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Toasting the S&P 500

For 7th Straight Year

Investors Dividend Portfolio toasted the S&P 500

Up 19% vs a -0.17% S&P 500 for 2011

See Friday’s blog post.

Here’s the results from our other portfolios.

More information on all portfolios can be found in the

Positions Section

Conservative Portfolio

ETF’s were chosen for 2011 because they have two streams of income

Ticker symbol, dividend, price change, total gain. Dividend gains were computed last January so they may be slightly off

• FLD +4.38, +10.29, = +14.67

• DTW +4.01, +8.22 = +12.23

• DVY +3.79, +7.54 = +11.33

Total +12.74 vs. -0.17% S&P 500.

While the conservative portfolio toasted the S&P 500, it did not do as well as the individual dividend stocks portfolio which was up @ +19%

Moderate Portfolio

These ETF’s were chosen to mirror the S&P 500, but give diversity

• QQQ +2.14
• SPY -0.17
• DIA +5.14
• IWM -6.36
• EEM -19.81
• DBC -0.74
• USO -0.03
• GLD +10.92

Total -1.19 vs. -0.17 for S&P 500

The moderate Portfolio mirrored the S&P, but was about 1% lower. This was because EEM (emerging markets) took a big hit. There was a warning about inflation attached to EEM.

Aggressive Portfolio

These were individual trades/investments made throughout the year and posted in the daily blog. I don’t have the time to go through approximately 225 posts to compile an accurate grand  total. But, I’m confident these choices overall beat the S&P 500. The vast majority of these trades had gains and losses of less than 10%

The most significant trades of the year was the GMCR Put/Call Hedge Trade that made almost +200 See LINK and previous blog posts.

Investors411 will keep a running total of special trades in the Aggressive Portfolio this year.

Your Stock List

Three Your Stock Lists were run in 2011.  Investors411 stopped running YSLs after 6/30 for several months. A wise move. This summer was when stocks took their big hit.

• YSL #4 +18.69 vs S&P +12.39
• YSL #5 +3.64 vs.  S&P +1.60
• YSL +6.50 vs. S&P +9.50

Total YSL +28.83 vs S&P +23,59

Stay tuned for the 2012 Forecasts and some major changes to Investors411 investment Portfolios

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AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

CHECK ALL DATA, I MAKE MORE THAN GRAMMAR  ERRORS.

Last blog for the week. Hope to be back Monday or Tuesday

From Huffington Post – Japan

Japan’s Reactor Crisis – NYT today has a comprehensive  article – U.S. Sees Array of New Threats at Japan’s Nuclear Plant Many Kudos to JS, Popeye. Yankee Bob and Jim J who have kept us up to date on this in the comment section of blog.

CBO on Republican Budget Cuts. – The non partisan Congressional Budget Office analysis of Republican Paul Ryan’s budget cut proposals. From Business Insider’s Dean Baker - “Representative Ryan Proposes Medicare Plan Under Which Seniors Would Pay Most of Their Income for Health Care” Proposed title if we had a “independent press” and people read the “CBO report“

Green Energy – “If someone told you there was a way you could save 2.5 million to 3 million lives a year and simultaneously halt global warming, reduce air and water pollution and develop secure, reliable energy sources – nearly all with existing technology and at costs comparable with what we spend on energy today – why wouldn’t you do it?

Maybe its improbable, but thought this was worth a look – Researchers from Stanford & UC says- “The world can be powered by alternative energy, using today’s technology, in 20-40 years”

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Stocks

• Not much happened. Market rallied in AM boosted by Fed Pomo and fell in PM when Fed minutes said majority of members did not want QE #3 right now.
• Lots of this type of editorial about second guessing the Fed abound.  The Fed does Rule or is the Manipulator in Chief. This one is interesting
• Many of the ETF’s mentioned yesterday are at highs. Preferable to wait for a dip to buy

Reading The Tea Leaves

Longer Term Bottom Line – No Black Swan events have been able to seriously impact the Fed liquidity driven equity market. So bulls rule

Shorter term Bottom Line - McClellan Oscillator shows moderate overbought US equities, so there is resistance to moving higher. Better entry points with lower MO

Market Movers to watch today - Same list with UUP (the dollar) still has most influential, unless others make some huge move.

• USO - ETF for oil - Oil up = stocks down - Now back above $100. - Headlines from Libya not good.
• UUP - (Tracking ETF for dollar) Remember - The dollar is a contrarian indicator. Bad dollar = good stocks
• AAPL – Tech giant and market mover – Trading below its 50 DMA. Since mid February this char shows a series of lower highs and lower lows = Bearish
• Japan Rector Developments – This keeps getting worse.
• EEM – Emerging market ETF – On a breakout run, but getting  way over extended.

