Investors 411 Blog

Chucky shredding wire from the movie or one of the remakes

Shredding Democracy

• Before Paulson/Bush asked for the  $700 billion 2008 bailout
• Before the worldwide 2008 stock meltdown
• Before Lehman Brothers went belly up

the FED Bank under Bernanke acting on its owned spent tens of billions of of unauthorized dollars bailing out AIG and Bear Stern. Without any constitutionally mandated congressional approval or oversight Bernanke/Geithner (who was NY fed board member) flooded these failing shadow financials with money. Did Paulson/Bush know this was happening?

“Its {the FED}secret deals, announced almost two years after they were done, violate the democratic process, if not the Constitution itself.” Robert Reich (Economist and former Sec. of Labor) The Fed came clean about this (masterfully) directly before the Easter break and American media has blown the story. Reich accurately explains the fall out here

What other secrets is the Fed hiding?

Shredding the Yankees

Yesterday was opening day for baseball, and hope springs eternal for every team. Most fans walk through a dark ballpark tunnel into a brightly lit transcendent green field full of hope on opening day.  The beloved Red Sox did twice come from behind to beat the evil empire, sometimes known as the New York Yankees, last night. Unfortunately there is over 170 games left if you make the playoffs and the Yankees will certainly shred far more teams than almost every other in baseball. Go SOX’s.

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!

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

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made each weekend

Friday’s March jobs report was better than expected, especially for the critical private sector +123,000 jobs created.

It clearly looks like jobs creation started in November and is slowly growing.  Here’s the ultra right wind Washington Times on the jobs report Clearly good news for the economy. The old Jolly Green Giant (not so jolly anymore – Alan Greenspan) and Obama Administration predicting potential acceleration in numbers.

This report, even though the headline -9.7% job loss stayed the same, was too good for Wall Street. The longer interest rates stay low, the better it is for stocks. A better than expected number in the private sector translate to the Fed rising interest rates sooner than expected.

The big stat out of last week was China’s Manufacturing Index coming in better than expected. This shows global growth in emerging markets is still pulling the world’s economy.

Last Week’s Fearless Forecast – “Up week” –  All US markets near highs as rally chugs along. Like the RED SOX against the YANKEES last night. We won.

This Weeks Fearless Forecast – “Up week” – But really difficult call – The Dollar is King right now. Europe is weak (see past Investors411) and the US (jobs report) is strong. The start of the week should see a rally, but the Dollar is coming up against major support level. (see below) Best read of the tea leaves. Our bullish momentum should carry us higher at the start of the week, but I expect the dollar to hold its support. Earnings season is around the corner and the expectations of better earnings will be the deciding factor making it an up week.

Bottom Line – With the McCellan stuck near zero – no wisdom in buying or selling any large position at this time. Will continue to nibble on dips.

Significant Indexes

• McClellan Oscillator rose significantly to -1.46 yesterday.  [+60 or above = Overbought = sell. -60 or below = oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – This (at least for a day) broke the downward trading pattern. Downside and Upside risk are about the same. We are neither overbought or oversold.
• US Dollar -fell  -0.44% yesterday. [Anything over +/- @0.50 is significant.] Dollar broke through a more minor support level Friday and ended the day at $80.71. The major support at it climbing 50 day moving average is $80.19. Would be very surprised to see this fall. Falling dollar = rising stocks

As stated before -What the dollar does over the next few weeks is critical to stocks and economics around the world. Falling dollar good for stocks & rising dollar bad in the short term

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

3D and related theater stocks weekend results good. Simply not enough 3D screens to fill the demand.

The big news is the manufacturing growth in China (see above) – Mistake to take profits in FXI (China), but adding EWZ (Brazil) looks to be a good counter balancing longer term move.

Strongly considering adding health care/Biotech ETFs on dips. Their fundamental story is compelling (baby boomers getting older & obamacare covering 30+ million more) Their charts are outperforming. Recently added stocks TEVA & ESRX are in this general area.

Its frustrating, but I’d rather wait till US equities are more oversold to buy larger long term positions.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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Teddy Roosevelt

Back in the early 1900 Republican President  Teddy Roosevelt busted up the big monopoly shadow banks when they tried to take control of government.  Big Wall Street banks have increased their control over Washington for almost 3 decades. Is Barack Obama a Teddy Roosevelt?

Can financial reform end the too big to fail problem? “Big shadow Banks have become even more powerful since the 2008 meltdown.”  Worthy editorials & videos

• Baseline Senerio’s MIT prof Simon Johnson today on Paul Volker
• Again MIT’s Simon Johnson on Steven Colbert show. As always humorous, but informative video (Interview starts at 15.00 minute mark into show and last 6+ minutes)
• Bob Kuttner former Businessweek & Boston Glob reporter who has his own mag., American Prospect on banking reform and the need for a game change like Teddy Roosevelt

If Democrats want an issue to run on in November. This is it. But perhaps/probably too many  are owned by bank lobbyists.

Bottom Line – If the financial legislation ends the too big to fail problem its good. If not it stinks.

The Public Option Did WIN

The “inclusive, single payer, cost effective, money saving ($61 billion over 10 years – CBO) robust Public Option” was won in education. This overlooked  bill was passed along with Health Care reform and cut out the banks (middle men) and opens opportunities for anyone seeking help at the college level. Jeff Cohen editorial

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!

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

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made each weekend

Another day of weak volume.  US equities were basically flat. Flat prices in high volume indicates a shift in course. Flat prices in low volume indicates little.

Good news was consumer confidence rose last month. Seeking Alpha (one of the best financial sights out there) presents an interesting long term view that low consumer confidence has historically been a good time to buy stocks. Bad news was concern over sovereign debt (see below)

KING DOLLAR is the major index to watch. (see below)

Significant Indexes

• McClellan Oscillator fell slightly to -4.55 yesterday. [+60 or above = Overbought = sell. -60 or below = oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. -Same pattern continues - We right in the middle so NO clear signal. However we are still in bearish pattern of lower highs and lower lows.
• US Dollar -started back up +0.21% yesterday.

What the dollar does over the next few weeks is critical to stocks and economics around the world. The dollar has risen 10% since Dec.. This means that US & China (their money is pegged to ours) exports are 10% more expensive to the rest of the world. A higher dollar,therefore, puts real negative pressure on US/China stocks, what you pay, and an economic recovery.

This is why the sovereign debt crisis in Europe [PIIGS & former Russian satellite countries] has the potential to plunge us into round two of the recession. The dollar is rising because of the problems in Europe.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

DWA (Dreamworks) Ended up selling all of DWA for 4% loss. Was stopped out of 1/2 and sold the rest. Selling the last 1/2 was probably a short term mistake because after three days of big volume selling it should bounce higher this AM. Loss -4% on 2% of portfolio

RGC & CNK – Opened a 1% of portfolio position (hopefully long term position) in each stock. RGC price = 17.68 & CNK = 17.98. Will add to these on dips. Caution if Easter weekend movies bomb, these two stocks will get hit. A safer entry point may  be Monday or Tuesday.

Waited for even a 2 to 3% dip in IMAX to buy a bit more, but it just not happening. IMAX is NOT having a climax buying spree (going elliptical) yet, because there is NO big volume behind the rally. IMAX now up 30 to 40%

Will try to add a 2% position in TEVA today. Hopefully at a slightly lower price.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING