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Closing Update: Stocks String Together 3 Straight Wins, Commodities Gain

"July consumer credit fell at 10.4% rate, the biggest decline since the government began keeping records."

This is the type of indicator that tells us we are not headed toward a recovery any time soon.

The market can do as it will, but the belief we are heading into a growth in demand is silly. The stimulus and junker car programs were going in July and consumers did not spend; may have paid down some debt. The road to nowhere is long and winding and we have just started. Liquidate the dead banks and start over in banking.

Biggest One-Month Changes in EPS Estimates

We have no idea what lies behind these numbers besides hope.

The EPS estimates are themselves manipulated to surprise and please the analysts and investors (understated). That they are rising a little is no surprise, especially if a firm is looking at a secondary offering or selling debt. No sell.

Report from Europe for Friday, Sept. 4

Fair comments, but hardly relevant to the meaning for America.

The EU thinks they have gotten the upper hand on recession effects and can quickly return to "normal" interest rates and productivity of better times. This is dangerous for all.

The American government has not got a chance of escaping Hobson's choice. No longer can we inflate to pay the bills, or default on obligations, or some combination of the two. The US has not got those three choices open. We have one open: Hobson's.

The sole choice is end the Congressional spending and turn the money loose on the consumer in various ways and hope for a recovery in 12 months. In the meanwhile where does the EU go for growing markets for its export goods? Cut prices and maybe the emerging economies will take some. All at the price of no or few sales to the USA (20% of the EU traditional market). It is bleak.

The EU is ready to do to the whole US what UK did to the US on its Libya prisoner swap: Lie, ignore the long run and wish the US the best and all that, you know. We are suckers being abandoned - Not that we don't have it coming.

Closing Update for Tuesday, September 1: Third Day of Pullback

Interesting a description of how it starts. The market is headed for 3500 more or less by the end of the year. Hold on we had a retrace of 50% now we rip it all out. Financials lead and they were down big.

Sobering Stat: ARMS Index Indicates Market Is at Peak, Not Bottom

Just read the comments each a chink in the wall of worry.

Many are bearish over the VIX /TRIN and foresee the retest of March lows, a second group sees an exception to any predetermined formula and points to the 50/68% retracements, a strong third groups sees a lingering bull since there is not time limit on how low it can go up: forget the indicators. The last group loves to hate the market and most of the participants andexcitement is their cup of tea. They don't care how it comes out.

I think we can feel some confidence that we have a good horse race of opinion that can go on for a while with just modest good news.

It has a core of buy side support that is not eroding that I can see.

The Bull is in danger of dying, long live the bull market!

AIG Is Dead, Long Live AIG

Wonderful comments and post.

This is state induced speculation and it is ill advised simply because it always fails, without exception. The AIG play is based in large part on its new banking relationship with the US Govt.

But It is state capitalism such as marked Italy and Germany in the WWII period, and it did not work then. Today France has its version and you can read the score: dismal at best. Mexico and Japan have whole sectors of government backed business, banking, oil and airlines all pop to the top of the swamp.

One reason the US flourished was the hacks in government could not rescue their favorite businesses (they would not know how).

Give it up before it kills us, GM, AIG, GSEs, Chrysler, and Health Care? The disease is metastatic !

Closing Update for Thursday, August 27: Late Save

AIG is the story to watch. What is happening?

Rank speculation that this wreck can regain prominent in banking, insurance and finance once again simply because it is too big to fail?

If AIG is back in good graces, what is next? GM or its successor in autos, Chrysler, maybe C, or is anyone excluded from a good con?

The bubble machine is running, hold on tight.

Closing Update for Friday, August 21: New Highs for 2009

We all must feel the Friday rally was desperation in motion.

Ben B is fighting to show Obama things are getting better under his hand. Very probable since he has spared no dollars.

The Need for a strong setup for the fall months is obvious. Go in fat and see if you can weather the fall storms.

The lack of final demand for goods and services is never the basis for a major expansion of multiples. We have a sheet in the wind and our growth, GDP, may look better for a while, but without jobs just expect nothing to last. More stimulus by late fall and so the sick man limps into the winter looking for an honest recovery.

Ben Bernanke at Jackson Hole: The Panic, in Retrospect

You are too critical of a man who may have saved civilization by merely wrecking its economy. The sine qua nun of liberal economics.

It is a difficult calculation, but now for the strategy of the exit. Can't wait to see how it comes out... I am a little frightened...being involved as I am.

Proposal for Fed to Become the Next AIG

I like the idea, no risk is too great for our economy even if we don't understand the odds or see a pay point. Trifles.

The truth is CDS are profitable until they must be paid to the counter-party and become liabilities. They must be matched on quantity risk v.s. quantity rewards, so presumably there are serious limits on any institution's capacity to deal with CDS adversity.

Do they imagine that in the long run the premiums offset the possible pay-outs? If so, is the the period infinite? Are we talking about AIG again? I know, white horses are different than brown horses, or something like that, when it comes to risk.

Today May Be Markets' Turning Point

Hang in there and structure your opinion around the essentials as you see them. I think volume is missing in this rally, as are transports, and NDX leadership. Overall it smacks of a little manipulation? I am watching GS and the banks for a clue since I do suspect a large scale setup by timed releases today. What do you say to that?

Best wishes to your efforts.

Expecting a Sell-Off: 35 Ways to Protect for Less

The analysis is thin on why, and therefor the possible depth and time for a correction.

The suggestions are close to financial advice requiring registration (RFA). I think the specific stocks are useless recommendations since you have not a clue who or what the buyer is all about.

Walk the plank please.

China's Construction Bank Buys AIG Finance. Is This the Start of a New Trend?

No strategy yet, just too much money and no where to go with it in China's economy.

But it shows flexibility and adventure in a corner where we did not expect it. Problem is, they don't manage much better than the former managements of the firms you listed. The offerings can only get better this fall, the US firms are going to unwind even further due to lack of demand. Who would want zombies ??

Closing Update for Friday, August 7: Day Up, Week Up

The story today was good, but there is no light at the end of the tunnel yet. What we are seeing is the speculation of early buyers of hope that a recovery is at hand. But beware this run has been long and on low volume, it will correct hard when it does correct. Where are we going ultimately? No one knows. Some think the recovery would come, the stimulus notwithstanding. Others know that the promise of the stimulus can only make things better so they want more. The true is that things are better, but not a recovery yet. Buying equities now is OK, but stick to the indexes and use stops. Nothing has changed but the level of hope.

Was August 6 the Stock Market Top for 2009?

No, not the top but within one more wave up.

The other side of the W is there, but it will come only as the euphoria wears out and reality comes to the fore.

The bubble mania is still here and we can see and feel it every day, but it takes time to recognize.

Great question.