45 Park Place NYC – Former Coat Store

Burlington Coat Store

It seems American media has one again spun, hyped, fear mongered & distorted facts to create a monster controversy. Building a Moslem Culture Center at the Burlington Coat Factory Store (45 Park Pace) building near the former Twin Towers has become Building a Mosque at Ground Zero or “Sacred Ground” (Newsweek Headline)

Now across the country this outrage has spread to protest building of ANY Mosque for the 6 to 10 million American Moslems.  This makes sense to the growing numbers of bigots in America. Why not, there are those that believe no Catholic Churches should be built because it is a religion of terrorist child molesting priests.

If winning the war against the lunatic jihadists who attacked us on 911 shown anything, it is that we must separate them from the moderate Moslems (the 6 to 10 million in the USA alone)  - almost all of whom are not Al Qaeda terrorists. Obama, General Petraeus and even George Bush realized this and developed appropriate strategies to divide the terrorists from the moderate Muslims.

Our American bigots want to lump all Moslem’s together Remember Neda heroic death protesting the brutal Iranian dictators?

Moslem’s/Neda did not attack us on 911. It was a group of vicious, fanatical, insane terrorists from al Quaeda. The answer to defeating these terrorist is NOT to devolve into the same kinds of beliefs and intolerance they and others like them have.  If we as American’s cave in to the bigots then Osama Been Forgotten has truly won.

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 the month – The Black Box/High Frequency Traders BB/HFT control the majority of trades. Paul R in the comments section has found a great source describing the BB/HFT traders and consequences of what they do.

O.M.G. Another day in the world of BB/HFT trading.

Even though Investors411 stated yesterday “the bulls seem to be loosing control” – Cowabunga - what happened? Collectively the dollar opened up an unheard of +1.80% and stayed their. (You can follow this by using often mentioned dollar ETF – UUP) Didn’t see that dollar move coming.

Your average investors have flocked to low yield bonds and are huddled their under the table. Some braver investors have chosen high dividend stocks – They got burned yesterday, but they should be more successful than your average stock holders in the long run.

The reason for the massive selling in moderate/average volume - ???? – There was no news out there that didn’t seem already built into most investors consciousness.

• The FED suggesting the US economy is shaky – We all know that.
• China slowdown. This is a planned slowdown as their stimulus funds have run their course and their worried about overheating GDP.
• Yes, there is a lot of vacant buildings in China and a housing bubble building, but there is also 10′s of millions of new members to China’s middle class each year.

Significant Indexes

• The Dollar (USD) had a OMG rally yesterday. [Anything over +/- 0.50 is significant] USD up a massive +1.84%. Don’t ever remember such a huge move. For stocks = Bearish
• The Baltic Dry Index (BDI) [measures cost of world trade/proxie for China & emerging markets] kept starting to go parabolic (+7.50% yesterday) Prices starting to go parabolic are a Danger sign but still = Bullish
• McClellan Index – (MO) [Basically longer term  - the rough guideline is over +60 = overbought market = sell or short stocks & -60 = oversold market = buy stocks.] MO fell to -32.95 Approaching oversold,but still = Neutral

Reading Tea Leaves

Welcome to the world of BB/HFT trading/investing - Jsovajani in his last comment states right now  ”the most important concept is capital preservation” and many of you bemoan the fact that Investors411 has not plunged into stocks this year like it has in the past. = capital preservation.

The good news – Our +/- 60 level on the MO has clearly become a fairly decent forecasting toll of when the BB/HFT will turn (see chart). Investors411 is going to stay and expand on this strategy. But we all need to have patience (including me) till the time is right to invest and to realize that its probably NOT going to be a long term investment, but one that lasts a couple months, weeks or days.

Positions

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

Current positions – NONE

• EWZ (Brazil – Now 0% of portfolio position) Bought at 69.80. Sold last 1/2 at 69.03 for -1% loss First 1/2 sold at +2% profit.

From yesterday – “The Bulls seem to be loosing control.” They lost it. “Perhaps the MO will drop low enough to consider buying again.” At -33 on the MO we are approaching the -60 oversold level

Long Term Outlook – NEUTRAL

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

“The Other Plot to Wreck America”

We get fear mongered about terrorism 24/7 yet obviously more American  lives within the USA will be directly impacted by everything from cancer to car accidents.

The other plot to wreck America is financial – the Shadow banks and the politicians, investors,lobbyists, and businesses that protect them. NOTHING has been done to to fix it.  We ignore the 9/15 crash (Lehmann Brothers) and it will happen again and again. American’s are being kept blissfully ignorant.

“What we don’t know will hurt us, and quite possibly on a more devastating scale than any Qaeda attack.” This make’s last Sunday’s Frank Rich’s NYT editorial a must read.

Bubble Warning

The Economist, one of the worlds most influencail economic magazine predicts “Markets are too dependent on unsustainable government stimulus [around the world]. Something’s got to give.” Sorry, you have to subscribe to getfull story.

YOUR Comments

Why us? Popeye (see right side of blog) asks the question Helen Thomas did at an Obama/Homeland security conference last week. Why is al Oaeda NOT attacking a hundred other countries? He lists a dozen major countries. Osama Been Forgotten’s old 1998  fatwa lists 3 reasons for his attack

• US troops in Saudi Arabia
• UN sanctions in Iraq were killing children
• US support for Israel

“Privatized War & Its Price”

The Roman empire privatized war before it fell and so too is the USA. The lead editorial in The NYT carries the above headline. We have outsourced war (with YOUR) tax dollars just like American companies outsource jobs. Blackwater and other undersupervised contractors have no code of military ethics and are perhaps the #1 reason we loose the hearts and minds of the countries we occupy. Ironically similar to Avatar.

AVATAR bigger than Titanic

Avatar in 3 D is on its way to shattering Titanic’s box office. $1.34 billion in 4 weeks vs. Titanic’s $1.8 billion.  BUY some IMAX stocks.  Forget waiting for the dip.  Start small and build. With 3d TV on the way, & newly mastered 3d technology IMAX should end up over 100% without some huge stock market or individual  disaster.

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

See Positions , Strategy , and Overview for changes made over weekend.

Major US markets rose in the last 1/2 hour of trading.  Why not – 15 of the last 17 Mondays have been up days.  This was, in part, a mad last minute buying of traders to get ahead of “Merger Monday.”  There may not be lots of mergers, but stocks follow patterns and Monday’s have a stellar record over the last 4 months.

The employment numbers for December - 84,000 – below expectations, but stocks rose - Why? – The number is sway better than last January’s - 700,000+ But for stocks the below expectations is more important. A quick jobs recovery is actually and perversely  BAD for stocks.  The reason is the quicker the recovery the sooner the Fed will raise rates.  Right now investors/traders are forced into buying stocks because everything else is at such a low interest rate.

Therefore , Low interest rates are one key to US stocks moving higher.

• McClellan Index at +32.89 = A bit overbought.  The index has moved higher for a week. There is still some wiggle room for US stocks to move even higher before they reach @+60 or overbought territory -  There’s a long way to go till we reach @-60 or oversold.
  

The McClellan Oscillator is showing less room for upside gain.   However, technically this chart shows a series of 4 higher highs and a solid base at sero – It’s bounced 3 times off this number and is now a short term buying point.

Earnings season starts this week. A (Alcoa reports on Monda)y and at the end of the week some bigger companies.

Fearless Weekly Forecasts -

• From last week “Up at start of week and decline at end.”  I thought the jobs number would be around zero (expectations of market was same) and investors would sell on the news.  We did have a great start and an up week.
• The weaker than expected jobs report (but not too bad) was just what stock bulls want.(see above)  Should be another good week for bulls.  Until the McClellan Oscillator reaches overbought territory bulls rule.

The long term bull is trend is firmly in place, but we are getting close to overbought territory.

Positions

The  Positions Section (also at top of blog) has the latest buys and sells (Usually updated over weekends)

These are positions I actually own

SELLING & BUYING

Adding a small position in IMAX – Will build this on dips.

More on other stocks tomorrow.

See POSITIONS (scroll down) for details on this and what’s under consideration for 2010.

Long Term Outlook = CAUTIOUSLY BULLISH