Austin Plane Crash

Act of Terrorism in Austin Texas

Can Americans Think?

Is there something hardwired into everyone on the plant that prevents logical conclusions? Perhaps were just manipulated mud  for corporate media (see story below).  Everyone thinks THEY are smart and the rest of the population is, how should you put it – lacking.

So here’s a quick quiz. It should take you a second or two to answer. Yet over 50% of Americans get this simple question wrong. – A bat and a ball together cost one dollar & 10 cents and the bat costs one dollar more than the ball.  How much does the ball cost. (answer below)


Last Thursday Joseph Stack burnt his home and crashed his plane into an IRS building () in Austin Texas killing or injuring at least a dozen people.  Unbelievably, the corporate US media, failed to label this a terrorist attack. Sure there were grumblings, but callers into Fox News & other right wing outlets told of their outrages against the IRS & taxes.

The ultra right wing editorial department of the WSJ called him just a “tax protester.” Even Worse Scott Brown, Massachusetts new Republican senator ” appeared to embrace the possibility that the pilot of the plane might have been one of his followers.” Even left wing Newsweek debates the point.

Bottom Line - Americans are brainwashed with fear. If this guy was a Muslim who crashed his plane into a US government building it would be a clear terrorist attack. Is there any doubt that the US corporate media would be alive with stories about this act of terrorism today if he was Muslim who crashed a plane into a government building.  Instead the story has all but vanished.


Answer – The Ball costs .05 cents and the bat $1.05.  Perhaps you got the answer right, perhaps wrong. But if you’re patting yourself on the back for getting it right, there are a large number of  cognitive traps that we all fall too easily into.  Of course, perhaps the largest is being manipulated through FEAR. (more tomorrow)

KISS & Stocks (Keep It Simple Stupid)

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


Index Percentage Volume
Dow +0.09% down
NASDQ +0.10% up
S&P 500 +0.22% up
Russell 2000- +0.37% -

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

Technicals, Fundamentals & Analysis

See PositionsStrategy , and Overview for changes made over weekend.

Last Week’s FEARLESS FORECAST - “Oversold market’s natural direction is up….Bullish.”

In one week US equities have gone from oversold to overbought positions. Almost overbought – (see below) We’ve had a week of rally days in weak below average volume. Volume, the #1 confirmation factor of a price move, has NOT confirmed this rally.

Lowe’s – the home products giant – had a positive report this AM.

Major group of Business economists up outlook for 2010 & 2011

Monday’s have been historically  rally days for the last few months. A big oil merger is going to add fuel to “merger Monday.”

Significant Indexes

  • McClellan Index rose to +56.23. Basically 60 = overbought and usually a time to sell or lighten up on positions. This is NOT a hard and fast rule. There has been a sharp fast change and a lot of upside momentum. So there is still psychologically a lot of positive momentum out there.
  • BDI The Baltic Dry Index which measures world trade (also a proxy for China) has fallen since late November, but rallied last week.
  • US Dollar – The dollar has come up off its low at about $74.5 in Dec. and rallied to $80.59. Rising dollar is usually bad for markets. Dollar was flat last week. A breakout Friday was


Everything technical (volume & McClellan) is showing that we are running out of rally room.  However behaviorally psychology has changed. Unemployment down, many big businesses have cash, Lowe’s news, the Fed raising discount rate, tame CPI numbers and economist almost universally agreeing the stimulus has worked are all making investors think rally.

It sure looks like investors want to rally despite approaching oversold positions. When bulls charge you get out of the way. Nevertheless, the only time the McClellan reached over 100 was in the rally after the 2008 meltdown.  Things have NOT reversed themselves as radically as then.  Therefore, selling into any major rally that will boost stocks. ( perhaps as much as 50% of portfolio & buying back on a dip in McClellan to zero or below.

Rally Ho, but it gets sold off at end of week.


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

Mea Culpa - Should have added more to ETF positions while McClellan Index was down at -60.

ETF Positions

  • 10% of portfolio EWZ (Brazil)
  • 6%of portfolio FXI (China)
  • 10% of portfolio MOO (agriculture)
  • 3% of portfolio IMAX (3D)
  • 7.5% of portfolio TYH (3x what techs do)

Long Term Outlook = NEUTRAL


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