Obama Oil Spill Speech

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Bravo Barack

Obama finally hit one out of the park yesterday. Let’s not damn him with faint praise  like America’s media or try to politically toast him for everything he does like the far right, but this time say Amazing, Well Done and Bravo Barak.

  • Obama got a $20 billion dollar Trust fund from BP for folks impacted by the BP volcano of oil.
  • Obama got BP to suspend their dividend for a year — the money goes to those impacted not shareholders.
  • Obama got a NO cap agreement on the $20 billion
  • This is especially significant because just a few weeks ago congress could NOT pass a plan for a $10 billion dollar fund. Something many congress people should be ashamed of.
  • Obama got BP to pay $100 million for idled workers.
  • Obama got, Kenneth Feinburg (oversaw 911 victims) to head independent agency to administer claims

Has an American President ever got $20 Billion from one of the biggest companies in the world? NEVERThis should be the headline of every major paper in the USA – but it isn’t. It is the lead editorial in NYT.

Black Boxes (see below)

NB –  Last Investors411 for week

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!

Index Percentage Volume
Dow +0.05% down
NASDQ +0.00% down
S&P 500 -0.06% down
Russell 2000 -0.39% -

Investors411 record – 5 years of beating benchmark S&P 500 and almost all major US indexes

Technicals, Fundamentals & Analysis

Markets were mixed in surprisingly light volume – This Friday is one of those days all kinds of options expire. Translation there should be a lot of trading.

FXE – The ETF that tracks the EURO fell -0.36% in very heavy trading. The amount of decline is not very significant, but the heavy trading is. Perhaps a reversal of the week+ long EURO rally is happening.

“Black” Boxes

Jim Cramer, host of Financial Channels “Mad Money show, last night called them “Black Boxes” I’ve called them the “Mega Sharks” and “HUGE institutions/hedge funds” that dominate trading. Cramer stated that 4 years ago they made up 30% of the trading, now these entities with their giant computers make up 80% of the trades on the US stock exchanges.

These Black Box traders are another form of casino capitalism-in other words – they rig the game so that YOU loose and they win. Some examples

  • High Frequency trading – Their ultra fast trades caused the major 800 point Dow meltdown in stocks a few weeks back. Now 10% curbs have been put in, but both Debolt and the Washington Post stocks were hit with 10% dips this week. Translation – their high speed computers that run on algorithms are in and out of a stock/sector/country’s currency before  you even begin to type in your trade.
  • Imagine you are trading SNDK. A stock that has and is doing very well right now. Black Box computers can instantly pick up any news on the company from media outlets to probably the amount of facebook, google or twitter traffic on SNDK and the team monitoring those black boxes can act accordingly.
  • They can manipulate to a significant degree a stock, sector, ETF that is close to an important technical level. One way is pumping and dumping. They pump something up, other suckers join in, then they dump it.

They rule and they run the rule book. In other words what used to work like volume confirming a price move seems no longer to apply.  The game has changed and the 20% of us that are not Black Box traders are their easiest targets. Sometimes they go up against each other and sometime they work together. In the long run fundamentals (earnings, company growth, profits, etc.) do move markets. However the Black Box traders that dominate markets can do a lot of damage/manipulation before fundamentals kick in.

Right now the Black Boxes are obsessed with the Dollar/Euro relationship. That’s where the money and the action is – the giant currency markets.

It was surprising to see Cramer, who is basically a market cheerleader, speak out against Black Box trading. He recommened supporting one of the champions of Investors411 – Senator Ted Kaufman. Here’s Kaufman on casino capitalism and black box trading

Bottom Line – Many people no longer invest in stocks. This is evident from the lack of volume. Black Box trading is one of the factors in out casino capitalist system that rewards the few at the top and the rest of socialize their risk.

About the best I can do is follow the tracks of the black boxes and make trades accordingly. Right now their obsessed with currency trading. Until casino capitalism is repaired investing for the long term (years) is more difficult.

Significant Indexes

  • McClellan Oscillator fell to +60.11 [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO) LINK. –  & Investopedia on –  How the MO works. Just into Oversold territory = Bearish
  • US Dollar –  The dollar rose +0.30% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important.

Reading The Tea Leaves -

The high volume turn around in the FXE (see above) & the oversold condition of stocks (MO) indicates the likelihood of a short term reversal of trend in the EURO. However, major reversals usually happen at support levels and the dollar & the EURO are still a ways away from its 50 day moving average. And one day’s trading in currencies is ardly an indication of a reversal, only the possibility of one. So lets go with moderate upside that gets us back to @+80 on the MO.

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own – Updated over weekend

Out of all stock positions.

Out for the rest of the week – Back Monday

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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