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Senate Fails to Break Shadows

3 Republicans and 30 Democrats stood up to the mega Shadow banks & their lobby yesterday in support of the Kaufman/ Sherod Brown legislation to break these massive financials. Senate Finance Committee Minority leader Richard Shelby (R) & Senate Majority leader Harry Reid (D) vote yes. The above link has a list on how YOUR Senator voted.

Opposition came from the vast majority of Republicans and the Summers/Obama White house. This whole group is owned by  and protects the Shadows.

Hopefully Main Street can still win some crumbs or a pice of the toast instead of getting toasted in the finacial regulatory legislation.

Greece vs. USA

Greece’s problems are many ways are similar to the USA. The major difference is in the solution.

The central Bank of the USA can print money and loan it out at @0% to shadow banks who take that $ and not so secretly invest most of it in highly leveraged derivatives instead of less profitable loans to small business and consumers.

Greece can’t print money to bail itself out like the USA. It is under the jurisdiction of the European Central Bank (ECB). Therefore, it can only get TARP like loans from other countries and the IMF.

Some where down the line all the $ we print are going to slap us with inflation. But for now its kept us from sinking.

EU Contagion

The 2008 collapse has created massive problems for PIIGS and former Russian satellite countries. Example Spain’s unemployment is at 20% Yesterday’s map of debt obligation is the tip of interconnected obligations that spread worldwide and are exacerbated by derivatives sold on that debt.

Nobel Prize winner, Paul Krugman has an excellent editorial. Krugman recognizes the European Union’s main problem

“The problem, as obvious in prospect as it is now, is that Europe lacks some of the key attributes of a successful currency area. Above all, it lacks a central government.”

He goes on and explains how Greece is different than our governments bailout/relationship with California. The only logical endgame is -

“Greece leaving the Euro…unless European leaders are able and willing to act far more boldly than anything we’ve seen so far.”

Another possible solution from MIT’s Simon Johnson & co author.

Bottom Line for Investors – Fundamentally its hard to see a bottom until some resolution comes to pass. Till then, we will all be slowly twisting in the wind.

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 for changes made each weekend

Massive loss in massive selling. Technically, we have gone elliptical to the downside. On a pure technical basis we are near the end of the downside move. = Bullish

However both fundamentally and psychologically the stocks across the world have been damaged and hopes of a V shaped worldwide economic recovery have turned into U‘s, W‘s L‘s and perhaps worse. The entire group of talking heads on CNBC, the #1 financial cheerleading channel, looked liked deers caught in the headlights. The trotted out Nourille Roubini (a Dr. Doom) to jawbone this AM. = BEARISH

Failing to break massive shadow banks = Bullish

A technical glitch caused caused a massive 1000 point drop in the DOW (similar drops on all indexes)

Therefore, its hard to see any rally NOT getting sold into and another low on the way. Stocks broke through support levels like a knife through butter. The only piece of good news is in the short term stocks are getting so technically oversold that they are close to running out of sellers.

Monthly Unemployment rate up to 9.9% But non farm payrolls up +290,000 This is a STRONG number (@+180,000 was expected) and other months were revised upward. When Obama took office it was over -700,000 I have no idea why such a strong jump in numbers equates to a rise in unemployment. But end result = Bullish

• McClellan Oscillator fell dramatically  to -113.71 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. – In the last three years the MO has only reached pass this level 3 times –  10/08, 3/09, & 10/09
• US Dollar – rose another massive +0.87%. This marks the 4th day in a row of huge gains. You have to go back to the 2008 stock meltdown to see anything similar. [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules Rising dollar almost always = falling stocks. The dollar is rising mainly because of the fluctuations in European currencies = Greek debt.

Bottom Line -Roller Coaster Rally day, but real long term fundamental problem from Greece spreading.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

The DANGER WILL ROBINSON, DANGER DANGER SIGNAL is as many of you long time readers know is the signal to duck and cover. It the strongest warning Investors411 gives of impending doom.  Investors sold its remaining position in EWZ (Brazil) near the open yesterday for a loss.

Long term what’s happened is bad for US markets - The higher dollar is a killer for any US company that makes profits abroad and will take a chunk out of economic recovery including job growth. Until we see a measurable reversal in the dollar both stocks and our economy are going to have trouble.

Gold has become a proxy currency and Investors411 mentioned last week GLD was a good investment, but never pulled the trigger. A buy the dip ETF

Today, Investors will start nibbling on IMAX & perhaps ESRX on any further dips. Both stocks have compelling reasons for long term growth, except in another world wide meltdown. This may be a shorter term trade

Caution – There is probably more major downside to this market because of Greece. The first major rally will get sold into & Investors will use ETF’s that short the market when this occurs. Example SDS = @2x shorts the S&P 500.

Long Term Outlook = NEUTRAL

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING

Drove my chevy to the levee
But the levee was dry
And them good old boys were drinkin’ whiskey and rye
Singin’ this’ll be the day that I die

American Pie lyrics by Don McLean

General Motors is Back

Today GM announced its paying back $5.8 billion in loans and interest to American & Canadian governments – just nine months after government supported bankruptcy and promises to pay the rest back by June.

Remember all those Republicans, especially Senator Richard Shelby (from SC who had Toyota plants), fighting to keep GM from being bailed out even though it could have cost millions more American job losses related to the car industry.

Obviously GM and other car companies still have problems to overcome, but GM, and my wife’s favorite – the Great 57 Chevy (photo above) – is back in less than a year  Thank You Barak Obama – for a Main Street bailout that kept American jobs and taxpayers off the unemployment lines.

Investors, GM news =Bullish

Goldman Sachs

Remember the 3 Monkeys covering their eyes ears and mouths- See no evil, speak no evil, hear no evil. They control Wall Street right now. The gargantuan shadow banks are simply too big & lawyered up to obey the law or fail.

We all know that virtually all Republicans (the secret meeting with 25 shadow financials big wigs on Wall Street) and many Democrats are owned by Wall St. not Main St.

Popeye in the comments section finds it amazing that the SEC is going after Shadow Giant GS because they are such a huge “cash cow” for the Democrats and Obama

From your credit card to your home loan to your stock market trading to your taxes -YOU get crunched by the huge shadow financials. No web site explains it better than the one from MIT The Baseline Senerio – “Break Up the Banks”

Obama BIG Speech

Thursday Obama will address the Nation on Financial reform. Who will he be?

MR MILQUETOAST - The Obama who wanted to compromise and turned to mush on Health Care. He got answered by Tea Party screamers disrupting Town Meetings and any rational debate with accusations of armageddon, socialism and death panels. Never, never, never underestimate those who want to (Tea Party members etc.) who keep the fact from coming forward by screaming, fear mongering & threatening.

MR CHANGE WE CAN BELIEVE IN – The Obama who campaigned  in 2008.  Again the Baseline Senerio sets what should be Obama’s message and tone. If Obama simply endorses the inadequate Dodd Financial Reform Bill the same thing will happen again and financial reform is over.

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 for changes made each weekend

Wall Street went back to what had ben the standard weak volume stocks move higher pattern. Although volume is historically the #1 confirmation factor behind a price move, the old trend continues = Bullish.

Earning report have overshadowed too big to obey the law, too big to fail, too big to worry about huge bonuses, shadow financial institutions. The profits and bonuses keep coming. Even the Greek debacle which has some of the same root causes is being ignored = Bullish

AAPL – Earnings report was a grand slam home run. Like so many other huge corporations the majority of jobs will go to faster growing emerging markets (more customers – less distance to transport product) where construction and labor is cheaper. Up another 5% in after hours trading. = Bullish

YHOO – Down over 3% after earnings. Not as important as AAPL= Bearish

McClellan Index is below zero and this gives building bullish momentum room to run = Bullish

GM – Repaying

Significant Indexes

• McClellan Oscillator rose  to -6.78 yesterday.  [+60 or above = Overbought = sell. -60 or below = Oversold = buy]. StockCharts has a better version of the McClellan chart ($NYMO)LINK. - This is still in NEUTRAL territory
• US Dollar – rose +0.08% yesterday. [Anything over +/- @0.50 is significant.] Mantra - right now The Dollar Rules Is very important. Remember, dollar down almost always = stocks up and visa versa. The positive earnings reports are overshadowing the dollar which is in the middle of a consolidating range between @$80.00 & @$82.20. Dollar at 81.03. If it moves to either side of that range it will impact stocks.

Positions

The  Positions Section = latest buys and sells – (Revised positions last weekend) - These are positions I actually own

Why you should always check out out the comment section of the blog.

YOUR STOCK LIST is now closed. This does not mean you can’t trade any of the stocks on it or the whole group.

Yesterday, Both The Critic and Paul R put into simple clear term the most used trading strategy of Investors411 for stocks. I can do no better than repeat them below. Also D. on IMAX

The Critic:

“#1 The Lower the McClellan goes the better time it is to buy stocks.
#2 YOUR Stock List has stocks moving higher – The 50 day moving average is going up. This is the blue line on the chart.
#3 the time to buy is when these stock dip back down closer to their 50 day moving average.
#4 A time to sell is when the stock gets too high above that moving average?
#5 AS ALWAYS DO YOUR…”

Paul R

“When a good quality stock pauses to refresh and hangs out on the 50 day moving average (DMA) it can be a good time to buy, this point is known as “Free Parking”. If you are watching a stock in this situation and it starts moving up on higher than normal volume go for it!

When a stock is extended 30% from the 50 DMA be light on your toes. When the stock is extended 50% from the 50 DMA have your finger on the trigger. When a stock is extended 100% from the 200 DMA many institutional buyers (mutual funds etc) will lighten up on their position.”

D

“:):):):):):)”over IMAX up +6.37% yesterday in increased above average volume

There is a play for short term traders here. IMAX is again just below or at an all time high. This is a technical breakout point. What could happen at the open to IMAX is a “pump and dump.” – (See Sunday’s Investors411) A major player(s) will try to break out this stock and the greed will flow as IMAX gets pumped up by other day traders who want to make fast money on the breakout.  You could see another big gain Then those who pumped it will dump  all their shares (the ones they owned form the past and the shares used to pump IMAX.

Obviously you have to buy early. The big question is how high will it go before it gets dumped.  For longer term investors, just be happy when a higher high is created on the chart because that = bullish

Long Term Outlook = CAUTIOUSLY BULLISH

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING