Stand by Me - There’s been a lot of bad economic news out there and  few bright spots.  So today  take a look at this you tube video that’s been viewed by almost 8 million people around the world since early last November. It expresses the same sentiment that the CEO and workers in a Boston hospital did when confronted by job cuts.( Thanks to Stewart E. for comments) Here’s today’s good, bad and ugly.


Iraqi Women

Kudos to Hillary Clinton

Dawn (Pakistan news outlet) and other worldwide outlets are giving Hillary Clinton lots of credit in defussing the tensions over the “Long March” and the reinstatement of the Supreme Court in Pakistan.

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Mission Accomplished.

If there is anyone who believes, like Cheney/Bush the Mission was accomplished in Iraq read Juan Cole’s editorial. He doesn’t even include the $3 trillion dollar cost and the loss/critical injuries of American lives. Above photo on how women are now treated in Iraq from Juan Cole.

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AIG AIG AIG

Lots of you have sent me personal emails over housing solutions and the growing anger over AIG. Several of you sent in the Sand By Me Video Two new bloggers  have sent in comments to the blog that deserve recognition. “We’re all in this together.”

Bob R – offers a outlet to express your anger over AIG by signing onto a petition. Link here

Scott H - offers an excellent editorial by Dean Baker on why politicians should be far more concerned over the staggering sums of $ that go into the bailouts.  He also has some eye opening stats on AIG.

I’ll try to get some of the comments many of you have sent in privately published ASAP.

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The Coverup

The Good, the Bad, and the Ugly on Mark to Market Accounting.

Undoubtedly, removing  Mark to Market Accounting will juice the financial sector and consequently the stock market. Just the fact that Dems. and Reps. in a congressional hearing called for changes has sent all the banks that traded in toxic assets soaring. Citgroup alone is up almost 100% in a week. Hopefully, more loans will now get made.  Obama and his economic crew are getting pats on the back as stocks soar.

What removing mark to market does is remove transparency. AIG will no longer have to account for major losses and hopefully when housing stabilizes the assets will be more valuable. The real question is will the crooks, who should be in jail, use this lack of transparency to continue over leveraging and making huge profits/bonuses?  

In China they took out the CEO and COO of a milk company who sold tainted milk and shot them. In the USA the crooks are rewarded by bailouts, bonuses and now a coverup.  The good banks who played by the rules will now be lumped together with the bad banks. Isn’t it the lack of transparency that got us in this mess in the first place?

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AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

 

Stocks

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Index Percentage % Volume
Dow +2.48% down
NASDQ +4.14% down
S&P500 +3.12% down
Russell2000 +4.46% -

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Technicals & Fundamentals

XLF (ETF) the beaten up financial sector continues to lead this rally – up over 30% last week. Up 6.5% yesterday. 

Big rally with little volume. Volume, the #1 confirmation factor did not confirm the rally. 

Critical to all this in that major major 741 support level on the S&P 500. S&P 500 now at 778 We have gone well above this “mother of all resistance/support levels.”

Fed meets today.

Reading the Tea Leaves - Allowing for less transparent accounting is fundamentally going to help those corrupt banks and ripple positively through out  the markets. As mentioned before we’ve recently had +20 and +28% rallies and the current bear market rally has reached +14%.  Technically its important that we are again above the 2003 lows.  

Bottom Line – Ride the wave – Technically, there are no major resistance levels till the SPX hits its 50 day moving average at 806. Short term momentum with the bulls.  

Long Term Outlook will be upgraded to CAUTIOUSLY BEARISH if we continue to trade above 741.

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Long Term Outlook BEARS RULE

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog 

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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