Investors 411 Blog

The Holy Grail of Fuel Cells?

The Terminator, WalMart’s CEO & Colin Powell

Add the CEO of Google and you have one of the most hyped and perhaps revolutionary product launches in history was launched yesterday – The Bloom fuel cell box – Low cost clean energy whose primary ingredient is sand in now being used by some major US companies. Hard to tell the hype from reality, but if you missed 60 minutes on the Bloom energy box the 3  links above will give you some more information.  Seems like a $3,000 clean energy box in your home will produce electricity at about 1/2 the rate currently charged.  For all its faults America still has the greatest innovators on the globe.

Shooting Shadow Banks

With a clenched jaw President Obama stated about the shadow financial institutions on January 21st – “If these folks want a fight, it’s a fight I’m ready to have,” In front of the Business Round Table all that tough talk turned to jello.  Paul Volker & Elizabeth Warren seem to be left out on a limb that is being cut off. Enlightening editorial in New Republic by Peter Boone & Simon Johnson

Health Care Summit Today

Obama’s six hour health care summit is being held today. Dylan Ratigan (MSNBC Show) pointed out that insurance companies in 4 states plan to raise premiums over 20% this year.  For many the Democrats have sold out to the insurance industry and Republican’s simply want to do nothing to prevent Democrats from getting any credit.  Both parties are dominated by lobbyists. Ratigan also has a piece on the Bloom Box yesterday.

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	+0.89%	down
NASDQ	+1.01%	down
S&P 500	+0.97%	down
Russell 2000-	+0.86%	-

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

The Terminator, WalMart’s CEO & Colin Powell

Add the CEO of Google and you have one of the most hyped and perhaps revolutionary product launches in history was launched yesterday – The Bloom fuel cell box – Low cost clean energy whose primary ingredient is sand in now being used by some major US companies. Hard to tell the hype from reality, but if you missed 60 minutes on the Bloom energy box the 3  links above will give you some more information.  Seems like a $3,000 box in your home will produce electricity at about 1/2 the rate currently charged.  For all its faults America still has the greatest innovators on the globe.

Shooting Shadow Banks

With a clenched jaw President Obama stated about the shadow financial institutions on January 21st – “If these folks want a fight, it’s a fight I’m ready to have,” In front of the Business Round Table all that tough talk turned to jello.

Technicals, Fundamentals & Analysis

See Positions , Strategy , and Overview for changes made over weekend.

Markets rose and volume fell.  Up days on lighter volume has been the norm for months.  Roughly 80% of the rally days have seen a DECREASE in volume.  This is NOT good in the long term for stocks. About 80% of the previous days losses were made up.

The US shrugged off the bad consumer confidence news two days ago  and financials led stocks higher. (See above) Obama has flipped flopped on getting tougher regulations for shadow institutions so many times I’ve lost count. Bottom Line – nothing’s been done in since he took office. In fact dropping mark to market accounting has made major shadow banks less transparent. Short term this is a boon for stocks, but longer term it just means without transparency or any regulations other financial bubbles will inevitably form.

Significant Indexes

• McClellan Index rose to +36.20. We are once again approaching oversold territory.  This looks like a second leg up into an oversold position – greater than +60

Positions

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

Will be lightening up when/if positions reach oversold.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Capitalism’s Most Ruthless Monster

John D. Rockefeller who owned 90% of US  oil at the beginning of the last century many thought earned the title back then.  The NYT’s Frank Rich LINK , Salon’s Glenn Greenwald LINK and MSNBC’s Dillon Ratigan – LINK all seem to be nominating Goldman Sachs for this position.  Over the top analogy – yes. But it does have some basis in fact. Ratigan , a former analyst for two financial channels has the best explanation (video) .

Basically, GS  received $70 billion from the government & the Fed while the financial world almost collapsed.(see Ratigan video) GS took that $70 billion and bought everything financial for incredibly cheap prices in the collapse.  They bought stuff with our money that allowed them to keep from collapsing. They "didn’t pay a dime for this money." Basically "legalized theft."  As the authors point out former GS employees permeate both the Bush and Obama administration. How do we get rid of legalized theft?

• Demand claw backs
• Get rid of invisible exchanges
• Stop placing GS executive and their protégée’s  in charge of our government
• Limit (GS on track for $29 billion) bonuses to firms who got bailed out.

President Teddy Roosevelt broke up the big monopolies including Rockefeller/Standard Oil. Will any of this happen now? Not under the Obama administration or any Republican administration – Too many GS folks running government economic policy. Some bad PR perhaps, but like Rockefeller did, GS will throw shinny new nickels at the poor/us taxpayers – As taxpayers we got royally screwed.

Investing in GS and its main rival JPM (JP Morgan) may be similar to investing in a ruthless capitalist monster(s), but also an obvious financial winner(s) The competition was devastated, they have profits from our cash, the backing of our government, they’re smart and therefore, they rule. -Recommendation – Buy these stocks on dip s

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage %	Volume
Dow	-0.67%	up
NASDQ	-0,76%	up
S&P500	-0.81%	down
Russell2000	-1.15%	-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals and Fundamentals

• prices fell and the #1 confirmation factor, volume, was mixed = Prices falling always bearish, but volume inconclusive
  
• Better than expected earnings for most companies yet markets fail to advance =  Short term bearish signal
• Dollar rose Friday (see below) = obviously short term  bearish for stocks, But longer term pattern bullish
• BDI (see below) forms higher high on its chart =bullish for worldwide recovery

FEARLESS FORECAST – Short term it looks like we are over bought and companies not moving higher on good earnings results. This is an indication of a short term correction. However The FED and the US government is not going to stop shoveling cash at the market as long as unemployment is so high. US companies are not hiring and will first hire abroad where labor is cheaper and growth faster.  So the cash shoveling will continue and Wall Street, once over bought situation is corrected, will continue to rise and the dollar fall.

Apple reports this evening

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI is @ 38% off its high (early June) Before that it gained almost over 630% from its all time low of 663 in Dec. of 2008 (April 2009 high of 4291 )

The BDI rose +40 points Friday and closed at 2728. This confirmed a higher high price on its chart pattern =  Bullish for stocks & world trade right now

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$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra – Dollar up = US stocks down & Dollar down = US stocks up

US dollar rose +0.15 % The dollar closed at $75.62. We have developed a suppor t now resistance (it’s called support on the way down and resistance on the way up) level just below $76 . The dollar closed below its support level. = Bullish for stocks

NB -

• Earnings will probably trump the dollar as the #1 influencing factor for the nest two weeks. But the falling dollar is the main driver of stocks right now and we have a long way to go till we hit last year’s $71 low.
• A slow decline in the dollar = good a rapid decline = bad .
  

Last year’s low was around $71, so there is a long way to go before the major and very crucial support level.

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

Review of Positions (Part 1) All recommendations for longer term investors unless otherwise indicated.

GLD – ETF for gold – Technically broke out over major resistance level at @ 100+. This is mostly a play that the US and other debt ridden G 7 nations will keep throwing money at economic problems till unemployment situation reverses itself. The longer this takes the higher GLD will go.  Mid 2010 is best read of tea leaves on this, but the created jobs will be tied to government bailouts in the US and not US companies producing jobs. – Recommendation – Buy the dip

EWZ – ETF for Brazil – This country is going parabolic in price now (not volume).  Going way up too far too fast. Very rich in natural recourses and more progressive government has meant more money for middle and lower classes who juice the economy and spend the cash. Due for a moderate/significant correction. Recommendation If there is a big spike in volume take some profits.

FXI – ETF for China – China has gone up too far too fast this year and is now lagging or mirroring US equities. China’s growth and huge stimulus package (relative to GDP) has led a worldwide recovery.  Somebody coined the word Chimerica and its true. Both economics are bound together through globalism.  The US middle & lower classes are shrinking , but the Chinese middle class and lower class is growing. This is now a decade(s) old trend.  Recommendation buy China on dips

EWY – S. Korea (much smaller position ) Tied to Chimerica, but N. Korea is a problem. Traders may want to take profits on any rally. There seem to be better countries to invest in like energy rich Canada, Australia or any country that is not consumed by debt and wasting money fighting wars. – Recommendation Hold or take profits on any rally.

More tomorrow. Including individual stocks.

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!