ain't no fortunate son

Holiday Boom or Economic Doom?

Nah, I'm nominating him for Treasury Secretary.


On Nov 28 12:50 AM untrusting investor wrote:

> Great article and comments again Steven. Thanks. Maybe you should
> be on the Council of Economic Advisors instead of Larry Summers.

Hero of the Day: Jeffrey Spinner

And a hero in my book as well!

Way to go Judge Spinner!

GE Is David Hartzell's Highest Conviction Holding - Here's Why

Harzell must know GE very well... that's why he didn't have the cojones to mention one single solitary word about GE Credit or the billions in toxic garbage sitting hidden over there. Not one word!

Why is that Mr. Harzell, because frankly, the fact you go to great pains to NOT speak about it says volumes more than all the fluff you do talk about.

And just why DID GE lose its AAA rating Mr. Harzell... didn't they sell enough toaster ovens?

A shill with major conflicts of interest pumps just the positives... a true investor provides a balanced, objective view of a company, and at least has the moral courage to discuss the fleas as well as the flowers... otherwise one might think he is just a scared tout talking his book.

The Fed Backed Itself into a Corner

I believe it is time for the FED to side with the American people now, voluntarily, or it may be forced to, at great pain for the nation, involuntarily.

I agree with the tone of the author's discussion; however, I disagree with one statement he made:

"The last I checked, this was still a democracy."

I'm afraid not, Tim. We were, once upon a time, but our government has been hijacked by the financial elite, the oligarchic big business leaders, their lobbyists who bribe both sides of the congressional aisle to do their bidding, the regulators (SEC, etal) and the "independent FED" (tell that to Jamie Dimon or Lloyd Blankfein and watch them fall over laughing).

99% of the American public are serfs Tim, nothing more. Serfs who are finally waking up to their status and the big LIE that they have been fed by their government for far too long, namely that America is a land of equal opportunity, equal rights, equal hope. In truth, America is a charade.

People will endure great hardship, as has been proven during the times of our "righteous" wars such as WW1 and WW2, if they have hope for better days ahead for themselves, and more especially for their children.

But take away a person's job, their home, their credit sources, their financial anchor to their community, reduce them to a life of constant fear and loss and financial terror, and you take away their hope. And without hope, I would submit that the normal constraints by which civilized societies maintain their "equilibrium" are no longer operable.

Mr. Bernanke, the banksters, the "regulators", the politicians and their keepers seem not to understand this message. YET.

I hope for every American's sake that the oligarchs open up their eyes and ears soon, for there is change in the wind, and "revolution in the air".

Show Me Economic Expansion, Chairman Bernanke

Another great article Steve - thank you. I have two anecdotal comments:

1. For the past three years, commencing in October '07 (perfect timing) I have been heading down Rt 95 from VT on the last weekend in October to St Augustine. I was absolutely shocked by the low volume of 18 wheeler traffic I saw this year... a huge reduction even over last year, which was at the tail end of the biggest part of the market shock. The overall volume of passenger vehicle traffic was also very low even though weather conditions were good, and the 2nd largest origination point by license plates was Quebec (makes sense due to Mr. Bernanke's torrid love affair with the US dollar). And, qualitatively, my gas station/restroom/motel cleanliness/upkeep quotient was abysmally low. Total gas expenditure was about $40 more than my trip up to VT in late April just 6 months previous - same vehicle, same load.

2. I wrote a comment about a week ago about the houses for sale in a typical middle class suburb in St Augustine - 16th Street. 31 houses, 7 with "for sale" signs (how many more without signs, or about to be foreclosed, or bank owned but not for sale (yet)? This isn't Miami, its northeast FL, near Jacksonville, and the amount of homes for sale is at least as high as at any time in the 3 years I have been coming down here. What does that say about where home prices are going? The comment is in my "comments" pages.

NYC and the Fed and Georgetown politicians need to get out and talk to real PEOPLE instead of their fellow stooges if they want to get a good view of where this economy is, and where its headed. People are scared, they're angry, they're hunkering down, they're tapped out, and they really don't give a damn about statistics at this point, seasonally adjusted or not, they're too freaking busy trying to survive!

Show Me Economic Expansion Chairman Bernanke

Another great article Steve - thank you. I have two anecdotal comments:

1. For the past three years, commencing in October '07 (perfect timing) I have been heading down Rt 95 from VT on the last weekend in October to St Augustine. I was absolutely shocked by the low volume of 18 wheeler traffic I saw this year... a huge reduction even over last year, which was at the tail end of the biggest part of the market shock. The overall volume of passenger vehicle traffic was also very low even though weather conditions were good, and the 2nd largest origination point by license plates was Quebec (makes sense due to Mr. Bernanke's torrid love affair with the US dollar). And, qualitatively, my gas station/restroom/motel cleanliness/upkeep quotient was abysmally low. Total gas expenditure was about $40 more than my trip up to VT in late April just 6 months previous - same vehicle, same load.

2. I wrote a comment about a week ago about the houses for sale in a typical middle class suburb in St Augustine - 16th Street. 31 houses, 7 with "for sale" signs (how many more without signs, or about to be foreclosed, or bank owned but not for sale (yet)? This isn't Miami, its northeast FL, near Jacksonville, and the amount of homes for sale is at least as high as at any time in the 3 years I have been coming down here. What does that say about where home prices are going? The comment is in my "comments" pages.

NYC and the Fed and Georgetown politicians need to get out and talk to PEOPLE instead of each other if they want to get a good view of where this economy is, and where its headed. People are scared, they're angry, they're hunkering down, they're tapped out, and they really don't give a damn about statistics at this point, seasonally adjusted or not, they're too freaking busy trying to survive!

Market Volume: Still an Unanswered Question

Small-medium retail investors are still in shell shock.. I think most are just watching, biding their time, hoping to get back close to break even, get out of the casino and put their 401 money in fixed income.. especially if they are near retirement. I have a number of friends who said they regretted retiring early last year, or who said they can't retire on schedule, but that was before this Fed-engineered rally... so many will take the $$ and run if they ever get back close to even. Good luck to them... they are waiting for sharks and crocodiles (and giant squid) to play fair with them.

There have been many consecutive months now where industry stats point out that there have been net outflows of money from equity mutual funds and corresponding net inflows into fixed income funds... not a coincidence if one buys my previous comment.

Much of the existing volume is HFT - that is estimated at as much as 65% of exchange-reported volume - particularly on the NYSE. Take out that volume and you would REALLY understand how low "reported" volume is.

But that is "reported" volume, and like others have said, the dark pools are supposed to report volume (when they get around to it) but I will guarantee you they don't... and do I need to mention WHO the biggest operator of dark pools in all probability is... so it wouldn't surprise me if there is a huge amount of money primarily from hedge funds and off shore accounts running silently through the pools. And despite many requests from concerned people like Senator Ed Kaufman (DE), the SEC seems totally incapable or unwilling to pull the curtain back from the wizard's machine and reveal what is really running through those pools.

It is my belief, and I have stated so to many congressmen and regulators, that much of the vast amount of naked shorting done last year to take down a certain hedge fund anointed bank holding company's major competitors was executed via HFT conduits and dark pools, overwhelming the public markets with hundreds of millions of illegal naked shorts, and the SEC never even took a look at it.

Be very worried when a certain hedge fund anointed bank holding company operates dark pools for the hedge funds and its various other friends - be very worried, because you won't see the volume until it is too late.

Bob Toll: 'Yesterday's Sub-Prime Is Today's FHA'

Bob Toll, true to his history, was bulling the luxury home market 10 days ago in the media, but meanwhile in September '09 he exercised options on millions of shares of TOL stock and did same day dumps on the shares... go to EDGAR and see his Form 4's for Sept '09. THat was a transfer of tens of millions of dollars of shareholder equity direct to himself... par for the course.