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Your Stock List #4

Your Stock List is about a month old and links/charts to each stock can be found in the POSITIONS section of the blog (scroll down) Paul has analyzed each stock and Monitor has researched the earning date of each stock. Below is their results. You can find this and other stock information in the daily comments section of the Investors411 blog – In my opinion, nobody’s perfect and, Paul is right far more than he’s wrong. –

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

From Paul

YSL 4 Comments April 5 Close, my opinion and I’m usually wrong!

SAP hold, buy on any pull back
RVBD not buyable
ADTN not buyable basing
CPHD hold, buy on any pull back
BEXP hold, buy on any pull back
SWKS not buyable basing
ALTR buyable
ABC hold, buy on any pull back
IMAX Extended
PCLN Extended
POT hold, buy on any pull back
JNPR basing buy above the 50
BIDU hold, buy on any pull back
KSU buyable
SPRD not buyable

From Monitor

Here’s the earnings reporting date of YSL #4 companies.

SAP 1/26 would assume @ 4/26
RVBD 4/25AMC
ADTN 4/13
CPHD 4/20
BEXP 4/29
SWKS 4/20
ALTR 4/26AMC
ABC 4/28
IMAX 2/24 would assume @ 5/24
PCLN 5/9
POT 1/27 would assume @4/27
JNPR 1/25 AMC would assume @4/25
BIDU 4/25
KSU 4/21 BMO
SPRD 3/3AMC would assume @6/3 AMC

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Look for Paul R’s always enlightening remarks on stocks and sectors in the comments section of the blog. See ”POSITION“ section of blog (at top of page) for lists of potential stocks & ETF’s including “YOUR Stock List.”

Outlook for 2nd Quarter

Case for the Bears

• Japan problem is underestimated and damage to the country’s GDP and the world’s supply change is worse than expected
• The latest housing and consumer confidence numbers are worse than expected and a second housing recession is expected.
• It’s only a matter of time before one of the PIIGS countries in Europe defaults and it will spread.
• Libya is a stalemate and challenges/chaos toward oil dictators will grow.
• State budgets are breaking down because of the lack of revenue and this means greater unemployment.
• More people in the USA are on food stamps than ever before.
• Opaque corrupt Shadow banks  are facing a mortgage crisis (thanks to Robert H for the heads up on the 60 Minutes Show)
• Quantitative easing will end and everything will fall apart because there is no entity big enough to buy as many treasuries as the Fed.
• Inflation and the over supply of unsold housing is going to explode in China, sinking the rest of the world.
• Inflation is coming and this will squash equities
• Earnings disappoint

The Case for the Bulls

• The Fed is going to keep pumping liquidity into the economy. QE #2 continues to June 30th.
• Even after 6/30 there will be a whole lot of liquidity sloshing around and QE 3# is likely if we start falling.
• The recovery from -700k jobs per month to +200k jobs per month shows an economic rebound in the USA.
• Emerging markets are growing again.
• The lack of wage growth and the huge numbers on food stamps in the USA will keep inflation lower than expected.

Bottom Line for Most Stocks – Once a trend is in place, you go with the trend until it breaks.

The Fed Rules (see past updates starting in November or Strategy Section of blog) This trend has crushed major black swan events (Japan & revolutions &  anticipated impending doom listed above) and until it breaks its strong.

This trend has a new force behind it – the better employment numbers. As unfortunate and cruel as the lack of wage growth and record number of people on food stamps  is, it serves to mitigate inflation. Obviously it also show an wealthy oligarchy further crushing lower class Americans.

Dramatically higher oil prices and/or a dramatic fall in the dollar could break the bulls. Of course some unforeseen catastrophe could too. Also,  if earnings season is a disaster, instead of mildly disappointing we could end up down.

Short term we are oversold and ripe for a small correction, but the Long Term outlook remains CAUTIOUSLY BULLISH

and – yes its all a bubble – How can you build a growing economy on a corrupt financial structure and a  growing imbalance of wealth in the #1 economy of the world?

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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

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Technicals, Fundamentals & Analysis

Investors411 record - 6 years of beating benchmark S&P 500

BUBBLE-ICIOUS - Investors411 term for the stock market – We are all riding on the outside of an ever expanding &  Central Bank manipulated liquidity stock bubble. See Investors411 STRATEGY section for more. Remember Fed liquidity (POMO, QE 2 or quantitative easing) announced ending is June 30th.

• Yawn - Another low volume rally. In fact, the lowest , non holiday,  volume day since 2008.
• Repeat - Bulls have two strong fundamentals – Jobs are recovering and Fed’s liquidity injections.-
• Because of the corruption, and lack of transparency housing still a major problem
• Wages still have not increased for most American workers.
• The above two factors should mitigate rising inflation in commodities.
• China has raised  interest rates – 4th time since October – They are worried about growing too fast and a housing problem. This will hurt stocks in the near term
• Emerging  Markets are leading this leg of bull market and the above should give them a whack.

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Shorter Term Forecasting Indexes

• The Dollar (USD) [Any daily price move over +/- 0.50 is significant. Dollar usually moves inversely to stocks]   The dollar saw a huge rally collapse and ended  a wee bit higher +0.10. Chart pattern showing volatility/erratic so short term hard to call, but longer term bearish  For stocks = Bullish/Neutral
• McClellan Index - (MO) [The very rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks .] MO fell to +46.12. Over past three months The MO has had problems getting over +30. This is, therefore, the highest the MO has been since early September 2010. We haven’t hit +60, but for stocks = Bearish

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Reading The Tea Leaves

Little change from yesterday, except that the leading emerging markets are even more overbought and overdue for a correction.

Bottom Line - No Black Swan events have been able to seriously impact the Fed liquidity driven equity market.

What to watch today - Market movers - UUP (the dollar) still has most influential, unless others make some huge move.

• USO - ETF for oil - Oil up = stocks down - Now back above $100. - Headlines from Libya not good.
• UUP - (Tracking ETF for dollar) Remember - The dollar is a contrarian indicator. Bad dollar = good stocks
• AAPL – Tech giant and market mover – Trading below its 50 DMA. Since mid February this char shows a series of lower highs and lower lows = Bearish
• Japan Rector Developments – This keeps getting worse.
• EEM – Emerging market ETF – On a breakout run, but getting  way over extended.

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Positions

UCO -(2x oil prices) Why not, its also a hedge against higher gas prices. Historically driving season in summer drives prices up in the late spring. Supply problems exist because of revolutions/instability in oil producing countries. If these problems are resolved then UCO should NOT be held.

REMX (Rare Earth ETF) - Really believe this a good long term holding.  Simply put because of limited supply of rare earth metals and big demand is going to outperform almost all other sectors. Only some sort of major economic collapse will hurt this sector. A buy.

DGP – (ETF is 2X gold) and/or SLV (silver). AGQ (2x silver) Both inflation worries and a falling dollar positively impact this sector. Silver actually has a manufacturing component.

RJA (Agriculture commodities Index) For a more complete list of commodity ETF’s see POSITIONS

UWM (2x small cap stocks) or TNA (3X small cap stocks) The later for more aggressive traders. Closest correlation to MO and falling dollar. Small cap stocks are outperforming.

EEM (emerging markets) and/or ILF (Latin America) EDC (3X emerging markets) The later for most aggressive traders. Emerging markets are leading the world and after underperforming for years they are back.

EWV (ultra short Japan) The horrific and tragic situation there has been minimized. This holding acts in part as a hedge especially for US small cap stocks and emerging markets.

TMV (3x 20+ year Treasury yields)

A winning hedge has been UWM & EWV combination (some of you may have problems emotionally shorting Japan)

ROM (2x techs) & TYH (3x techs) The later for most aggressive traders.–  Technology has been toasted and if the S&P is higher on June 30th, this sector should catchup.

I’ll keep this on the blog’s home page for a week or two then place it ion the Positions page.

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Your Stock List created 3/7 has underperformed the other 3, because it is overweight tech stocks. A major tech stock, Texas Instruments, bought another company and this should help the whole tech sector today. Paul R often comments on these and other stocks/sectors in the comments section of the blog.

Look for Paul R’s always enlightening remarks on stocks and sectors in the comments section of the blog. See “POSITION“ section of blog (at top of page) for lists of potential stocks & ETF’s including “YOUR Stock List.“

Popeye & Mama Jama (AKA Olive Oil)

Your Comments

Mama Jama – Are 25 hedge fund managers are worth 658,000 teachers? The 25 moguls/oligarchs who run the giant hedge funds and only get taxed at 15% are earning $25 billion a year vs and average teacher whose salary is 38k per year (plus benefits) and being taxed at 28% – Only in America.

Want to learn more about the Ten biggest Lies or Distortion Wall Street is feeding Main Street from Les Leopold

Popeye - This comment caught both Paul and my attention yesterday It summarizes globalization & US political impact on Main Street – Big business no longer needs the American consumer to grow. To them the Chinese consumer is replacing them. (You could replace China with the word emerging market consumer)

So not only are jobs being outsource, but so are consumers.

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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

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Technicals, Fundamentals & Analysis

Investors411 record – 5 years of beating benchmark S&P 500

• Markets were flat & volume abysmal AGAIN
• Yesterday rare earth metals exploded higher. The new ETF for the sector REMX was up over 7% on a climax run.
• Can’t emphasize this point enough - The Fed has now accumulated over a trillion dollars worth of T bonds  from its 21 Prime Dealers (Big financial institutions) These institutions all have trading desks that invest a lot of that money in stocks. It also helps to keep a lid on Treasury yields and the new currency helps drive down the dollar. Without quantitative easing and low interest rates stocks would not have made the gains they have over the last 18+ months.
• China has almost cornered the market on rare earth materials.

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Reading The Tea Leaves

We had some odd moves on the significant forecasting tools (see above) and No real reaction from stocks.

However, if the dollar and T bill yields continue to fall like yesterday  - It sure looks like the Fed’s manipulations through quantitative easing and low interest rates are having a significant impact.   This would be good for US stocks. Two points investors are looking at suggest quantitative easing may continue/ morph into QE3#

• The deep economic trouble of state budgets (see Meg Whitman’s comments in last weeks blog)
• Continued high unemployment.

AAPL the world’s #! tech stock is the canary in the coal mine. If the General rolls over watch out.

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Positions

• #1 UWM - (2x small cap stocks ETF) – Sold 1/2  for +9% profit
• #2 UWM
• EUO - (double short the EURO currency)
• UCO – (double long oil) Bought Tuesday at  12.39 (this is a trade of short duration)
• SLV – (Silver ETF) Bought Wednesday at (see comments section of blog.)

Selling 1/2 of UCO at open and putting a 2% stop loss on the rest. This ETF is currently at the price it was bought for. See yesterday for explanation)

Buying GDX – (The double gold ETF) –  A lot of the rise in price in gold has to do with the Fed’s print and dump of money. It says instability and gold says stability. GDC has dipped recently.

SLV has reacted technically even better than gold. It also has industrial uses

EUO have a stop placed at what it was bought for. It’s about 2% above that right now.

Your Stock List – Paul informs me that YSL#3 is currently under performing the benchmark S&P 500 +5.05% to +3.78%. Disappointing results However, there have been 13 gainers vs. 3 Losers. – It’s been two of those losers that have dragged down the entire list. Both are Chinese internet relate stocks that have big losses – BIDU & especially SOHU (More later)

UWM – The Critic informs me that the UWM (our major ETF position) that was bought on the same date as YSL#3 was published (11/22) for 35.76 is up +22% over same period. Since Investors411 has both bought and purchased double and triple positions in this market basket ETF, she is compiling a more complete record.

I’ve tried a lot of other ETF’s that have been less successful over the same period. Example EEM, which was held on the same day UWM was purchased was sold earlier for a +4% profit.

Comparing the two is like comparing apples and oranges. Especially since many of the ETF’s turned out to be short term trades.

Diversity is the key here. I strongly feel that having both ETF and stock selection has merit and is a way of diversification. YSL numbers 1 &2 outperformed the benchmark S&P by over 2 to 1.

Let’s give it all more time before the final results are in. Then learn from what was done.

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Look for Paul R’s always enlightening remarks on stocks and sectors in the comments section of the blog. See POSITION section of blog for lists of potential stocks & ETF’s including “YOUR Stock List.” (YSL)-

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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

Technicals, Fundamentals & Analysis

Investors411 record – 5 years of beating benchmark S&P 500

Major news yesterday and today is Spanish debt. Spain is a major country in the EU and if Spain goes down all of the EU get shaken to its roots.  This is making the Euro weak and therefore the dollar strong. This is important. Europe got hit by the 2008 financial meltdown and because of how their monatary system is structured its far harder to smooth over the bumps as our FED does.

Additionally the 10 year T bill yield is still rocketing ahead

Too early to tell if this is a much needed and healthy correction in stocks or something deeper. I suspect the first.

There is also plenty of reasons to be fundamentally bullish.

Reading The Tea Leaves -

Spain is Europe’s 4th largest economy and its 10 year T bill is trading at 5.53% (relative to ours at 3.52%). The posablitity in investors/traders mind of run away inflation in Europe and the USA is growing. Stocks have historically handled a beginning of inflation well, but if it gets too large everything suffers. The good news in all of this is deflation (a much more significant problem) seems off the table. Could go on for thousands of words but here’s the

Bottom Line – Quantitative easing over the past 18 months has kept stocks surging and stabilized our economy. Europe is having a major negative impact on us and it looks like right wingers and others are going to challenge or put road blocks in front of our FED.(I’m all for more transparency, but these guys want to destroy the FED – lead by Ron Paul.)

Right now quantitativ easing is NOT having some of its intended effect of keeping the dollar lower and the T bills/bonds yield low.

This is going to make for a bumpy ride and perhaps  changes investment strategy.

• EUO – an ETF that double shorts the EURO
• PST – an ETF that double shorts 7 to 10 year treasuries.

