31 December 2009

31 DEC 2009, Thursday




  1. HAPPY NEW YEAR!!!  Best wishes of health and happiness to all.
  2. 2009...good riddance! 
  3. And...another decade rolls into the dustbin of history, too!  Guess we were due for a weak decade after two back to back barn burners.

30 December 2009

30 DEC 2009, Wednesday





  1. Folks...please do not blow off the XMas Eve news announcement by the US Treasury to completely back Fannie Mae and Freddie Mac.  Originally, the taxpayer was to back $400 billion and now it is unlimited.  The portfolio of those two housing behemoths is close to $5 trillion dollars.  No small sum!
  2. Effectively, this is a "backdoor TARP" program!
  3. This tells me that the Treasury Department is convinced that the worst of the burst real estate bubble is yet to come. Why else would they be providing unlimited financial support for the two largest Zombie banks the world (outside Japan) has ever seen?
  4. As we move into a new year, the stock market’s technically weak rally and the repercussions of the burst real estate will follow along. So stay flexible with your investment strategy because we could be in for another hard fall.

28 December 2009

28 DEC 2009, Monday


  1. Interesting...breaking out?  Continue or fail?  I just can't buy this...too extended....could still run higher.
  2. Things that give me the willies...
  3. To Al Gore...wanna see a hockey stick...here ya go!  Speak out against this and I'll be impressed!  This is the looting of the taxpayer...especially after the XMas Eve announcement by Treasury to cover unlimited losses by Fannia mae and Freddie Mac for the next 3 years.
  4. And for those that believe the economy is improving because commodities are rising....Boom!  What happens when this deflates.  Of course it would be good for us peons wh o actually have to put gas in our tanks to get to and from work.

27 December 2009

26 DEC 2009, Saturday


  1. Well...whaddya know...Con-gress continues to do things in the dark of night to pass items (remember, Monday @ 1 AM to vote to bring the bill to the floor).  But, now they slip to new lows...Christmas Eve, after dinner news cycle, to pass the healthcare reform bill and avoid drawing anymore attention?
  2. And coming in right behind them as a close second in the "we can be sleazy too" contest...US Treasury announces the Obama administration's decision to cover an unlimited amount of losses at the mortgage-finance giants Fannie Mae and Freddie Mac over the next three years which removed the previous $200 billion loss caps on each.  Prepare yourself because it's coming...the next huge bailout has now been made inevitable...the question is simply when.  I suspect it will be a slow, steadily increasing bleed just so the unwashed masses don't become outraged at a single huge announcement.
  3. Which brings me to my next point....
Above picture, I just read a fantastic book that, historically, connects all the dots regarding the mess we're in and how it will continue to result in rolling crises / taxpayer bailouts until government once again frees the free market instead of attempting to coerce the markets into unsustainable and market deforming political mandates. Below is a review of the book....HIGHLY RECOMMENDED (Warning: you will be absolutely sickened by the long slow motion trainwreck that we are still on)!!!  I truly hope you read it...if it's not at your library, ask your librarian how to get it through the Inter-Library Loan system.




Architects of Ruin, bestselling author Peter Schweizer describes in riveting detail how a coalition of left-wing activists, liberal politicians, and "do-good capitalists" on Wall Street leveraged government power to achieve their goal of broadening homeownership among minorities and the poor. The results were not only devastating to the economy, but hurt the very people they were supposedly trying to help.

Built slowly, over decades, and agressively expanded in the mid 1990's....The story begins in the 1960s with Saul Alinsky, the legendary Chicago rabble-rouser who trained his acolytes in highly aggressive techniques of community activism. Alinsky's disciples—along with race-baiting activists like Jesse Jackson—seized on the "redlining" controversy of those years to argue that banks were guilty of racial discrimination. In the 1970s, with the help of liberal senators like Ted Kennedy and William Proxmire, legislation was passed that put bankers under the thumb of local activists.

In the Clinton years, a new generation of liberal technocrats came to power in Washington and on Wall Street. Schweizer describes how a powerful phalanx of elite liberals, including Bill Clinton, Robert Rubin, Andrew Cuomo, Barney Frank, Chris Dodd, Janet Reno, Deval Patrick, Henry Cisneros, Barack Obama, Nancy Pelosi, Ted Kennedy, Charles Schumer, and many others, aggressively pushed banks to make trillions of dollars in loans to individuals who should never have received them.

