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Pain at the pump
http://www.msnbc.msn.com/id/7087195/
Stocks rally and crude/wholesale gasoline surges somethings gonna give and I think it will be stock prices collapsing.
Several hundred million motorists spendinding a few bucks more of their discretionary income every week on gasoline cannot be good for the economy.
Strong Employment Numbers Portend Worsening Economic Imbalances
http://www.safehaven.com/article-2690.htm
"No warning can save a people determined
to grow suddenly rich." - Lord Overstone
March 05, 2005
Strong Employment Numbers Portend Worsening Economic Imbalances
by Peter Schiff
As crazy as this may sound, not all employment is good employment. Today's labor department release of a larger than expected 262,000 increase in February non-farm payrolls, heralded by Wall Street as evidence of a vibrant U.S. economy, actually confirms the reverse: a dangerously imbalanced economy moving further off kilter.
The over-bloated service sector added another 207,000 jobs, with construction, no doubt mostly residential, adding 30,000. The beleaguered manufacturing sector did manage to add 20,000 jobs for a change, though half of that gain resulted from temporarily laid off auto workers returning to their job. In other words, the wealth producing sector of the economy added few workers, while the wealth consuming sector provided over 80% of new jobs.
The basic problem with service sector jobs is that they produce few tradable goods. As a result, the added incomes associated with such jobs create upward pressure on our nation's trade deficit, as service sector workers use their additional incomes to buy more imported products. In addition, such jobs provide more workers with the means to qualify for home mortgages, which require additional borrowing from abroad, and provide the basis for future cash-out refinancing, requiring still more foreign financing and resulting in additional purchases of imported products.
In other words, the last thing the U.S. economy needs is more non-productive service sector jobs, which only lead to higher trade deficits as Americans import more goods that service sector workers do not produce, and larger current account deficits, as greater interest payments become necessary to service growing external liabilities.
While this reality may have been lost among U.S. investors, who reacted foolishly by buying stocks, it was not the case among currency traders, who despite their initial, almost reflexive action to buy dollars on apparent "good" economic news, quickly re-evaluated the data and sold, sending the buck sharply lower against all the world's major currencies, and to a new twenty-three year low against the New Zealand dollar. Is this simply a case of buying the rumor and selling the fact, or is it an actual epiphany on the part of currency traders with respect to their understanding of the true nature of the fundamentally flawed American economy? If it is indeed the latter, our bubble economy may have finally found its pin.
Peter Schiff C.E.O. and Chief Global Strategist
Euro Pacific Capital, Inc.
Yes, here's a long time Dow theorist with his take...
http://www.financialsense.com/Market/wrapup.htm
Ryvnx...Inverse to NDX.
Delete Problem w/chart
I'll take the other side of that...37.00
Jim, does your work include the NDX? Momentum seems non-existent there. Acts like it's marking time while non-tech finds a top of sorts.
Crude trumps JR here.
Crude Oil(NYM) Apr 53.00 54.70 52.86 54.65 +1.60
Given the wide anticipation of a high # this has become a sell the news event. Good news has been priced in.
Or their not finished distributing stock yet. Most likely though we see a blowoff top as you aluded to.
One more from 29-32...hope it shows up.
Liquidity is drying up...m1 money supply
Speaking of just melting away the 73 model was the 1st year of a presidential cycle.
Been considering the possibility of this type shakeout before a blowoff top. Strong correlation to current market. Of course we could just melt away too.
Heres what could be a recent blowoff top...
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I think just delayed. March is normally a volatile month and known for turns. SPX/DOW look likely to set blowoff tops while NDX looks to break up to maybe 1590 being accelerated on short covering. I think a fast move up and a faster reversal is in store. Perhaps then the indicators will register the extremes your looking for. I don't think such a trading range can be supported by the fundamentals looking forward a few months. BWDIK?
Nice Wag.
Lot's of trapped bulls above Frank. If we blow through the Jan. lows yet another box of resistance.
Damn...Looks like I'm the Bull so far.
36.46. Truly a Wild Assed Guess.
Could be another bounce in that H&S formation. Both charts look to be on the precipice of a cliff and definitely need to bounce here.
Other than short term bounces, where can the market go w/o the banks and techs? Looks like sh*t...
Wag 1 37.21
Choad... Juno tracks the thirty year bond. The TNX is the 10yr bond yield and TYX the 30 yr yield. Perhaps the closest correlation would be with http://stockcharts.com/def/servlet/SC.web?c=$USB
Here's the comparison with the yields, do not have the symbol for USB on this site.
Snippet from Rydex
Benchmark:
Inverse(opposite) of the daily price movement of the current 30-year U.S. Treasury Bond
ABOUT FUND
The Juno Fund seeks to provide total returns that will inversely correlate to the price movements of a benchmark for U.S. Treasury debt instruments or futures contract on a specified debt instrument. The Fund's current benchmark is the inverse of the daily price movement of the Long Treasury Bond.
Correction. Did a search for data on the historical range.
Decision Point probably has the best review of the subject. PE of 10 is undervalued. 15 is considered fair value. Often when the ratio exceeds 20 during the correction process stocks become undervalued at 10. http://www.decisionpoint.com/TAC/SWENLIN.html
The decline had been gradual. Had been...
North American Semiconductor Equipment Industry Posts January 2005 Book-to-Bill Ratio of 0.80
Kayaker post
http://www.investorshub.com/boards/read_msg.asp?message_id=5474555
Cash/Short. S&P PE ratio is near 21%, grossly overvalued by historical standards. I would buy and hold again if we return to historical valuation of 10.
I'd rather not trade... too time consuming, But I'm not about to buy an overvalued asset with a low probability of much appreciation for a long term investment. All IMO and I guess we'll know soon enough whether it's different this time and PE's can expand further.
If we bounce to 15-1534 I'll add a couple percent to my short position currently at 58%. One of these times we start down and don't look back.
Yep...we're in the green.
Let me know if this works.
deleted
Ouch...Ouch...Ouch <ggg>
Best to avoid wash sales altogether as it is complex w/o a tax accountant. Example of how I avoid, I sold RYVYX (NDX) at a loss Jan 21... since I thought a rally was imminent, at the same time I bought RYTNX (SPX). Later, I sold RYTNX at a gain while also capturing the offsetting loss on RYVYX.
The trick is to not buy RYVYX again untill Feb 22. If I were really hot on tech I could have bought the Inet, Technology, and Semi funds as a like trade w/o wash sale consequences.
And on ignoring wash sales...
One unofficial "trick" to avoid some or all of the annual headache is to stop trading and holding any and all positions for a 31 consecutive day period that includes December 31st. If you do this at both the beginning and the end of any given calendar year, generally, you can just ignore the wash sale rule with relative impunity. (this isn't really a "trick", it's just "in the math" of counting days pursuant to the rule)
http://www.traderstatus.com/washsale.htm
Action in the NDX unimpressive. I doubt it can overcome two big boxes of resistance. Selling is pervasive and the rotation is into safety. Momo stocks sucking for wind. Lack of follow through again takes it sub 1500 IMO.
Wag 37.42.
...another sideways Mon/Tues...Wed reversal?
Especially if you import trade data from Quicken and import w-2's from ADP or other processor.