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Now let’s not have the Obama acolytes descend upon us for finding his words regarding Chrysler Orwellian. The headlines will read that April 2009 was the best market month by performance since March 2000. That seems ominous to me since the following month that bear market began in earnest.
This commentary is brief since we have house movers on the scene and I’ve lost (sigh) my big PC with multiple screens.
Have a great weekend!
Disclaimer: Among other issues the ETF Digest maintains positions in: SPY, MDY, IWM, QQQQ, XLF, XLI, XLB, XLY, IYR, DBC, USL, XLE, DBA, MOO, DBB, EFA, EEM, EWJ, IFN, EWH and FXI.
The charts and comments are only the author’s view of market activity and aren’t recommendations to buy or sell any security. Market sectors and related ETFs are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period. Chart annotations aren’t predictive of any future market action rather they only demonstrate the author’s opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at www.etfdigest.com.
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If bankruptcy and the crushing of bondholders is a sign of Chrysler's hidden vigor, then surely the coming damage to holders of US Treasuries must be incontrovertible proof a US economic, indeed global, long boom in the making.
What do you suppose the Asian governments, who are our biggest creditors, will make of this oracular pronouncement?
It seems to me that "Animal Farm", even more than
"1984" describes our present reality.We are at the stage where the pigs have become the new tyrants, for the good of all the animals (who toil with little food and rest), of course.
Hope your move goes smoothly and your PC gets there in one piece. I am concerned for it too!!!
My question is looking at all your holdings looks like overkill to me. For example, you own EWH, FXI, EFA and EEM (and posibly IFN) which are all plays on the same theme. Why not just concentarte in EEM (or EEB) which you don't own and forget the rest?
Some folks have targeted and unique issues they're interested in. So, if they want to cobble together their own portfolios from the main menu, that's up to them.
I don't see what's so "Orwellian" about Obama's statement. You kill a sick company, then revive it in a much healthier form. What's hard to understand about that?
Let's ignore the self-evident, that Chrysler was a walking corpse way before yesterday.
Obama's comment WAS Orwellian, in the context that it is beyond nonsense, absolute nonsense, it is a contradiction in terms. That's what's Orwellian, "slavery is freedom", "war is peace". A lie is not any less a lie just because it comes from the mouths of the powerful. Saying that a company being placed into bankruptcy is not "a sign of weakness". What is it a sign of, pray tell?
In Obama's doublespeak, I guess what he was saying is "don't stand in the way of an orderly settlement", we will steam roller you. "We" being the government of the United States of America.
I find it interesting that the creditors that were willing to settle for the big haircut were the big banks who know that EVERY loss is now guaranteed and that no bailout is too big to reward them. The guys that balked were the creditors who have fallen between the cracks, i.e., not the big banks that have been bailed out right and left.
I actually kind of like Obama, in a weird way. He's a great orator as long as his teleprompter is going, and he is well-spoken. I really don't blame him for most of this, he did inherit a really lousy position. But please, don't insult my intelligence.
On May 01 09:55 AM CloroxCowboy wrote:
> What a crock...how else did you expect this to play out, David? Chrysler
> forfeited ALL their rights the day Nardelli flew in his private jet
> to beg Congress for spare change. From that moment on, the company
> existed at the pleasure of the Federal govt. Had money not been forth-coming,
> the company would have and should have died at that time.
>
> I don't see what's so "Orwellian" about Obama's statement. You kill
> a sick company, then revive it in a much healthier form. What's hard
> to understand about that?
I really enjoy your commentary on the many charts that you post, and reading your articles has helped me to better understand what may be driving some of the activity in the market. What do you think is going to be the result of SPY hitting resistance? Do you think we break through and take it to the next level, or do we falter and fall back?
On May 01 10:33 AM History Buff 24/7 wrote:
> CloroxCowboy,
>
> Let's ignore the self-evident, that Chrysler was a walking corpse
> way before yesterday.
Why ignore it? I'd rather not if you don't mind. It's is the whole issue in my opinion. A walking corpse is something you should put out of its misery by killing it swiftly. If it can be brought back to life in a healthier form, then all the better.
> Obama's comment WAS Orwellian, in the context that it is beyond nonsense,
> absolute nonsense, it is a contradiction in terms. That's what's
> Orwellian, "slavery is freedom", "war is peace". A lie is not any
> less a lie just because it comes from the mouths of the powerful.
> Saying that a company being placed into bankruptcy is not "a sign
> of weakness". What is it a sign of, pray tell?
You're confusing Chrysler with its (soon-to-be former) management. Bankruptcy is a huge sign of weakness for Nardelli et al, proving that they are ineffective at dealing with their creditors, unions, etc. On the other hand, Chrysler, the company, the distinct corporate entity will emerge stronger because of bankruptcy, which is the entire reason Chapter 11 exists. By your line of thinking, a doctor giving his patient medication would be an Orwellian act. You're confusing the patient with the virus.
> In Obama's doublespeak, I guess what he was saying is "don't stand
> in the way of an orderly settlement", we will steam roller you. "We"
> being the government of the United States of America.
Yes, I imagine that would happen. A big reason he was elected was the concept of change, therefore it's his mandate from the majority of Americans. Changing things doesn't always equate to asking nicely.
Isn't it great when a large, failed and corrupt company can refuse to honor most of its financial obligations and use public money to continue its failed way of life of enriching its management and unions at the taxpayers expense?
Now, the Street and hedge funds insiders will try to run successfully a large commercial corporation. WOW.
Unfortunately, no society or economy can function long in a lawless society where any obligation can be cancel/terminated at-will regardless of how this process is called.
PS
I am just curious of how many patients are ready and willing to undergo a surgery with a government appointed bureaucrat or a lawyer?
Support HR 1207, an Audit of the Federal Reserve:
www.govtrack.us/congre...
Find your congress person:
www.house.gov/house/Me...
Why is BHO looking like Bush Lite??
www.oftwominds.com/blo...
On the fundamental side and longer term charts, you can see that Taiwan is playing catch up as it never really participated in the explosive rally from China growth story from 2004-2007 (due to geopolitical risks depressing valuation). Now, with a once-in-a-lifetime change in China policies (e.g., China Mobile deal is only the first one ...), the market is finally breaking out.
Watch for more higher highs and continued outperformance vs. EWH. In fact, for cautious investors, a pair trade of long EWT & short EWH strategy will allow you to capture the "alpha" (as we are all seeking alpha out here), while controling the beta.
Hope you are able to find the chart for EWT somewhere, so all your readers can benefit from the growing alpha (vs. FXI and EWH).
Chrysler will emerge stronger after the bankruptcy. That's almost a given. But AT THE MOMENT Obama gave that speech, it was not in good shape. By your line of reasoning, a patient admitted to a hospital with a life threatening but curable illness has "nothing really wrong with him, basically". Fine, if he/she gets the medical treatment. Not otherwise.
This may seem like quibbling but the truth is the truth. Tomorrow's truth is not the same as today's truth, as today's is not the same as yesterday's.
Changing David's wording a bit:
- Peace comes thru war
- Blind faith is strength
- Freedom comes at a cost
That's how you spin in the USSA, baby!
Maybe we should rephrase that -- the rotting corpse of Chrysler will be kept on life support as long as the UAW can buy enough votes to keep their jobs, even if no one buys the cars.
Ultimately, isn't this really what this is all about now?
On May 01 04:13 PM Hot Richard wrote:
> It is absolutely NOT a given that Chrysler will emerge stronger after
> bankruptcy! If "liquidate and die" isn't on the table, then we aren't
> talking about real bankruptcy here. There should not be a presumed
> conclusion that the patient can or should be saved.
>
> Changing David's wording a bit:
> - Peace comes thru war
> - Blind faith is strength
> - Freedom comes at a cost
>
> That's how you spin in the USSA, baby!