Of course, this would be a buy the dip situation.

Positions

• EEM - (Emerging Markets ETF) -1/2 positions sold
• UWM – (2x small cap stocks ETF) – 1/2 position sold
• UWM-
• UWM

Putting stop on 1/2 of  last UWM position at what it was bought for. 40.94 or sell 1/2 for minor 1% gain near open. 2% trailing stop on the rest.

Very Interested in UCO – double oil ETF, but still waiting for dip.

Look for Paul R’s always enlightening remarks on stocks and sectors in the comments section of the blog. See POSITION section of blog for lists of potential stocks & ETF’s including “YOUR Stock List.” -

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Crunch Time/Elizabeth Warren

Perhaps the best result of the Financial Reform Legislation could be  a strong Consumer Protection Agency. Over the past few years Investors411 has beat the drums for the stand and policies of Elizabeth Warren. She would be an ideal choice for the agency, but has strong opposition from influential Senators like Democrat Chris Dodd (He approved the big financial bonuses for bailout TARP shadow banks) WaPo thinks there is good shot she will get the job.

Matt Taibbi

The Rolling Stone’s Matt Taibbi has an excellent editorial on “Wall Street’s Big Win.” The win, of course, is the new financial reform package that became law. Taibbi nails Republicans and Democrats (including Dodd) who gutted financial reform legislation.

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.

Individual companies may be doing well, but earnings season is basically over. The focus now turns to economic news and from China to the USA (talk of GDP growth being revised down in USA from 2.4 to 0.2 in 2nd quarter) the news has not made investors happy.  We’re not falling over the cliff, but even the BB/HFT traders need some series of economic fundamentals to hang their hats on.

Therefore, don’t see bulls getting out of the corral until the market becomes more oversold.

Same story of bigger volume on down days that has been the hallmark of US indexes for many moons.

Significant Indexes

• The Dollar (USD)  [Anything price move over +/- 0.50 is significant] The dollar rose 0.42% yesterday. This confirmed a massive +1.84% move the day before. Very bullish for the dollar but for stocks = Bearish
• The Baltic Dry Index (BDI) [measures cost of world trade/proxie for China & emerging markets] Rally +2.48% yesterday. Has broken up through 50 day moving average & upside momentum slowing. Overall trend  = Bullish
• McClellan Index – (MO) [The rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks.] MO fell to -38.98 Approaching oversold, but still = Neutral

Reading Tea Leaves

The dollar is the key index to watch. The larger currency market is almost  dictating what happens to US stocks. You can follow (or invest) in it by watching the dollar bull ETF – ticker symbol UUP. If UUP goes up, stocks go down and visa versa.

The dollar closed at $82.64 and the first significant resistance level is the 50 day moving average at $84.06 ( 50 dma is falling each day). So there is a ways to go before we reach this point.

Positions

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

Current positions - NONE

From earlier this week - “The Bulls seem to be loosing control.” The MO has fallen to -39 & we are approaching the -60 oversold level.  The lower the MO goes the better the chances whatever long position you take has of making at least short term gains.

A number of you have asked or are investing in stocks with high dividends.  This gives you a second revenue stream – the dividend that is in some cases higher than what you can get in CD’s. The problem of course is will the stock go up or down. Here a list of top ten dividend stocks from an author in at Seeking Alpha.

FXI, EWZ, EEM, EWY, & EWS are the courty ETF’s recommened for consideration when conditions are appropriate. Also GLD on dips.

Also considered are ETF’s that mirror or do 2 or 3 times what major indexes do.

YOUR Stock List last generated on this date (scroll down) Have not gone over these recently.

More agressive traders could start to buy the dip. Longer term investors may want to wait for stocks to move lower.

Long Term Outlook – NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

R. KY Senator Mitch McConnell

Blocking Financial Reform

Republicans are considering blocking even debate on financial reform. Ewanapat thinks I’d like his comment/information/link. He’s wrong I Love it. The 3rd Fed Governor publicly has come out against the “shadow” banks that are too big to fail.

There are a few sensible Republicans (Simon Johnson and his Baseline Senerio best source on this) who are bucking Republican Minority Leader Mitch McConnell (see yesterday’s Investors411) do nothing approach.

Taxes

Mama Jama has sent in a link to a site that reales 80% of major corporations evade taxes by having offshore accounts etc. How much does this cost you? $637 in MA and small business has to pay their full share.

Tea Party Flops

Only a 1500+ showed up for the supposed “huge” final day of tea party tour on April 15th (Tax Day) in DC yesterday. A few thousand more showed up in Boston the day before but NOT the newly elected  Republican Senator or the Republican running for governor. They called the Obama administration a “gagsta government.”

Remember we many demonstrations of 10,000 20,000 and even larger protesting the Iraq war and other left of center issues all over the country and there was almost no coverage. Yet even on the financial channel CNBC they are headlining the Tea Party protest this AM.  This is

The issue of deficits is real, but the media distortion of the Tea Party is real too.  We live in a world created by media and the thousands of past protest that get over 1500 people in DC never got the kind of coverage that the Tea Party gets. This is media bias or media manipulation.

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 for changes made each weekend

US markets improved a bit on Wednesday’s significant gains in above average volume = Bullish.

Google had  earnings report = an almost 4.71% fall in post market trading = Bearish

BAC (Bank of America) seems to have had blowout earnings numbers this AM up @1.5% = Bullish

Something called a Fibonacci retracement is important in worked of technical analysis. The benchmark S&P 500 is sitting just below a critical 62% retracement from its 2008 high according to analyst on CNBC. This is a strong resistance level. = Bearish

Significant Indexes

• McClellan Oscillator fell to +8.67 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is still in NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – rose +0.36% yesterday. [Anything over +/- @0.50 is significant.] Mantra – right now The Dollar Rules Remember, dollar down almost always = stocks up. The dollar broke though its 50 Day Moving Average support level and next significant support and yesterday rose to just below resistance (Remember the 50 day MA is called its support on the way down and resistance on the way up).

Positions

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

I realize the TYH explanation will make some of your eyes glaze over because it is too technical. The best time to buy is when the McClellan is oversold and any trades now (McClellan Oscillator is neutral) is riskier.

TYH – (10%) (3X technology) Up well over 3% since bought. File under - If its not broken don’t fix it Mistake? – In the past Investors 411 sold 1/2 when TYH rose 3% and let the rest ride. Then I put a stop/sell order at what it was bought for or 3% below what it was bought for.  Bottom line here – selling 1/2 into any minor rally.

UWM – (5%) (does 2X small cap stocks) Bought yesterday at 37.57. Stop/loss set at 7% below what it was bought for

EWZ – (10%) (Brazil) Holding on

Monday’s are usually good days and some major tech companies report next week. So expect stocks to drift higher into the close.

Caution – Holding individual stocks into earnings is obviously dangerous – Even giants like INTC (+5%) or GOOG (-5%) can make huge moves. Smaller stocks even greater.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

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The Illusion of Democracy

In the USA we have an Illusion of Democracy. What we really have is a rich oligarchy that buys votes through money any lobbyists. Lets use two blatant examples.

• The Billionaire ultra right wing Koch Brothers - JAB a few days ago sent a link to a site that quantified and qualified the $50 million they have spent to influence the American public’s vote. These right wing zealots with their $50 million sure have vastly more of an impact than you do with your one vote.
• Let’s look at politicians who get this money – Great site to see how much your representative (Dems or Reps) is bought and by whom is OpenSecrets.org. Today’s focus Senate minority leader Mitch McConnell.  His leading contributors are shadow financials (securities & investment) at $1,147,924. Republican leadership just met with Shadow Financial and other Wall Street leaders on financial reform. Even ultra right FOX Business news carried the story

From the Tea party workers to the leadership of the Senate (include lots of Democrats in this) the truth gets distorted by the vast financial resources and screamers in & reported on by the media.

Yes, along with JAB I still boycott Exxon, and have now added Koch Industries (Georgia Pacific -paper products) to my small protest.

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 for changes made each weekend

I really try to make this stock section as simple as possible, but I certainly hear your public (see comments section) and private pleas to make it simpler.  Over weekend I’ll put together some simple rules, strategy and sources

Big volume + Big rally = Bullish Outlook

UPS – world’s biggest package mover clobbers expectations. = Bullish

Weekly jobless claims worse than expected – two weeks in a row – Bad for economy, bad for Obama politically, but neutral for markets.

Reading the Tea Leaves – Add UPS to JPM & INTC results yesterday and you get the financial and technology sectors growing over expectations. Add more packages are moving across the globe. Add the Dollar dropping and McClellan Neutral (NOT overbought)  Everything at least till the McClellan gets overbought says Bulls will continue to stampede.

Its time to buy the dip and ride this rally till we enter overbought territory on the McClellan Index.

Significant Indexes

• McClellan Oscillator rose to +19.34 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is still in NEUTRAL territory – technically neither overbought or oversold.
• US Dollar – fell   -0.42% yesterday. [Anything over +/- @0.50 is significant.] Mantra – right now The Dollar Rules Remember, dollar down almost always = stocks up. The dollar broke though its 50 Day Moving Average support level and next significant support at @$79.5. Dollar closed at$ 80.19

Positions

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

Right Now, as I read the tea leaves, it looks like the beginning (first week+) of earnings season is going to be a bullish period and it would be good to be invested in those stocks/ETF that are going to move the highest.

Example, Yesterday Investors411 added a 10% position in TYH the ETF that does 3X what the tech stocks do. Price 174.1.  Originally, had planned to hold this for a small gain (3+%) but it now looks safe to hold till the McClellan Oscillator hits or gets close to overbought territory.

Depending on your level of risk – Buy dips (1 to 3% = dip) of following ETF’s – You can also check out YOUR stock list.  but as Pail R suggests – watch out for when earnings reports ate (google company and you will find date or your trading platform should provide this)

List from MOST risky to LESS risky

• SOXL – 3x semi conductor stocks – Warning very thinly traded.
• TYH – 3X technology
• UWM – 2X small cap stocks
• ROM – 2X technology
• SSO – 2x S&P 500

I will be adding another 15%+ of these on dips.  Remember once we enter overbought territory its time to sell or lighten up. Set a stop/loss at a level you feel comfortable with. 7% maximum loss is what I use.  Once a stock goes up I usually raise the stop. There are more sophisticated ways of doing this, but I’m keeping it simple.  Investors411 will be exiting these positions as we come close to or over +60 on McClellan Oscillator.

Remember its a short term trade. It’s natural for their to be a dip today. If markets fall over 50% of yesterday’s gain in bigger volume this strategy is in trouble.

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Frank Rich

“The… Obsessed and the Deranged“

There is a symbiotic relationship between governments and capitalism. Without the checks and balances, or regulations from government capitalism will allow greed to run wild. The catastrophic 2008 economic meltdown was just another example of the long line of history that keeps repeating itself. Obviously capitalism works economically better that pure socialism, but when human being whose only bottom line is profit are left alone their schemes explode in bubbles of over leveraged greed.

The NYT’s Frank Rich has another excellent editorial similar to the one in Investors411 last Monday. His focus was on Francis Joseph Stack III, the terrorist/right wing hero who drove his own plane (he was rich enough to own a plane) into an IRS building to protest his tax situation. Rich has a far more extensive list of anti tax right wing zealots and politicians who give Stack III a pass or praise.  Urge you to read his editorial  “It’s enough to make you wonder who is palling around with terrorists now.“

George Soros

Economic Hit Men

(Part 2)

Banks are the good guys – It’s the loan sharks, or almost  totally unregulated entities that bring economic systems, taxpayers and countries to their knees that are the economic villains. Technological innovation is great for financial institutions, but unregulated it can also create over leveraged Frankensteins from AIG to Lehman Brothers.

Niall Ferguson, in his book The Ascent of Money points to two other financial entities that are today’s “economic hit men” – Hedge Funds and Sovereign Wealth Funds. Both can place massive amounts of highly leveraged capital in short positions against a currency,stock,  bond, or country.

• Hedge funds are almost totally unregulated entities that pool money of ultra wealth individuals and can leverage it in a multitude of ways. There are thousands of the hedge funds who often take highly leveraged short positions on for example the survival of Greek bonds. (A current example). The “capo dei capo” of hedge funds is multi billionaire George Soros (also a major Dem. fund raiser)
• Sovereign Wealth Funds have even more capital than and they can use their power as an economic weapon to take over or crush other economic entities.  “More powerful” than hedge funds and centered primarily in Arab dictatorship’s and China their power is staggering. Ferguson cites (page 358) a 2007 Morgan Stanley report “That within 15 years they could control just over 9% of total global financial assets.”

Bottom Line – There’s a Financial war out there. Some may call it a competition. There are some major sharks that are circling debtor nations (us) – Shadow financials, hedge funds, Sovereign wealth funds. SHARKS BITE AND GO INTO FEEDING FRENZIES. The more in debt you are the jucier you look to hungry sharks

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 over weekend.(No changes this weekend)

Last Week’s Fearless Forecast

“Everything technical (volume & McClellan) is showing that we are running out of rally room…Rally Ho, but it gets sold off at end of week.”  US Markets were down 0.4 to 1.5% for the week, so the Forecast, for the most part was accurate.

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Chili earthquake is going to impact copper prices – Chile world’s #1 producer of copper. Earthquake means copper prices going to rise.  In Boston all we’ve had is some rain, but up and down the East cost huge amounts of Snow will have a negative impact on the US economy.

Internationally the acronym to remember is PIIGS – Portugal, Ireland, Italy, Greece & Spain – These are the European countries, like the USA that have over leveraged debt problems.  The difference is these problems are peaking now & ours have been covered over by less transparency ant trillions of dollars. This comparative weakness will continue to make the dollar stronger & a stronger dollar usually means weaker stocks.

————

This Week’s Fearless Forecast

The US markets are trying to rally, but economic fundamentals seem to be moving in a different directions.  Similar situation to last week. Markets looking to rally, but economics keep declining.  Call – Flat week. – Rally gets sold into at end of week.

Significant Indexes

• McClellan Index rose slightly  to +31.71 We are somewhat oversold, but have a ways to go to +60 Oversold territory.

Positions

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

No change in major ETF positions.

ETF Positions

• 10% of portfolio EWZ (Brazil)
• 6%of portfolio FXI (China)
• 10% of portfolio MOO (agriculture)
• 3% of portfolio IMAX (3D)
• 2.5% of portfolio TYH (3x what techs do) (Down from 7.5% last week)

Will be lightening up when/if positions reach oversold 0n McClellan Oscillator.

Also,  Set what’s called a stop/sell orders on at @ 3% above what it was bought for

• recently bought (added to) EWZ
• 1/2 of MOO, a longer term position.
• The remainder of THY

Stocks

• IMAX – doing fine – really hope this will be a long term hold – and there will be other dips to buy into on the way up.
• Looking for entry point to buy PRLN & VPRT as well as some other stocks on YOUR watch list (scroll down on link)

Other stocks on YOUR watch list - the earliest I would nibble is when the McClellan Oscillator falls below 0 (zero)

Not adding to any major ETF positions until markets become oversold again.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Bubble’s Bursting

YOU feel like you’re standing in a room and looking around with everyone else to see if anyone else notices there’s a massive time bomb about to go off and no one is doing anything about it. You watch politician’s babble about cutting waste, foreign aid or welfare recipients and realize that’s what’s been done for 20 years and there’s less than 2 or 3% of this budget left to cut. Here’s the naked reality

• Medicare & Medicaid are going to explode in cost as baby boomers reach retirement
• Social Security payments are going to explode too. Each of these entitlements alone dwarfs political babble about cutting waste etc.
• Military/weapons spending exploding higher and now is the #1 government spending category
• Tax cut advocates are screaming for more and crashing planes into buildings
• Our shadow financial system has drained trillions in further resources and remains in the shadows.
• Health care cost are exploding out of control
• Massive private debt (credit card,housing,job loss etc) is driving many Americans into despair.
• Massive debt crisis in US  trade
• Housing bubble has burst

When you consider all this it seems like a miracle that Obama has kept the American economy & the stock market afloat.  Politicians on every side think more their own power instead of getting something done.  You get so sick & tired of listing to politicians blaming others and calling for “a dose of reality” instead of sitting down together and getting something done. Meanwhile – Tick Tock, Tick Tock, Tick Tock – BOOM.

Investing Bottom Line – These financial liabilities and our inability to solve them are why it is  no longer safe to buy and hold US equities.  The potential of financial bubbles growing and bursting are just too great. Our government just too polarized. It’s hard to see a decade without continued financial meltdowns.

Death Toll = 1000 in Afghanistan

Obama has joined Cheney/Bush and continues to try to nation build in Afghanistan. US on Feb 19th reached 1000 casualties.  Obviously, the surge of American troop here has a lot to do with upcoming wars in Iran (Afghan. & Iraq surround Iran) and Pakistan (Afgan also boarders Pakistan).  We’ve seen our military budget double over the last decade and its continuing to grow perhaps faster than Medicare, Medicaid and Social Security will.

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 over weekend.

US Consumer Confidence plunged yesterday. The monthly index had just hit a 16 month high and it plunged yesterday. Simply put Consumers are worried about the economy. They make up @ 70% of GDP.  After a solid 3 month rise the unexpected fall from 56 to 46 could means the consumers fell like they took it on the chin last month. This is bad news for the US economy, but many US stocks are rebounding because of Asian and Emerging market growth.

There is obviously a disconnect between US stocks and the US economy US Stocks can rise without the US economy because many of them rely on profits from abroad.  But, Europe is in trouble and emerging markets alone are not big enough to carry the res of the world.

Markets fell as volume rose. Volume was slightly above average. Would have expected more volume. Surprised that US markets did not fall further.  Another indication that many long term investors are simply not interested in stocks = Bearish signal

Two Major events today. Toyota’s embattled CEO & Bernanke in front of congress

Significant Indexes

• McClellan Index fell to +18.33. + or – 60 is our overbought/sell or oversold/buy levels.  +18.33 is approaching neutral or 0

Positions

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

Sold another 1/3 0f TYH at 131.35 for a +6% gain. I’ve also set what’s called a stop/sell orders  on

• recently bought (added to) EWZ at @ 2% above what it was bought for
• 1/2 of MOO, a longer term position.
• The remained of THY

This is just protecting gains before they turn into losses

McClellan Oscillator is not close to buy or sell position.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING