Hmm?!

Wednesday Outlook: Commodities, Global Markets

apirri,

Good Question. I was not sure about David's gap comment.

As a general rule.....most gaps usually fill within a few days. However gaps are also indicators of strong directional movement.

Hmmmm???


On Oct 28 07:28 PM apirri wrote:

> David, UNG has only $10 to go before it is zero. What do you think?

Wednesday Outlook: Commodities, Global Markets

IMHO.......just speak to fundamentals and ignore the prognostiticators...who do not speak to fundamentals. Then your issues are timing and the spin doctors as you mention below.....that is still more than enough to worry about.


On Oct 28 05:57 PM Alex Trias wrote:

> Alas, what a difference a day makes. The big excitement today is
> how many ETFs sliced through their 50 day moving averages. I expect
> Dave will have something to say about that in his next article, which
> I await with great interest.
>
> Some would argue that a failure to observe a 50 day moving average,
> at a time when short term momentum indicators like the NYMO are already
> at oversold extremes, suggests we are at the front end of an intermediate
> downward trend (or worse). If so, then we will be in the most heavily
> and widely anticipated market correction in recent history. Yes,
> we are all conditioned to believe that the market rarely rewards
> the majority-held view, but perhaps this truly is The New Normal
> - to borrow a phrase from Bill Gross. In the New Normal, the majority
> actually get it right, and are richly rewarded by the market. <br/>
>
> Which reminds me, anyone notice Abby Joseph Cohen stepped down this
> year at Goldman? Ahhhh, at the highs of the market bubble back in
> the late 1990s, Abby Joseph Cohen was practically a household name,
> offering up her widely accepted views that the stock market had nowhere
> left to go but up, thanks to the miraculous and new dynamics of the
> tech industry. In the late 1990s, we all knew we were in a fundamentally
> new era, that markets would absolutely go higher and higher, perhaps
> forever, and Abby Cohen was quite the spokesperson.
> But no longer. Bill Gross is rapidly becoming today what Abby Joseph
> Cohen was to the financial media in the late 1990s. Like her, he
> points to a New Normal, a fundamentally new era that supports a continued
> slide in equities (and other risky asset) prices.
> Have we come full circle, then? Do we all have a high degree of conviction
> that asset prices must drop, that the economy is fundamentally different
> this time, and have we finally settled on financial celebrity spokespeople
> who will articulate this belief on our behalf? If so, with history
> as any guide, we are wrong. Unless, of course, we are all collectively
> smarter than we were in 1999.

Chart of the Day - Inflation Adjusted Dow

bobdark,

I am not sure I follow your comment. I see the chart and the cones on it pretty much supporting your conclusion. It does not look like the DOW could go a whole lot higher, without breaking through the cones? Within the cones, we should be revisiting DOW 5000 pretty soon.


On Oct 24 11:23 AM bobdark wrote:

> I see it differently from the other commenters. A double-top often
> implies a significant reversal. And, why should we the Dow be going
> up related to inflation anyways? The most logical long-term direction
> seems to be retracing down to 5,000.

Chart of the Day - Inflation Adjusted Dow

Very enlightening. It takes a minute to adjust your mindset......to what is a proper scaling (every doubling).

What stopped you from moving the suppport line even lower, where it would just touch the bottom of the second dip?

Will Housing Data Show Improvement This Week?

There are approximately 7 million homes in bank shadow inventories today.

By 2007 48% of mortgages were low/no doc loans. A sample of 100 low / no doc loans showed 60% of low / no doc borrowers overstated their income by MORE than 50%. (Data Source: Mortgage Liquidity Du Jour by Credit Suisse)

That means about 30% of all homes sold in 2007 are destined for foreclosure. The other Liars loans could still have up to a 50% overstatement on their income. Do you know how buyers who never qualified the first time come back into the market? They don't!! They never existed as qualified buyers in the first place.

A lot more will go wrong from the side effects of excess before it is all absorbed. With a downward spiraling economy and slowing population growth, the excess could last...........a decade? How does this get absorbed when builders are still building?

On Oct 20 07:37 PM PompanoFrog wrote:

> this is ridiculous..the FRB is well aware of the weak housing market..they
> will continue to create liquidity until the housing market stabilizes..meanwhile
> the spread between the rise of the stock market and the real estate
> market gets larger..at some point households will shift their asset
> allocation towards housing..
>
> If you dont understand that asset prices rise rapidly when central
> banks fight recessions i guess you havent made any money in the last
> 6 months..the turn in real estate prices will cause banks to have
> to take profits under the new estimation models..this will create
> an earnings explosion in financials..

Earnings Notwithstanding, Citigroup and BofA Have Two Different Stories to Tell

In the end. Maybe they both go down.

The Power of Unintended Consequences: SuperFreakonomics, by Steven D. Levitt and Stephen J. Dubner

I will respectfully disagree, there are some pretty cleary defined economic principles out there. None of them have been violated (unlike ethics), by the recent economic meltdown.

Some key points
- 300 economics professors signed a full page Wall Street ad stating the stimulus bill was a bad idea. Beyond government and Wall Street puppets, there has been no equilavent rebuttal.
- There is NO Keynesian or Austrian branch of economics....just economics. John Maynard Keynes had some theories, none of which supported large government debt. Keynes fought against deficit spending. Ever study Chinese Physics or Equadorian Mathametics???.....it is nonsense!
- The core principles are almost as clear as Newton's laws of physics. However the timing of economic outcomes and the rationality of human behavior will never be accurately clocked like a falling apple (9.8 m/s).


On Oct 17 03:56 AM Ponchovilla wrote:

> Of course their objective is not just shedding light on "behavorial
> economics" but to sell books. But the plot is entertaining. Can't
> wait for the charts and graphs, theories and conclusions.
>
> The problem with economics is there is no non-arguable definition
> of what economics IS. Remember that reply under oath? "It depends
> on what the meaning of the word 'is' is"
>
> Put 25 economists in a room for a week and I'll bet a war breaks
> out. Particularly if there are macro, micro, Keynesian and Austrian
> schooled "ECONOMISTS" still alive.

Friday Roundup: Commodities, Emerging Markets

Is it possible the banks are manipulating the technicals and the zombie public is being drawn in.....as long as posible....buying new issues to cover the losses on worthless real estate debt?


On Oct 17 08:41 AM tunaman4u2 wrote:

> It always seems down days produce a higher degree of oversold than
> up days produce over bought...
>
> We're oversold just under 10K after gaining overall last week?

Oil Traders Bullish; Analysts Aren't

The big misconception is that peak oil means running out now.....it does not. It means CONVENTIONAL oil output has likely reached its peak and will begin decay.

However South African Sassoil can make oil from coal for as little as $35 a barrel, and China, the US and even India have a hell of a lot of coal laying around.

Future Canadian Oil Sands production was going to be as high $80 a barrel to break even. But with the crash all the construction contracts were renegotiated....... not sure where it is at now. Most of the existing production is in the $40 - $50 or less range.

And lastly if oil prices jump high enough, just about every dry oil hole in the planet will start getting steam or something else pumped into it.

Until we reach peak oil production, can there be viable economic alternatives??

Minding the Markets' Gaps

Good Stuff. Thank You.

I was expecting a market drop with a dollar rebound. However some Dow 10,000 hype may destroy that opportunity somehow.

The sell side is pushing with all of their might to inflate the market...

Hang in there Reggie, justice shall prevail if everyone keeps on it.

I find the typo baking system rather than banking system quite humorous. Which makes me wonder......intentional or subconscious?

Politicizing the Olympic Decision

Mr. Miller,

You make somewhat of a point, ......... however neither Blair or Putin, is currently the leader of his nation.

In the case of Putin, some would say not officially the leader. Saying "the critics would have been loud" paints with a pretty broad political brush, ...... well beyond Mr. Kudlow.

It really comes down to...what else would President Obama have likely done with his time? Given Obama's history, I see nothing that would get the investment community or his critics jumping for joy.


On Oct 04 11:20 PM Jeff Miller wrote:

> Mr. Hmmm.
>
> I am always interested in well-researched comments. I suggest that
> you check out some additional information:
>
> www.universalsports.co...;ATCLID=204796264
>
>
> IOC president Jacques Rogge said disputes with the U.S. Olympic Committee
> will have "no negative effects whatsoever" on Chicago's chances of
> landing the 2016 Summer Games.
>
> and later...
>
> "I think I can make a bet today and say that it's probably going
> to be a couple of votes, two, three, four," Rogge said, echoing his
> comments in an Associated Press interview last week. "Something like
> four, five votes is only the situation of a change of mind of two
> or three persons. You see how close it is. You can convince two people
> more and you might win."
>
> If you google "Obama not going to Copenhagen" you will see many stories.
> Things have changed since the last US bid, with Blair and Putin both
> making personal appeals.
>
> I have provided a strong message in many articles that investors
> should not play politics with their investments. This article makes
> the point very clearly.
>
> Those who think that the Olympic loss has some grand implications
> for investments are looking in the wrong direction.

Politicizing the Olympic Decision

Your comment "No one knows what would have happened if Obama had not made the trip, but the critics would have been loud." ......is way off the mark!

President Obama announced well in advance that the First Lady would be making the trip and there was no public criticism. Never has a US president made such a trip in the past. Therefore the President may have taken a risk in going.

"we should be focused on investments, agnostic about politics ......... Overtly partisan messages do not fit." You are right, so hopefully you do not do it again.

Friday Outlook: Commodities, Global Markets

"how can one stay positive about things when we owe our economic existence to the Fed Gov" Good comment Enigmaman!

I would also add we owe our economic desitution to our Federal Government(s).


On Oct 02 07:45 AM enigmaman wrote:

> Without Gov support this faux economic recovery is toast, IMF Pres.
> states the world could face a double dip but as long as Gov support
> is provided, he doesn't see it and exclaimed how happy he was to
> find the Gov of the world were not going to pull the stimulus plug
> so quickly, in other words the patient must remain in the ICU, patient
> is not strong enough to survive on its own, plugging just IV could
> kill the patient, not very reassuring and recent new, car sales and
> unemployment numbers confirms that the USA is no way out of the woods,
> how can one stay positive about things when we owe our economic existence
> to the Fed Gov

Gold's Record Monthly Close: Technically Significant

" Meanwhile, European Central Bank head, Jean Claude Trichet warned that large currency fluctuations could derail economic revival. He warned that "excessive volatility" and "disorderly movement in exchange rates" would have "adverse implications for economic and financial stability."

I don't think so.....excessive volatility is the result of fundamental issues. The reason this comment irks me.....is that it plants the seed for blaming currency traders later on. It shifts focus away from the root cause......... all the various government entities that routinely falied to do their jobs for quite some time.