Meanwhile, Clinton forged a new form of state capitalism in which the big Wall Street financial companies were repeatedly bailed out—with their profits intact—from a series of costly errors, leading them to take ever larger risks. Both financial policies had profoundly distorting effects. The result was the bursting of twin bubbles in mortgages and mortgage-backed derivatives, in turn leading to a global economic collapse.

This tale of liberal "Robin Hood capitalism run wild" has never been told. But more than just a story about the past, it is also an urgent warning about the future. For today, the very same people who planted the seeds of the collapse are back in Washington, tasked with cleaning up the mess and determined to use the crisis they caused as cover for a massive overhaul of the American economic system.

These people have learned nothing from their past mistakes and are busy applying the same methods to other sectors of the economy—health care, the auto industry, real estate (again!), and above all the promotion of "green" technologies—inflating bubbles that are sure to bring about another crisis. Ordinary Americans who foot the bill for the last state-capitalist bubble have reason to be afraid—very afraid—of the inevitable result.

23 December 2009

23 DEC 2009, Wednesday


  1. New closing high for the year on SP500...but not quite out of the range.  Click chart for comments.

22 December 2009

22 DEC 2009, Tuesday




  1. I'd be very careful here.  Could go up some more...but caution in this low volume environment is called for...in my humble opinion.
  2. Mid October was the last time I took a stab at the short side.  Seems it was a reasonable stab.  Approaching a similar situation?  Tough to say in the low volume year end environment....but definitely higher risk environment.
  3. Below is definitely some cause for concern...very few bears...can go on for awhile but...concern.


21 December 2009

21 DEC 2009, Monday

  1. How has Congress "done sex to us" over the healthcare bill...let us count the ways...
  2. Why are young people being specifically targeted and systematically robbed, again, to pay for the benefits of the elderly?
  3. More...deficits due to increased medical expenditures go up, taxes go up and premiums go up....Wait!  Didn't Obama tell us that all that was not going up...no way, no how???! 
  4. Oh...and why are the rest of the states responsible to pick up the increased Medicaid expenditures for states like Nebraska, Vermont and Hawaii???  Isn't Virginia responsible for it's own...which will be going up now due to this bill?
  5. Yay!  Go Congress...even a bad bill is better than no bill....Brilliant...Freaking Brilliant!
  6. For an interesting long term outlook at how this legislative trick to get to the eventual desired outcome may play out consider reading "The True Intent of Healthcare Reform."

20 December 2009, Sunday


  1. Weekly chart above...comments on it.
  2. Market is coiling sideways...breakout coming...which way is impossible to know.
  3. My preference would actually be an upside breakout which would get the bulls excited some more and then a failure which would have them trapped and finally forced to sell or ride their positions and hope....which is not a good spot to be in.

20 December 2009

19 DEC 2009, Saturday



  1. Governments around the world try to again produce prosperity with the printing press. I dare say it's never worked in history and it's not going to work this time either.  I'm just baffled by the fact that supposedly intelligent people in governments around the world can't take the time to pick up and read a history book.
  2. I'm absolutely dumbfounded that policy makers can't comprehend the fact that the exact same policies they are pursuing now are the ones that caused the implosion of the global financial system just a little over one year ago and put us into the worst recession since the 1930's.
  3. If too much spending and too much debt are what got us into this how can any sane grown up think that more spending and more debt are going to get us out? Albert Einstein said the definition of insanity is doing the same thing over and over expecting to get a different result. I guess by that definition the Fed must be insane.
  4. Yet, we are pursuing the same policies that Roosevelt followed in the 30's that turned what should have been just a nasty 2-3 year recession into the Great Depression. If we don't stop and change course quickly we are going to get the same result he did and the same result Japan did when they went down this path.
  5. We've already lost one decade in the stock market do we really want to lose another or two or three (like Japan)?  Don't think it possible...check your history of Japanese financial markets...it's sobering!


Thank God that there are other distractions to think about other than the reality that looms large, my opinion.


16 December 2009

16 DEC 2009, Wednesday (Part 2)


  1. Merry Freaking XMas to the bagholders...Love Goldman Sucks!

16 DEC 2009. Wednesday



  1. I like it..."The man who saved the world!"  If this isn't a contrarian signal...I'll be dumbfounded.  Prediction...Ben Bernanke will go down in history as one of the worst Fed Chief's in history due to his experimenting with theory vice dealing with facts.  Time will tell.
  2. But for examples:  Appearing on the cover of Time as person of the year is like a bell ringing. It almost always is akin to a figurative death sentence for the person involved, and sometimes even a literal one.


    Jeff Bezos made the cover in 1999 - the year the internet portion of the tech stock bubble topped out.

    GW Bush made the cover as his popularity rating had just begun to slide, ending at the worst such rating since Nixon, concurrent with a stock market crash.

    Hitler made the cover in 1938.

    General Chiang Kai Chek in 1937. It turned out to be an ill omen, career-wise.

    Stalin made the cover in 1939 and again in 1942.

    Kennedy made the cover the year before he was assassinated, as did Martin Luther King - a literal death sentence in both cases.

    Lyndon B. Johnson made the cover in 1964 - he was about to lead the country into the Vietnam catastrophe.

    Nixon and Kissinger made it in 1972.

    It was Yury Andropov's turn in 1983 - he died shortly thereafter.

    Gorbachov became 'man of the decade' half a year before being forced to step down.

    Obama's turn was last year.



  3. Below...still not much to say.  December, with lightened participation and money managers just trying to make it to the end of the year, may make this a slog of an affair.
  4. What's really changed below?  And the following picture reminds me of what it feels like.


15 DEC 2009, Tuesday


  1. Truth, the simple God's honest truth, holds such simple beauty.  All free men and women want to live in the truth!
  2. Why are political leaders doing everything within their power possible to obfuscate and hide the truth these days in almost every issue?
  3. Truth and truth above all else, please!  Why must we be constantly on guard for the next way the leadership is trying to fork us.  This can't end well if the elites around the world honestly think they can get away with trying to dupe the masses.  Our tolerance wears thin.
  4. Oh great Buddha...I merely seek the wisdom, peace and serenity of the truth! 
  5. "This rant has been brought to you by someone who cares deeply for my country and the children we are responsible to turn it over to.  Thank you for your consideration"

14 December 2009

14 DEC 2009, Monday


  1. Comments on chart...click to enlarge. 
  2. Highest close for the year as it appears ready to try and take out the highs of the range.
  3. 2010 is just around the corner.  2009?  Well, I gotta say that I was absolutely amazed at how much of an impact the government had.  They turned on the printing presses and Voila!  All that "free" money went straight into and lifted all markets...big!
  4. What happens when the money inflows stop?  Or has it worked?  Time will tell.  Personally, I'm probably wrong, but I am still wary.
  5. So, as the holidays near and things slow down I will be re-caging my gyros and preparing for 2010.   

13 December 2009

13 DEC 2009, Sunday


  1. Know what...this month long tight range is getting old and right now it is tough to determine any probabilities.
  2. Thus, just taking trades intraday to see what happens...and not staying with them long either.  It's like a "grab yours and get" type of market.
  3. Wrong side and you get "gapped" into oblivion, repeatedly.

12 December 2009

12 DEC 2009, Saturday



  1. STOP!!!  This market has got to stop this tight sideways chop-chop crap and pick a direction already...up or down.  Frustrating has been the word for weeks now. 
  2. But for now, it's early on a cold wintry morning and a great time to do some research and post some thoughts on big picture, long term, "what if" stuff...just to throw it out there and get it posted to the blog so I can later go back and search for it when I need it.  This blog thing has really been helpful allowing me to go back and find old and relevant info.  Anyway...will be adding items throughout the day.
  3. Click here for an EXCELLENT read from Martin Pring who is asking, "Are you ready for another lost decade?"  It discusses longer term Secular Bull and Bear Markets versus the normal Cyclical Bull and Bear Markets.  Things I found interesting were" 1) the number of recessions (4-6) contained in a secular bear cycle (we are currently in our second), 2) you'll want to look at his depiction of US stock prices in secular bears with their 7 waves exceeding 25% up or down, and 3) consider his "Pathway to the secular low" graphic to get a sense of where stock valuations historically go to during Secular Bear Markets...THAT is the point when everyone will have sworn off stocks forever and Buy and Hold can safely return...not until!  Research!
  4. Below is a graphic I picked up at Barry Ritholtz's blog back in July but didn't post at the time (the "you are here" mark is July 2009 thus we are closer to roll-time).  It is the result of a study of severe financial crises throughout history (secular bear markets?), across many different countries, and shows how they tend to play out.  When I read Pring's "7 waves" it pinged my memory and I went and searched for the below graphic.  Whadya know?!!  7 waves...with 4 recessions?!!