Reminds me of his actions in 2006 - talking up the stock while he was dumping (with his brother(s) tens of millions of shares.

Lets just say I wouldn't personally believe a word that came out of that guy's mouth.

AIG Counterparties: The SIGTARP Report

Thank you Karl.. as an old insurance guy, I've watched this whole ponzi/ lack of collateral scam materialize and blow up over the past couple of years with varying degrees of amazement, incredulity and disgust... oh, and abject terror too. There was a reason these guys didn't want to be regulated... they would have been shut down in a New York minute.

These guys are writing insurance contracts without having any conception whatsoever of general insurance principles, risk assumption, risk management, or risk avoidance, calculation of probable maximum loss, necessity of maintaining adequate reserves, maintaining proper spread of risk, calculating catastrophe exposure, reinsurance, etc etc etc...

Oh, well of course, I forgot, silly me - they DO have unlimited reinsurance coverage - its called the American middle class taxpayer. So screw all those other details.

Whitney Gets Bearish: Will She Be Right Again?

OK Guy, here's your short if the chart works:

Rolling top or H & S top, looks like a small bear flag into the 50 EMA the past few days, major MACD negative divergence dating back to August 10

stockcharts.com/h-sc/u...

Bounce, Crackle and Pop: Seven U.S. Metro Housing Markets Fall Below March Lows

Since I commented on another article about this on Sunday, and since one of the featured cities is 40 miles from the subject of my other comments, I'll throw in a piece of those other comments:

"... real estate is on a tear!!!!

I live in St Augustine, FL half the year, out at the beach. Its in north FL, about 40 miles south of Jacksonville, so its quite a way from "ground zero" of the housing meltdown which was at least originally in south and central FL.

To reach my bank, I have to drive through a nice middle class residential neighborhood, which is about 1/2 mile long on the part of 16th St that is between A1A Beach Blvd and Florida A1A. Just your typical middle class ranch style homes, mostly fair to well maintained, 25 or 30 years old, maybe 2500 sq ft on average, 1/4 acre lots, middle class working stiffs and retirees mostly, not the small rundown stuff you see out along the beach... in fact, you wouldn't know there was a beach within 100 miles. I used to rent a condo at the beach end of the street, that's how I know the road so well.

So, there are 31 houses on the street. I counted them Saturday. And there were 7 houses with "for sale" signs out front. I'll leave it at that even though I'm sure there were others in trouble, or some bank holding someone's paper isn't ready to foreclose and take the balance sheet hit yet, or the bank owned the place but wasn't selling it now, but we'll say nearly 1 in 4 of the houses on this typical stretch of Main Street USA were for sale. Since its named 16th St., you would be correct to assume that its one of about 20 or so other streets in that part of town, all laid out cookie cutter style, all nearly identical. And on all the other streets out that way I I've been driving around seeing the same thing. The condos are as bad, if not worse.

I'm gonna go out on a limb and state that none of these sellers was doing so in order to trade up for a bigger piece of the American dream..."

so, if anyone thinks we're out of the housing troubles, have them stop by 16th St in St Augustine... enuff said...

Roubini on Unemployment: 'The Worst Is Yet to Come'

Screw jobs... real estate is on a tear!!!!

I live in St Augustine, FL half the year, out at the beach. Its in north FL, about 40 miles south of Jacksonville, so its quite a way from "ground zero" of the housing meltdown which was at least originally in south and central FL.

To reach my bank, I have to drive through a nice middle class residential neighborhood, which is about 1/2 mile long on the part of 16th St that is between A1A Beach Blvd and Florida A1A. Just your typical middle class ranch style homes, mostly fair to well maintained, 25 or 30 years old, maybe 2500 sq ft on average, 1/4 acre lots, middle class working stiffs and retirees mostly, not the small rundown stuff you see out along the beach... in fact, you wouldn't know there was a beach within 100 miles. I used to rent a condo at the beach end of the street, that's how I know the road so well.

So, there are 31 houses on the street. I counted them Saturday. And there were 7 houses with "for sale" signs out front. I'll leave it at that even though I'm sure there were others in trouble, or some bank holding someone's paper isn't ready to foreclose and take the balance sheet hit yet, or the bank owned the place but wasn't selling it now, but we'll say nearly 1 in 4 of the houses on this typical stretch of Main Street USA were for sale. Since its named 16th St., you would be correct to assume that its one of about 20 or so other streets in that part of town, all laid out cookie cutter style, all nearly identical. And on all the other streets out that way I I've been driving around seeing the same thing. The condos are as bad, if not worse.

I'm gonna go out on a limb and state that none of these sellers was doing so in order to trade up for a bigger piece of the American dream.

Yah, housing's stabilizing, just like commercial real estate, foreclosures, unemployment are all stabilizing, they're all just lagging indicators you fools. Yah, we're through the recession and everything is swell, Obama and Bernanke both said so. The fact that they're still desperately looking for ways to stimulate the economy, still trying to bail out the banks because a couple trillion wasn't enough, still planning to keep US interest rates at 0 for a couple more years because everything is humming along so great, still destroying the US dollar in order to turn the US into the world's street corner whore, well, none of that means squat. We have our dollar carry trade and the world's markets are exploding, so everything's fine.

I would submit that hysterically buying stocks, commodities and every other THING on the planet simply because your currency is collapsing is not always a savvy investment. The folks on 16th St. in St Augustine may have a similar opinion on that, altho I don't have the cojones to ask them. Some of them looked a little pissed off as I drove by staring at their dreams for sale.

7 houses for sale (that we know of) on a street of 31 houses, but everything's swell, and even if it weren't, who really gives a damn about the middle class taxpayer anymore, really, because if it means destroying the dollar and what's left of the American middle class to keep the TBTF's safe and sound, so THEIR brand of "state sponsored capitalism" can thrive, then screw Joe Q, his house, his job, his DREAM if he can't step up and be a man and take one for the team.

U.S. Government Practices Restrict Jobs Growth

Trader, there are a number of people (not you) who are pretty clueless about who the real traitors are. They go ranting about the evil shorts and yet they don't have a clue on earth what the difference is between legal shorts (who have been around for over a century, and who serve a VITAL ROLE in preserving the health and liquidity of the capital markets) and the illegal NAKED shorts who are the hedge funds spawned by, supported by, financed by a certain few Too Big To Fails who set them loose against their biggest competitors last year and brought the world to its knees.

Those same few TBTF's now award themselves monstrous bonuses in the tens of billions of dollars for their work in nearly destroying the system through their naked shorting, sending hundreds of millions of illegal naked short sales in a day against this or that competitor through their HFT's (high frequency trading conduits) that overwhelmed the system, never once having the required share "borrow" to do a legal short sale, and the SEC knows exactly who they were but won't do anything because these are the biggest of the biggest... anybody who seriously follows the markets knows who they are, and knows that they have won a virtual monopoly and vast profits in the markets now as a result of their malicious trades last year.

And the sad thing is they got away with it, and they will again whenever it suits their purpose, because they OWN the markets the regulators, the politicians. And its they who are the traitors, for they have destroyed American capitalism, the concept of free and open markets, the essence of competition.

Legal shorts must have BORROWABLE shares available in order to conduct a short sale... you and I can't just call our broker and ask him to sell 50,000 shares short that we can't "borrow"... but the hedge fund naked shorts got around that critical requirement by being in cahoots with the trading desks of the TBTF's who gladly looked the other way because they had the means, motive, opportunity and trading platforms to pull off these trades in the hidden and opaque dark pools and HFT's that concealed their purpose.

And their biggest win may be in the fact that the legal shorts are getting tarred with the same brush as the illegals are by the clueless and the misinformed.

Legal shorts add liquidity to the markets, perform significant homework and due diligence, and open up a pro-con dialogue that is essential to true price discovery and the education of investors on both sides of the trade. They are the canaries in the coal mine.

Naked shorts? Well, they should all be hanging from the tallest tree... but they have too many friends in too many high places, and even some unwitting and uneducated allies.


On Nov 15 07:13 PM Old Trader wrote:

> appropo,
>
> Thanks...I've been self-employed for the majority of my adult life.
> I like your 2 suggestions, although I'm a bit leery of the tag end
> of #2, re; short sellers, because I suspect they're more of a "symptom",
> rather than a "cause".

Are Stocks Making a Major Top?

Well, I look at the leaders on the way up. If (big IF) this chart works, you can see an important financial stock (JPM) that has a rolling top setting up going back to early August, your elongated/inverted "U". Note that the MACD topped out in early August but the stock kept rising, indicating declining buying momentum. Many financials are toppy here, look also at such stars as GS. Hope this works:

stockcharts.com/h-sc/u...

Look at an index that led the way up, the Russell 2000. It has your same rolling top formation, with a double top and what appears to be a right shoulder forming. Note that the MACD also peaked out in early August although prices kept rising. So here are two good example of leaders that are apparently rolling over.

stockcharts.com/h-sc/u...


On Nov 15 11:13 AM E Nuff Sed wrote:

> Good post - but what is your outlook on the market? I agree watching
> for divergences is important but the key is distinguishing between
> false positives and the real deal. You have to watch multiple indicators.
> It is much easier to identify a major bottom (which forms a characteristic
> and sharp "V" , than a major top which is an elongated - inverted
> "U")
>
> On Nov 13 08:19 AM ain't no fortunate son wrote:

U.S. Government Practices Restrict Jobs Growth

Another good article Steve, but I must say I disagree with the first of your (and your corporate shipmates) opinions about corporate taxes. While I feel sorry for the relatively onerous burden that current tax laws force on the small businessman, who always takes it you know where just like the middle class always takes it in exactly the same place, cutting corporate taxes and benefits like health care across the board is not the solution in my opinion, simply because the BIG corporations, as always, are avoiding much of their rightful share of taxation, with a never ending stream of writeoffs, exemptions and other outright gifts from Congress, states, municipalities to avoid much if not all of their fair share of taxes. And you can bet their senior people will still get THEIR benefits, and their stock options, and all the other rock star status crap, even if their employees don't. Their leverage? Why, they just threaten to destroy the local economy by going elsewhere, like overseas. Sorta reminds me about what the big banks have been doing to keep their bonuses intact while fighting tooth and nail to not have to mark their trillions in broken "assets" to reality while hypocritically taking trillions in middle class financed taxpayer bailouts to cover up their ongoing disasters. Whaaaaa, we're gonna cause another meltdown unless you give us our way. Whaaaaaa. Sob. Sob. Sob. We didn't cause the meltdown. Whaaaa...

And sadly, we the Sheeple seem to be buying that load of bullcrap.

As far as joblessness goes, I suppose if all the corporations can stop offering health care and other benefits, and if all the unemployed and underemployed American workers who can't find work in this profitless, jobless, recoveryless recovery can't afford health care while its premiums, deductibles, co-pays and exemptions get ratcheted up by the health insurers in advance of the fumbling congressional march towards a watered down "reform" (ha!ha!) bill (remind you of what the banks did with credit card rates after that reform (ha!ha!) bill went through???), then a lot of working class people will die earlier than they had planned. I suppose THAT will take the pressure off the unemployment numbers, since the BLS will then have some REAL birth/death numbers to finagle, but I doubt the dead people will see much advantage to that elegant solution.

Yeah, a recoveryless recovery for a long time to come seems to be the best we can hope for in America, the land of opportunity for all.