Tax Options Impact

The WA PO has created a terrific interactive chart (bigger/clearer picture here) from (non partisan) Tax Policy Center, Joint Committee on Taxation, Office of Management and Budget.  They offer 3 options on Bush tax cuts.

Hopefully, in he Obama plan the $3,000,000,000,000 saved will go to deficit reduction over the next 10 years. I favor this right now, but another worldwide economic meltdown, 9/11 event, or other unforeseen disaster could change this.

Get Educated then Educate your friends - This is a great informational chart to post on your facebook page, send to friends , etc. Everyone can draw their own conclusions.

Hopefully, in he Obama plan the $3,000,000,000,000 saved will go to deficit reduction.

Note – The default is set to plan #1 – “Let the Bush Tax cuts expire” creates $3.7 trillion for government. Click on options to compare.

Blogo del Narco

People in Mexico are so terrorized by the drug cartels that few news sources dare print what’s happening for fear of reprisals. Blogo del Narco is the exception. (At top left there is a marker that will translate to English)

Reality is right (because of our huge # of drug addicts) now anyone in continental USA is far more likely to die from something related to Mexican drug terrorism than something related to a Moslem Jihadist terrorist.

A Mexican computer student is risking his life documenting drug terrorism in Mexico. I hope you check out and support his site.

KISS & Stocks (Keep It Simple Stupid)

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


Index Percentage Volume
Dow +0.09% down
NASDQ +0.28% down
S&P 500 +0.15% down
Russell 2000 +0.28% -

Technicals, Fundamentals & Analysis

Investors411 record – 5 years of beating benchmark S&P 500

Mantra for the month The Black Box/High Frequency Traders BB/HFT control the majority of trades. Paul R in the comments section has found a great source describing the BB/HFT traders and consequences of what they do.

Very weak volume & markets go nowhere. Today the FED injects more cash (see yesterday for explanation) and weak volume give BB/HFT’s more control.

Significant Indexes

  • The Dollar (USD)  [Anything price move over +/- 0.50 is significant] The dollar was flat 0.00% yesterday. For stocks. A little more often than not flat trading indicates a reversal. = Neutral
  • The Baltic Dry Index (BDI) [measures cost of world trade/proxie for China & emerging markets] Rally +1.71%yesterday. Has broken up through 50 day moving average. Overall trend still = Bullish
  • McClellan Index – (MO) [The rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] MO rose to +7.89Neutral

Reading Tea Leaves

Another day that the FED is injecting liquidity in their Permanent Open Market Operation.  From yesterday – 8/19,24,26 & 9/1 So the major players are going to have some cash in hand to play with today.


The  Positions Section link to latest & former buys and sells  - These are positions I actually own

Current positions - EWZ EWS

Investors411 has just revised the entire POSITIONS sectionYou can click on the word POSITIONS at top of blog or LINK here Most revised is the ETF section.

Many foreign ETF’s are again technically outperforming major US indexes. I’ve listed a dozen.

Two New Listings in Position Section

USO (oil commodity ETF) & UCO (2x crude oil ETF)  The later is obviously more volatile. Both these have dipped and Investors411 is opening a position is USO & perhaps USC (the bigger the dip in oil prices the better UCO seems)

ReasoningInvestors, long term emerging markets are going to need more energy. The second reason is if the USA or Israel bombs Iran. Intrade puts possibility at bid 22.9% & ask at 25.6% this AM before 1/1/12 – also see last Monday’s update. In effect, this is a hedge, against something blocking oil supplies.

Downside – going into winter usually oil prices move lower and possible world wide recession.

Technicals USO - Higher highs over last 3 months and hopefully right now we are at a higher low.

Like EWS & EWZ starting with 4% of portfolio position.

Long Term Outlook – NEUTRAL


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