• “The flip-flopper tag he [Romney] earned four years ago is taking on new resonance”. “Afraid to Lead” FOX News

• Cain’s 12 year old harassment accusation seem minor compared to other political sex scandals.

• Comparison –  OWS has had over 3000 arrests while those calling for democracy in Syria have over 3000 deaths

• Syria responds to Arab League’s proposal to end violence in Syria with threat – “Volcano” of blood if attacked LINK

• OWS Oakland Thousands peacefully demonstrate, marred by no one hurt vandalism/arrests at night. LINK

• Poll 75% of Americans support Obama’s Leaving Iraq withdrawal LINK

• Fed downgrades future GDP and employment numbers. Stocks hold gains. LINK

• God in politics –  Obama on his jobs plan “Even God wants to put Americans back to work.”  LINK

• Split in Greece over referendum NYT

• Private ADP report shows 110,000 jobs added – juices stocks yesterday LINK

• Europe has an unfunded plan that involves a 50% bond haircut and Greek austerity. If December referendum in Greece fails, then a whole bunch of CDS’s (over leveraged gambling) blow up causing EU & US banks big big big trouble. How German Chancellor feels about the Greek referendum shown in her face below.

The Face

Fighting Crony Capitalism

Take the crony out of Capitalism – NYT’s Nicholas Kristof’s excellent defense of Occupy Wall Street

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Boycott BOA

10 Reasons NOT to Bank with the mother of all Bankstas

Bank of America.

From Nomi Prins at Truthout. Of all the ways  (hidden fees, lawsuits, nailing vets, over charges, pay’s no taxes) BOA charges vs other local banks I find reason # 6 the most compelling. They use your deposit to gamble hidden over leveraged derivatives.

“The total amount of derivatives in the FDIC-insured portion of B of A as of mid-year was $53.7 trillion, up 10 percent from $48.9 trillion the prior year, and up nearly 35 percent from its pre-fall [2008] crisis level of $40 trillion.”

Your over leveraged FDIC insured deposits at BOA  multiplied the severity of the 2008 housing/financial crisis. Who knows how deep BOA and other banksters (shadow banks) were into the European sovereign debt crisis? – Our Fed is not audited, US banks don’t have mark to market accounting, and the whole 500 trillion derivitives market hides its trades.

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Bankstas Take A Hit In Europe

Yes, over leveraged European financials did get a $1.4 trillion bailout fund. But they were also forced to take a “50% haircut”on the Greek bonds the held. How much of this haircut that will come out of their bottom line is open for debate. (See links in yesterday’s blog)

Bankers and Bankstas - There are normal Bankers who take our deposits and use them as collateral for loans that help people and small businesses. The good guys.

Bankstas take our FDIC insured deposits and use them  as protection to play casino capitalism, on bundles of mortgages, sovereign debt, student loans etc., called derivatives  or Credit Default Swaps.

This over leveraging is done in hidden transaction in an opaque $500 trillion derivatives market. The biggest poorly regulated bankstas are now too big to fail – Example BOA.

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STOCKS

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Reading Tea Leaves

• Our #1 technical forecasting tool, the McCellan Oscillator, is at +93.06 - OMG overbought = Bearish.

• Our secondary indicator, the Put Call Ratio is at 0.91. Well below its 50DMA which is at 1.15 = Bullish

• For more on MO & PCR see POSITION Section of blog (scroll down)

Stock traders/investors put their money down yesterday -  The proposed solution in Europe looks like it will have a somewhat similar impact on stocks that the  of 2009/2010 Obama/Bernanke bailouts did. In fact, traders/investors have been putting their money down since the lows almost a month ago.

It is rational to expect some kind of pull back today. But, there are lots on the sidelines who have missed out on the move looking to buy the dip. Volume was big yesterday, but not yet the huge kind of volume associated with a climax selloff.

Unfortunately, the bigger part of this move off the bottom is probably over, but it looks like we may be able to reach this year’s highs again.

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Positions

SPY – (ETF tracks S&P 500 or SPX) bought at 123.5, now at 128.63

Reminder – Your Stock List#5 – . 5 of our 14 stocks took  some big earnings hits (one on an analysts downgrade) So Paul & I have decided to drop TSU, RES, CROX, GMCR, & CPHD. . LINK to entire list (scroll down)

Under consideration.

SSO (ETF that is @2X SPX) Buy on dip. Investors411 uses a buy the dip strategy in markets that are trending higher.

EWG (ETF that tracks Germany) and/or EWQ (ETF that tracks France) Both are higher risk because they are on the cutting edge of what’s happening. A bigger technical breakout than US indexes. Yesterdays melt up was fundamentally focused on the fact that specifically German and French financial institution would weather the default crisis.

I favor Germany – better overall economic fundamentals. Buy the dip.

XLF (ETF for financial stocks) For those that can handle more risk UYG (2X financials) & FAS (3x financials) Several Investors411 bloggers have made out handsomely with gains of 50+% trading January Calls on FAS.

Mea Culpa – All of the above new considerations should have been listed Monday after the Upgrade.

Note – These are official Investors411 Positions – I buy each position mentioned.

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Long Term Outlook

3 to 6+ months

Investors411 upgraded its Outlook on Monday to CAUTIOUSLY BULLISH. Reasoning

• Technically, we broke out of this summers trading pattern. The resistance and now support level for benchmark S&P 500 is @ 1225.
• Fundamentally, the perception that European banks will survive (see Banksta at War) another over leveraged crisis
• A 2.5% GDP Growth in the third quarter is NOT a recession number.

CAUTIOUSLY BULLISH

Investors411 has 5 different valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.

Stocks

Friday, Saw a major short covering rally in US equities. The move off the summer lows has been led by financials (ETF = XLF) Up almost 20%.

The major issue in the short term is who is going to finance sovereign debt of Greece and other European countries.

The German banks are the largest holders of European debt. The Greek situation is crisis #1. Today

• At 8:00AM EST  German stocks up +3.55%
• Earlier this AM Greek stocks down -4.6%

This data trumps others and says the rally will continue even though our McCellan Ossillator is at overbought levels 69.87

______________________

The Long Term Outlook has been upgraded to CAUTIOUSLY BULLISH because of a technical breakout in the trading pattern and what is perceived to be a victory for bankstas in Europe. (more explanation tomorrow)

Investors411 has a position bought Friday – SPY (S&P 500 tracking ETF) at 123.5 (see comments section of blog)

Traders – Shadow banks and financials look like they will continue to rally, but are very risky

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Long Term Outlook

3 to 6+ months

CAUTIOUSLY BULLISH*

*Investors411 has 5 different long term valuations - BULLISH, CAUTIOUSLY BULLISH, NEUTRAL, CAUTIOUSLY BEARISH, and BEARISH.

* Everything written in BROWN is a repeat from a previous day(s)

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

CHECK ALL DATA, I MAKE MORE THAN GRAMER ERRORS.

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Turning on the Light

So many spend so much time analyzing darkness instead of just turning on the light

One such organization that turns on lights for Cancer patients is

First Descents

“Cancer taught me about death and First Desccnts taught me how to live.”

From personal experience (a daughter who is a cancer survivor & she took me to one of their camps) I can’t begin to tell you in words the impact this organization has on the lives of everyone involved.

Yea I hope you explore their site and get involved. But even more I hope that YOU have the courage to make your first descent into any new life enhancing challenge. Turn on a light.

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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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Index	Percentage	Volume
Dow	-0.76%	Down
NASDQ	-0.89%	Down
S&P 500	-0.81%	Down
Russell 2000	-1.55%	-

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Technicals, Fundamentals & Analysis

Shorter Term Outlook.

day/days/week

• Debt crisis in Europe is expanding. Interest rate on Greek 2 year bond rocketed to high of 35.19% yesterday. How is Greece ever going to be able to pay this back?  Most talking about major problems in Italy whose banks and bonds got toasted yesterday. Real problem –   European banks still make bets on bundles of securities (credit default swaps) You tend to cringe each AM as the rates for these CDS’s move higher.

• The odds of the British PM staying in office over the Rupert Murdoch scandal went from 100 to 1 to 8 to 1 overnight.

• An editorial that turns on some lights from Dylan Ratigan – The Real Debt Deal

• Two of our most successful technical forecasting tools listed below

• The McClellan Oscillator (MO) chart fell dramatically to -47.70 (-30 somewhat oversold, -60 oversold, -90 OMG oversold. The more oversold we get the better the chance for an oversold rally) We’re  somewhat oversold now, but momentum shows there’s probably more to come.= Neutral/Bullish

• $USD The Dollar rose +0.48% yesterday (+/- 0.50 is a significant move and the dollar is usually a contrarian indicator) Price chart shows we are in a month+ long trading range with slight, but erratic momentum for dollar bulls, For stocks= Neutral

• Reading The Tea Leaves – -48 on the MO, is usually a figure that oversold stocks bounce higher from. But how high and far is up to the the fundamentals of Europe and US debt.

Longer Term Outlook

weeks, month, months

• May 20th forecast still in effect.

• It’s impossible to accurately predict how the politically manufactured Kabuki dance over the debt will end. Yesterday’s blog (click on date in calender at top right of blog) contained a tea leaves reading of what and why.

• No asset class, with the possible exception of gold or shorting equities, could come out of this unscathed. Example – Cash – worse case senerio - US defaults – Dollar implodes your US greenbacks become toilet paper. Inflation soars and your cash becomes burnt toilet paper. Of course, other asset classes will probably do worse.

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Paul’s Corner

Hello world, it’s July 19 and pre market futures are up, let’s RUMBLE!

Eh excuse me! After a rotten day yesterday you actually expect us to believe it’s going to be a good day in the market you say?

Well that’s just it, at the moment this is a news driven market and it’s dangerous to play in the market with your grand children’s inheritance. A stock or two at the moment Ok, but please don’t sink your cash hoard into the market quite yet. Ian Woodward has just posted another gem of a blog and it’s worth the read. It’s title “Stock Market Spooked: Send In The Clowns” sums it up nicely!

LINK

My favorite HGSI “High Demand Search” for July 18 shows the following top three groups had the action yesterday:

Gold (18.00%, 18 securities)

• Agnico-Eagle Mines (AEM)
• Allied Nevada Gold Corp (ANV)
• AngloGold Ashanti Limited (AU)
• Barrick Gold Corporation (ABX)
• Buenaventura Mining Company (BVN)
• Coeur D’Alene Mines Corporat (CDE)
• Eldorado Gold Corp (EGO)
• Goldcorp  Inc. (GG)
• IAMGold Corporation (IAG)
• Kinross Gold Corporation (KGC)
• Minefinders  Ltd. (MFN)
• New Gold  Inc. (NGD)
• Newmont Mining Corporation (NEM)
• Novagold Resources  Inc. (NG)
• Randgold Resources  Ltd. (GOLD)
• Richmont Mines  Inc. (RIC)
• Royal Gold  Inc. (RGLD)
• Yamana Gold  Inc. (AUY)

Apparel Accessories & Luxury Goods (9.00%, 9 securities)

• Carter’s  Inc. (CRI)
• Coach  Inc. (COH)
• Fossil  Inc. (FOSL)
• Hanesbrands Inc (HBI)
• Lululemon Athletica  Inc. (LULU)
• PVH Corp (PVH)
• Under Armour  Inc. (UA)
• VF Corporation (VFC)
• Warnaco Group  Inc. (WRC)

Oil & Gas Exploration & Production (9.00%, 9 securities)

• Brigham Exploration Company (BEXP)
• Energy XXI (Bermuda) Ltd. (EXXI)
• EQT Corp. (EQT)
• EV Energy Partner LP (EVEP)
• Gulfport Energy Corporation (GPOR)
• Northern Oil & Gas  Inc. (NOG)
• Southwestern Energy Company (SWN)
• W&T Offshore  Inc. (WTI)
• Whiting Petroleum Corporatio (WLL)

It’s interesting we have these groups as the top three groups once again, Gold, High End Retailers and O&G Exploration. It’s almost like a broken record. These groups keep coming to the top of the list. Perhaps the market is trying to tell us where to place your bet!

So what’s the market going to do today, futures are up this morning, is this a new morning in America? Let’s load up ThinkOrSwim………here we go folks another day of fun!

Remember, you are responsible for your investment decisions, and I am not.  Please do your diligence, and please take ownership for your actions because I‘m sure not going to.

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Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500.

NLY - Annaly Capital Mgt. Ultra high dividend stock - Has dipped down into buyable position. Caution if we do have meltdown over debt crisis this stock will take a hit.  However through 2008 meltdown it still produced a double digit dividend.

GLD & SLV – Shouda, Woulda, Coulda – I did not buy into any of the gold or silver ETF’s yesterday. Waiting for a dip is like waiting for Godot. Will try again today.

Disclaimer - Personally I own a group of dividend stocks including NLY and have placed puts on some of them and some general ETF’s that track market indexes. JS in the comment section has used the term “insurance” to describe the way “Puts” are used protect long term investments. – email me if you want to know more or post a question in the comments section.

_________________

Look for an enlightened Paul’s Corner every Tuesday & Thursday and the always informative Comments Section every day.

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Longer Term Outlook

NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

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Fancy Pants Debt

If YOUR eyes gloss over when they explain economics (and even if they don’t)

This 3:49 seconds video is for you.

YOUR investments dollars, from the stock market to your houses value, depend on the quality of debt. So does world economics. Good debt, Bad debt and Fancy Pants debt.

The video is FUN, Entertaining, and educational.

John  Green does more than explain the Greek Crisis “which has pushed the Greek government close to defaulting on its loans, the reasons why the Euro zone and the IMF are desperately trying to bail Greece out, and what the rising cost of sovereign debt means for the massive budget deficits throughout the developed 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

_____________

Index	Percentage	Volume
Dow	+1.36	Down
NASDQ	+1.53	Down
S&P 500	+1.44	Down
Russell 2000	+1.52	-

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.

Technicals, Fundamentals & Analysis

Shorter Term Outlook.

day/days/week

• Technically, the huge 5 day move off a double bottom (prices make a low and test it – see charts on far right) is very bullish

• Fundamentally last week -we kicked the Greek debt problem down the road. But Greek debt - benchmark 2 year bond is selling at 26%. Is virtually impossible to adopt a massive austerity program and pay a huge 26% interest on the Greek two year bond at same time. Also China said has the inflation problem is under control - Premier Wen. This fueled the rally. However problems in China this AM

• The McClellan Oscillator (MO) chart rose to +89.65 (above +30 somewhat overbought , above +60 overbought, above +90 OMG overbought) This is just a fraction from OMG overbought levels. 2009 was the last time the MO reached over +100 (twice) This began a long term bull run. Short term  overbought = Bearish

• $USD The Dollar stabilized after falling for a week. -0.06% yesterday. (+/- 0.50 is a significant move and the dollar is usually a contrarian indicator) Short term tend for stocks now. Will stability hold? = Bullish/Neutral

• Reading The Tea Leaves - Shorter term  -OMG oversold levels will be reached in any stock rally. This put big pressure on rally to let off some steam. Repeat – Outside the HTF and Trading desks there are a bunch of normal day/swing traders who have missed the rally and are waiting to buy the first dip.

The 5 Day Bull Stampede

Long Term

weeks/months/years

• Still the risk of bad European debt and our own debt crisis confronting bulls. However, the silver lining investors see is low interest rates for a long time, a Fed managed US market and inflation fears diminishing in China and more time for banks in Europe cushion debt crisis. If there is a mediocre or poor jobs number (this Friday) this could even add oil to a burning hot fire that’s driving the bulls. Poor jobs = More Potential for Fed intervention and lower interest rates for a longer time.

• Bulls are back and they see a light at the end of a tunnel. If fundamentals in earnings season are decent (starts next week and earnings should do OK) we could go on a run. We are due for a overbought mini dip, but a move of this size off a double bottom in a very strong longer term bullish sign. As we switch from a temporary timeout in European debt to our own manufactured (July 22 deadline) debt crisis fundamentals matter. Still too early to raise NEUTRAL rating.

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Your Stock List

Paul has published to a spreadsheet of YSL #4 in the comments section of the blog.

Sorry many of you had problems with the old link

Like the past 3 YSL’s is beat the S&P 500 our benchmark S&P 500 again

A new YSL is under construction. If You are on the email List send in your choices to me this week.

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Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500.

NLY - Annaly Capital Mgt. Ultra high dividend stock - Up  over 6% in six weeks and was held through the date that allows you to collect dividend. so add another 3% to 4% profit. = +10%

IMAX - Mea Culpa – As expected IMAX and 3D hit a major home run with the new Transformer’s movie over the weekend and I did NOT buy stock for Investors411 portfolio last Weekend. I would have sold IMAX into the Harry Potter movie July 15th.

Paul has published in the comments section (last week) some potential high growth buys

Short term strategy is to short overbought stocks. Bought 1/2 position in TZA near close Friday at 33.00.  MO closed at 89, just one point away from OMG oversold. Will sell quickly for a small gain.

Longer Term Strategy The 5 bulls is a major signal and there are many who missed the rally waiting to pile on.  We’re in NEUTRAL, but a possible positive senerio has appeared (see above)

Disclosure - I own NLY &  a group of dividend stocks which I have used some short ETF’s to protect. (I’ve cut back on short ETF’s) – I buy all stocks mentioned in the hypothetical Investors411 portfolio.

I very much like the position of going long High Growth Stocks (week to months and on dips) and/or longer term dividend plays – yet holding some sort of protection (preferably a Puts over a short term ETF that shorts) in case of sudden meltdowns.

_________________

Look for an enlightened Paul’s Corner every Tuesday & Thursday and the always informative comments section every day.

Paul is on break for a couple weeks, check Comments Section for a few weekly updates.

_________________

Longer Term Outlook

NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

Greece

The Greek debt crisis has impacted the world. Just what are the austerity measures imposed by European Banks on Greece. Here’s the top 5  from CNBC. (CNBC is an ultra pro bank/Wall Street network.) More details at link.

NB all prices are in EUROs not dollars

• Raise Taxes – 7 trillion over next 3/4 years. Includes a 23% value added tax.
• Wage cuts – 15% public sector (huge 25% of Greece is public sector workers.)
• Military Cuts – about .5 trillion
• Social Security costs – about  5 trillion – means test and retirement age moves from 61 to 65.
• Luxury Tax – All they said was thy were going to soak the rich too.

Lets compare this with what the US is doing to balance it budget.  Obviously both parties are to blame and they are far more interested in ideology than solutions. However, one sides total lack of willingness to compromise was pointed out in Obama’s press conference.

Republican’s are not willing even to compromise on

“limiting tax deductions for corporate jets.”

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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

_____________

Index	Percentage	Volume
Dow	+0.60	Up
NASDQ	+0.41	Up
S&P 500	+0.83	Up
Russell 2000	+0.32	-

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Technicals, Fundamentals & Analysis

Shorter Term Outlook.

• Chart of the Day – Shows HFT trading over 15 major exchanges (not dark pools)  - “The image below reflects high frequency trading (HFT) operations with quotes in milliseconds. The sharp increases in the chart are what’s termed “quote stuffing” as the machines try to engineer some action over the four minute span.”

Thanks to Dave Fry. The quote and chart are his

• At the end of he quarter managers of stock funds “window dress” their stocks. Part of this rally is “window dressing” or stock managers buying the “hot” stocks to impress their clients so that they stay invested. The major factor is the HFT are buying. Both the quarter and QE2 end today.

• The McClellan Oscillator (MO) chart rose to +52.72 (above +30 somewhat overbought , above +60 overbought, above +90 OMG overbought) Repeat -The MO has been unable to get above the +50 range for 6 months. It sure looks like the +50 high of the last 6 months is about to fall = long term bullish. Short term almost overbought = Bearish

• $USD The Dollar fell  again significantly -0.55% yesterday. (+/- 0.50 is a significant move and the dollar is usually a contrarian indicator) The trend since May 1 is bullish for dollar and bearish for stocks. Big reversal down in last 3 days. Most of this movement is based on Greece. Short term tend for stocks now = Bullish/Neutral

• Reading The Tea Leaves - Shorter term – Repeat-  A raging bull is stampeding and right now it looks like the only barrier is that markets are almost oversold and what earnings season might have next month.  MO is at +53 almost oversold

Long Term

• Fed tells Wall Street and Banks - it has your back. The Fed with its surprise announcement favoring banks (swipe fees)  over consumers has sent a message to the markets that it will do whatever it takes takes. MC & Visa up 10+% and banks rallied on $8.5 billion BAC settlement. This $ went to big hedge funds etc. not to middle class.

• It certainly looks like the HFT’s can sustain a low volume rally without Fed liquidity (QE2 which ends today). Earnings season, Chinese inflation, or something else may trump this, but for now bulls have regained momentum and the only barrier is overbought markets.

• Obviously, people who buy/sell stocks think the Greek crisis is bullish.

• Reading Tea Leaves - Changing back to NEUTRAL for the summer.

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Your Stock List

Here’s the LINK to a spreadsheet of YSL #4.

YSL #4 beat the benchmark S&P 500. So did YSL 1 & 2 & 3

Remember t0 send in by emails or post in the comment section any choices YOU have for YSL # 5

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Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500.

NLY - Annaly Capital Mgt. Ultra high dividend stock

Short term strategy is to short overbought stocks. –  Stocks did not rally from their earlier highs so I did NOT “nibble on” the TZA trade. Will do so if the Dow goes up 60+ points and I’m watching.

NB – The long term strategy is no longer to short rallies since outlook has turned to NEUTRAL

Disclosure - I own NLY &  a group of dividend stocks which I have used some short ETF’s to protect. – I buy all stocks mentioned in the hypothetical Investors411 portfolio.

_________________

Look for an enlightened Paul’s Corner every Tuesday & Thursday and the always informative comments section every day.

Paul is on break for a couple weeks.

_________________

The Fed has moved from an expanding money supply to a neutral – No QE #3. Congress is threatening to contract the money supply. “We [the USA] need to grow at this point more than anything else.” Investors411 outlook will remain negative/neutral on the USA unless the Fed and/or congress return to more pro growth policies and/or Euro defaults are resolved.

_________________

Longer Term Outlook

NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

.

Why so many people who remember the past have problems with the right wing’s political agenda

Obviously we’re NOT going to punish the uber wealthy, unregulated free markets and greed that got us into this horrific mess.

No the right wing agenda is to force cuts ONLY on working class Americans.

________________

JOBS, JOBS, JOBS

More and more, US multinationals are laying off workers at home and hiring overseas.

What happened after the 2008 meltdown is globalized employers laid off workers in the USA. Term for this is disaster capitalism. They rehired them in other foreign countries.

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Lipstick on A Pig

Greece – Today the Greek parliament will vote on and probably approve austerity measured imposed by the IMF and European Banks. Germany’s leader has proclaimed “Greece will NOT be our Lehman Brothers.” Stocks should rally. But are we putting lipstick on  PIIGS

Here’s reality – The massive protestors outside parliament against this are all voters. Voters almost always vote their self interest and Greece is a democracy.

Greek parliament is made up of 303 seats and the ruling Socialists (PASOK) who favor the bailout have a thin majority of 155 seats. The #2 party, New Democracy (ND) has 86 seats. The ND other minor parties who are also against the bailout have less votes.

Two major polls show that instead of the 2 to 1 majority that the pro bailout party enjoys over the anti bailout ND party in Parliament, the ND party is now slightly ahead in popularity. All the other minor parties (Communist is the next largest) have also gained ground. One can easily infer that the Greek people by the level of anger (there is a two day strike now happening) and polling data that sooner or later this vast majority of anti bailout voters will gain power in Greece.

All the PIIGS countries in Europe face similar problems. Sure looks like its just a matter of time before the you know what hits the fan.

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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

_____________

Index	Percentage	Volume
Dow	+0.91	Down
NASDQ	+1.33	Down
S&P 500	+0.93	Down
Russell 2000	+0.92	-

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Technicals, Fundamentals & Analysis

Shorter Term Outlook.

• The McClellan Oscillator (MO) chart rose to +10.81 (below -30 = somewhat overbought, above +30 somewhat overbought ) Repeat - The MO has been unable to get above the +30 to +50 range for 6 months. Still closest to middle of range and plenty of room for bulls or bears to work with = Neutral

• $USD The Dollar fell  significantly -0.50% yesterday. (+/- 0.50 is a significant move and the dollar is usually a contrarian indicator) The trend since May 1 is bullish for dollar and bearish for stocks. The dollar fell back after just barely making a short term high on its chart. Tend for stocks = Bearish

• Reading The Tea Leaves - Shorter term – From yesterday – “Our MO chart has been very accurate in predicting short term tops and bottoms. So tea leaves say wait for an oversold or overbought levels to be reached before acting. The whole roller coaster ride of the last two weeks is a big spring winding.”

• Chart of NASDQ – Today we may see some sort of short term breakout – we are far closer to upside breakout levels.

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Paul’s Corner

Gloom and Doom?

The market is down, much of our profits have disappeared  and there is no hope in sight, right? Well looking at market internals, there just may be some life left in the market. Ian Woodward posted a great blog this weekend and here are a few points to consider.

LINK

Ian includes charts to show how the market canaries (NFLX, AAPL, BIDU, AMZN) are performing.

The market is currently range bound between 2700 and 2600 on the NASDAQ. So consider 2700 as resistance and 2600 as support. If we go through 2700 on good volume the market is “probably” gonna keep going. If we drop through 2600 next obvious support is 2500, so watch these numbers closely.

One of the ways we follow the market is to look at  stocks ERG numbers to see which way the market is going. ERG refers to Earnings Per Share, Relative Strength, and Group Strength of the individual stock. Assigning a number between 1 and 99 to each of the ERG components you can evaluate the health of any stock relative to the rest of the market. A week ago we only had 13 stocks with an ERG number higher than 270, this week ended with 26. Although extremely low numbers, it still shows there are some quality stocks starting to move. Also the numbers of stocks with “A” accumulation ranking is improving.

I have been keeping an ERG list for years and it’s a very good confirming indicator for the market.

Last Thursday I posted a list of stocks that have done well through this correction and in his blog Ian lists a  group of 25 that are currently doing well. Between these two lists there are some good stocks to consider IF this market takes off.

Remember, you are responsible for your investment decisions, and I am not.  Please do your diligence, and please take ownership for your actions because I‘m sure not going to.

Paul has the full results and I will post them in the POSITION Section of the blog ASAP.

This time out we didn’t do as well as we would have liked, but the results were still positive. Both Paul and I will go over what worked and what failed this week to create a better YSL #5

Since WE have toasted  the experts and beaten the S&P 4 times in a row Paul has already called for a YSL #5. – Send in entries to me or post them on the comments section of the blog.

Send a sort list of  three  or less socks you think deserve consideration.  Paul and I will go over them and choose 12 to 15 that should again toast the S&P 500.

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Current Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500.

NLY - Annaly Capital Mgt. Ultra high dividend stock. Bought on a dip over a month ago. After a 5+% gain is has come down a bit last two days.

Gold /Silver Trade – These commodities usually move the opposite direction of the dollar. Dollar is going up (mostly because European outlook is bleak) so gold/silver is going down.

Shorting Banks - one major reason major banks are underperforming stocks is that the Fed will on June 30th stop purchasing treasuries from them. This and mortgage problems have have led this sector down. There are some signs (three weeks of flat trading)  that a short term bottom has been reached (see link above)

Repeat longer Strategy remains - Waiting for MO to hit overbought levels before acting

• Short any rally - Investors411 will use TZA (3X short small cap stocks) and SDS (2x short S&P 500 more conservative).
• Sell long positions into any rally -

Disclosure - I own NLY &  a group of dividend stocks which I have used some short ETF’s to protect. – I buy all stocks mentioned in the hypothetical Investors411 portfolio.

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Look for an enlightened Paul’s Corner every Tuesday & Thursday and the always informative comments section every day.

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The Fed has moved from an expanding money supply to a neutral – No QE #3. Congress is threatening to contract the money supply. “We [the USA] need to grow at this point more than anything else.” Investors411 outlook will remain negative on the USA unless the Fed and/or congress return to more pro growth policies and/or Euro defaults are resolved.

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Longer Term Outlook

Neutral/CAUTIOUSLY BEARISH

The NEUTRAL in the forecast will vanish If/when we break the recent lows of the S&P 500 chart

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

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Bond King – Bill Gross – “I simply think a default of six, twelve days, eighteen days, not only sends the wrong signal, but a disastrous signal to the world credit markets,”  Republicans are threatening this.

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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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Index	Percentage	Volume
Dow	big rally	Up
NASDQ		Up
S&P 500		Up
Russell 2000		-

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Technicals, Fundamentals & Analysis

• The McClellan Oscillator (MO) chart rose to +27.25 ( below -30 = somewhat overbought, above +30 somewhat overbought ) The MO has been unable to get above the +30 to +50 range for 6 months. So it sure looks like our four day rally will run out of room very soon. = Neutral/Bearish

• $USD The Dollar fell a significant -o.72% yesterday. ( +/- 0.50 is a significant move)  The trend since May 1 is bullish, but the last few days are ruled by bears. For stocks trend = Neural/Bearish

• Reading The Tea Leaves - Shorter term – MO shows we’re technically entering overbought territory. Advantage bears. Can’t help thinking all those put positions were the reason for the rally. Now that the # of Puts is back to normal, we are close to overbought, and only a week and 1/2 of Fed money remains to juice stocks the bears case should gather momentum.

• Reading The Tea Leaves - Longer Term – No change.

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Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500.

NLY - Annaly Capital Mgt. Ultra high dividend stock. Bought about a month ago.

TZA - ETF that is 3 times short small cap stocks Bought 1/2 TZA position at 39.75 about  10 days ago. Have already cashed in a 6% gain in TZA. The remaining 1/2 TZA now at 37.71 almost a -6% loss.

The short term player in me wants to sell this position (futures are down so TZA will rally at open) and buy back in at a better point. The long term investor wants to hold onto this. I’m leaning short term.

Repeat Strategy remains

• Short any rally - Investors411 will use TZA (3X short small cap stocks) and SDS (2x short S&P 500 more conservative) .
• Sell long positions into any rally -

Disclosure - I own NLY, & TZA as well as a group of dividend stocks – I buy all stocks mentioned in the hypothetical Investors411 portfolio.

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Look for an enlightened Paul’s Corner every Tuesday & Thursday and the always informative comments section every day.

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The Fed has moved from an expanding money supply to a neutral – No QE #3. Congress is threatening to contract the money supply. “We [the USA] need to grow at this point more than anything else.” Investors411 outlook will remain negative on the USA unless the Fed and/or congress return to more pro growth policies and/or Euro defaults are solved.

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Longer Term Outlook

Neutral/CAUTIOUSLY BEARISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

James Verone

Sorry Server was down most of the morning  - so here’s a quick mix.

• Markets rallied in pathetically low volume.  Our MO indicator says thing are not oversold and back to neutral. Financial stocks took a hit yesterday.

• Greek gov’t has confidence vote tonight. It will pass. This should rally stocks. Key is the size of demonstrations in front of parliament. Greek people feel banksters share responsibility for crisis and should be held accountable not just people of Greece.  This crisis through out Europe is going to be twisting in the wind all through summer and beyond. Besides its debt problems Greece now has to pay almost 30% interest rate on its bonds.

• Banksters are calling the shots in Greece as they have since the 2008 meltdown. “The epicenter of the new crisis is Greece, which epitomizes the folly of banker rule.” - Bob Kuttner

• SHIBOR rockets to 8.6% – Translation =  China has a significant exploding inflation problem that crucial to economic worldwide growth.  Not good news.

• Lots of blogs headlining how you can get health care for $1.00. Story of James Verone who desperately needed medical attention so he held up a bank for $1.00 then say in a chair to wait for police.  He now gets free medical care. – The money quote from Verone - “When you don’t have your health you haven’t got anything.”

• Read of tea leaves – short term rally continues on Greek news. No change in long term outlook or strategy.

Paul’s Corner

1^st Official Day Of Summer! Wow! Market futures are up, time to jump back into the pool?

Yup at 6:30 this morning market futures are up and you know what that means, once the market opens at 9:30 all bets are off. Great place to put your money, eh?

Yesterday was an up day and many of the indexes finished up but it was done on low  volume.

The bulls are trying to make a stand but there appears to only be a few bulls ready for action.

David Garlardi, an HGSI user, posted a link to an interesting article “Economies are slowing around the world…

LINK

The last line is important “The US dollar gained against the Aussie dollar and other major pairs as investors’ risk appetite diminished following the minutes. ” If this indicates a change in the direction of the US dollar, a strong dollar equals a weak market. (Interesting, the world economy is slowing, I GUESS Obama’s policies really don’t work)

Bio-Tech led the way yesterday in the high demand stock search, 2^nd and 3^rd have some of our old favorites:

Apparel Accessories & Luxury Goods (5.00%, 5 securities)

• Fossil  Inc. (FOSL)
• Lululemon Athletica  Inc. (LULU)
• True Religion Apparel  Inc. (TRLG)
• Under Armour  Inc. (UA)
• Warnaco Group  Inc. (WRC)

Specialty Stores (4.00%, 4 securities)

• OfficeMax Inc (OMX)
• Signet Jewelers Ltd. (SIG)
• Tractor Supply (TSCO)
• Zale Corporation (ZLC)

So what’s the market going to do today, futures are up this morning, is this a new morning in America or another fakey before the BIG crash? Let’s load up Quote Tracker………here we go folks another day of fun!

Remember, you are responsible for your investment decisions, and I am not.  Please do your diligence, and please take ownership for your actions because I‘m sure not going to.

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Longer Term Outlook

Neutral/CAUTIOUSLY BEARISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

Robert Reich

Economics in Two Minutes

In two minutes 15 seconds a Rhodes scholar, renowned economist and former Labor Secretary explains the structural economic problem of the USA – LINK

The video does a much better jobs than the points listed below.

• Since 1980 our economy has almost double in size, but (adjusted for inflation) salaries have barely increased. Where did the money go?

• To the super rich (top 1%) who used to take home 10% of the wealth & now take home 20%. It’s given them a total of 40% of today’s total wealth in the USA.

• With the wealth they buy political power. In 1980 their tax rate used to be 70% and now its 35%, and a major major portion of that wealth is taxed at 15% – the tax on capital gains. The wealthiest 400 only pay a 17% tax

• This created a huge budget deficit. Schools, roads, and many safty nets that protected the middle class have and will be further cut

• America’s middle class no longer able to survive on the scraps left by the wealth  turns on each other. The flames of hate are even fueled by the wealthy. – Union against non union, native born against immigrant,  one race against another, one religion against another, public employee against private.

• The middle class no longer able to borrow as before  and diminished in assets = an anemic recovery. The only way we can have a strong economy is to have a strong middle class.

We all want government to be more efficient, but its long past time for the USA to start building its middle class like Brazil, China and so many other countries are doing.

Thanks to several of you who sent me this video and Paul for posting it in the comments section.

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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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Index	Percentage	Volume
Dow	+0.36%	Up
NASDQ	-0.28%	Up
S&P 500	+0.30%	Up
Russell 2000	+o.03%	-

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Technicals, Fundamentals & Analysis

• The Silver Lining - If some sort solution to the Greek crisis occurs, all those put buyers will get caught with their pants down and we will have one hell of a rally. Usually this number of puts indicates a market reversal. However fundamentals over Greek debt rule.

• The McClellan Oscillator (MO) chart rose to -31.20 ( below -30 = somewhat oversold, below -60 = oversold, below -90 OMG oversold) The lower the MO goes the more the chances for some sort of rebound. Stocks are now moderately oversold.

• $USD The Dollar fell a significant -o.79% Friday. ( +/- 0.50 is a significant move) There have been many major moves in the dollar as the Greek crisis builds. Although we had a big fall Friday, the last 7 weeks are clearly bullish.  This is money coming out of the Euro (because of Greece and into dollar) and moving into the dollar. For stocks trend = Bearish

• Reading The Tea Leaves – The training wheels come off the US economy June 30th as QE #2 ends. Greece’s debt crisis overshadows Irelands (just as bad) and Portugal, Spain and Italy follow. All this is exacerbated by unregulated derivatives that the US introduced to the world’s banking system. It’s impossible to to call exactly when Greece defaults (some say it may not default) and how the panic will spread.  However there is great downside risk.

• Reading The Tea Leaves - Longer Term (repeat) -  ”See May 20th blog for forecast for this summer.“

Our bull market has survived a a catastrophic nuclear disaster, bank foreclosures, unemployment, shadow capitalism, revolutions and a whole lot more as the Fed had our backs with liquidity. Now that liquidity (QE #2) is over in two weeks and if Greece collapses Investors predicts – the bull will die.

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When Bears Rule

Right now, instead of  joining the Chicken Little’s running around with their heads chopped off many sophisticated investors are protecting their assets

We’ve learned from experience everything from cash to housing values can go down in value. There seems to be NO financial armageddon looming, but their are ways to buy insurance or hedge against bears ruling. Investors has recommended several and they are listed in the POSITIONS Section of the blog and below

If the markets go down you can make money by using ETF’s (market baskets of stocks) that short the market (they go up as stocks go down). Here’s a list of some from the least risky to the most.

• SH (Short the S&P 500)
• SDS (2x short S&P 500)
• TZA (3x short small cap stocks)
• More sophisticated investors can place calls on these three ETF’s or puts on long ETF’s, or use puts,spreads etc.

By no means is Investors411 recommending that anyone go all in any of the above positions. But they can help if bears rule. You can also follow Investors411 hypothetical portfolio below. Since Investors made its May 20th negative call on the US stocks the benchmark S&P 500 has gone down from @1340 to 1270 or lost about 5%.

• SH gained @+5%
• SDS gained @+10%
• TZA gained @+17%

Simply put stocks go down and you make $. Investors has outlined some of the risks since 5/20 (today – see Silver Lining and Greek debt above for updated risk assessment)

Obviously some strategies can get complicated and difficult. You have to choose just how much  you want to risk. Do you want want to hedge/insure against a small portion of your assets,  go all in or something in between.

Bottom Line - Using an ETF that shorts the market is no different/riskier than using one that goes long. The skill/luck is choosing the right direction and evaluating how much to risk.

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Positions

Below – Investors411  hypothetical portfolio that should outperform the S&P 500.

NLY - Annaly Capital Mgt. Ultra high dividend stock. Bought about a month ago.

TZA - ETF that is 3 times short small cap stocks Bought 1/2 TZA position at 39.75 about  10 days ago. Have already cashed in a 6% gain in TZA.  Hope to buy more today in rally.

Repeat Strategy remains

• Short any rally - Investors411 will use TZA (3X short small cap stocks) and SDS (2x short S&P 500 more conservative) .
• Sell long positions into any rally -

Disclosure - I own NLY, & TZA as well as a group of dividend stocks – I buy all stocks mentioned in the hypothetical Investors411 portfolio.

_________________

Look for an enlightened Paul’s Corner every Tuesday & Thursday and the always informative comments section every day.

_________________

The Fed has moved from an expanding money supply to a neutral – No QE #3. Congress is threatening to contract the money supply. “We [the USA] need to grow at this point more than anything else.” Investors411 outlook will remain negative on the USA unless the Fed and/or congress return to more pro growth policies and/or Euro defaults are solved.

_________________

Longer Term Outlook

Neutral/CAUTIOUSLY BEARISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE