Investment

» BoltonCT - Futures declining

The market run up on Tuesday ended as quickly as it came as most short covering rallies do. The volume was surprisingly low that day. If you look at the DJI, NYSE, or S&P volumes you immediately see those volumes are fabricated and manipulated as we have said before. They began manipulating those major market volumes in January of 2005. So you cannot look at the market volume for those three American Indices. I never read anywhere why they decided to manipulate those indices but any investor who uses them today is also being manipulated. I have noticed that sometimes those volumes have been used to make the markets appear to be doing better by making the volumes higher one advances and lower on declines. So you have to find an index such as small caps or the Qs which are not less complex and are the main indices they like to manipulate.
If you do not believe they manipulate data on Wall Street then look yourself at the DJI, NYSE, or S&P volumes and notice they are the same each day since they arrange to bring them together in January of 2005. Then ask yourself how can indices of different stocks and different weighting techniques give the same answer? That is right they can't be the same. Then ask yourself if they are now useless indexes why do they continue to print them? That's right their only use is to fool investors. I have noted on occasions that at critical turning points such as high volume in the underlying stocks in a decline they use a substantially lower index volume so investors do not see that a significant market change occurred. If Wall Street was honest why wouldn't they provide honest information?
The Jakarta market is being pounded. It was down 4.45% last night. Jakarta is a Moslem nation very high on the list of known corrupt countries in the world. The most corrupt, year to year is Bangladesh. Then not far behind is Nigeria and Jakarta. Finland is most often ranked the least corrupt national population and yet does not have the benefit of Sharia law. Who does the ranking? The CIA does. Sharia deals with many aspects of dally life, including economics, banking, politics, business, contracts, family, sexuality, hygiene, and social issues.
Most Asian markets rose 1% to 2% last night. European markets are down fractionally this morning.
USA market futures seem to be declining faster than usual this morning. That points to a likely poorer opening to the markets and unless it stabilizes we could lose all the earlier gains this week.
Billionaire ps---phant George Soros called the current financial crisis the worst since the Great Depression and said markets will fall more this year after a brief rebound. That must mean he is losing his butt this week shorting American currency and equities. I am sorry to say I think he is right and he wants and is betting on the decline of everything American. That also explains whom he generally supports in American elections.

-- posted by BoltonCT

» Normxxx - Signaling The All-Clear?

Signaling The All-Clear Horn?

http://normxxx.blogspot.com/2008/04/sign...

-- posted by Normxxx

» BoltonCT - Thumpin good day to you too

Thanks Norm for the humor. Some people may not know the origin of the word thumping. Thump is the sound a dead enemy makes when you hit him with a big stick to make sure the is really dead on the battlefield.
India's market is down over 3% this morning while China is up about 1.5% and Japan is down 0.72% after a mixed night in Asia.
The major European markets are fractionally higher this morning. Presently the futures are essentially saying whatever you want to hear. They quote them two ways now so you can take your pick.
So much money is going into the bailout of Wall Street now and other investment opportunities are evaporating as inflation adjusted interest rates are already negative... that it now appears we could have initially bubbles in the market with increased market volatility. The volatility will continue to whipsaw and weaken the hedge funds. At some point there will be a mass exodus from stocks again into inflation resistant investments. Zimbabwe is on the news quite a bit now because the western countries want to see what lies in store with hyperinflation. Today Zimbabwe starting printing 50million denominated notes so that people can buy a bar of soap.
The inflation currently rotates in by sector. That is to say first energy then primary building materials tripled then PVC's and specialized materials etc. Now food prices are rising rapidly. It will rotate in at first and then all prices will begin to move up together as the inflation increases.
The FED is doing an excellent job preventing a run on the dollar by assuring other nations that if they keep their currencies linked together with the dollar we will all inflate together thereby foiling the people like Soros who thrive on undermining small country's currencies.
The world economies seem to be spiraling down together with a hint of a flushing sound in the background.

-- posted by BoltonCT

» Normxxx - Bear Stearns or JP Morgan Rescue?

allancoleman wrote:

I doubt they'll put Bear Stearns back together again ... kind of like Humpty Dumpty .

It never was about "putting Bear Stearns back together again"! It was all about saving JP Morgan and the CDS market!

See Wagging The Dog By Contraryinvestor.Com. Heavy reading, but worthwhile for a head's up on what to expect ahead.

-- posted by Normxxx

» BoltonCT - The FED, the opiate of the masses

With all the Wall Street bail outs and deficit spending where is the money going? The tight money seems to be due to the velocity of money dropping as we begin to hunker down and pay down debt rather than passing the money to the next guy by buying the next guy's product or service.

That causes sharp dislocations in different sectors and contributes to the problems and inflation jumping from one place to another cracking one edifice and then the next as the FED scurries to throw cash at each problem. But the cracks keep spreading because the root causes have not yet been cuffed and thrown in jail. The Banking Committee review of the Bear Stearns bail out has be likened to the congressional investigation of Don Corleone in the God Father. It is said that some on the Banking Committee have taken money from the banks and did not recuse themselves.

Now the FED itself is becoming a root cause because their medicine is killing us. Like an opiate their injections are putting entrepreneurs to sleep, consumers in a comma, and Wall Street is so high on it that WS is ready for a cardiac arrest.

-- posted by BoltonCT

» Normxxx - ..

-- posted by Normxxx

» Normxxx - The FED, the opiate of the masses

In response to The FED, the opiate of the masses posted by BoltonCT:

With all the Wall Street bail outs and deficit spending where is the money going? The tight money seems to be due to the velocity of money dropping as we begin to hunker down and pay down debt

There is another, newer mechanism which beats even money velocity in the old equation which used to relate all 4 of the money ingredients; "credit", which we just recently were using in lieue of money, has probably contracted by a cool $Trillion or more. and the nice thing about derivatives (and why BB panicked when it looked like BS would fold, taking JPM and the CDS market with it, is that there is no limit to the amount of derivatives which can be written against any 'legitimate' debt, such as a bond. Think 10 to 1; or even 100 to 1! Think of Millions of dollars in derivatives written against a bond issue of maybe $100,000!

P.S. And, most of those derivatives are backed only by the "full faith and honesty(?)" of... (drum roll)... the issuer- truly promissory notes!?!

-- posted by Normxxx

» BoltonCT - CO2 derivatives coming

Norm,
Imagine the damage that will be done by the global warming scam once it gets going and then collapses. That is even warmer and more fuzzy than was providing mortgages to the underprivileged and selling the worthless derivatives to widows, orphans, politically correct hedge funds, and pension plans. Who would dare expose global warming CO2 swaps as a scam?

-- posted by BoltonCT

» BoltonCT - In our hearts and guts

Both Asian and European markets were down somewhat significantly and American market futures were down this morning. The average declines in both markets are about 1% today.

Rice, the worlds largest food staple was reported up 60% to 70% in American dollars over the last three months alone. But Bob Brinker this week end reported continued low American inflation rates of less than 3% and now predicts a stock market high this year.

Sy Harding says that when investors are bearish that is the time to buy, and when the investor sentiment index is more bullish as it is now... that it is also a good time to buy. In fact the entire market decline has occurred in Sy's favorable stock buying season and soon we will be entering May which begins Sy's unfavorable season... but he says it now looks like it may be a good tome to buy too. Sounds like Sy and Bob have the same investment advisor. It seems like all the market experts and the wise men will be buying stocks today.

However the apparently foolish folk like Warren Buffet and George Soros who lack Bob's and Sy's wisdom are investing in inflation hedges such as commodities and are not bullish on the markets or the world economies at this time.

Who do we believe? Do we believe our five senses or do we jump on a rally bandwagon today and hope to eat drink and make money? I guess it depends on whether your investment time span is a day, a week or something longer like Buffet's.

As for myself I have never in my life seen so much cash awash on the streets of lower Manhattan and yet it is doing little to stimulate anything but prices. Credit or plastic to be more exact seems to, as Norm pointed out, add a whole new dimension to "velocity of money." The slowdown that now looks like a ripple on a pond to me is being fought by the FED as though the FED thinks it is the start of a tidal wave. The FED has expended its entire arsenal on an economic ripple and now we wait and wonder what comes next? And in our hearts we know there is more to come and in our guts we know Wall Street and the FED have already gone nuts.

The next few weeks will tell if we are going to gently bottom out or resume the market decline. With normal inflation the stock markets decline, but that may not be true when we start a transition to hyperinflation. Hyperinflation leads to economic depression and government upheaval but what happens in the initial period when we are awash with cash? Does anyone know?

-- posted by BoltonCT

» BoltonCT - Market bath resumes?

Asian markets resumed their decline today. Shanghai Composite -5.50%, Hang Seng -1.35%, BSE -1.50%, Jakarta -3.10%, Nikkei -1.05%, NZSE -0.84%, Seoul Composite -1.06%.

The European markets are still open and down about 0.75%.

The American market futures are all down indicating a likely negative start for all of them. They were flat up against an upper resistance level for six days trying to stage a rally but did not succeed. Bob Brinker tried his best this weekend by predicting new highs this year. Today if they do not succeed again we can expect new lows in the coming weeks.

http://finance.yahoo.com/q/ta?s=%5EGSPC&...

http://finance.yahoo.com/q/ta?s=%5EDJA&t...

Once the corporations begin the bath and clean their income and balance sheets of all hyperbole the disguised losses of the past suddenly appear simultaneously with the decline in price. That hides the fact that the truthful PE ratio had be a lot higher than they quoted when analysts last fall were saying the PE ratio's were reasonable. Does everyone understand that?

For example:
Last fall a company that claimed a fictitious PE of 30 with say 50% higher income claimed than prudent... now sees a 33% price decline so their PE ratio should drop to PE=20. But instead they decide to remove 33% of the fluff, smoke and mirrors in their books so their PE ratio stays the same at PE=30 and they still have 17% fluff to remove in a further bath a few months from now. And so the naïve investor believes the PE ratios are fairly stable and reliable indicators of market health. The naïve investor thinks the PE is not very volatile.

But the truth is that at the market high the PE ratio of this company was actually at a relatively level of PE=60 (with truthful earnings) and today it is actually at a still high at PE=40. But because they are still hiding 17% of the fluff the naïve investor still thinks the PE is only PE= 30 not PE=40. So the naïve investor does not realize that when the bath is complete the income will be down another 17% and the price of the stock will likely decline another 17% as well along the way. Now this example does not even consider the fact that we could actually go into a recession and the real earning can also decline. This example was for the situation similar to 2000-2003 where the stock market collapsed but there was virtually no increase in unemployment, virtually no recession. The earnings collapse was almost entirely the write down of the DotCom fluff. You may remember the new creative business models that linked earnings to market share and used projections of the fictitious earnings rather than actual profitability because for the most part the DotCom companies were actually losing money hand over fist.

That is why it is not evident to novices that for the current American markets... and especially the Asian markets... that this market bath could go on for the rest of this year without the American economy even going into a recession.

-- posted by BoltonCT