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Want To Live

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Go To Denmark

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Denmark and almost every other Western Democracy has

more upward mobility than the USA.

Even the Latest Republican presidential star Rick Santorum  agrees

See Jason DeParle front page NYT article

WHY?

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Income Inequality

How Income Inequality Harms Societies

Click on Photo for Video

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Dr Richard Wilkinson presents what is perhaps the best TED presentation of 2011, You all know the Truth of what Wilkinson is saying…

“Income inequality is divisive and socially corrosive, its been around since the French Revolution…What’s changed is that we can now look at the data and see what that inequality does.”

Using UN and World Bank data Wilkinson starts out comparing gross national per capita income of 20+ market democracies – Gross income has no or little relationship to the well being  of countries (the USA is at the top in income)

But when Income Inequality between countries and within  countries is measured,  well being has a massive correlation on the following categories (the USA is at or near the bottom in every category)

• Life Expectancy
• Trust
• Math and Literacy
• Infant Mortality
• Homicides
• Imprisonments
• Teenage Births
• Obesity
• Mental Illness
• Drug Addiction
• Alcohol addiction
• High School Drop out Rate
• Child Well Being
• Education Scores
• and of course Social Mobility

You can view an entire list of the data and charts in a couple minutes HERE

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Rich Developing Societies have reached

A Turning Point in History

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“Politics should be about social relationships and how we develop and sustain societies”

Bottom Line – Wilkinson genius – The measurement with hard economic data of what gets worse in countries and societies when the rich and poor move too far apart.

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STOCKS

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Wall Street Bull and OWS Symbol

• The correlation between Europe and the USA is wakening, but still significant. The Bulls are gaining more control in the USA

• Our #1 technical forecasting tool, the McCellan Oscillator (MO) fell to +41.14 . 50DMA at +2.02 A wee bit of bearishness, but still room for rally to grow (for more see  STRATEGY link at top of blog) = NEUTRAL/bearish

• The major trade war between the USA and Iran has consequences. Investors/traders should be long Oil. USO, UCO or Oil related stocks (See YSL 2012)

• My single largest holding remains EUO (double short the Euro) This is because it sure looks like the Euro will continue to be devalued.

• Over weekend I will try to update Positions section of blog to reflect changes made this week and 2012 outlook.

For those who have an options expiration on the 21st.

Remember if you are out of the money the option will degrade even faster the closer you come to the 21st. (12 days)

MOS has traded between 44.7 and 55 over the last 12 days. If your Call/Put was placed at 52.5 you need about a 4% move either way to make a profit. One item in your favor is that we are entering earnings season next week and things almost always become more volatile.

As stated in the comments section lots of yesterdays rally was short covering and not fundamentally based.

Odds are you will see a 4%+ move above or below 52.5 in the next 12 days, but the trade is no longer based on the earnings report. MOS is currently at 53.50. Technically, because it gave up 1/2 its gains yesterday its outlook for today is a wee bit bearish. But that’s just for today.

All – Also remember you can sell the Put side too if its value is more than the commission.  Example MOS goes up and you sell your call next Wednesday when MOS is 54.5 You make (guess) 30%  By Friday  MOS has lost 5% of its value and each Put is then worth (guess) $30.

MOS could also shoot up to the moon. MOS is up a bit in pre market trading.

Obama’s Speech

Here’s today’s lead editorial in NYT Obama needs to  “follow through — with more energy and dedication than they have shown so far.” The NYT was one of the best reviews I saw others were a lot harsher. Bluntly – great speech, but where’s the beef?

The rock and the hard place – So far BP’s stock has lost @50% of its value. You push these SOB’s too far too fast and the company disintegrates leaving the taxpayers to pick up the bill.

America’s Debt

Who is the biggest holder of America’s $13 trillion dollar national debt? Hint they hold over $5.2 trillion of it. Slide presentation on Huffington Post was a big surprise to me. The 15 biggest holders of US debt-Link here

Who holds 40% of the national debt and what does that mean?

Tea Party

Tonight at 7:00 PM EST Chris Matthew’s will have a documentary “The Rise of the New Right” on MSNBC. I suggest that you watch it on line or see it live.

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	+2.10%	up
NASDQ	+2.76%	up
S&P 500	+2.35%	up
Russell 2000	+2.53%	-

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

Technicals, Fundamentals & Analysis

Another low volume major move for US indexes that crushed significant resistance levels for several of the major indexes = Bullish.

As stated before, volume has NOT been a factor in trading for many many moons.

From yesterday – “FXE (tracks the EURO) is the ETF to watch along with Spain’s EWP”  FXE was up a very significant +0.97% & Spain was up @ +5.75% along with Italy. Spain and Italy are the two largest of the European PIIGS + Hungary nations that are having debt problems.

The MO has reached Overbought territory = Bearish

The Baltic Dry Index BDI kept falling – It’s dropped well over 25% of its value in the last month. Since the BDI measures shipping rates this fall is NOT good for world trade, economics. The BDI is often a lagging indicator,. For stocks = Bearish

Significant Indexes

• McClellan Oscillator rose dramatically to +79.56 [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO) LINK. –  & Investopedia on –  How the MO works. You have to go back to March of 2009 to find a higher MO. Clearly  Oversold = Bearish
• US Dollar –  The dollar again fell significantly -0.82% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important.For stocks = Bullish

Reading the Tea Leaves - The HUGE institutions that control 80% of the market ran wild yesterday. Their black box computers all gave a buy signal in front of what’s called a “quadruple witching day” on Friday – This means lots of options expire so there’s usually lots of volatility and trading. Except few outside the Mega Sharks (huge institutions) are investing or trading- so volume has dried up but not volatility.

The Mega Sharks seemed to have decided that Europe is going to be OK & will rally like the US did when Obama took office and the Fed flooded our shadow banks with $$$$. Back then the MO pushed up over +100 and stayed above +20 for 2 months as stock continued to rally.(see chart) Its now at +80.

A similar situation with the EURO could be happening. Don’t let American self centerdcenternessness get in the way – Europe total GDP is slightly larger than ours. We had another day where treasury auctions in Spain & Ireland went well. Just like they have had in the USA for over a year. Therefore, what happens there matters.

Even though we are now clearly oversold, we could see a sustained rally (couple months) develop. The dark cloud in all of this is the falling BDI.

Personally, what’s happening fundamentally does not justify, the rally. It’s Irrational, especially with falling trade (BDI). But mega giant sharks/institutions control this market and what anyone thinks outside their giant computers is irrelevant. The mega sharks control of stocks are a quantum shift from old trading patterns and rules. (best examples – volume is irrelevant & huge volatility in currency markets)

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own – Updated over weekend

Sold 1/2 of UUP (ETF tracks dollar) for small loss at 25.08 -2% Will probably sell rest today

Sold VCI at 38.00 for +15%

Traders – +80 on the MO is the signal to sell what remains or short any rally.  See Positions section for some ideas.

Investors – Some of YOU commented (see comments section of blog) that you sold into the rally. Good idea. I’d sell into a rally today also.  No one went broke taking profits. When the MO dips down to @+30 you can nibble.

From Yesterday – “Not the technical breakout we were hoping for. Let’s wait till the resistance level actually falls to change the outlook. Maybe today .” The technical levels fell and the long term outlook = NEUTRAL

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

1967 TV Show Lost In Space-

Danger Will Robinson Danger Danger

It’s time to take out the Old Lost In Space TV show robot with all its bells and whistles and  have him flap his arms and announce Danger Will Robinson Danger Danger.  We’ve reached a critical technical support level of the US stock market (see stocks below) and if that level falls you could see growing panic.

The fundamental behind all of this is the revaluation of European currency down and the US currency higher. This reflects the worsening shape of Europe’s economy. Eventually a lower Euro will mean their goods will cost less to export. This will help their recovery. Relatively it means a rising dollar. Therefore, our goods will cost more to export. This will hurt American companies that export and cut profits.

It looks like the Central Banks across the world will step in to soften the fall. But right now a fall seem very likely. Lots more below under Stocks

Your Comments

Some Great threads going in comments section. See comments on right side of blog

• Paul R and others on stocks.
• Jim J., John S. & Popeye on Israel
• Yankee Bob and others on BP

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	-1.16%	?
NASDQ	-2.04%	down
S&P 500	-1.35%	?
Russell 2000	-2.44%	-

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

Technicals, Fundamentals & Analysis

The Bears Growled Again Monday. Sorry had a hard time reading volume charts (see right side of blog) and click on each Financial Chart in light blue on right side of blog.

Volume has NOT been as relevant as it has been historically as a confirmation factor. This makes the day after a major move more significant. Another decline (about 50% as big as Friday’s) is bad news for bulls. You can feel the fear investors have. = BEARISH.

The benchmark S&P 500 reached 1049.86 – a closing low for the year = Bearish

There is two interday lows that were lower this year – the lowest at 1040.78 (see chart) This is the line in the sand major support level for most technicians. Breaking this could open the DANGER WILL ROBINSON DANGER DANGER Floodgates. For right now it’s holding = Bullish

Approaching support with a lot of downside momentum (last two days), a rising dollar, and not yet over sold MO (see below) gives the bears a big battering ram. = Bearish

Significant Indexes

• McClellan Oscillator fell dramatically Friday to -47.68 [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO) LINK. –  & Investopedia on –  How the MO works. Momentum down/Bearish, and approaching oversold. Remember in the past month+ twice the MO has fallen to over -120 So the MO can go much lower than -60 = NEUTRAL
• US Dollar –  The dollar rose +0.25% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important. Massive breakout to new high is bullish for dollar and for bearish for US stocks. That big breakout Friday was confirmed by yesterday +0.25% gain = Bearish

Reading the Tea Leaves . Expect central banks to intervene and BUY the Euro to stop the growing panic. They might get overwhelmed by fearful investors today. Eventually it will fall. The fundamentals in Europe are bad (See Investors411 over last few weeks)

Would expect some sort of relif rally today after two days of significant price declines and strong support level in front of us. But watch out later in week.

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own – Updated over weekend.

From Yesterday – “ SDS (2x Short S&P 500) Will sell 1/2 for hopefully 5% profit.”  - Sold 1/2 SDS (3% of portfolio) at 37.32 for +8% gain. Letting the rest ride for now.

From yesterday – Small remaining 1% positions in VCI & ESRX - Also considering selling into rally – Still Have VCI and ESRX will probably sellone or both into any rally this AM

The only position Investors411 has is a 3% in SDS (ultra short S&P 500)

Others we should be in include more ETF’s that short/ultra short major indexes, GLD & UUP (mirror’s dollar) Wating  for dips and MO to be higher to buy. These are all contrarian plays.

From Yesterday – Invetors411 main strategy remains wait for the McClellen Oscillator to fall below - 60 before going long.

Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

What’s happened to the Change We Can Believe In?

Obama – “I was Wrong”

Obama has admitted he was wrong to trust BP in his mea culpa on the gulf oil disaster. He’s obviously also wrong to trust that shadow banks will act in the interest of the USA. Even Apple or Google (for all their good PR) bottom line is their profits. What we need is a regulator of regulations that prevent greed from running wild. (See Popeye’s comments)

So Obama – Do something and stop dithering. There is a myriad of choices besides correctly blaming BP/Transocean for the disaster.  Solutions from take them into temporary  receivership to adding a tax on gasoline to pay for the clean up. You could create hundreds of thousands of jobs hiring more people to clean up the mess.

Fed Manipulation of Currency

The admission that our Fed is manipulating the currency market is really no surprise. Investors411 has suggested this for weeks. What is a surprise is that the German Finance Minister Rainer Bruederle has openly admitted it.

Bottom Line is Bernanke manipulates currencies. This may be totally unconstitutional. Stabilization of the dollar/Euro relationship is in short term = Bullish

Turkey+Israel+Gaza = Crisis

Israel has boarded Turkish ships 80 miles from the coast in international waters. This was much publicized relief effort for Gaza. 9 protesters died including Turkish citizens. Some ships were taken to Israeli post. Turkey is a member of NATO who has very specific treaty obligations about “acts” committed against its members.  This includes treaty relationships with the USA. Reports “Total Rupture” of Turkey/Israeli relationship possible. Other ships on the way to same area. = Bearish

This situation is developing minute by minute Google “Turkey Israel” for more

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	-1.19%	down
NASDQ	-0.91%	down
S&P 500	-1.21%	down
Russell 2000	-1.33%	-

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

Technicals, Fundamentals & Analysis

Markets down in light pre holiday trading and news of lowered Spanish bond rating = Bearish

The admission that our Fed is manipulating the currency market is really no surprise. What is a surprise is that the German Finance Minister has openly admitted it. Stabilization of the dollar/Euro relationship is in short term =  Bullish

Fearless Forecast Last Week = “Down Week” Dow was down, NASDQ was up.

Fearless Forecast This Week – Fed manipulation of currency make a forecast almost impossible. North Korea, BP oil disaster, and now Israel/Turkey/Gaza makes for a lot of negatives = Down Week.

Significant Indexes

• McClellan Oscillator fell to -26.55 [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is in NEUTRAL territory, but we are now out of WAY oversold territory. How the MO works.
• US Dollar –  The dollar rose  a significant +0.54% [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules is very important. Currency markets are now being directly manipulated by out Fed and other central banks. This manipulation to keep the Euro from falling = Bullish.

Positions

The  Positions Section = latest buys and sells  - These are positions I actually own

Have NOT had a chance to update last weeks trade.

So far for YOUR stock List OSTK (Overstock.com) BIDU(China’s Google) & SAM (Sam Adams Beer) have all received at least three votes to be new stocks in YOUR stock list.  Last chance to submit  entries. Room for a couple more.

See Paul R’s insightful comments on SNDK and other stocks in comments section of blog.

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Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING