Photo from Politico of all white Tea Party activists – Queston should the USA have the same level of tolerance as Saudi Arabia or are we better than that?

Your Comments

Mainstream media (CNN & others)has chosen to give priority to right wing groups that believe we should ban all  mosques in the USA. Yankee Bob has returned to the comments section with a rebuttal -

“Exactly right!

Fear is the Mind Killer! Prejudice is born of ignorance! We fear that which we do not know or understand! Enlightenment is much harder to attain. It’s easy to be afraid of what you don’t know or understand. That’s easy. Seeking the truth is hard!

Think of what prejudice has cost the world. How many Genocides? How many victims of Genocides, Enslavements, Victims of Prejudice  were denied their human rights. What does that mean as a social cost? Suppose Einstein had been murdered  in  a Pogrom before he gave the world his Theories. Suppose he had been denied his eduction because of a quota on student seats for Jews! How many potential Einstein’s were lost at Auswitz? Suppose Drs. Salk were denied becoming Drs because they were Jewish! The Dr that developed the procedure for blood transfusions that has saved the lives of countless millions,died after being in a car crash and was denied a transfusion because he was Black! What if he was in that crash before he developed his discovery. We have lost so much as a society because of the fear that ignorance inspires!”

Yankee Bob

JS has a lot more valuable information on covered calls in the comments section. Also Dave & Jim J (bonds) have some added information Kudos to JS for initiating and leading the discussion on an alternative method of investment

If you don’t watch the comments section each day your missing out on some of the best investment ideas and most passionate editorials.

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!

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.

Weak volume rally is typical US for the BB/HFT.  Although volume did pick up a bit as short positions scrambled to cover. Weaker dollar & rally abroad played a part in this.

NB – The US markets are , for the most part are being engineered by the BB/HFT and now the Fed has taken an even more direct role. Investors411 has beat the drum over the BB/HFT’s, so lets do the FED.

The FED – It was perhaps no accident markets moved higher when the Fed at 10:15 AM EST yesterday opened its window to start to buy Treasuries. Lower treasury rates pushes investors seeking higher yields into stocks. More important Zerohedge.com does a good job describing what happens when cash is given to potential traders. Future auction that inject cash to major traders will occur 8/19,24,26 & 9/1. So stocks should have an artificial boost on those days. At Zerohedge read anything with symbol POMO – Permanent Open Market Operation.

Bottom Line - You’re not getting the Fed’s money and we could see a little juice added to stock on the above dates. Plus the day before traders may rally in anticipation of new cash.

Cash rich companies are also buying back shares – they certainly are NOT hiring American workers.

Significant Indexes

• The Dollar (USD)  [Anything price move over +/- 0.50 is significant] The dollar fell -0.38% yesterday. For stocks = Bullish
• The Baltic Dry Index (BDI) [measures cost of world trade/proxie for China & emerging markets] Rally +1.09% 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 +3.14 = Neutral

Reading Tea Leaves

Emerging markets due for a consolidation after a nice 3/4 day run. MO in neural and the FED injections of cash through 9/1 should keep the nasty Hindenberg Omen at bay at least for a while.

Positions

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

Current positions – EWZ & EWS

Each time we have a MO below 40 and a dip, I plan to buy.  First nibbles and the lower we go the more riskier ETF’s.

Same strategy – Will sell 1/2 ETF at @3 to 5% gain/loss and let the rest ride till the MO moves higher. Sold 1/2 of EWZ at 70.88 for @ +3% gain. Both EWZ & EWS opened and closed near the same levels. In the language of technical analysis this usually means at least a short term trend reversal.

Long Term Outlook – NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

“The Comeback Country.”

America’s Back - Is the front cover headline from April 19th’ Newsweek.

The stock market chart below sure shows the US stock market is back. This issue of Investors411 is going to go over why stocks NOT the economy (a different story although since Obama took office we have gone from -700,000 jobs to +100,000 jobs a month) have recovered and one major point on technical analysis

LINK to bigger representation of above chart by dshort.com

CAUTION – While this two year chart (we are the blue line) does look good if you take a 10 year perspective the chart shows that stocks are in the 3rd worse bear market. The US stock crash of 1929 and the 1989 Japan stock crash the other two worse bear markets.

Why Stocks Recovered

1. The Paulson/Bernanke Bailout - You can also give credit to Bush, Obama, McCain, Geithner and every member of congress that voted for this flawed plan. We stood at the precipice of well over a dozen of the world’s largest banks, its largest insurance company all failing. This would have easily have cascaded us in panic into another Great Depression. Many many big foreign banks were also bailed out.
2. Worldwide Stimulus – Obama’s stimulus plan cut taxes @ 10%, kept state governments solvent, provided new jobs, new focus on alternative fuels, and gave tax breaks to small companies. You can argue the merits of the Obama plan vs. the other world wide stimulus plans, but combined they made a difference.
3. Low Interest Rates – Our Fed and other central banks cut interest rates dramatically and gave insolvent or near insolvent banks the money at close to 0%
4. Changed Accounting procedures - We virtually eliminated “mark to market” accounting. This allowed banks to less transparency in accounting and not to value assets at what they are worth at the present time.
5. Speed - Unlike the 1929 Great Depression and the 1989 Japanese stock crash, action was taken within a year to fix a worldwide economic problem.
6. Emerging Markets – China, India, Brazil and others never entered recession. Partly because their banks did NOT get over leveraged. Their economies kept right on growing.

This is all truly great news for Wall Street. Of course for every on Main Street this Simply Sucks

1. We’ve privatized the Gains and Socialized the Risk - Untold trillions have gone into fixing our over leveraged, unregulated markets (shadow financials that caused the crisis). The government money printing presses (later this means you pay with inflation) and tax dollars (bigger deficits) have added new burdens on Main Street.
2. We’ve done NOTHING to fix the problem. Alan Greenspan had his OMG moment in front of congress when he exclaimed he was wrong – “Free” (unregulated) market can not fix themselves.  There is something called GREED that emerges on Wall Street if you have little or no transparency and rules.  In fact, we’ve made things less transparent by removing mark to market accounting.

Technical Analysis

I love it that so many of you who have my personal email send in stocks for consideration on YOUR Stock List. Again Thanks – I will give you a short technical analysis of each stock. Two new stocks sent in over the weekend CKEC (3D theater stock,but over extended) & MSPD (chart looks great!) are worthy of consideration. One stock on YOUR list ICON “raised guidance”

One request - Almost all of you send me some stocks that  are too small to consider. These small companies are too easily manipulated by Wall Street Sharks. Please send in stocks that do over $5,000,000 a day in trades. More than that is even better. Multiply Volume X Price

Over two decades I’ve watched /owned way too many of these “thinly traded” stocks that exploded.

Here’s how they fall in an analysis of ERES – Chart shows @200,000 shares a day traded and price at $7.27 = @ $1.5 million a day.  Thats chump change to hedge funds, big investors, brokers, institutions.  Its too easy for them to “pump and dump”

Example-someone acquired 1,000,000 shares around 6 to 6.5. over time. They pumped up the stock by buying more shares as it comes close to its technical breakout point. Knowing other investors would then jump in as the stock broke out, they pump it up by buying more. ESRS goes higher and then they dump the million (plus say 50,000 to 100,00 extra shares it took to pump up the stock) ERES prices go down big time but they make a killing.

This obviously does not mean ERES is getting pumped then will be dumped. But the lower the volume & price the greater the potential for manipuation

Don’t worry if the above explanation makes your eyes glaze over. Just stay away from thinly traded companies.

AS ALWAYS DO YOUR OWN ANALYSIS BEFORE INVESTING