• Warren Buffett – “Why should I have a lower tax rate than my secretary”

• Steve Jobs -  Fox News is - “An incredibly distructive Force”

Remember the giant corporations and the weathy have  an army of lobbyists and lawyers in Washington. This is what they pushed for

• 1998 – Tore apart banking regulations like allowing  banks to merge with insurance companies

• 2004 – SEC allows bank over leveraging to grow from 12 to 1 to 40 to 1

• 2008/09 – Financial meltdown. Housing crisis, Bush/Paulson  bailout of too big to fail banks. -9% GDP & stocks tank

Nothing we can do becuse its all legal They privatize gains. We taxpayers subsidize the losses

• Romney (uber wealthy) paid 13.9% rate on his 2010 taxes while most working American pay far more.

• Romney’s company Bain, like hedge funds and other investment firms, pay only 15% on their profits while small business pay a much higher tax rate.

• Romney, sets up $100 millon dollar tax funds for all his sons without paying taxes. We can’t.

• Gingrich, like all politicians, can exit politics and make millions lobbying for government agencies (Fannie & Freddie)

.

ITS LEGAL, ITS LEGAL, ITS LEGAL

Because they own our government.

Elizabeth Warren -

In her passionate plea to fight for the working middle class -

“Washington now works for those who can hire an army of lobbyists and an army of lawyers … 30 largest companies pay more for lobbyists than they do taxes...Who really pays for that?…And the answer is America’s middle class. They’re the ones left to pick up the pieces, to pay the taxes, to keep the country running.”

.

The Cleaver Family from 60′s sitcom Leave it to Beaver.

RIP – Middle Class America

The middle class in America is being systematically wiped out of existence in America by Americas growing wealth oligarchy. Say good bye to The Beaver

Editorial is from Business Insider features 22 statistics showing America Middle Class is headed toward oblivion. This is documented & substantiated evidence that the middle class is being wiped out by the rich oligarchy in the USA. Many many thanks to Robert H for finding this article.  Here’s just a few of those stats –

• 83% of all US stocks are in the hands of 1 percent of the people.
• 66% of the income growth in the USA went to the top 1% of Americans from 2001 to 2007
• 36% of Americans contribute nothing to retirement
• 61% of Americans live mostly paycheck to paycheck in 2009 vs 43% in 2007.
• Bottom 50%of Americans own less than 1% of nations wealth.
• 40% of Americans are employed in low pay  service jobs.
• Competition China garment worker makes 82 cents an hr. Cambodia 22 cents an hr.
• 35.4 is the ave. amount of weeks it takes to find a new job.

The list goes on & on, but you get the picture. Send this to your friends

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Technicals, Fundamentals & Analysis

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

Mantra for week -The Black Box/High Frequency Traders control the vast majority of trades.

Another typical light/decreased volume rally that has become the norm for the Black Box traders that control the markets.

Major indexes are cutting through support levels like a knife through butter. = Bullish

For only the 8th time in history the Dow has seen triple digit gains over 3 days

Significant Indexes-

• McClellan Oscillator (MO) rose  to +97.25 [+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. 79.25 = BEARISH
• US Dollar –  The dollar  fell  -0.46% yesterday [Anything over +/- @0.50 is significant.] The dollar/stocks relationship is strong – Dollar up = stocks down and visa versa. Dollar just broke a major support level yesterday = Bullish
• BDI - The  Baltic Dry Index (Measures cost of shipping – Higher costs good = more being shipped = Bullish. Also, good proxy of China.) BDI was in free fall from a high of @4200 to 1700 . This was a huge -60% drop in 8 weeks is very bearish Often a leading indicator for stocks. Here’s a 3 year chart of BDI for context. The BDI has staged a 7 day+8% rally and is at 1841 = bullish

Reading Tea Leaves-

The Black Box/High Frequency traders are on a buying rampage. You can’t call it a parabolic climax buying spree because of the lack of volume. Then again the BB/HFT have shatted all the former technical rulus about volume.

Because support levels have fallen, any small dip will now probably be bought into by non Black box traders.

Both the dollar and the BDI have clearly reversed their trends.

Positions

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

Updated over weekends Investors411 holds ONE position in SDS at this time

Sticking with overall strategy. But its looks more and more like a trade.  Looks like the original SDS (Short ETF trade) is going to loose $)

Instead of catching a downside move in a bear market , its turned into a downside move in an overbought bull market. This also makes the chances for success less and you have to be a more nimble trader instead of investor.

Strategy - From Monday - The same as before – “If/as US major indexes become more overbought the more ETF’s that sort the market will be purchased. Starting out with SH. Then the higher above 60 the MO goes, the more SDS (200% short the S&P 500) and other even 300% short ETF’s will be used the higher the MO goes.  See POSITIONS section at top of blog for more. Therefore what is happening is a series of trades (Short ETF’s) the more overbought the market becomes.

The same entry/exit strategy applies. Considering dropping exit/entry point to 4 instead of 5%. See Friday’s Investors411 for more. The following trades were made Friday.”

SDS (ETF the shorts the S&P 500 at 200%) was bought at 32.50 Nibbled with just a 2% of portfolio position.

From Yesterday

EWZ (Brazil) an ETF Investors411 owned for years is again outperforming and is a buy the dip opportunity.

GLD - (Gold) has come down off its high and any further dip Investors411 will buy.

Paul & Monitor in the comments section and several of you privately are anxious to reinstate the June 2 2010 YOUR Stock List – Using the old list as a starting point – will try to put a list of a dozen stocks together to buy on a dip.

Right now EWZ is the leading ETF candidate.

Long Term Outlook - NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

-

China

For well over a decade the big government, tightly managed, Chinese capitalist system has kicked ass.

Their GDP in past quarter was above 10% and its projected to stay near that lofty range.  It has obviously outperformed the casino/free market capitalism of the USA which has brought us a tech bubble and a financial/housing bubble. Both led to two major worldwide meltdowns. It has also outperformed the more socialist models in Europe, that adopted US shadow banking for their own.

China’s growing because money is flowing into a growing middle class while that same middle class is shrinking in  the USA.  In fact every democratic and capitalist economy from India to Brazil that is outperforming ours is growing their middle class. Perhaps China can manage to slowly cool down. Perhaps not. If the Chinese bubble bursts, so will economies around the world.

The problem here is this one party state that does not foster Democracy.

Elections

Primary Day in a dozen states across USA. Some results

• Most under reported is Prop 14 passed in California – “will give every voter the same ballot in primary elections for most state and federal races, except the presidential contest. The two candidates with the most votes would advance to the general election, regardless of party affiliation.” - Interesting.
• Blanche Lincoln won in AK. There was a progressive challenge that fell short. I love Lincoln’s derivative bill and hope it passes congress.
• Harry Reid got who he wanted to win in NV – The Tea Party candidate that wants to store nuclear waste in Nevada. He had little chance against her opponent in polls.
• For more see Huffington Post

Robert Kuttner

Scorecard on Financial Reform

This week/today we get to see what financial reform will look like when it is voted on. Many of what was necessary will be stripped. The Banking Showdown by Robert Kuttner is an excellent source on this.

Your Comments

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

• Paul R educational insight and others on stocks. – continues
• Jim J., John S. & Popeye on Israel – Looks like they settled on an International group should look into incident. Perhaps so, but Israel will never agree.
• Yankee Bob and others on BP – Got caught in a BP on line nightmare

KISS & Stocks (Keep It Simple Stupid)

If you don’t understand a term look in up at Investopedia.com dictionary

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

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

Technicals, Fundamentals & Analysis

US markets looked over the cliff, decided not to jump and backed away in increased, above average volume = Bullish

US Markets rallied into the close = Bullish

From Yesterday – “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”

We went down to the line in the sand for the second time since it was established as the yearly low in February. It held. Technicians call this a triple bottom and get excited. Fundamentally this held because the dollar fell. That’s what to focus on. But the fact that it held = Bullish

Financials was one sector that led this rally (+2.09) Weak financial reform likely outcome in congress. Materials was the other sector (+2.27) = Bullish

Significant Indexes

• McClellan Oscillator rose yesterday to -28.47 [+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. We are a bit overbought, but basically = NEUTRAL
• US Dollar –  The dollar fell -0.34% [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 Monday’s +0.25% gain. The dollar fell yesterday so stocks rallied.

Reading the Tea Leaves . From yesterday-”Expect central banks to intervene and BUY the Euro to stop the growing panic….Would expect some sort of relief rally today after two days of significant price declines and strong support level in front of us. But watch out later in week.”

Strong volume behind yesterday’s rally  and a -28.47 on the MO (we are a bit oversold) indicates a rally is getting started and has some room to run.

Bottom Line – The Dollar Rules. This rally will hold as long as whichever (probably a combination of Swiss, German US, French, Chinese? etc.) keeps buying/propping up the Euro.  Short term trend = Bullish

However the long term trend is still dollar up and Euro down – For stocks = Bearish

Positions

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

Traders – Conventional wisdom says that stocks that held up best while others got toasted are the ones to invest in if markets rally – be it for a day, two a week. But sometimes those high beta stocks from YOUR Stock List that are down the most take a big initial first step. Those from YOUR Stock List still above their 50 day moving average and turned with the markets yesterday may be worth a trade today.

• VCI
• SNDK
• SAM
• BIDU

I’m perhaps too emotionally involved, but IMAX looks good and their seems to be a good lineup or 3D movies this summer.

Financials – No real reform = Bullish

• XLF – Investors could nibble here.
• UYG – (2X Financials)
• FAS -(3X Financials)

Still holding VIC, ESRX & SDS (may take profits in SDS) – Today considering positions in FAS (short term) & UUP (longer term) The later mirrors the dollar and also may be good for Investors to nibble

Long Term Outlook = CAUTIOUSLY BEARISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING