User 86999

Tuesday Outlook: Commodities, Global Markets

David, thanks for your continued commentary. I notice that you're using the McClellan Summation from some other site (decisionpoint?), but it is also available on stockcharts ($NYSI), where you're making the rest of your charts. Just saying!

What New Exchange Traded Products Do We Really Need?

Most important, we need ETFs that work with simple tax structure, like 1099 forms, and not those phantom income producing, K-1 form based products which can produce negative surprise for the consumer at the end of the year. Worst nightmare is when they don't bother to spell it out in the prospectus that they will produce K-1 and hide behind keywords like "partnership" and so on. I would like to see some movement in favor of the consumers. Enough with the wall street games!

Wednesday Outlook: Commodities, Emerging Markets

Shorting the bonds means we're betting that the interest rates will go up, but Bernanke has emphatically made it clear that the rates will not be allowed to move higher anytime soon. They will buy all the treasuries they have to buy in order to maintain the rates under their control. Hence, there is the dilemma.



On Feb 04 10:26 AM kelm wrote:

> Reason to short bonds is pretty simple. There is $2.5 trillion in
> US treasuries coming to auction this year vs $890 billion last year
> and most major governments in the world are also planning massive
> debt auctions. Supply and demand - too much supply so prices have
> to drop significantly to attract buyers. The Fed can tr and drive
> the rates lower but the morr debt that is auctioned the harder they
> will have to work to effect any real change in rates through intervention.
> This will also play into the dollar's level causing it to drop.
>
>
> Disclosure: long TBT, PST, CEF, TGLDX, UDN

Distressing Details of the UltraShorts

Thanks for addressing this issue. It is helpful to those who are new to leveraged ETFs, and are researching their options.

In the vein of 'distress', may I suggest doing an article that addresses the K-1 nightmares. That will also be a good topic for the people who may not know what to look for in a prospectus/SAI, such as the 'limited partnership', PTP and so forth. The real issue with K-1 producing ETFs is that even if you lose money in a transaction, you may still be slapped with a phantom income, for which you owe taxes. That does not make sense at all. So, I am taking the approach to avoid all funds that produce K-1 at the tax time. Any thoughts?

Direxion Leveraged ETFs Win Fans Amid Market Volatility

People need to be aware of the K-1 complexity issues involved, when the tax time arrives. The prospectus is silent but SAI includes information of how the funds are PTP or QPTP, which should generate K-1. Unfortunately, the prospectus does not clearly provide the information on of the tax form vehicle used: i.e. whether they'll issue 1099, the normal tax document or the K-1. I am looking for some credible site/article that may have compiled such information on all the financially engineered ETFs. We know what financial engineering has already done to us, but transparency is still an issue.

There Are Many More Satyams Out There

"Because as long as auditors fail to conduct extensive and precise reconciliations between cash-flow items within financial statements on one hand and contractual obligations which generate those items on the other, innovative managements will always find ways to create an aura of viability."

Yes, indeed. This is an equivalent of credit rating agencies, which have no fear of being accountable, because they grease the right wheels in the entire chain! Good luck with finding a respectable system. The common man/woman will be screwed until they bleed.

Stocks vs. Bonds: Long-Term and Short-Term

Richard, great charts, but it would be nice to include your opinion on how to incorporate the monthly distributions to complete the picture. The price charts above are ex-dividend price behaviors. So, including the monthly payments will substantially strengthen the case for bonds, I think.

Deflation: It's Starting to Get Silly

When there is an elephant running around violently in the streets, do you think someone should tackle the beast, or should it be left alone to do whatever it wants? That's the analogy to show the big corrupt organizations (bank/insurance/auto/w... and the government's role is to tame the beast and to define its boundaries.

The problem with the government is that it's micromanaging/mismanag... the affairs. Now, it's not just a bunch of rowdy elephants that are the problem, but also the ring-masters in this circus that are part of this fiasco. When the government was sleeping while the elephants were slipping out by bribing whoever was supposed to be watching them, that was the time to raise the red flag. And, some people did, but when everyone is drunk on the easy money, voices of sanity are usually ignored; because, some people are just too fond of learning the hard way.

Deflation is a problem for those who have been on credit, and that means a whole lot of US population, and the government itself, and the central bankers cannot allow for that. People who were/are savers, they will gain more purchasing power during deflation, but the government would rather punish those who were careful and reward those who were/are reckless.

ProShares Leverages Currencies and Commodities

Any ideas on the tax treatment of these funds? Will they be using K-1 based tax treatment or is it regular 1099?

UltraShort ETFs: At a Tipping Point?

You, sir, are the reason why TA gets a bad rap. Many have already pointed out the inadequacy of charting a derivative, and then not to mention, a leveraged one! Wow, double the mistake! You really do like leveraging.

Now, as to the salvaging the effort, RSI is still heading up. the SHS may actually be a triple top (I haven't checked the underlying index - I don't like nasdaq index), +DI is still above the DI, even though it's just about to cross, all averages, you show, are in their normal form. The only clever sign picked up by Mllambo is the developing negative divergence. I would keep an eye on this baby if I was trading QQQQ/QID.

The Reagan Counterrevolution

Peter, I have read your book and have been reading your articles and watching your comments on tv. What you say makes sense most of the times, but then suddenly, you say something that is either too simplistic or just doesn't make sense. Buffett Jr has pointed out one above.

Can you write a focused and concise analysis of why we're in such a historic financial turmoil and what exactly was the role of regulation in this turmoil. I think that effort will make your case more believable. The general statements like regulation is bad is not strong enough evidence. As economists we should be able to back up with empirical data.

I would argue that the lack of regulation is exactly why the bankers' greed got out of control and now we're all paying for it. The gov has to step into the situation after all, because the final tab of that greed is running into trillions (yes, with a T), and no private enterprise has that kind of money; besides when you start selling those junk CDO and CDS vehicles to foreign enterprises, the gov will be forced to step into resolving any conflicts. So, how do you propose the private enterprise to be able to self-regulate. I think the current situation already self-evident of what self-regulation can cause.

Obscure Indicator Points to Possible Market Bounce

The week of 10/10 implies end of that week because 10th was a friday, so the data is a bit too old in today's fast moving circus, as 2 more weeks closed after that data. And we already know how brutal those two weeks were. Since the 'specialists' number was also on the rise that probably indicated what we saw in the two following weeks after that number was published.

Don’t Blame Wall Street - At Least Not Completely

Stop the propaganda. The Level 3 assets with opaque books unable to explain the true value of assets and a whole lot of junk used to bloat the books to make the hefty incomes and bonuses does not fall in line with legitimate reasonable business practices. You cannot convince anyone who understands the accounting books, but good luck with some simpletons who may buy illogical random thoughts. Ron Paul has it right, once you are able to grasp the knowledge!

Being the Change: Baidu Report Raises Important Ethical Questions

Good timing on the article - BIDU went up 20% today!

Roubini Attacks Bailout, But Misses Boat on Regulation

While I agree with the MS thesis that Fed itself and all FNM/FRE style entities were a problem to begin with, I will interpret Dr. Roubini's complaint about lack of regulation when applied to cooked books at those institutions. When the top forensic accountants are still struggling to correctly figure out what exactly is where in assets/liabilities, we have a problem. And of course FNM/FRE are just the tip of the iceberg; wait till an army of others start getting exposed with all their Level III assets. When the regulation allows you to hide your deeds with creative financial engineering and rewards the fat cats at the top of the institutions with millions of dollars in compensation and severance packages, you need to bring the regulation in line!