metricon

Why Shorting the Market Makes Sense Above 980

"I don't think oil will reach $80 by year-end as suggested by Goldman Sachs. Two reasons: economic indicators don't support that level, and oil is negatively correlated with economic progress."

There is more and more talk by Israel of attacking Iran's nuclear installations. Were that to happen, do you think oil would not go above 80? I suspect Israel's rhetoric, and the posibility of war is a factor in the rising price of oil.

Why Shorting the Market Makes Sense Above 980

"Now the other side of the equation: most U.S. households work on a $10/hr wages. That gives a monthly average salary before taxes of $1600/month. So unless the government just pays everyone's mortgage for the next thirty years, I just don't see how an average person can afford homes at these prices."

Are you claiming that the average salary for a US household is about $10/hr? This seems unusually low. I was under the idea that the average US household is populated by more than one working person, which brings the salary of at least one working person to less than the minimum wage, assuming your logic. Please clarify.

Maybe It Is Different This Time

"So there were 4 past periods and this current period which makes 5 in total. The only period since 1981 where the S&P has had a positive return during a period when the 10 Year Treasury Yield increase by at least 1.50% in a six month time period is the current period we are in"

The dramatic decline of equities in 2008 and early 2009 may affect the pattern you observed. So it is possible that things will differ from your findings at the end of 2009.

Rising Rates: Modern Day Version of Sisyphus

"Not to pick on GM, but $30bn is being allocated to rescue it (with the issuance of new debt). Go figure…"

So true. Especially when cars can be manufactured abroad for a fraction of what they cost here. That money could have gone to increasing America's educational base.

Yes, America's children are falling behind. Freshman classes are getting dumber and dumber and more difficult to teach. Rather than learning, kids come to class to text each other about what they are wearing, and where they went the previous night. Worse is that educators are forced to pass these kids. While this may be ok in a class like music appreciation, when this is done in a class like calculus, it is like stabbing America in the heart with pins. America is falling behind very fast, and no place is more obvious than in the American elite college campuses.

After an hour of trading, stocks are still rising steadily. Dow +2.2% to 8,687. S&P +2.4% to 941. Nasdaq +2.6% to 1,821.

The earnings are implied presumably by an improving economic environment. The painful issue, and why this ascent must reverse is that long term treasury bonds continue to fall precipitously, which translates into higher interest rates and a choked recovery; quantitative easing appears to have failed, leaving the fed out of control. The whole thing looks like flying into the rain with paper wings. And dont forget the inflationary reassure exerted by rising oil and commodities! The markets are not stupid. They sense that hyperinflation is around the corner.


On Jun 01 10:52 AM CPAtrader wrote:

> This is not justified. There are NO earnings. You cannot have a sustainable
> rally, much less a bull market without EARNINGS. Simply because everyone
> believes all the media hype that these 'better than expected' earnings

Why to Short U.S. Treasury on the Next Uptick

Your article expresses good ideas, but it is written poorly.

Thanks for the article as it expresses ideas that some investors have been contemplating for a while.

Keiser: US Dollar 'Backed by Bananas'

Several clips of interview with Max Keiser in Youtube:
tinyurl.com/okkly2

The Rally That Won't Die

Yes you can, If by manipulated you mean a market fed by the Fed's printing presses and the taxpayer's coffer. If that is what you mean, then by all means the markets will continue to rally as long as long term interest rates are kept down by QA. The looting of the tax payer has barely just begun, and alot of fresh money is being minted by the day. Alot of that money has got to go somewhere, where better than the equities market. Same stuff is being done in China.


On May 21 08:19 AM xxxx wrote:

> YOu can't predict a manipulated market.

Gold Breaks Downtrend and Dollar Breaks Down

Hope link here works:
ichart.finance.yahoo.c...

Gold Breaks Downtrend and Dollar Breaks Down

It certainly looks like a good time to buy UDN ;it is trading nicely above its 50 and 200 MA. Although, it is important to realize that any significant correction in the global equities markets will drive people back to the US dollar. I know it makes no sense.

Further let us not forget that further improvements in the US stock market drives the yield of the long bond up, an anathema for a sustained recovery in the housing market.

It seems reasonable then to assume that the long term outlook for UDN is not stellar, unless foreign markets become unhinged from a USA recovery, something that may happen, and has begun to happen to a small degree.

UDN chart: tinyurl.com/r88vmo

How to Determine the End of the Current U.S. Dollar Rally

Agree with you, but what makes you think this manipulation will stop?

New Data Shows Active Managers Continued to Fail in 2008

I believe that the larger a mutual fund is, the harder it is to manage. An informed investor managing less than say, two million dollars, can do a lot better than a mutual fund with hundreds of millions. Why? Such an investor can move in and out of the market swiftly, parking money where it can benefit from news and trends...

For example, many of the etfs doing quite well are very low volume etfs. By the time a fund managing billions parks 50 million dollars in such a fund, a small investor is in and out, and looking for greener pastures, especially with todays low trading costs.

Funds are for people who dont have the time, or the curiosity, to keep abreast of the markets.

Rally in the last 10 minutes raised many boats. At the close: DJIA +0.5% to 8017.59. S&P +0.97% to 842.50. Nasdaq +1.2% to 1621.87.

True. It should offer an opportunity for many people to unload some of their positions and pick them up in the correction that will follow. Until the Markets have some logic behind them, it make sense to sell it in strength and buy it in weakness.

On Apr 03 04:24 PM AndrewBaker wrote:

> This is going higher on Monday. Don't know why, can't say why, totally
> illogical, as any good Vulcan would say; but it's going to happen!

Rupert Murdoch (NWS) says the time has come for newspapers to charge for online content.

Ummmm, good luck Mr Murdoch. These days you can get better news coverage from places like this website, and without the spin.

Encouraging Similarities to the End of the 1973-4 Bear Market

Thats is one of the problems with relying on graphs, and not historical parallels.



On Apr 02 06:33 AM ED K wrote:

> With the causes of the bear market from both time periods, being
> so entirely different, the historical references you point out as
> similarities really do not apply to our present markets.
>
> At this point in time the end of the Bear Market appears to be a
> lot further away than three months.
>