Happy Talk

The happy talk by governments and  media outlets around the world have masked the severity of the 2008 economic meltdown. Today, that same happy talk hit reality in Japan.

TEPCO and the Japanese government has continued to underestimate the problems in Japan.

• The lead story in yesterday’s NYT examined “Vents that American officials said would prevent devastating explosions at nuclear plants in the United States were put to the test in Japan and failed.” (Thanks to frequent blogger Popeye for heads up on this.)
• Today we learn that Japan’s GDP for the last quarter was almost twice as bad as was predicted. Last quarter’s GDP was -3.7% making Japan officially in a double dip recession.(Two negative quarters of GDP)

The sky is not falling. However, its time for some  realism when comes to economics and nuclear power.

• The USA is the ONLY country that is NOT stopping to evaluate  its nuclear program in light of the Japanese disaster. Shouldn’t we pause to evaluate nuclear power?
• Japan was the #2 economic power in the world till this year and its GDP had turned negative before the nuke disaster. Our economy and the worlds is in a fragile recovery. Shouldn’t the immediate focus of our politicians be insuring that we recover?

Without recovery there will be no funds to impact problems of the future. Japan seems to be taking the right role and focusing on recovery. Our politicians in the USA should do the same.

“The Donald Ducks”

Headline from Politico

Three of the leading Republican candidates (Gallop Poll) effectively ended their quest for the presidency this week.

Mike Huckabee – Announced he would not run – Not to worry he will keep his FOX News show. Directly after his announcement in what only can be considered as bizarre Fox news ran a long infomercial as Donald Trump monologued his assessment of Hukabee, Obama and politics.

Newt Gingrich- Announced that Ryan’s plan to privatize and eliminate Medicare was “too radical.” This brought down the wrath of Republicans and then led Newt to say opps it was the media’s fault. Ryan’s plan will cost more and cover less (Goggle the words – CBO, Ryan & medicare) for American according to the non partisan Congressional Budget Office.

The Donnald - Announced he would no run – Not to worry he will keep his TV show. Trumps tough talk (fear mongering, finger pointing, & bigotry) and constant references to his TV show had catapulted him to the #2 position behind Huckabee (Gallop Poll) in the race for president. Wake up and smell the coffee, this run was all about Trump’s ego and his show. Everyone from the media on down who took his candidacy seriously was played for a sucker. (see Popeye’s remarks in comments section of blog)

The new Gallop poll has two new front runners for the presidency.

Mitt Romney – A candidate in 2008 whose cardboard presentation and flip flops on positions made John McCain look like John Wayne on Steroids. If Newt stays, undoubtedly, folks will evaluate which of the two has changed more positions. Romney wins the cardboard contest hands down.

Sarah Palin – Mama Grizzly can always say grrrr.

Maybe a better candidate will emerge from the pack. Stay tuned.

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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	+0.65%	Down
NASDQ	+1.14%	Down
S&P 500	+0.68%	Down
Russell 2000	+1.60%	-

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Technicals, Fundamentals & Analysis

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

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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 was flat +0.03% yesterday.  After a big run  higher for 8 trading days the dollar has flattened or retreated for the last 3 days. Three flat days is neutral. but momentum is still with dollar bulls. If the dollar continues to move sideways the outlook will change to Neutral. For stocks shorter term trend = Bearish/Neutral
• McClellan Index - (MO) [The very rough guideline is over +60 = overbought market = sell positions or short stocks, & -60 = oversold market = buy stocks .] MO fell to -40 two days ago and rose to -9.04 yesterday. Accurate prediction from Tuesday MO is – On its way to oversold (@-60) Another bad day or two and we should be ready for at least an oversold bounce. We got that bounce yesterday and, depending on the dollar  could hold onto those gains today. However MO is now near Zero and therefore = Neutral

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Paul’s Corner

What an interesting week so far, at the start of the day I don’t know whether I should open a new bottle of Tums or put on the party hat.  Wednesday was a good day and most of Your Stock List looks ok with many stocks in a good buy the dip position.

So how do we “buy the dip” without “losing the house’?

Buying when a stock drops and touches the 17 or 50 DMA or if below when it crosses up through the average is usually a good method. In many instances a stock isn’t at a moving average or is even slightly below the average so we need to place a buy order above the previous days high to get a safe trade.

LYB took a serious hit this week along with the sell off of the commodities and now is in a buy the dip position. I have prepared a PDF  file  explaining  how to safely trade LYB in a  “buy the dip” position .

LINK

Take a look at the stocks in Your Stock List [click on word POSITIONS at top of blog and scroll down for list] and you’ll see most are in the “Buy The Dip” position.  SPRD and JNPR would not have been bought yesterday may 18  using this method since they didn’t raise above their close on May 17.

Remember, you are responsible for your investment decisions, and I am not.  Please do your diligence, and please take ownership for your actions.

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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

Will Any of YOU Defend Obama?

huffington post phot

Check out the last 4 comments on the right side of the Blog starting with Bob Sadinsky’s – “Republican Lite” Besides someone else would have done worse (McCain & Palin) is there anyone out there who will sing Obama’s praise?

D. pointed out Tom Friedman’s we need nation building at home not Afghanistan  -  LINK Popeye does damn with faint praise – Afghanistan speech was a brilliant political move for Obama & Abby Gold reminds us what’s happened in Afghanistan to invaders for the last 100 years.

One of you privately sent me an email of someone very significant who praised Obama on Afghanistan – Mike Huckabee LINK Huckabee was the leading Republican candidate for president. Unfortunately, he’s toast as a candidate. He granted clemency to the guy who killed the 4 cops sitting in a Washington cafe.

Huckabee might not have  been your political cup of tea, but he was a decent guy who, like Obama made overtures to fellow American’s who disagreed with him. The Republican’s leading alternative is probably Sarah Palin – God help us.

So here’s some Obama good news from me besides he gives eloquent speeches – Bank of America is repaying $45 billion of its TARP loan with interest, the economy is clearly stronger as measured by GDP (in part due to stimulus package) and the rate of job loss is declining.

Remember Larry Wilkerson’s words from yesterday’s Update -

“If you are a praying person, he {Obama} needs your prayers and support. If you are not, he needs your support. Because all of us Americans put him where he is–and I do not mean by votes. We–all of us–let George W. Bush and Richard B. Cheney set us up. Moreover, we all contributed to creating the perilous fiscal state that is now a more dangerous threat to our country than any terrorist could ever hope to be”

KISS & STOCKS

Keep It Simple Stupid

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index	Percentage %	Volume
Dow	-0.18%	down
NASDQ	+0.42%	down
S&P500	+0.03%	down
Russell2000	+1.17%	-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

• Brown = repeat statements
• Green = usually bullish statements
• Red = Usually bearish statements

Technicals, Fundamentals & Analysis

The dollar rose a modest +0.34% and this seemed to keep a lid on a growing desire for stocks to rally.  Were in December so I guess you can call it a Santa Clause rally led by internet retailers like recommended AMZN (at new high)

Bernanke’s confirmation hearing goes in front of congress today. No matter what you feel about the guy, if he does not get confirmed it will hurt stocks.

Jobs # for November on Friday.

Now going to get a bit more technical

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

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Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI - The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI rose +82 points yesterday and closed at 3836. Technically  the BDI broke out through its major resistance level 4291 (this year’s high) over a week ago.  The BDI has rallied about 1700 points since late September. After 16 up days in a row, 9 down days in a row & down through the former resistance/now support level 0f 4291 . This is a chart that usually gives off signals – the rate of decline was slowing and yesterday turned.

What it means – Long term we created a higher high on the chart = Bullish. The BDI is far more useful as a long term indicator of not only world trade, but specifically China and growing emerging markets. Recent price drop-Nothing to panic about yet

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The Dollar is currently the #1 forecasting tool .

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar. Mantra – Dollar up = US stocks down & Dollar down = US stocks up US dollar rose  +0.30% yesterday . Anything close to or over +/- 0.50 is significant  The dollar closed at $74.64 . 

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$NYMO The NY Stock Exchange McClellan (EOD) Index measures how much the NYSE is oversold or overbought .

The index closed at +25.24 This is a slightly Overbought Position . This chart is showing we seemed to have reached a plateau. It’s spilled over a little bit, but the McClellan index has moved between +25 & -25 .  There has been no clear buy or sell signal for over a month,. Oversold conditions (@ -60) = buy, Overbought positions (@+60) = sell

The closer we get to +/- 60 the better our chances of making money with a shorter term buy/sell signal

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

This section need to be updated – Sold 8% (24 to 16 % position in portfolio) of FXI and all of DGP. Taking profits was a mistake and bought back all of DGP (Double gold) & 1/2 of FXI.  This all happened because yours truly got spooked over the Dubai crisis.

Recommended ETF’s

Gold (GLD & DGP) – (recommended positions) is also at a new high. Warning – this ETF is starting to go parabolic (up too far too fast) Perhaps we have reached the top of the parabola. If  we have another day or two of volume increase and major price move (above 1%) we will probably get at least a short term hit. Long term holders – the fundamentals are still good. Traders and shorter term investors keep a close on this growing parabola. Time to take some profits – now or in next few days (depending on escalation of price & volume)  Sell into the parabola

MOO – Our new agriculture ETF is also at a new yearly high and on a breakout run.  Each of the recommended ETF (except anything that is 2x or 3x a sector or country) is hopefully a long term position.  This stock is fundamentally aided by the growing middle classes of India and China eating better and a falling dollar.

EWZ (Brazil) – Again at a new high.

FXI – Overall excellent for the year, but lagging right now and within a few percentage points of new high,

NVS -(A stock, not an ETF) Our swine flu play – we had a nice run with this stock now up over 20% – It is a solid company, but it was mainly a swine flu play.  Our town is getting out shots on the 7th.   We already took 1/2 the profits on NVS and will take the rest in any slight rally. The scare is diminishing. This stock had a big volume decline yesterday. Looks like the momentum players are heading for the exits.

Long Term Outlook = CAUTIOUSLY BULLISH