Last Post For This Week

Disaster Capitalism

Disaster Capitalism [LINK to video]is a term used by Naomi Kline. JS in the comments section of the blog calls it “creative destruction.”

You create an economic disaster. and use the disaster not fix the causes of the problem, but to create a new economic structure.

  • Trillions spent on foreign wars
  • Trillions spent to fix disaster created by shadow banking system (bailouts, QE’s, Stimulus.etc)
  • Trillions spent on Bush tax cuts that give great benefits to wealthiest Americans

The bait and switch -  The current case is, obviously, to obsess on the debt and ignore the clear and present economic and jobs crisis

The corporate oligarchy uses disasters, their media, their lobbyists who own politicians to enhance globalized corporate wealth and devastate Main Street America.  The debt crisis provides a perfect cover for this to continue.

A Supposed American Icon Apple Computer

Example - Wildly profitable AAPL has been expanding massively in China. Foxconn,  the largest manufacturing company in the world and of AAPL products treats people like machines.

  • AAPL, while we have been fixated on wars and economic crisis, has been steadily outsourcing  jobs mainly to Foxconn and other foreign entities.
  • Labor is a fraction of the price, there are no pensions, no health care, and no benefits.
  • The Chinese peg their currency 50% of the USA’s. We have a 2.5% tax on Chinese goods and they have a 25% tax on our goods. This gives a huge added incentive to manufacture in China. All our polls allow this because they are dominated by the corporate oligarchy the profits from this.

The end result in a post Steve Jobs Apple will be moving even the corporate headquarters to China, because that’s where all the jobs and new consumers will be.

In the short term, globalized companies may take a hit if the US defaults, but this will also give them cover to send more jobs abroad or force the same economic conditions on US workers that the Chinese have.

These actions (from outsourcing to trade/tax policies) are being repeated by all major globalized US companies with the help of the vast majority of US politicians including POTUS.

How you can adapt to creative destruction/disaster capitalismLearn Mandairin and how to bow to Chinese/corporate masters.

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A better example would have been the bait and switch of US shadow banksters, but Investors411 has covered this topic many times.


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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

Index Percentage Volume
Dow -0.73% up
NASDQ -0.10% up
S&P 500 -0.41% up
Russell 2000 -0.79% -

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Technicals, Fundamentals & Analysis

Shorter Term Outlook.

day/days/week

  • Volume increased yesterday, but not significantly.  As mentioned in earlier posts, globalized  US stocks are NOT going to be as negatively impacted by the debt crisis/kabuki dance in DC as much as our economy and jobs.
  • AAPL, up eight days in a row, is almost singlehandedly kept US stocks solvent. Nothing goes up forever and AAPL is due for a correction.
  • Two of our most successful technical forecasting tools listed belowOf course the big dog out there is the debt crisis in DC. It trumps everything. If there is some favorable resolution for Wall Street (It may NOT be favorable for Main St) The lower the MO & dollar go the bigger the rebound higher for stocks.
  • The McClellan Oscillator (MO) chart fell to -36.58(-30 somewhat oversold, -60 oversold, -90 OMG oversold). We are somewhat oversold in the short term. The June low for the MO was @-70. Current Level Neutral/Bullish
  • $USD The Dollar fell significantly -0.80% yesterday (+/- 0.50 is a significant move and the dollar is usually a contrarian indicator) Chart shows dollar on its way to challenging the May lows. = Bullish/Neutral
  • Reading The Tea Leaves - Instead of focusing on the clear and present danger – the economy & jobs, the corporate oligarchy has created an immediate debt crisis.

Longer Term Outlook

weeks, month, months

  • Both Parties have drawn up last minute plans that they think help them get elected.  There may be a lot of political back slapping over some ineffective plan. The danger is this will be repeated over next years budget, and if Republicans have their way, before the election.
  • This would create added uncertainty over extended period and hurt the American consumer.
  • For Main Street USA the continued uncertainty will be devastating. No ones working on job creation and if you cut current government spending there will be even less jobs. How do you fix any deficit without jobs? For Wall Street the results will be negative. Globalized companies that make their profits outside the USA will profit in the long run.

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Current Positions

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

Monday’s Headline Repeated

PROTECT YOUR MONEY

NLYAnnaly Capital Mgt. Ultra high dividend stock – This was the one stock I thought could weather what will be a repeated debt crisis storm, because during the 2008 meltdown it produced double digit returns (one of you mentioned this in the comments section)

In  my personal portfolio I have a Put position to protect NLY -

All the blow concepts  considered because of the potential of a US default.

Check the comments section of blog during day because at least one of these positions will be added to hypothetical Investors411 portfolio.

GLD & SLV – Gold is at a new high.

UDNAn ETF that shorts the dollar.

BZF - ETF that tracks Brazil’s currency. Big breakout to new highs. Major mistake not to buy this currency.

What about cash?Realize that as the dollar falls your cash becomes less valuable relative to other currencies. Interest rates may explode if the US does not honor its debt (example Greece) This too would make your cash less valuable.

DisclaimerPersonally I own  a group of dividend stocks including NLY. I have placed puts on one ETF of a major index and a couple of dividend stocks. I buy everything in the hypothetical Investors411 portfolio.

JS in the comment section has used the term ”insurance” to describe the way ”Puts” are used protect long term investments. – email me if you want to know more or post a question in the comments section.

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Long Term Outlook (for US Economy)

BEARISH

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

Longer Outlook for US stocks downgraded from CAUTIOUSLY BULLISH to NEUTRAL

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Longer Term Outlook (for US stocks)

NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

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