracy that has decent heath care if you get sick.

If independent scientist study something, mainstream media almost always ignores it.


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England Get’s it Right

Congratulations to England –  “Finance minister George Osborne announced a major overhaul of Britain’s banks, approving a separation of their retail and investment businesses to help avoid another global financial crisis.”

Major investment banks backed up by CNBC, Fox News and others are screaming at Obama’s weak financial reforms here. Political candidates are falling all over themselves courting Wall Street banks. Chances of reform like this happening here are about the same as either the Red Sox or the Yankees NOT making the playoffs.

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Greece

Almost the entire investment world’s eyes are focused on when will Greece default. Some key points.

  • The major point here is this will be no ordinary defaultThere are trillions in derivatives on Greek loans that will have to be paid when Greece default. Like the Lehman collapse this multiplies the seriousness of the situation.
  • All major banks are trying to find others that will buy their toxic Greek derivatives. Perhaps a major reason this process is going so slow.
  • Ireland is in the same boat and perhaps Portugal (China seems to be backing them)
  • The chances of Greece NOT defaulting about as high as the Philadelphia Philies NOT getting into baseball playoffs.
  • Another reason to be bearish on US markets - The dominoes – Greece defaults = Euro falls = dollar rises = US stocks go down. Also – Who knows how many derivatives any bank has on Greek debt?

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KISS & Stocks

(Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

DOUBLE CHECK ALL DATA, I MAKE MORE THAN GRAMMAR MISTAKES

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Index Percentage Volume
Dow +0.54% Down
NASDQ -0.29% Up
S&P 500 +0.18% Down
Russell 2000 +0.27% -

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Technicals, Fundamentals & Analysis

  • Basically flat market yesterday. Volume changes were minor. Worth noting NASDQ under preforming.  Almost every market guru  is shouting BEAR’S RULE The only possible silver lining to this dark cloud is when you get so many people on the same side of the trade, there is a potential for a quick, sharp reversal

  • It looked like US markets were going to meltdown yesterday, but about 3:00PM EST rumors of Central Banks in Europe threatening intervention and everything changed. Central Banks are manipulating currencies and therefore stocks. They can manipulate for a period of time, but eventually market forces (a default in Greece or elsewhere) will trump.
  • The key situation that almost all investment eyes are focused on is Greece and when it will default. Latest (5:27AM EST) on this
  • The McClellan Oscillator (MO) chart rose slightly to -51.27 ( below -30 = somewhat oversold, below -60 = oversold, below -90 OMG oversold) The lower the MO goes the more the chances for some sort of rebound. Obviously, we’re now close to -60 so pressure for rebound/rally is building
  • $USD The Dollar rocked higher two days ago +1.83% and was flat yesterday +0.01% (consider that Investors uses +/- 0.50 as a significant one day move) It broke out through resistance and formed a higher high on its chart two days ago. Yesterday  confirmed the massive move higher. . Big time bullish for dollar and for stocks which usually move inversely to the dollar = Bearish
  • CHART OF THE DAYshow inverse relationship between the dollar (UUP ETF) and the S&P 500

This is a 6 month chart. Dollar up usually means stocks down. Dollar down usually means means stocks up. Hopefully you can see why Investors411 uses it as a forecasting tool. The big volume shown under the end of April/beginning of May low makes that figure a strong support level.

Chart

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  • Reading The Tea LeavesShort term (repeat) - Staying with the same dead cat bounce pattern of lower highs and lows till it breaks down. Pattern in place since early May The dead cat rally bounced Tuesday and fell Wednesday and held/confirmed those losses Thursday = Bearish. Investors411 predicted an MO of -90 to -120 this summer. It may come sooner than expected.

  • Reading The Tea Leaves - Longer Term (repeat) -  “See May 20th blog for forecast for this summer.

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Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500.

NLYAnnaly Capital Mgt. Ultra high dividend stock. Bought about a month ago.

TZAETF that is 3 times short small cap stocks Bought 1/2 TZA position at 39.75 last Thursday.

Gold/Silver - RepeatNo trends except gold is out performing stocks and silver. A major editorial on this in near future.

Repeat -  More likely to add TZA than subtract. Would buy more TZA in small rally. I’ve been preoccupied with grandkids so have NOT had a chance to trade. I would have bought TZA yesterday and will try today to add to TZA on dip.

RepeatInvestors411 recommends using TZA or SDS as a hedge/insurance against losses in high dividend stock NLY and especially if you own other dividend stocks (see past month+ blogs on dividend stocks.)  This way you protect prices of dividend stocks against falling prices and still collect the dividend.

Repeat Strategy remains

  • Short any rally - Investors411 will use TZA (3X short small cap stocks) and SDS (2x short S&P 500 more conservative) .
  • Sell long positions into any rally -

DisclosureI own NLY, & TZA as well as a group of dividend stocks- I buy all stocks mentioned in the hypothetical Investors411 portfolio.

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Look for an enlightened Paul’s Corner every Tuesday & Thursday and the always informative comments section every day.

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The Fed has moved from an expanding money supply to a neutral – No QE #3. Congress is threatening to contract the money supply. “We [the USA] need to grow at this point more than anything else.” Investors411 outlook will remain negative on the USA unless the Fed and/or congress return to more pro growth policies.

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Longer Term Outlook

Neutral/CAUTIOUSLY BEARISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE


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