Our President…

… mindful of soaring deficits, was pushing bold action to shore up the nation’s balance sheet. Cloaking himself in the language of class warfare, he calls on a hostile Congress to end wasteful tax breaks for the rich.

“We’re going to close the unproductive tax loopholes that allow some of the truly wealthy to avoid paying their fair share,“ he thunders to a crowd in Georgia.

Such tax loopholes, he adds, “sometimes made it possible for millionaires to pay nothing, while a bus driver was paying 10 percent of his salary – and that’s crazy.”

Preacherlike, the president draws the crowd into a call-and-response. “Do you think the millionaire ought to pay more in taxes than the bus driver,” he demands, “or less?”

The crowd, sounding every bit like the protesters from Occupy Wall Street, roars back: “MORE!”

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The President who spoke these words was not Barack Obama

The year the above speech occurred – 1985

The President was

Ronald Wilson Reagan

• When did today’s Republican Party abandon their hero Ronald Reagan who raised taxes 11 times when faced with a deficit?

• When did the Republicans abandon Reagan’s “bus drivers” and the middle class?

• When did Republicans become the party of the richest 1% of Americans?

“The GOP has undergone a radical transformation, reorganizing itself around a grotesque proposition: that the wealthy should grow wealthier still, whatever the consequences for the rest of us.”

How, Why When?

The LINK

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Ohio and Debates

Republicans debated last night, but on Tuesday Ohio voters went to the polls.

They defended the freedom of working Americans to collectively bargain.  By a 61% to 39% vote they granted middle class working Americans the freedom to fight collectively for their rights

All Republican Presidential candidates were against this and latest poll show Obama’s popularity (a supporter of collective bargaining) at least 9% above Republican candidates in Ohio.

Its just one vote/poll/major issue, but when you compare it to the rights we give the elite oligarchy in America its very significant.

Thanks to Jim and Popeye for a heads up on this.

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STOCKS

That cut Bear Cub didn’t hang on but his mother is back and she’s angry.

The tipping point was when the Italian 10 year bond rate hit 7.00%.  The rate that others (Ireland, Portugal, and Greece) began their meltdowns. = Meltdown in US Equities.

WSJ on Euro Crisis. -

“the risks to the global economy are broad. The European and U.S. financial systems are deeply intertwined”

Every investors411 reader should realize by now the major link between European Bank debt, European Banks, and American Banks is the opaque Derivatives Market (CDS’a) that exchanges trillions of dollars of privatized over leveraged risk on European Debt.

Media virtually ignores the same derivatives that multiplied the over leveraging in the 2008 financial meltdown, because to many too big to fail shadow banks profit from it.

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Our #1 technical forecasting tool, the McCellan Oscillator fell to -10.66. 50DMA at +22.80. = NEUTRAL

Since derivative markets hides whose on the other side of a transaction, and too big to fail shadow banks and central banks have hidden or irregular accounting, its impossible to accurately predict stock trends.

Therefore Hedge plays like the GMCR listed below is far less risky than picking a market direction.

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Paul’s Corner

The Big Blue Line

Dave Landry is one of the many excellent market technicians kicking around Wall Street and is known for his Big Blue Line approach to the market and stock selection. It’s a very simple method; take a look at Dave’s excellent Big Blue Line YouTube video:

LINK

Pay attention to the three ways the Big Blue Line points and his discussion about buying in very oversold markets. Which way is the line pointing with respect to our current market?

Kindly post your thoughts about The Big Blue Line.

A short Paul’s Corner today,  that’s all folks!

[Editor's Note - Landry  presentation is enlightening]

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• Giant airlines AMF fell 33% on fears of bankruptcy. BAC, JPM and other banks took hits yesterday

• Where’s The Next Support Level? - David Brown at Seeking Alpha – His answer - Not until Europe is fixed.

Gold – Gold (GLD) seems to have found some stability after a significant fall.

Fundamentally, gold should rise because to stay out of recession both Europe and the US are probably going to end up printing more money and have zero% interest rates. This is bullish for gold in the long term.

Since Europe has father to go to reach the level the US has (already 0% interest rates and has printed lots of $$$) shorting the Euro (EUO – double shorts Euro) is also a decent trade. Therefore gold should do especially well relative to the Euro. Right now the Euro is way over extended, so wait for a pullback.

Civil Rights Victory

Those that watched the Republican debate last night or read about it, know that a gay soldier who asked a question was booed  by the audience. Shameful. Gay rights is this generations civil rights issue like integration was ours back in the 60′s.

The repeal of “Don’t Ask Don’t Tell” was obviously a major step. Decade long poll numbers, especially among younger Americans, are increasing in support of gay rights. Excellent editorial from Huffington Post (Photo also from HP) by Aaron Belkin on “How We won.”

Ron Suskind

Disfunction Junction

Failure to Regulate Banking industry is coming back to haunt investors and again threaten the world economy. When you listen to shadow bank CEO cry and whine crocodile tears about too much regulation ask them to name one banker whose gone to jail over the Wall Street 2008 financial crisis (remember Madoff ran his own seperate ponzi scheme which he got away with for years)

Also give them Matt Taibbi research that shows how in bed the limited amount of investigators are with the industry.

Today

• Shadow Banks have their own special accounting system. The do not have to “mark to market” accounting.
• Shadow Banks operate on the unregulated $600 trillion dollar Credit Defaults Swaps Exchange. (no one knows who buys and sells)
• Shadow Banks are also invested in everything from home loans to Greek bonds to CDS’s on French Banks.

As an investor, do you want to invest in the shadows of an opaque banking system when all you have is some CEO saying – “We are not over leveraged?” No wonder Financials (XLF) are leading stocks lower.

Pulitzer Prize winner Ron Suskind has a new book, Confidence Men, that focuses on Obama’s failure to act on banking regulations.

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Investors411 Technical Forecasting Tools.

The McClellan Oscillator

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Reading The Tea Leaves

Short Term Outlook

days, week+

• Forecasting tools more Bullish than Neutral. This indicates risk on trading opportunity. If you can handle the risk the odds seem to be in your favor. Investors411 conservatively prefers to wait for a better situation – In this case a bigger dip that leads to more extreme reading on the MO & PCR.

• Best read of the tea leaves is HFT’s and pros can make more $$$ by breaking support levels and increasing panic. Also the lower the market goes the more pressure on Bernanke to do QE #3.

• Energy , Financials and Copper (proxy for global growth) all made significant new lows yesterday = Long Term Bearish.

• Yesterday’s lead editorial contained reasoning behind long term outlook – CAUTIOUSLY BEARISH.

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Current Positions

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

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

Yesterday Investors411, as stated, sold all positions. Now looking for more of a dip to buy.

Traders – We have a risk on opportunity that The Critic (see comment section of blog) took yesterday. Our two forecasting tools are with the bulls, but not yet at the more extreme levels where its even safer to buy.

Investors - Yesterday’s lead story is the Long Term Outlook for the Fall.

Positions

NLY - Annaly Capital Mgt. Ultra high dividend stock –a @14% dividend NLY was bought in mid May at 17.14

Sold at 17.70 for 3+ gain add to that a 3 to 4 % dividend check and total = almost +7%. Not bad when you consider the benchmark S&P 500 was down @-17% in the same period. Again Investors411 beats its benchmark S&P 500.

Mea Culpa – In retrospect this was a poor time to sell. NLY had done well through the meltdown. Unfortunately yesterday’s warning to sell covered all stocks. NLY is nearing the date you have to hold the stock to get the dividend. A period NLY usually rises. Will buy back on dip.

GLD – (Long Gold ETF) Bought at 167.05 - Sold 1/2 for 8% gain.

Sold remaining GLD at 167.05 for 0% gain. GLD hit the stop/loss order. Total for trade +4%

Looking to buy back into GLD – Gold fell yesterday because so many were liquidating positions from hedge funds and money managers, the managers sold GLD to cover those cash redemptions. This occurs often on major meltdown days.

Why gold? – Europe is going to try to join the USA in zero% interest rates sometime down the road and Bernanke will probably be forced to use printing press to help Europe and USA get out of economic problems. This will again be bullish for gold. So again - buy the dip.

Investors411 Portfolio gained @+11% while the S&P lost @-17%

Disclaimer - I buy everything in the hypothetical Investors411 portfolio. If stock is mentioned and I own it you will know.

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Long Term Outlook

(for US stocks only – not our economy)

CAUTIOUSLY BEARISH*

*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

Why this won’t happen.

• It would lower unemployment and increase Obama’s chances of reelection – Republicans will therefore stall.
• It does NOT help the giant conglomerates who outsource their jobs overseas.
• The Too big to fail and other major US Companies are mega lobbyists who rule almost all Republicans and many Democrats by controlling media and campaign contributions.

You will see congress vote on a tax break for mega overseas corporate profits before you will see them help the engine of growth – small business in the USA.

Much More on The Civil War to come

Small Businesses, Taxpayers Get Shafted

Investors411 Technical Forecasting Tools.

The McClellan Oscillator

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Reading The Tea Leaves

Market momentum is obviously to the downside. Fundamentals matter. In this case its the news coming out of Europe - CNBC & WSJ However both the MO and the PCR are telling us that we are getting ready for at least a short term reversal.

Current Positions

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

LONGER TERM POSITIONS

See POSITIONS Section of blog for more on YSL#5.(scroll to bottom)

Traders - If we get another strong move down today I would consider going long in a leveraged index ETF.  Technically, because we are so oversold and approaching support, any dip down close to support should hold.  It’s a risk, and you could get overwhelmed by some bank failure in Europe. However, if we get that MO to -60 and below we should get at least a technical bounce.

Investors - It’s sure better to nibble when the stock market is 20% down than when it was higher.  The Caution, of course is the breakdown through support for the major indexes. My best read of Tea Leaves is that it would take a major bank meltdown for this to happen. FT Link on this possibility.  A downgrade is NOT a meltdown, but there is risk.

Greece is going to default at some time and in some way. They have an interest rate near 50% on their 2 year gov’t bond. We have an under 2%interest rate. That 50% rate is unsustainable for Greece. The problem is derivatives taken on the debt and the shadow financial system, like Lehman and so many others, make this crisis worse. Many want this to happen sooner rather than later so we can stop twisting in the wind.

Bottom Line – If we have another meltdown today, technicals will show an overbought market. If we get to OMG oversold levels the technical Tea Leaves put the odds even more in YOUR favor to Buy.

Paul has said this is not a market to be in. He’s right unless you are protected (Puts or ETF’s that short the market) But, when everyone else has panicked there is no one left to sell. It’s hard to call a bottom exactly, but the Investors411 portfolio will nibble and risk a long position in a leveraged ETF if oversold and better OMG oversold conditions exist.

Positions

NLY - Annaly Capital Mgt. Ultra high dividend stock –a 14% dividend

GLD – (Long Gold ETF) Bought at 167.05 last week - Sold 1/2 for 180.4 (see comments section of blog on Friday) Almost +8% profit.

From yesterday - There are simply too many calls out there on GLD. Ripe for a bear raid by HFT’s. Investors411 also likes to take a 5 to 10% profit and let the rest ride. Last reason – Gold should have gone way up as stocks went way down.

There is a major political battle going on over gold. Sides

• The US government and most companies/banks want the US dollar to be the “fiat” currency of the world.  If everything is traded to the dollar standard is gives us a major advantage.  We can conduct our monetary policy independent of exchange fluctuations.

• The other side is China (plus other countries) and the Tea Party/Ron Paul who want gold to be the standard for the world.

Xinhua, China’s official news agency - “International supervision over the issue of U.S. dollars should be introduced and a new, stable, and secured global reserve currency may also be an option to avert a catastrophe caused by any single country.”

There are some major government/Fed/Commodity Exchange manipulators of gold prices. Often when gold declines in the USA you will see it bounce back in Asia overnight. This is probably due to Chinese intervention.

Disclaimer - Personally I own  a group of dividend stocks including NLY, SNH, KMP, MO, HTD, ABV & AGNC and a few other smaller positions I have puts half of dividend stocks I own. I also use leveraged ETF’s TZA & SDS to minimize downside risk or make a profit. I buy everything in the hypothetical Investors411 portfolio. I will be purchasing additional YSL #5 stocks when we have a lower MO.*

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Long Term Outlook

(for US stocks only – not our economy)

NEUTRAL*

*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

Last Post for Week

Arab Awakening

Investors411 has covered many different points of views of the Arab Spring or Arab Awakening

Often the fear mongering Islamophobia of the Murdoch/American based media was contrasted with how much like us arabs are in just wanting freedom and better living standards.

Tom Friedman, in the NYT, has an especially relevant editorial, especially in light of Syria’s major attempted crack down against democracy. The money quote –

I still believe that the democratic impulse by all these Arab peoples to throw off their dictators is heroic and hugely positive.

YOUR Comments

4 of you have debated if corporations should be allowed periodic tax holidays to repatriate foreign earnings. The majority view seems to be that loop holds should be closed and/or taxes reuced rather than the “once evey 5 year holidays that cut 85% of the tax. “

Add YOUR view on this, stocks and other subjects in Investor’s411 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

Index	Percentage	Volume
Dow	-2.19%	up
NASDQ	-2.75%	up
S&P 500	-2.56%	up
Russell 2000	-3.26%	-

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.

Technicals, Fundamentals & Analysis

Shorter Term Outlook.

day/days/week

• Mea Culpa – I should have had a better insight into yesterday’s meltdown.  I’ve instituted a longer term Outlook call for the US economy as bearish, made the May 20th call, but my timing was poor.

• What the bond market is saying – Economic Weakness, low bond rates, Debt deal stinks. – From Seeking Alpha’s Cullen Roache

• Like always, after a major move on one day the next confirms or deies the move. All that has to happen for confirmation is holding onto most of the losses. Actually we, have had a series of high volume losses over the last 8 days get confirmed and that’s bearish.

• Two of our most successful technical forecasting tools listed below -

• The McClellan Oscillator (MO) chart fell to to -88.61(-30 somewhat oversold, -60 oversold, -90 OMG oversold). MO just 1 point away from OMG Oversold levels. Only 5 times in three years has the MO gone lower. (@-135+ was the lowest in May 2010 -after QE 1 ended and before QE 2 was introduced)  So it could get worse. However Current Level = Bullish

• $USD The Dollar rose again +0.34% yesterday (+/- 0.50 is a significant move and the dollar is usually a contrarian indicator) Technically we are sitting near bottom of a trading range. A minor two day move higher. Overall = Neutral

• Reading The Tea Leaves - I’ve mentioned DeMark Indicators before. He has a nine day indicator that says US markets should at least take a break today (this would be the 9th down day in a row for S&P). Also the volume looks like its reaching climax sell off levels (when taken as a whole over 8 days) and the MO is almost at OMG levels.  All this shows a bottom approaching, but their is some downside wiggle room between a -89 MO & -135 MO (see explanation above)

• Never Forget its is High Frequency Traders (This group is made up of high net worth individuals and entities) that now account for the vast majority of trading. You’re average investor has left a long time ago. Another $32.2 billion of less wealthy traders left mutual funds last week. (see yesterday’s update)

Longer Term Outlook

weeks, month, months

• Repeat – Some serious damage has been done to the US political structure as a functioning body. Even though we didn’t default everyone now realizes that there are a sizable number  of US politicians who are willing to hold the US economy hostage to their ideological beliefs.

• Repeat – For Main Street USA this means uncertainty. This will be devastating.  The debt crisis deal will cost jobs rather than create them. If you contract the money supply in the USA it means less jobs.  Investors411 mantra - How do you fix any deficit without jobs?

• May 20th forecast still stands. The recent Washington debt crisis debacle has focused everyone on cutting the money supply.  Simple math – The less money that’s out there = less jobs = greater chance the “Great Recession” returns. European debt and emerging market’s inflation fears add to this. Quantitative Easing (QE #1 & 2 plus stimulus kept our economic heads (especially the stock market) above water.

• JP Morgan seems to have recently overtaken Goldman Sachs as the #1 prognosticator out there and their chief economist says –

“FISCAL POLICY WILL CUT OUR 2.7% 2012 GDP FORECAST TO SUB 1%”

Until the Fed comes up with QE #3 or some other liquidity measure, stocks and especially the US economy are beginning to look like a double dip recession.

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Paul’s Corner Extra

This past week we looked at evaluating the market using Bollinger Bands (BB). Briefly if a stock is above the middle of the band good, if below the middle of the band bad.

I use a product called EdgeRater each evening to count the number of stocks in the S&P 1500 that are above the middle of their Bollinger Band or below the middle of their band. Last evening the results were shocking. Only 7% of stocks closed with a %B above 0.5. (Above the middle of their BB) Even more impressive 50% of the stocks in the S&P 1500 closed below the lower BB.

This shows an extremely over sold market. Numbers comparable to the flash crash and the ripping 08 down turn.

Barr likes to use the MO for market evaluation. Yesterday the S&P 1500 had a MO of -133, All Securities Index -80, NYSE -88, and the Amex -60. The MO summation index is pointing straight down and needs to bottom and start pointing up before is really safe to play. If you wish to bottom fish, good luck.

Oh for those of you who really don’t believe in chart reading, indicators and spending the $60 a month that I do for HGSI, July 27 HGSI gave a strong exit signal for the market.

My friend Ron Brown from HGSI sums it up nicely this morning:

“the markets are extremely oversold, but on the other hand, we have not yet seen a washout day where there is heavy selling at the open and the market reverses intraday to form a hammer. If you step in front of this moving train, make sure you know where you’re getting out if the balance does not materialize.”

So what’s the market going to do today, 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 – It’s been shaky, but so far NLY has held up reasonably well through current stock market slide.

In  my personal portfolio I still have a Put position to protect NLY. (strike price $17.00 for 3rd Friday in Sept)

GLD – (Long Gold ETF) Bought at 157.1 last week. (see last weeks blogs and comments section) –  Getting way too over extended above its 50 day moving average.  Have put stop in at 157.15. Yesterday up 2.41%.

If you’re a short term trader, you probably should take your profits in a rally for GLD.  Longer term investors probably should wait for better dip to buy opportunity.

Disclaimer - Personally I own  a group of dividend stocks including NLY. I have placed puts on one ETF of a major index and a couple of dividend stocks. I buy everything in the hypothetical Investors411 portfolio. I own some TZA & SDS (ETF’s that double and triple short the market) as hedges.

Mea Culpa – Bad move yesterday to remove some short positions.

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.

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Long Term Outlook (for US Economy)

BEARISH

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

_________________

Long Term Outlook (for US stocks)

NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

ALL TRADING INVOLVES RISK AND POTENTIAL LOSS OF PRINCIPLE

Meltdown

Yet more stories of greater than expected damage. Reactor #1 at the troubled Japanese nuclear plant has melted fuel rods. Here’s the money quotes from the Reuter’s story.

• “One of the reactors at Japan’s crippled Fukushima nuclear power plant has a hole in its main vessel following a meltdown of fuel rods, leading to a leakage of radioactive water”
• U.S. nuclear experts said that the company may have to build a concrete wall around the unit because of the breach, and that this could now take years.”

“Years” to contain the radiation. Already if you live 10 miles from the plant you are allowed two hours only to retrieve your belongings and have to wear a protective suit to enter the area for those two hours. Anyone who has seen the moving graphic (scroll down) of the radiation plume has seen that plume mostly go over the ocean but also its blown back across central and northern Japan.

The damage has been constantly underestimated by officials, but not by this blog. “Year’s“ of significant amounts of leaking radiation is a clear possibility or probability.

“Crackpot” Senator

” When the devoted follower of crackpot cult leader Ayn Rand gets elected to the Senate, you wind up having Congressional hearings filled up with feverish reasoning like this:” Link to video and editorial on Senator Rand Paul (Republican TN) The problem here is much of Wall Street worship’s Ayn Rand who wrote “The Virtues of Selfishness” The video is less than 2 minutes. Check it out.

Paul says if you think you have a right to health care “it means you believe in slavery.” So everyone who believes in medicare believes in slavery. There are some concepts Libertarians/Ayn Rand worshipers (and a Tea Party darling) have right. (example – end empire building) but when you peal away the outer shell its the core beliefs of leaders like Paul that are something rational, reasoned individuals must be aware of.

FYI – Republican congressman Ron Paul (Rand’s father) has officially launched his bid for president.

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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	+0.52%	flat
NASDQ	+0.63%	down
S&P 500	+0.49%	down
Russell 2000	+0.82%	-

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Technicals, Fundamentals & Analysis

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

_________________

Shorter Term Forecasting Indexes

There are hundreds of forecasting tools, – These two tools have worked

When they stop working Investors411 will use other Indexes

• The Dollar (USD) [Any daily price move over +/- 0.50 is significant. Dollar usually moves inversely to stocks] Dollar flattened +0.11%yesterday. Third major move higher in 6 day has created a short term bullish trend. Long term trend is still bearish for the dollar. For stocks shorter term trend = Bearish
• McClellan Index - (MO) [The very rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks .] Mo rose  to +11.41. Still in the middle of its range. Almost equal room to rally or fall = Neutral

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Dividend Stocks

More in this continuing series early next week. See part’s 1 & 2 by using calender at top of blog. Click on May 9th & 11th.

________________

.

Positions

Reading The Tea Leaves – Long term outlook below is still CAUTIOUSLY BULLISH and has been that was almost every day since QE #2 started in November. Shorter term forecasting tools

• The dollar – Stocks have held up quite well despite the short term rally in the dollar. This may continue as long as Fed POMO liquidity keeps managing/manipulating stocks higher. Without quantitative easing (POMO) the dollar would probably rise a whole lot faster
• MO has been in neutral the past couple days and given no strong overbought or oversold signal. So this shorter term forecasting tool is parked in Neutral

Analysis – Overall long term, remains the same CAUTIOUSLY BULLISH, probably will till the Fed QE2/POMO ends on June 30th. All the printed money has to have somewhere to go and stocks have higher yields than the near 0% interest rates of banks and better but still meager yields of bonds. If US stocks falter after 6/30, there will be strong pressure to continue to have some sort of liquidity program by the Fed.

UUP - The tracking ETF for the dollar still the index to watch. Dollar up significantly = stocks down

Disclosure - I have personal ETF positions in REMX and manage a fund that has a 5+ year position in GLD. I also own NLY and AGNC mentioned above

“I have a position” = Either I own it personally or a member of my family does.  I also manage an account for a non profit organization.

The Investors411 Portfolios – See POSITIONs Section of blog. – Click on word POSITIONS at top of page.

• REMX – Still trading above 50 day moving average which would be a buying point if your interested in owning rare earth mining companies.
• NLY and AGNC (two recommended high dividend stocks) still too far above 50 DMA to buy. Have buy order for NLY at 17.70
• YSL stocks according to longer term market outlook CAUTIOUSLY BULLISH are  in a position to buy. Shorter term Investors411 feels a lower MO is a superior buying position. Also each stock individual performance obviously matters. See Paul’s remark’s on right side of blog.

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Check out the advice, recommendations, analysis by bloggers on stocks,politics and trends in the comments section of the blog  Many of the best concepts regarding YOUR Financial Future are discussed their. Watch for Paul’s Corner every Tuesday and Thursday

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Longer Term Outlook

CAUTIOUSLY BULLISH

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

Iran Day 11

Iranian protestors – Photo from Andrw Sullivan blog

Neda Agha-Soltan has become the hero of the Iranian revolution from American media (LA Times here ) to Arab media here In fact al Jazeera has a whole section devoted to "Iran in Crisis" here Al Jazeera is an outlet for mostly Arab Sunni’s and Iran is Persian Shia’s. No love lost between these two groups. You heard and saw Neda’s story at Investors 411 3 days ago.

More of the same in Iran. Less on street demonstrators and more violence. Previously listed best  sources are still telling the story to the world. Some predictions from BBC – What’s next for Iran here

One issue that many on the far left are not going to like to hear. Israe l has certainly made mistakes in its two recent wars with Iran and her proxies (Hamas & Hezbollah). But seeing how the Iran’s "Supreme Leader" treats his own people you can see how hard it is to make some peace with him or his clients. Of course, the first the recognize and lavishly praise Ahmadinejad’s & "Supreme Leader’s" victory was Hamas (here) and Hezbollah (here )

Barack "Hoover" Obama?

Yesterday Abby posted an article by Kevin Baker on Obama from Harper’s magazine. Unfortunately you have to be a subscriber to reference the article. You can view some excerpts here The focus is that Obama has not and may not be able to change the strong intrenched interest that created the economic mess we are now in. President Hoover (his picture above) did nothing and the Great Depression grew.

Context We tore down the regulations on "free" markets and developed a massive credit debt over the last decade that has exploded. Yes, Paulson, Bernanke (more the previous Fed chair Greenspan) and Bush were leaders in creating this mess, but late last year when we stood on the edge of economic catastrophe they (PB & B) instituted a plan and prevented world economies from falling off a cliff. Bernanke, Geithner & Obama have followed through and added to that plan

Remember Lehman Brothers cause over $400+ billion dollars of debt to spread throughout the world when it went bankrupt. People were lined up in panic at insurance companies and banks. What if AIG, CitiBank, Merrill Lynch Fannie, Freddie. AIG and so many others had followed Lehman. The end result would have rippled through out the system and economic catastrophe would have been the result.

How Obama handles the economy is priority #1. Because it is the world’s economy and he is easily the most important/influencial figure. Unlike Hoover whose inaction significantly added to the Great Depression Obama has acted. But its those entrench interests that have dug in. Time will tell.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING

Index	Percentage %	Volume
Dow	-2.35%	down
NASDQ	-3.35 %	down
S&P500	-3.06%	down
Russell2000	-3.88 %	-

-

Technicals & Fundamentals

US markets took a major hit on a bad economic forecast from the World Bank.

The volume was again below average. It hard to be sure about making a forecast when our #1 forecasting tool – volume – gives no indication of which way prices will flow.

Major event – Fed Meets today and issues statement on Wednesday

Yesterday’s major event was The World’s Bank lowered its outlook for the world’s economy this year from -1.7% to -2.9% .  This is some truly bad new s for long term investors.

Since volume is out as a forecasting tool right now, today’s price move will act as a confirmation of yesterday’s move. Do we fall further (bearish) or rebound (bullish)?

Significant forecasting tools/Indexes for stock markets

Note - Repeated statements in brown

Right now, there are two indexes that are significantly influencing stocks in the USA & world. The US dollar in the short term and the BDI in the longer term

$USD -  The dollar is the index to watch. Dollar went up +0.57% yesterday. Any move over 0.50 is significant.  It looks like the dollar may be establishing a short term bullish pattern (see chart)  of higher highs and higher lows. Still to early to tell.

All together now -  our mantra – when the dollar goes up stocks go down . This strong inverse correlation has existed for many moons.

BDI - The Baltic Dry Index measures the flow of goods (world trade). 24 up days in a row, 6 down day in a row,  a 6 day rally and the BDI fell minimally on Friday and significantly yesterday. This is a very important chart that has just rolled over. It usually moves in one direction for an extended period of time.  If it moves past and creates a lower low than it had eight days ago it would be a serious sign of trouble Right now, the momentum is with the bears.

If trade is diminishing through out the world then a worldwide recovery is in big trouble.

You can play with the chart and create different settings to get a better idea of what’s happening, (the same with all other links to different charts)

Reading the Tea Leaves

Still think this market has moved too high to fast and is a technical rebound. As stated two weeks ago we may see a 5 to 10% technical fall or consolidation. This week fearless forecast – Another down to flat week. The benchmark S%P 500 has already broken through support and fallen 6 to 7% from its high to  893. Next significant support level is 875 to 880. As stated above volume is NOT confirming (or has yet to confirm) the downside move. So far this still is a technical correction of a market that went too high too fast.

Both the dollar and the BDI have started to trend in the wrong direction (If you’re a bull on stocks) Add the World’s Bank prediction and you have lots of reason to hear the bear’s growl.

Got burned with this the last time I did this, but buying a little protection on any minor rally. Adding small position in SDS (ETF that does 2X the opposite of the S&P 500)

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING