Investors 411 Blog

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Vampire Squids, Bankstas,

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& Vampire Capitalism

Will Return in the next Investors411

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Republicans

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In 1928 we elected a proven businessman president. His name was Herbert Hover.  He enacted the Smoot Hawley Tariff Act. and a worldwide trade war began that sank the world into the Great Depression.

Yesterday another proven business leader running for President doubled down on his commitment to launch a trade war against China on day one of his presidency – Mitt Romney.

This is a major reason

Romney has to be stopped

Romney wrote an Op-ed in the WSJ, as the soon to be  leader of China is visiting the USA.

Fellow Republican and former ambassador to China Jon Huntsman replied –

Link to editorial and reply.

Link to video reply

• Are the Chinese currency manipulators – Yes
• Is the US a currency manipulator – Yes  (quantitative easing is massive currency manipulation.)
• Are trade practices unfair – Yes

But you do NOT “accuse China in front of the world court on day 1 of  your [the Romney] Presidency“.

Asian cultures are about saving face, and to China this act would be a direct escalation into a trade war. Plus,  You all know how good Republicans are at fear mongering – Think Iraq.

This has a very real possibility of happening, because there are Democrats and Republicans led by Chuck Shumer (D) who have already pass similar legislation through the Senate.

Every Neocon and weapons manufacturer is drooling at another explode (pun intended) the national debt war.

(Again more later)

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STOCKS

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Wall Street Bull & OWS Symbol

• Mantra - “INVESTORS411 has not changed its long term outlook, because this is a manipulated market. Our Central bank  has backed American banks since 2009 and the European Central Banks is now backing their Banks in the same way – by basically printing money and holding interest rates near zero.”

• Therefore - “Anyone who wants a return on their $ greater than near 0% is pushed into assets that the ECB and Fed is manipulating higher. Our economy either gets better or the Fed has our back”

• There could be some very negative consequences to Bernanke/Fed manipulation of markets and economies. But looking foward for 3+ months this is bullish for stocks.

Shorter Term

• AAPL , the mother of all stocks ended up with only a 7% drop from its high, before it recovered yesterday. From yesterday – “While AAPL did go elliptical, it had above average but not huge volume behind the move.”

• Its starting to look like US is economically recovering. Yesterday’s signs –  GM up 7%+ on earnings, weekly unemployment number lowest in many years

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• Our #1 technical forecasting tool, the McCellan Oscillator (MO) rose to -5.26. 50 Day Moving Average at +21.62 (for more see  STRATEGY link at top of blog and scroll down)  More wiggle room for bulls than bears, but not near any clear technical tops/overbought or bottoms/oversold = NEUTRAL

Investors411 has used this one simple timing indicator to call tops, bottom and “wiggle room” (the space/room US stocks have to wiggle/move higher or lower till they reach a top or bottom) because it has been so successful for over a year.

• What used to be the European canary in a coal mine is chirping, but a negative trend has started.

• Italian 10 year bond yield from from at 5.84% (yesterday AM EST) to 5.62% (7:00 AM EST) - No where near the danger zone of 7.0% of just a couple weeks back.The 5 days in a row move higher trend was broken.

• Of course the long term negative here is ECB printing presses are hard at work printing money to drive down bond yields. This is similar to US money printing (quantitative easing)

• In the very long term this has negative consequences because the world’s banking system no longer runs on capitalism, but extraction. (A subject for many future editorials)

Bottom Line – Investors411 recommends American stocks. There are many areas to consider.

• The former beaten up sectors are outperforming
• Usually technology and small caps lead the way when stocks get bullish.
• Financials are no longer running a capitalist system but running a corrupt extraction program. This sector should do well also.
• Safest is ETF that mirror the Indexes or Sectors
• More aggresive investors could use ETF’s that do 2x what major market sectors do.
• YSL 2012 should outperform.

Bull Rule – Repeat – “A 2 % to 5% pullback would be healthy for stocks. Even a flat consolidating stock market.” You don’t want to overheat stocks too rapidly.

Buy The Dip – But, it now looks like the dips are going to be small.

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Longer Term Outlook

3 months+

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Still

CAUTIOUSLY BULLISH

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Vampire Capitalists

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Matt Taibbi’s

quote on Investment Bank Goldman Sachs –

“A great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.”

However as we’ve seen over the course of the week its not just Goldman, but Republicans, Democrats, all investment banks, lobbyists, plutocrats and a host of wealthy individuals that have turned banking into an industry full of giant vampire squids.

These giant squids are still sucking today.

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The Blood Sucked

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• The rise and fall of the housing bubble.

• massive loss in homeowner value

• Banks collapsing others forced to merge

• Stock markets around world melting down

• The Great Recession

• Massive rise in unemployment

• Collapse threatened from Insurance (AIG) to Conglomerates (GE) companies

• Stimulus to help (largest chunk a tax cut) increases deficit

• “Financial Armageddon” threatened

More

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Dylan Ratigan Chart LINK

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• Massive Debt

• Outrageous bank fees

• Declining Investment

• Incentive to create debt not value

• Loss of  finances innovation and product quality

• Major factor in over leveraging European debt crisis

• Banksters keep all the profits and bonuses

• YOU pay for their losses

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Tomorrow – The Cover Up and

Some Solutions

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Republicans

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Rick Santorum

Releases 4 years of Tax returns

Simple question - If Romney and Gingrich are so proud of their wealth why not release 4 years of their returns like Santorum?

Vampire capitalists like to hide in the shadows

Real capitalist are not afraid of how they honestly earn money

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Romney at Bain Capital

Is Romney

a good Businessman?

Three companies are trying to sell a product – In this case the product is a candidate labeled- a Romney, a Santorum and a Gingrich.

• The Romney company outspends the Santorum company 20 to 1
• The Romney company outspends the Gingrich company 5 to 1.

The Bottom Line - Santorum is slightly ahead in the polls – Make all the excuses you want, but any business manager with this kind of cash advantage  not able to sell his product by now and obliterate his competition would be hearing these  words

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You’re FIRED

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STOCKS

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Wall Street Bull & OWS Symbol

• Mantra - “INVESTORS411 has not changed its long term outlook, because this is a manipulated market. Our Central bank  has backed American banks since 2009 and the European Central Banks is now backing their Banks in the same way – by basically printing money and holding interest rates near zero.”

• Therefore - “Anyone who wants a return on their $ greater than near 0% is pushed into assets that the ECB and Fed is manipulating higher. Our economy either gets better or the Fed has our back”

Shorter Term

• AAPL , the mother of all stocks had a 5% drop off highs (2% loss for day) and this took stocks down with it. While AAPL did go elliptical, it had above average but not huge volume behind the move.

• From Yesterday Tom Demark is an analyst  that major firms pay 5 figure amounts to use his advise.  Using one of his indicators roughly based on the fact that AAPL has been up 11 of the last 13 days, we should start to see a correction about now.

• About a decade ago I was taking technical analysis classes at MIT with my friend Harold and I learned about Demark’s 13 day trend exhaustion Indicator. It has worked far more often than not when I have applied it. It sure worked yesterday.

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• Our #1 technical forecasting tool, the McCellan Oscillator (MO) fell to -27.60. 50 Day Moving Average at +22.71 (for more see  STRATEGY link at top of blog and scroll down) Now in a clear falling (bearish) pattern. However, with such a high 50 dma we are near oversold/reversal of trend territory.  But still = NEUTRAL

• 2 year MO chart This chart shows many reversals in trends  start around -60. Big  meltdowns 10%+ can go to -100 to -140. Since the 50DMA is so high (+23) we start oversold territory at -60 + +23 = -37

Investors411 has used this one simple timing indicator because it has been so successful for over a year.

• What used to be the European canary in a coal mine is chirping, but a negative trend has started.

• Italian 10 year bond yield is now at 5.84% - No where near the danger zone of 7.0% of just a couple weeks back. But its moved up 5 days in a row. This may be just a technical rebound, but clearly now something to watch especially if  yield goes up at a rapid rate.

• From Yesterday  - Bottom Line - “An AAPL led technical market correction is very possible. A 2 to 5% correction would be ”healthy” for stocks and a buy the dip opportunity.”

• A yield approaching 7% would mean European manipulators are loosing control. You can be sure Investors411 will give a shout if the Italian Bond yield gets too high

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Paul’s Corner

A Shot Across The Bow!

Well gang the early shots have been fired across the bow. This bull market may not be over but the signs  point that way. I have linked to two charts of yesterday’s action with the VIX and the TVIX (2x VIX). Down kahuna’s for have been fired and the %B*BW are now up into early warning dangerous territory.

VIX Link

TVIX Link

I’m not going to explain what these charts show as Ian Woodward in his recent video does a great job of explaining. This is an excellent video, and it shows why I follow Ian. He is an excellent teacher. Please watch the video!

Ian’s video explaining these charts

This may be a minor blip in the bull market we have recently enjoyed so be careful, let’s let the market tell us where it is going. At the moment we have been warned, please be careful with any new long trades.

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Longer Term Outlook

3 months+

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Still

CAUTIOUSLY BULLISH

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Whose Buying Democracy?

The Million Dollar

Super Pac Club

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At some point in time $1,000,000 or even the Adelson’s (now) S11,,000,000 million will seem like chump change to give to a Super Pack.

By then our democracy will be like Russia’s oligarchy or  the one Party state of China.

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The Oligarchs contributing to Super PAC’s

Romney’s $1,000,000 Super Pac Club

• Steven Lund - Formed a company just to contribute then company vanishes.

• Edward Corner – VP Bain – Had to be outed.

• Jeremy Blickenstaff – Lund’s Son in Law

• Julian Robertson – Hedge Fund Owner/Manager

• Paul Singer – Hedge Fund Owner/Manager

• Robert Mercer – Hedge Fund Owner/Manager

• John Paulson – Hedge Find Owner/Manager

Every one for these individuals, because they are associated with/runs a venture capitalist or hedge fund pay the same tax Romney did for all his years at Bain

15% or less – You suckers pay more.

How many Swiss and Caymen Island Bank account’s here?

Obama – $2,000,000 Super Pac Club

• Jeffery Katzenberg - Dreamworks

What’s missing ?

and More Important

(I’m just one person up against a deadline)

• Bundlers for Unions and Companies that amass millions

• The massive Pack of donors who give more than legal $2,500 to a campaign, but less than a $1,000,000

• The donors who give to both sides

• The oligarchs who are smart enough to wait till the last quarter to give so that their names won’t be made public till after the election.

The Bottom Line

Below

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STOCKS

• Repeat – Long term - As long as interest rates stay low, and there is liquidity without inflation – investment money seeking higher returns will be forced into stocks and bonds. This dynamic has not changed under Bernanke/Obama even though other significant sectors of the world have taken some big hits (Europe & Japan) or are slowly pulling back – China.

The POSITIONS page does not yet reflect the 2012 Outlook.

• The MO can be read like any chart (see  above link) This is the 6th time in 6 weeks the MO has approached +60. It failed the other 5 times. That’s one very very strong resistance level.

• Mantra - Low volume rallies are a characteristic of Central Banks and friends manipulating stocks/bonds. They have become quite good at this and these rallies have tended to last.

• Combination Option Trades – Congratulations to two of you who made $ on an AMZN combination options trade.  Not a lot, but a 10 to 25% profit. NFLX , we all made out on this one last quarter, reported last night. The option prices were too high to risk this trade, but it sure looks like it may have worked again.

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Buying Democracy

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How money

Wins Campaigns and  Destroys Democracy

Part 2

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What if Sheldon Adelson (8th richest man in USA and pictured above) decides to give Newt Gingrich’s Super Pac more than the $10,000,000 he already has? After all $10 million is not even close to one day’s profits from his giant gambling empire.

What if Adelson gives $100,000 million?

What if a Saudi Prince through an American corporation he own/controls/influences  decides to give a $100,000 million?

What if George Soros (7th richest in the USA) decides to give Obama $100,000 million?

Just because Adelson’s chosen to be open about his contribution, doesn’t mean the others have to be open about their contribution.

Money sure helps win elections. (There are some other infuencing factors)

• Gingrich & Romney spend the same amount of  money in S. Carolina and Gingrich wins.

• Romney spends the 5 times what Gingrich does in Florida and Romney wins

Where is the Outrage in the media?

There is almost none.

Why?

Because both Democrats and Republicans are out getting all  wealthy oligarch Super Pac money they can.

Its all legal.

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Here’s a photo of one leader who has consolidated power in a supposed democracy with the help of his own wealthy oligarchy. Now, Even billionaires who opposed him are in Siberian jails.

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Russia’s Vladimire Putin with a former friend

Think this will never happen in the USA?

Did you ever think there would be a legal $10,000,000 campaign contribution to influence a presidential campaign by a Vegas casino owner in the USA and no one cares?

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STOCKS

• Fundaments- These are the drivers of stocks –  The earnings reports, the jobs number, GDP, money supply and a host of other significant factors.

• Fundaments are the drivers and the car that move along the road. One good or bad earning report can shatter any sign or light on the technical road.

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• Repeat from Friday – “The MO can be read like any chart (see  above link) – Three times in January the MO has tried to break out above the 55 to 60 range and failed. Yet is has stayed in a very tight range between 30 and 60. If this range/trend breaks  on the top side bulls win and on the bottom bears win. The fact that the trend is from + 30 to + 60 instead of minus is BULLISH

• DAX (Germany)  down 1.2%  at 9AM EST. Not good for US markets. Big European Meeting this week. But they are all big meetings. Just lie all 19 Republican debates – each is hyped and hyped

• Link to the market events of the week here and Seeing Alpha’s homepage

• Two more considerations for Option combinations. BIDU (Monday earnings) A short term trade.MCP as a possible long option term combination trade.

• Reading Tea Leaves – It seems the majority of market tea leaf readers I look at are predicting some kind of pull back this week – It would be healthy if markets had a minor consolidation. Earnings season is winding down so outside economic news will start to dominate.

• The Key to Watch for – Any signs of Central Banks manipulating stocks or bonds. Rumors of a QE #3 abound. (google – news QE 3)

Brutal, Just, Brutal

Gingrich Super Pac new 7 minute movie on

Romney and Medicare

Came out at 1:00AM EST

Click on word FRAUD above to see it

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What’s even worse for Romney is Gingrich , catches Romney in a “blatant lie” in the Tampa debate about 6 Minutes and 30 seconds into the film.

Gingrich “Did Bain have any work with the government such as Medicare and Medicaid.” Romney “We didn’t do any work with the government.”

Documentation for Film at

“MittsBloodMoney.com“

That’s Gingrich’s Super Pac title NOT mine

Be Afraid, be very afraid because Super Pac adds  by  members of a corrupt oligarchy and permitted by the 5 right wing Supreme Court Justices who gutted campaign finance reform by voting to allow this are buying our democracy.

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SOTU

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George “Been Forgotten” Bush went over the top with his “your either with us or against us” proclamation.  A line he later regretted.

Remember, those of us who opposed the Iraq war were hated as un American and not Patriotic. Emotions ran high because of the terrible 911 tragedy, but now some healing  has occurred over a war that was a tragic mistake.

The heart of Obama’s speech

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We don’t begrudge financial success in this country. We admire it. When Americans talk about folks like me paying my fair share of taxes, it’s not because they envy the rich. It’s because they understand that when I get tax breaks I don’t need and the country can’t afford, it either adds to the deficit, or somebody else has to make up the difference – like a senior on a fixed income; or a student trying to get through school; or a family trying to make ends meet. That’s not right. Americans know it’s not right.

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Why are Romney’s Poll numbers Dropping?

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Romney provides the contrast to Obama SOTU and makes Bush’s “you’re either with us or against us”  milquetoast.

The following 20 second video is a perfect example of raging extremism. The kind of shouted hatred that twists the minds of so many of our fellow Americans into blind fear mongered emotionalist.  Romney -

“I’m going to Stuff it Down Obama’s Throat”

Click on photo for 20 second video

As far as timing goes Obama caught a huge break that his SOTU address came directly after Romney released just his 2012 tax returns (13.9% tax rate) that have opened a massive amount of new questions. (future editorials)

More on SOTU here and NYT here

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STOCKS

• From Last week – “We are in a low volume rally” In Paul’s Corner he points out the decrease in volume over the last five days. There have been lots of technicians who are calling for a pull back here. I tend to see 1350 1370 as the target on the S&P 500 before a significant retreat. (S&P now at 1314)

• Low volume rallies are a characteristic of Central Banks and friends manipulating stocks/bonds. They have become quite good at this and these rallies have tended to last.

• DAX (Germany) down this AM 0.67% at 7:00 AM EST. Italian bond’s two week long yield fall puts it well out of the 7% danger zone. But yields rose yesterday and this AM to  +6.23%. The Spanish and Italian bond reversal shows some economic stability returning to two of Europe’s largest economies and is bullish

• NFLX reports earnings after the bell. Watch comments section for details on possible combination Option Trade.

• Our government is simply overwhelmed by corporate lobbyist and money. For more Robert Reich

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Democracy Dying

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Billionaire Sheldon Adelson

Donates Another $5,000,000

to Gingrich Super PAC

Yesterday’s blog detailed the vicious negative & effective character assassination assaults of the Super Pacs for both the Romney and Gingrich presidential campaigns.

Why the Super PAC’s?

because fear mongering negatives work

They Buy YOUR vote?

You can have an army of outside attack adds decimate your opponent and funded by anyone or any entity/corporation that wants to buy/own a candidate.  These hidden or transparent oligarchs buy votes, thanks to the US Supreme Court’s Citizens United decision.

This week the target of Gingrich’s Super Pack will be Mitt Romney and they have plenty of fresh ammo because

Romney just released his

2010 Tax Returns.

• Romney has 13.9% Tax rate for 2010.

• Romney has/had a Swiss Bank Account.

• Romney has/had other off shore banking accounts in noted tax havens Luxembourg and the Cayman Islands

• Romney unlike his father, Obama and Biden has NOT released 10+ years of tax returns – only 1 with an estimate for 2011

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Some of the negative attack adds that are being used so far below.

Here and here and here and here

and here and here and here

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How to Fight Back

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Join United For The People

“We believe that America works best when our government is of, by and for the people. Although we have differences in scope and tactics, all of us are united in the understanding that the Court’s decision in Citizens United must be remedied by amending the Constitution in order to restore the democratic promise of America.”

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STOCKS

Back tomorrow with Stock Section

Check Out Comments Section For More

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Headlines

US, French, English warship go through Gulf of Hormuz,   Europe agrees against Iran Sanctions,   Prez addresses nation tonight,   Earnings season continues,  Overbought markets due for a pull back

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Special Note

Investors411 2012 Yearly Investment Outlook

is in the Stock Section Below

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One Big Party

The news of the morning - The first Florida prediction poll is out since South Carolina and its Newt +9%. Its only one poll, but there is a change in momentum. Its way to early to call this race.

Some interesting political analysis  ”Mitt Romney’s Misery in a Word Bain “(Politico)

Clearly Republican voters in South Carolina felt Gingrich won the debates, but there was another even more significant factor.

Super Pac Money

“There are probably less than 100 [obscenely wealthy] people fueling 90% of these Pacs”

LINK

In Iowa it was Romney’s Super Pac that spent millions on negative adds against Gingrich. He was caught flat footed. He obtained one agreeable billionaire and created his own giant super Pac They smashed Romney with negative adds in South Carolina and spent just as much money as he did.

Florida Super Pacs are already in full swing with the vast amount of money not spent on building a case for constructive ideas on how to help fix out economy, but scathing negative character assassination.

Everybody says they hate these adds, but the reality is they work. Romney beats Gingrich in Iowa by going negative with his super PAC and Gingrich beats Romney in Florida by going negative with his.

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In the last election we saw a massive amount of money go to Obama from Wall Street. Almost every progressive will tell you Obama has not delivered becuse he is influenced or ownd by big money.

Sure there is a difference between Republican views and Democrats (watch the debates) But in the end to compete with the winner of the Republican Primary Obama is going  to need his own Super Pac’s to go negative.

End result –

A group of wealthy oligarchs determine the outcome of what used to be called

Democracy

We are slowly morphing into one big party

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STOCKS

• 
  

• From Friday – “We are in a low volume rally. This means the manipulators (central banks, HFT’s and other giant sharks) are in control.” Sorry I haven’t got the details on how this is happening, only a recognition of its existence (see yield rates falling below) Low volume rallies can last a long time as we saw when the Fed introduced quantitative easing (QE #! & QE #2)

• DAX down this AM 0.57% at 6:00 AM EST. Italian bond’s two week long yield fall puts it well out of the 7% danger zone at 6.13%. The Spanish and Italian bond reversal shows some economic stability returning to two of Europe’s largest economies and is bullish

• A record setting -599,000 have been eliminated from government. If these jobs were still in existence the monthly jobs growth figure would be higher.

• US corporations are sitting on more cash than ever before ($1.9 trillion) Most company profits are again beating expectations.

• Relative to the rest of the world – Japan (tsunami) India & China (GDP in decline) Europe (crisis) – the USA is outperforming (Thanks to EW for his heads up on this)

• While it may be just a little too soon to call the trend, there has been a three month surge in housing stocks The fall in housing prices was a dominant factor in the great recession.

The USA under Obama and his Fed Chair Bernanke is in a slow steady recovery with little sign of inflation on the horizon.

Later this week the Bad and the Ugly

• DAX way up 0.47% this AM (6:30EST) and the Italian 10 year bond is in full retreat for over a week. The correlation between European & US stock markets has become weaker, but still significant. Latest data below. All this = Bullish

Last Night’s

Republican Debate

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Here’s Andrew Sullivan’s (fiscal conservative/social liberal)

View

“11.05 pm. Frank Luntz just gave us the quote of the night, as explosions – fireworks? – boom around the convention center. “It sounds like Fort Sumter out there.”

10.58 pm. I’m not sure what to say about this evening, except I want to take a shower. I’ve rarely been repulsed by the atmosphere of a debate as I was tonight…”

Want more?

Link here and here

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Why Republicans want an end to the debates NOW?

LINK

“Romney #47 in jobs creation”

Thanks to EW for heads up on this

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1. EUO – (ETF that’s double Short the Euro) – You might also want a put on this because they are cheap.
2. UCO – (ETF that’s double long oil)  Oil historically goes up in the spring and this video Thanks to HG for heads up on video.

• DAX way up 1.77% this AM (7:30EST) The correlation between European & US stock markets has become weaker, but still significant. Latest data below.