Carl Spackler

A Major Market Correction Is Inevitable

I agree with your view on where the market is going, but it is unfair to say state governments are deeper in debt. Their balance sheets are relatively the same, although they now have less revenues. State governments are required to balance their budgets. Some use financial gimmickry (like California), but they (unlike the US Govt) must balance their revenues to their expenditures. Then bigger issue is the consumer's balance sheet which is in the toilet.

Global Markets in Review: Share Prices Too Far Ahead of Economic Reality

Bernake and the Feds gave some passing compliment to the dollar, but it just a passing comment. This administration's true colors were shown when Obama mentioned recently that his belief is that US exporters will pull us out of this mess. That means this administration is behind a weak dollar campaign in the futile hope that exports can drive our economy.

This will go down as a massive miscalculation. Our economy is only 30% manufacturing, and such a small sector will not drive growth much. The damage of a depreciating currency on the remaining 70% of businesses will cripple us long term. We will have a small group of companies doing well, and a bunch doing poorly.

U.S. Treasuries in a Bubble, Not Commodities

I like Mark Anthony's hat almost as much as my assistant greenskeeper hat in my Carl Spackler picture! Couldn't agree more with the arguments here - US Treasuries are 150-200 basis points too low. Eventually, just like water, things find their natural level despite man's interference.

Gross: Utilities Becoming the New Gold

On a short term basis, utility stocks are high, but if they can correct 10%, I would be a buyer. Historically 60% of all profit from stocks comes in the form of dividends. In the last few years, that changed as the high flying market rewarded growth investors. I think the market will now fall back to its norm and the dividend paying companies will outperform the no dividend-growth stocks.

Looking for Signs of a Dollar Rally

Hey Sage! Learn to read posts. I did not write the Varmit Cong comment, I was just commenting on it. FYI - it is a reference to the movie Caddyshack that another poster made because Carl Spackler is a character in the movie. BTW - cool your jets. While I am a LT dollar bear, I actually believe it is due for a good run up (perhaps overdue).

Looking for Signs of a Dollar Rally

I like it! Funny!


On Nov 02 06:19 PM yellowhoard wrote:

> Carl,
>
> The dollar is not the friendly rabbit or the harmless squirrel.<br/>
>
> It is a varmint. The Fed has made it an adversary, like the Viet
> Cong.
>
> The dollar is Varmint Cong.
>
> And, as such, we're all licensed by the government of the United
> Nations to take all necessary actions.
>
> So, we've got that going for us.
>
> Which is nice.

Looking for Signs of a Dollar Rally

One thought keeps entering into my mind - if the dollar continues to fall, then Oil and othe commodities will continue to rise. Our economy started its big fall when Oil ran too high. According to many economists, the current increase in the price of Oil already has negated half the impact of the economic stimulus. If the dollar fell further and Oil went to 80, 90, or 100, wouldn't economic activity hit the skids? If this is true, the markets would fall, and the dollar would rally as everyone searched for a safe haven? It appears as though a dollar rally is really a "when" and not an "if" question. Long term, I am a big dollar bear, but the conditions do not support a big dollar fall right now. I hate to even consider buying the dollar, but it does look to be the smarter play right now.

Market: Spooked Today, But Panic Attack Is Likely Temporary

Let's not get ridiculous. I could play the same game and say it is overvalued because in 1832 the S&P was at 12 and now its at 1036. There is no refuting that over the last six months we have had an unprecedented rally. Name one other time where you got 60% in six months......silence .........that's right its hard to beat it. Face it, this baby had gone a long way and maybe, just maybe its over.


On Oct 30 05:00 PM klarsolo wrote:

> What do you call almost 11 years and flat returns (S&amp;P is on
> 1998 levels)? Or returns over the last 13 months: -3 %. Is that the
> biggest rally ever? Look at other timeframes than just the last 6
> months only. Some party...not.

Q3 Real GDP: Not All Details Are Bad

Just like fundamentals did not mean anything when the market was at S&P 666 in March (fundamentals were horrible), they don't mean much right now. What drove the market then and now at these critical points is the behavior of the herd. You can be fundamental right at the moment and still lose your rear for several months. Remember oil at $150? Great fundamentals there. Peak Oil Theory will end up being right, but the herd got ahead of itself and eventually the party ended for Oil. At extreme valuations, statistics validate that the logic of the herd will trump the fundamental logic.

Market Bounce Not Unexpected

Question for the author: Have you analyzed and back tested what happens when the rising support line of stocks above their 50 day MA gets broken? It might be interesting.

This Week's Recap: Goldman's Sucker Punch

For the past three weeks I have been buying S&P puts, and when yesterday happened, it took away about 70% of my profits. This time, I did smell a rat, and I followed a rule I now view as sacred - never decide to buy or sell during trading hours. I just turned off my monitor. Too many times I have seen these guys pull these tricks, but I learned that if you ignore them long enough, they cannot hurt you.

By the way, for long players, the same is true - don't dump your positions just because the market screen show -250. Make your decisions during off hours when your emotions are calm. The stock market is just like hustling in golf - you win when you raise the stakes enough for your opponent that he becomes nervous. A great golf gambler gets you out of your comfort zone and then he has the edge. This is exactly what the GS guys do.

Market: Spooked Today, But Panic Attack Is Likely Temporary

If the bearishness was chart topping, what do you call 6 months and 60% - oversold? Everyone has a reason why the party has to continue, but we all know that eventually all parties end. Sometimes they end because everyone is tired of the party and no one wants to be the last one there. Everyone bought into yesterday and just assumed that the market would rocket up (just like it has previously). When it did not follow through today, everyone ran for the exits.

Big question is, if you have a lot of people with profits in various positions, do they decide to take their profits and sell now, or do they get greedy and hope for more. Value and fundamentals will not enter into their decision very much - fear and greed will.

GDP Euphoria: An Artificial High

Funny!

This entire economic episode reminds me of some of the lessons I learned while I was studying economics - in a good economic system, good businesses are allowed to succeed and poor business are allowed to fail. By allowing this, capital will freely be distributed to those businesses that are successful, and poor endeavors are quickly halted. The strong companies create more jobs and thus more money for the workers - which in turn creates more demand.

What we have done is prop up the weak companies who will not be expanding, and starve the best companies of capital which leads to no job growth and further reduction in demand. Assbackward thinking created one big poop shoot in the end. This is basic econ 101, but I guess Obama never took economics in community college.


On Oct 30 03:38 PM Albertarocks wrote:

> On Oct 30 03:28 PM Carl Spackler wrote:

GDP Euphoria: An Artificial High

I read an article yesterday that said that of all the "cash for clunkers" buyers, only 15% would not have bought except for the program. In other words, the other 85% got a free handout and we only marginally increased sales. In fact, that 15% that was increased sales cost about $24,000 per car. Even more tragic, we pushed forward future demand into last quarter, and now all future quarters will be much worse as a result.

Now that just sums up all this government intervention - its expensive, poorly applied, and tends to rob future sales. Cash for clunkers was a microcosm of what was wrong with all government intervention. The market now senses that government money has withered demand at every step. They gave trillions to the banks, yet the banks only are responsible for 35% of all loan activity. What did they do with the money - they reduced loan activity for the last 20 weeks in a row (per many publications). They took their money (plus borrowed more at 1% or less) and bought risk-less fixed income instruments. They could have handed each American $20,000 for the same total bill. At least they would have increased demand, not reduced it.

So what is the moral of the story - when you bet on government intervention being efficient, you will lose. The market is waking up to this and wondering what happens when the government induced "sugar high" disappears and we are left with tepid demand. Can you say Bailout Version II in January?

ETF Market Trends: Bears Emerge from Hibernation in Oversold Market

Fair enough Mr Hill! I just believe that the action of the last few days hardly constitutes a major oversold condition. We have only corrected 5% from the recent highs - not exactly a thorough correction by any measure. If we were talking at least 10%, I would say we finally are seeing a meaningful minor correction. After a 60% up move, 5% is nothing but a random movement. A major up move like we have had should eventually see a 15% to 20% correction at a minimum. I am just saying that to say we are oversold might be right if we are trading with a horizon of two weeks, but on a longer term basis than that we are not really oversold.


On Oct 28 06:58 PM J Clinton Hill wrote:

> <img class="authors_reply" src="static.seekingalpha.co...">
>
>
> carl,
>
> no where in this post do i quantify the market being down "5 out
> of 6" days and/or associate or imply the market being oversold for
> this reason.
>
> it is true, after today's close, the market is down 5 out of 6 days.
>
>
> i state that the market is "approaching the boundaries of extremely
> oversold territory" which implies that this is not yet its current
> condition. however, it is moving towards "extremely oversold" based
> upon percentage qualifiers and historically tested models.
>
> nothing is infallible, but if it makes you feel good to give yourself
> a pat on the back by saying "gotcha" to an analyst/writer, then god
> bless you...
>
> my determination for the market being overbought or oversold is derived
> from proprietary technical indicators. during the extended rally,
> i have labeled the market overbought on several occasions.
>
> when the facts change, i change my opinion. my investment bias is
> dictated by the trend tables that i have organized and if the trend
> is down for a short, intermediate, or long term basis then my bias
> corresponds appropriately with the market trends. you only need refer
> to the trend tables to learn my investment bias.
>
> if you have followed any of my writings on technical analysis over
> the years, i continually caution readers that markets can stay overbought
> or oversold for extended periods of time.
>
> statistically, a disproprotionate percentage of stocks are displaying
> oversold signals vs. overbought based upon proprietary oscillators
> and price-volume indicators.
>
> 1020 to 1040 is key support zone. if we break 1020, the odds favor
> us testing 990 levels. until the market arrives at this testing area,
> it is premature to call things one way or another. the only thing
> i know is that the short-term trend is down. after i conduct my analysis
> this evening, my conclusions may be better or worse... let's wait
> and see...
>
> what i am trying to do is alert people to a potential anomaly and
> the vulnerability of getting bitch slapped by following the herds
> of sheeple. i find it quite unusual and disturbing for the market
> to advance for such a long period of time and flash oversold signals
> so early after only 5 trailing days of relatively small negative
> performance.
>
> in terms of overbought or oversold, indicators can be applied to
> different time frames. Short-term the market is oversold. Intermediate
> term, the market still remains overbought.
>
> also, if you read my reports regularly, then you should know that
> i am fundamentally bearish on the market while acknowledging that
> the technicals have been bullish...
>
> in terms of logic, i am not always linear in my thinking or interpretation
> of the environments in which i interact...
>
> hopefully this clarifies my investment bias for you and other readers...
>
>
> thanks...