  1. Above...whaddya know?  After the big Secular Bull Market from the late 1940's to the mid 1960's...there's your inflation influenced Secular Bear Market with its 4 cyclical bear markets that eventually transitioned into the following Secular Bull Market that we all grew accustomed to from 1982 to 2000.
  2. Below, is merely a repost / reminder to me of the tough 1970's and the eventual transition into the 1980's bull launch.

11 December 2009

11 DEC 2009, Friday



  1. Chairwoman of the Upper House Nancy Pelosi has reportedly authorized a test firing of the Debt Star at Area 51 in preparation for a full attack on the resistance at a forthcoming date.
  2. Comrade Hank Reid of the Star Chamber subsequently reported its success. 


  1. Below...sure seems scary to me that they're ready to unleash the beast.

10 December 2009

10 DEC 2009, Thursday


  1. Same story, different day,

09 December 2009

9 DEC 2009, Wednesday


  1. The bears get close to pressing it lower but Rocky (the market) just keeps getting up.  Amazing!
  2. But he didn't get up by much as you can see below.  Nothing has really changed...comments remain the same.
  3. But it was interesting how the lower blue line and the upward sloping yellow line contained the downside.  I'm always amazed at how sometimes the simplest things such as trendlines can appear to work.

08 December 2009

8 DEC 2009, Tuesday


  1. Points made on chart above (click to enlarge).
  2. Sure looks like distribution as the upmove seems to have hit a pretty solid wall.  But, later in the month the volume dries up and Da Boyz could always cram it up again...just thinking "what ifs".  Tricky.
  3. About the only thing you can say is that it gave up it's 20 day moving average (orange line).  50 day MA (red) has contained bulk of price action since the beginning of the move except the brief stab in JUL and 90 day MA (green) has contained all the upside.

07 December 2009

7 DEC 2009, Monday


  1. DEC 7th...a day which will live in infamy!  Obama's EPA has now declared CO2 and a few other greenhouse gases as a threat to the public health and welfare of the American people.
  2. They continue to charge headlong in this stupid "the science is settled" despite those pesky leaked emails, the complete destruction of the original temperature database, and the inability to explain the cooling over the past 10 years as their computer model says it couldn't happen!
  3. Let's see...Turbo Tax Timmay Geithner dodges the IRS for a few years and is eventually made the head of it!  You and me....we're gonna get ticketed for breathing!
  4. The world's gone mad....I quit!  The flipping inmates are running the asylum.
  5. Below, no movement, nothing to add except that this is really getting old.  Patience is definitely a requirement over the past few weeks. 

06 December 2009

6 DEC 2009, Sunday



Broke out the Blackbird this weekend to get a high level view of the current situation...this is not a "something is gonna happen tomorrow" look.  It is merely to get a view of the potential risk environment.




Above, Investment Newsletter writers have very few bears.





Above, here's the Bulls versus Bear comparison.


Above, retail investors aren't as snorting bullish but some more upside would probably get them there quickly.



Above, Corporate Insiders appear to be selling into the rally.



Above, commercial hedgers are getting short for some protection against any downside.



Above, this is a really long term look...Doesn't look like a lot of cash available on the sidelines to provide additional fuel (ie, buying power).  Look at the mid 1970's, early 80's, and early 90's levels, for example, to see the "I hate stocks" mentality that results in longer term stock market runs.  When people swear off stocks forever and you see cash levels go back to high levels, then your buy and hold environment has returned for those so inclined. 



Above, weekly SP500 chart shows the ongoing struggle with the downsloping blue line from the 2007 highs and, also, the upsloping blue line which connects the OCT 2002 and MAR 2003 lows.  Also, the upsloping yellow trendlines from the bottom appear to still have influence and the SP500 has now retraced 50% of the decline as it hit the 1120 area.



Above, the only thing to say about the daily is that it's gone nowhere for close to a month...sideways.  Out of sideways comes either up or down.  It's a coin toss at this time since they can be working of the overbought by going sideways.  Is it possible that it breaks to the upside to tag the upper yellow trendline which has served as a barrier for this whole move and then fail...around SP500 1155 right now?  We'll see. Pretty soon the holidays will be upon us and it will be a low participation time for the market which can make things dicey, too.  Da Boyz have played this well to their advantage....masterful bastards!

03 December 2009

3 DEC 2009, Thursday



  1. Above is the intraday chop band since 10 NOV (until yesterday noon)...big gaps first thing in the morning and then chop chop the rest of the day.  Yielding a whole lot of nowhere.
  2. Definitely sideways and out of sideways comes a move...up or down?  Let it breakout of the range and then see how it reacts afterward. 
  3. Unemployment Report Friday AM...this report results in a sizeable move 85% of the time...perhaps the sideways shows that everyone is waiting for the report and unwilling to commit before it.
  4. This restores faith that there are some Senators that get what the heck has occurred in depth!

02 December 2009

2 DEC 2009, Wednesday


  1. Not much to add...probed above the highs of the recent range but couldn't hold it into the close.
  2. I'm reminded of the way the Crude Oil market finished it's run awhile ago (JUN 2008)...formed a tight 3 week rectangle probed above it by about 3-4% for a bunch of days to clean out any remaining early bears and then the downmove began. 
  3. Admittedly, I've leaned more bearish than not on this entire upmove with brief bull moments.  I've been absolutely dumbfounded at how silly it's been because it has no fundamentals backing it and ordinarily I'm the first person to say "Screw the fundamentals...they'll catch up!"  And, yes...I still think that the fundamentals will catch up.  Only, not in the direction that most people think since the financial system is in worse shape now than it was before the last swoon...higher unemployment, looming second wave of residential and commercial real estate defaults, federal government and Federal Reserve appear to be painted into the deficit corner which will limit their ability to flood new rescue money into the system, etc.
  4. The government's efforts to "extend and pretend" or "delay and pray" merely slid the day of reckoning forward. 

01 December 2009

1 DEC 2009, Tuesday


  1. Well, the T-Day Dubai swoon has been completely recovered and we're back to the high end of this very tight 3 week rectangle.  So, the intermediate and long term remain up while the short term looks sideways...but which way will it break?  Not in a hurry here since I can make a case for either direction...unclear.
  2. It's been gapping in a very erratic fashion which is trapping bulls and bears alike.  Ms Market is doing her best to create the most confusion.

29 November 2009

29 NOV 2009, Sunday (Part 2)



  1. While I was home over T-day, was trying to explain the type of environment that I think we're in to folks. 
  2. So, hopefully this post will show it from multiple angles via several different charts previously posted.
  3. Above is the Dow Jones Industrial Average since 1900.  In it you can see the multi year rises seperated by multi year flats.
  4. My personal opinion is that we're in one of those long term flats...which can be tough, so to speak.
  5. How long do these long term periods last?  Glad you asked...historical perspective is important.
  6. Spend some time reviewing the multiple part post from 17 NOV and you will hopefully begin to see what I think. 
  7. And, I am by no means correct, these are just my opinions and how I'm approaching this environment that I "think" we are in. 

29 NOV 2009, Sunday





  1. Potential Dubai debt blow-up...conveniently over Thanksgiving holiday impacting international markets?  Niiiice!  Boostards held it up in the front half of the week knowing this was coming...no doubt.  Perhaps that explains the run to T-Bill safety mentioned last week (22 NOV post).
  2. All previously drawn trend lines and horizontal support / resistance areas are still holding significance...so far.  Interesting.  
  3. Action is happening overnight with big gaps prior to the normal trading hours leaving only the scraps for day traders to play with.  Hmmm...reminiscent of how the upmove from March started.  Crazy crap!  Da Boyz rule this tape with all the free money pumped into them via the Federal Reserve and federal government "looking the other way".
  4. Only guarantee...this will not be easy in either direction.
  5. Sentiment, below, is not a precise timing tool.  But, it is interesting that newsletter writers are as bullish as they were at the 2007 top...and with fewer bears, too.  Just something to consider regarding potential risk environment.
  6. Since T-Day timeframe was very low volume, it is tough to draw any conclusions...which is precisely what Da Boyz probably want...max confusion.
  7. Short term direction...unknown.  Will take some time to settle out.  Intermediate term still up...although small caps have broken their trend.  However, on the 60 minute charts (currently oversold), we have made new lows but are probably prone to a rise before clarity is restored.
  8. Entering a very difficult time of year (year end).  There is the potential for many cross currents as money managers try to protect profits and there will be less and less trading as we draw closer to the XMas holidays.
  9. Just my thoughts.  Could be treacherous both ways.  Time to be patient and nimble at the same time...not fun...I'll be trading in and out more than anything.
  10. However, I'm still looking for safe shorting opportunities if they present themselves.