Daily Investment Interpretations Archive

January 1, 2010, to June 30, 2010

July 1, 2009 to December 31, 2009
January 1, 2009, to June 30, 2009
July 1, 2008, to December 31, 2008
May 7, 2008, to June 30, 2008

2010-6-30:  The markets fell again today, this time taking them below their support levels.  The NASDAQ Composite dropped 25.94 points (-1.21%) to close at 2109.24, below its February 4th low. The Dow declined 96.28 points -0.98%) to close at 9,774.02, and the S&P 500 doffed 10.53 points (-1.01%) to end at 1,030.71. Oil ended down at $75.30 a barrel, while Gold closed at $1,244. The VIX rose 0.49 to 34.62.
    The markets faced more bad news regarding the economy today:
(1) Chicago factories weaken
(2) 'Lame' data on private U.S. payrolls hobble Wall Street, and 
(3) Fed's Evans wary of asset buying.
    This last article is noteworthy in that the Chicago Fed's Charles Evans states that the U. S. recovery is on track, even if slow to recover, and that the Fed doesn't need to go for further "quantitative easing". We'll see.
    This moves the S&P 500 below the 1,040 "line in the sand" drawn by my investment advisory service and by other technical analysts. 
    Todd Harrison observed a few days ago, Where we've been and where we're going, that if the S&P 500 closed below 1,040 (it closed today at 1,130), the next stop would logically be S&P 860
    Mark Hulbert reports that the three Dow Theory newsletters he tracks are, as of today's close, in agreement that a Dow Theory sell signal has occurred: Dow Theory Sell signal? The Dow Jones Transportation Average has closed below the Dow Jones  Industrials Average.
    Portfolio moves you should make now suggests moves into dividend-yielding stocks, and lists some promising candidates.

    I'm personally committed to raising cash for the next day or two until we see where this market breakdown is leading. Eventually, the markets will return to their present levels and surpass them. For my part, I plan to sell what more I can sell, and to hedge the rest of my portfolio by buying deep-in-the-money, January, 2012, puts on one or another of the major indices. (This will be one way to flexibly crash-proof my mutual funds during the day until I can close out both my hedges and my mutual funds at the end of the day. Another way would be to buy a double-inverse fund, like the Proshares Ultrashort S&P 500 ETF: SDS) early in the day that I can sell at the end of the day.)

    Stock market futures are down a little more than ½ % tonight.

    This article, Permanent Link to Leading indicators and the shape of the recovery, points out that "
I’d add that this is a really, really bad time to be relying on conventional indicators. Why? Basically, because in a zero-interest rate world — the three-month rate was .066% last I looked — especially one that’s suffered from a collapse of the shadow banking system, conventional indicators don’t mean what they usually mean. Increases in the monetary base aren’t especially expansionary. The yield curve more or less has to slope up, even if no recovery is expected. And so on."    
    What's significant about this is that the everyday economists who write for the public are arguing that (1) increases in the
monetary base are inflationary, and that its going to come on suddenly any time now, and (2) the yield curve slopes upward, so we're looking at an economic recovery ahead.

    The Paul Krugman squibs below are samples of the estimations he made in January, 2009, of the level of stimulus that would be required to restore the economy to normal operation. As he predicted, when the stimulus proved to be inadequate, their would be assertions that the stimulus didn't work, whereas, without the stimulus, we would be in Depression 3.0 right now.
    There's the notion floating around that we just need to take our medicine. Todd Harrison argues that we can't keep masking our massive indebtedness with "drugs", and "to get through it, we need to go through it". I think that the consequences of getting the government out of the picture and letting banks and other business implode would be unspeakably bad for you and me. As I've said a time or two, on September 15, 2008, Lehman Brothers filed for bankruptcy, and the very next day: 
2008-9-16:  "One harrowing happening after the close today: Money market fund halts redemptions, and Cloud over money-market funds. The financial advisory service Seeking Alpha is advising its clients to immediately transfer their money market funds to U. S. Treasury funds or to Federal Deposit Insurance Corporation-insured deposits at banks. Monies greater than $100,000 are to be split into multiple $100,000 accounts spread among several banks. (This will probably lead to a run on money market accounts as they are converted to Treasury funds or withdrawn and sent to banks.) As an example of how this works, the Primary Fund has an intrinsic loss of about 1.2% because of investments in Lehman Brothers, but because 60% of its investors have already withdrawn their money with no losses, the current level of loss is 3%. Presumably, anyone who withdraws their money from now on will get 97¢ on the dollar. But note that the greater part of the fund's money was withdrawn in the past day at $1 on the dollar by investors who knew something was amiss. In all likelihood, the fund notified insiders and institutional investors so that they could withdraw with no losses, sticking the remaining 40% with the bill. That's how the game is played."

    And the following day:
2008-9-17:  "Part of what's so unnerving is the fact that three money market funds that had significant investments in Lehman Brothers and AIG are unable to return quite all their investors' money to them. Of course, the elephant in the room is: how much farther will this go? With major banks and brokerage houses suddenly falling away after claiming that the worst was behind them, everyone is wondering who else will fail. Small investors can spread their money among several bank accounts, each of which is insured up to $100,000, but high-net-worth investors can't insure their money so easily."

    By the 18th, $90 billion had been withdrawn from money market funds. I had transferred my money into a Treasury-based money market fund.

    On Saturday, September 20th,,2008, I wrote:
2008-9-20:
    "Thursday afternoon, if the U. S. government hadn't intervened dramatically, I suspect that there would have been massive sales of mutual funds starting yesterday, and that there might have been runs on our banks starting next week. I know I was worried about what to do to safeguard Tommie's and my savings and investments. Should we open Swiss bank accounts? Buy gold? Are U. S. treasury bonds safe? The Federal Deposit Insurance Corporation is running low on money, and in any case, it wouldn't be possible to instantaneously return all the cash invested in all U. S. money market funds and bank accounts. As some commentators have put it, we were staring into the abyss Thursday morning. And in the abyss was a cratering of the world's economies. Fortunately, the U. S. government is taking dramatic steps to restore confidence in U. S. financial markets."

2010-6-30:
    If the government hadn't moved to shore up the markets, I believe that by the following week 9/22-26/2008), your (and my) life savings and non-federal retirement accounts would have been gutted by insiders who would have gotten their money out while the rest of us stood around trying to figure out what had happened to us. Banks and pension plans don't keep their money in cash. They loan it out, or otherwise invest it. If the economy crashes, the banks and pension funds would have to try to redeem their collateral at whatever prices the depressed markets would bear. (The Federal Deposit Insurance Fund was running out of money.)
    The speed with which laissez faire ideologues would have come clamoring to the federal government to save their life savings and their retirement funds would have been breathtaking. After all, that's what the investment bankers did.

2009-1-30:  "In Permanent Link to Saving, investment, Keynes, evolution, Paul Krugman laments the lack of knowledge of fundamental economics that is being displayed by some vocal economists... like discovering that some eminent biologists are not only creationists, but 'have never heard of the the theory of evolution and the concept of natural selection'.
  
2009-1-30:  "In Permanent Link to Damnification, Dr. Krugman mentions the paradox of thrift. While saving money rather than spending it is a good thing for an over-indebted society, it can be a disaster if everyone does it at the same time. If people save rather than spend, consumption and production falls off, leading to layoffs, leading to further cuts in consumption, leading to further cuts in production, leading to further layoffs. This means (1) that people who want to pay down debt won't be able to do it if they lose their jobs, and (2) if prices and wages fall over time, debts become relatively larger and harder to pay off even for those who keep their jobs. Dr. Krugman writes, 'and we're only in the early stages of a slump that, in the words of the Congressional Budget Office director,

    'absent a change in fiscal policy, CBO projects that the shortfall in the nation's
     output relative to potential levels will be the largest--in duration and depth--since
      the Depression of the 1930's.'"

    "He concludes that, 'yes, running up large debts is risky; but dong nothing is even riskier.'"

2009-1-28:  "Permanent Link to Zero lower bound. The Zero lower bound commentary observes that "the House has passed the stimulus bill with not a single Republican vote. Then Dr. Krugman says, 'Aren’t you glad that Obama watered it down and added ineffective tax cuts, so as to win bipartisan support?' The second commentary concerns 'the amazing amount of misunderstanding of the basics of fiscal policy, even among people who should know better'."

2009-1-27:  "Permanent Link to A Dark Age of macroeconomics (wonkish)."

2009-1-27:  "Permanent Link to How late is too late? deals with the question of the timing of the stimulus package."

2009-1-26 (Monday):  "Bad Faith Economics"

2009-1-21:  "In Permanent Link to Give me some men who are half-hearted men …, he warns that we'd better not address this crisis half-heartedly... we'll either succeed or we'll fail, with no middle ground." 

2009-1-19:  "In Permanent Link to Economists, ideology, and stimulus, Dr. Krugman deplores the first-rate economists who reject fiscal stimulus on ideological grounds."

2009-1-19:  "In Permanent Link to An alternative economic strategy, Dr, Krugman says, 'The interest rate is up against the zero lower bound; the fiscal stimulus doesn’t look big enough; the TARP has been a disappointment. What to do? My wife suggests that we might try sacrificing a few bankers — central bankers, investment bankers, whatever — to appease the financial gods.'"

2009-1-19:  "Permanent Link to Getting fiscal. This commentary concerns Nobel Prize-winning economist Gary Becker asking why there's so much interest in fiscal stimulus today compared to 1982. Unemployment peaked at 10.5% in 1982. Peak unemployment today is forecast to hit 9% even if there's no stimulus package, so why should we worry about a stimulus package. Dr. Krugman responds, 'Urp. Gack. Glug. If even Nobel laureates misunderstand the issue this badly, what hope is there for the general public?' 
    Interest rates when the unemployment rate peaked at 10.5% in 1982 were in the neighborhood of 15%. All that Paul Volcker had to do to re-ignite the economy was to lower interest rates to 14%, which is what he did in the second week of August, 1982  Today, with the unemployment rate at 7.2% and the economy falling into the abyss, interest rates are already at 0% to 0.5%, and they can't go any lower. This is a deflationary recession, categorically different from the inflationary recessions that beset us since World War II blasted us out of the Great Depression. The Fed has fired its last, best shot at the bear, and has failed to stop it.
Keynesian fiscal stimulus is one of the only weapons we have left. (Think of this economic imbroglio as an antibiotic-resistant infection.)"

\2009-1-19:  "In Permanent Link to Zero lower bound blogging, he quotes a paper by Goldman Sachs Jan Hatzius. Mr./Dr. Hatzius applies the "Taylor Rule" to estimate how much farther the Fed should cut interest rates to combat the deepening recession through conventional monetary policy alone, and concludes that the rates should decline to -6% by 2011 (and still falling). Since interest rates can't practically go negative, the only alternative is fiscal stimulus or unconventional monetary measures.

2009-1-16:  "In Permanent Link to The TIPS spread, The bad news is the fact that 10-year TIPS (Treasury Inflation-Protected Securities) are forecasting deflation over the next 10 years. Dr. Krugman concludes that the situation looks more and more like the Japanese, with their 'lost decade'".

2009-1-13: "Paul Krugman's article, Permanent Link to Bang for the buck (wonkish), observes (also crediting Mark Thoma and this) that this kind of money that the federal government borrows isn't wasted, but that the greater part of it comes back to the government in the form of income tax, and of savings that don't have to be paid out in the form of  what I might loosely call, 'job welfare'.

2009-1-11: Update: "Paul Krugman has just published two more 'news bites' dealing with the prospects for a second Great Depression. The first of these, Permanent Link to A scary analogy, quotes Mark Thoma, who likens the stimulus package to driving up an icy hill. If you don't tackle the hill with enough initial momentum, you risk sliding back down before reaching the top.
    "To me, this drives a ten-penny nail into the coffin of the existing Obama stimulus package, and indirectly, into the economy and U. S. stock markets. Better no stimulus package at all than one that fails to slay the bear. Of course, they're probably making it as large as they think they dare.
    "The second news bite, Permanent Link to Specifics, addresses the demand for specific solution suggestions from Paul Krugman. His response: he doesn't have the inside information that he would need to offer specific solution suggestions."
  
2009-1-10: Update: "Paul Krugman has just published two new articles dealing with the prospects for a second Great Depression. In the first of these: Permanent Link to Risks of deflation (wonkish but important), he extimates that, without intervention, the current crisis could lead to an annual deflation rate of the order of -3.5% a year. He concludes:
    "'So tell me why we aren’t looking at a very large risk of getting into a deflationary trap, in which falling prices make consumers and businesses even less willing to spend. Tell me why this risk wouldn’t remain high, though lower, even with the Obama plan, which as far as I can tell is expected to reduce cumulative excess unemployment by about a third.'
    "In the second article: Permanent Link to Romer and Bernstein on stimulus, he concludes that the Obama team's estimates of the effects of their stimulus package appear to be within reasonable agreement with his own.
    "Of course, the Obama Administration can generate additional stimulus packages that would make up this shortfall, but you have to wonder about their loss of face and of credibility if they show up on Congress' doorstep in a couple of months asking for another $1.4 trillion.  

2009-1-7: "Dr. Krugman notes today that the planned economic stimulus package, to be delivered over a two-year time frame, will deliver, at 3% of GDP, a 3% boost, against the Congressional Budget Office' projected 8%-or-greater shortfall in GDP over the next few years: Permanent Link to More stimulus notes. (See also Lots of Buck, not Much Bang.)"

2009-1-6: "I think it's worth quoting a few lines from Dr. Paul Krugman's latest article, dated Sunday: Fighting Off Depression. In it, he says, 'Let’s not mince words: This looks an awful lot like the beginning of a second Great Depression. So will we 'act swiftly and boldly' enough to stop that from happening? We’ll soon find out.'
      "Today, he followed up his article with back-of-the-envelope estimations of the effect that the Obama Team's $700,000,000,000 -$1,000,000,000,000 stimulus plan might have on unemployment, and concluded that the plan might reduce unemployment by as much as 1.7%. He summarizes:
    "'I see the following scenario: a weak stimulus plan, perhaps even weaker than what we’re talking about now, is crafted to win those extra GOP votes. The plan limits the rise in unemployment, but things are still pretty bad, with the rate peaking at something like 9 percent and coming down only slowly. And then Mitch McConnell says 'See, government spending doesn’t work.'
    "'Let’s hope I’ve got this wrong.'
"

2009-1-5 Update:   "Stop the presses! Here's Paul Krugman's latest article, dated yesterday (Sunday): Fighting Off Depression. What he's concluding, and what I think may well happen, as I wrote below before reading Dr. Krugman's latest article, is that although in principle, the world's governments might be able to stave off a coming Depression, in all likelihood, these remedial measures could become a political football in which the political party that's out of power sabotages the salvage measures of the party in power. (More below.)"

2009-
1-5:   "The markets fell just a little today. The NASDAQ gave up 4.18 (-0.26%) to close at 1,628, the Dow slid 81.8 points (-0.91%) to close at 8,953 and the S&P 500 slipped 4.35 about (-0.47%) to land at at 927. Oil ended the day at $48.57 a barrel as OPEC's production curbs began to bite, and gold lost $21.70 to $857.80 an ounce. The VIX remained unchanged at 39.11.   
    "Paul Krugman has bad news: Permanent Link to Is Obama relying too much on tax cuts?. Dr. Krugman's point is that the Obama team may be showing weakness in confronting the Republicans over the incoming administration's economic stimulus plan, and that some leading Republicans and their political consultants may be moving in for the kill. Offer a 40% tax cut and the Republicans will demand 100%. The Republicans will also demand cuts in corporate taxes. Dr. Krugman observes that Republican minority leader Mitch McConnell is already "moving the goal posts". (Senator McConnell has a reputation as a shrewd political tactician.) This could possibly, I should think, lead to a squandering of the $1 trillion economic stimulus program, and a deep Depression. 
    "Obviously, the party that is out of power has every incentive to sabotage the policies of the party that's in power. Would that extend to ruining the nation? I suspect that, as far as some Congressional representatives are concerned, that wouldn't enter into their personal calculations. Witness the former members of Congress who are behind bars, and consider that this is probably just the tip of the iceberg. I would imagine that there are many Congressmen and Congresswomen who are outstanding public servants, but if you pick the worst out of 500... Some of our most successful are apt to be guided by what's best for their power bases and their prospects for re-election. ('What have you done for the Party lately?') So things may not go altogether smoothly for an economic rescue program." 


2010-6-29:  The markets crashed again today, hitting their their support levels.  The NASDAQ Composite lost 85.47 points (-3.85%) to close at 2,135.18, less than ½ % above its February 4th low. The Dow dove 268.42 points -2.65%) to close at 9,870.30, and the S&P 500 fell 33.33 points (-3.1%) to end at 1,041.24. Oil ended down at $75.74 a barrel, while Gold closed at $1,242. The VIX rose 5.13 to 34.13.  
    Yields on 2-year U. S. Treasury bonds  fell to their lowest yield on record today  (0.59%) in a flight-to-quality as investors fled "safe" European bonds and bought "risky" U. S. Treasuries. Yields on 10-year Treasuries broke the 3% barrier, hitting 2.96%, the lowest in two years. (It should be noted that the past two years include the autumn of 2008, the March low of 2009, and last month's "mini-crash".) Yields on 30-year Treasuries broke 4% today (see below).
    This article, The three biggest lies about the U.S. economy, by Marketwatch' Brett Arends, lists three myths of which the general public is probably unaware.
(1)  Myth #1:  U. S unemployment is under 10%. The author concludes that about 25% of the men in the U. S. who "are of prime working age" are either unemployed or underemployed.
(2)  Myth #2:  The markets are panicking about the deficit. "To hear the G-20 tell it, the U.S. and other top countries had better slash those budget deficits before the world comes to an end." In fact, the rates on 30-year Treasuries closed at 3.96% this afternoon. "They aren't seeing inflation either. On the contrary, they're saying it will average just 2.3% a year over the next three decades. That's the gap between the interest rates on inflation-protected Treasury bonds and the rates on the regular bonds. By any modern standard the forecast is low. Instead of worrying about inflation, some are starting to worry about something even more dangerous: deflation, or falling prices."
(3)  Myth #3:  The U. S. is sliding into 'socialism'. "Numbers published by the Federal Reserve a few weeks ago show that corporate profit margins have just hit record levels. Indeed. Andrew Smithers, the well-regarded financial consultant and author of "Wall Street Revalued," calculates from the Fed's latest Flow of Funds report that corporate profit margins rocketed to 36% in the first quarter. Since records began in 1947 they have never been this high. The highest they got under Ronald Reagan was 30%.      
    "Meanwhile, federal spending, about 25% of the economy this year, is expected to fall to about 23% by 2013. In 1983, under Ronald Reagan, it hit 23.5%. In the early 1990s it was around 22%. Some socialism.  
    "So much for a revolution. But here comes the counter-revolution just the same."  
    Some people never learn, including G-20  
    Dr. Irwin Kellner, Marketwatch' Chief Economist, makes the same statements as Brent Arend and Paul Krugman: Europe is replicating Herbert Hoover's mistakes of the 1930's: "Talk about déjà vu all over again. Language and actions like this are what turned the mild recession of 1929 into the Great Depression of the 1930s."
    He continues, "Because of the G-20, we may well be heading in the same direction. Our recovery is clearly losing steam. After a 5.6% surge in 2009's fourth quarter, the gross domestic product expanded at only a 2.7% pace in the first, and it may well have slowed even further in the second quarter. Yet the U.K., Germany and even Canada are prepared to tighten. Should they do so, it would depress their appetite for imports from the U.S. and elsewhere."
    Double dip: Best be nimble and quick  
    Mark Hulbert also writes, Key technical levels at risk  This article points out that a close below 9,884 on the Dow would constitute a breakdown of this year's "head-and-shoulders" pattern
    Mark Hulbert writes Top adviser since 1980 mostly in cash. The top advisor" is Charles Allmon, who's been mostly in cash for most of the past 30 years.   
    S&P testing 2010 low for 4th time: Michael Ashbaugh   
    I'm repeating this article from last night because it plays into what I'm getting ready to say:
    "The RBS tells clients to prepare for 'monster' money-printing by the Federal Reserve.      In this article in Telegraph, Ambrose Evans-Pritchard advances many of the points brought out by Paul Krugman, arguing the moves at fiscal stimulation last year were highly effective during that time frame, but observes, 'As the Bank for International Settlements warns, sovereign debt crises are nearing "boiling point" in half the world economy.' He also states, 'The Krugman doctrine of perma-deficits is ruinous - and has in fact ruined Japan. The only plausible escape route for the West is a decade of fiscal austerity offset by helicopter drops of printed money, for as long as it takes.'"
    Huh? A decade of austerity (starting now), offset by the Federal Reserve printing buckets of money to avoid deflation? This is fiscal austerity? I note that Ambrose Evans-Pritchard is speaking ex cathedra as an Authority Figure, with nothing to support his case except ipse dixit. Paul Krugman, by contrast, provided a baker's dozen formulae and charts to estimate the magnitude of the required stimulus, and warned repeatedly that (1) the Administration's stimulus package was too small to fill the hole, and (2) that the Adminisstration would have a tough time going back to the well if the economy began to flag in 2010. (I'll have to hunt for the links tomorrow., but here are two tonight: .) 
    Here's one of his blogs from March 17, 2009: A Continent Adrift.
    From March 13, 2009: "White House economic advisor Lawrence Summers gave a speech today in which he said, US would need more borrowing if deflation sets in: Summers  "If deflation sets in, if the GDP (gross domestic product) collapses further, if the consequences of that collapse for the financial system and even just the insured parts of the financial system, if that happens, the magnitude of the federal borrowing as large as it is today will be dwarfed, will be far, far larger," he said at the Brookings Institution."
    This addresses the effects of deflation upon the federal budget.


2010-6-28:  The markets closed today slightly below where they started. The NASDAQ Composite lost 2.83 points (-0.13%) to close at 2,220.65, the Dow drifted down  5.29 points -0.05%) to close at 10,138.52, and the S&P 500 dropped 2.19 points (-0.2%) to end at 1,074.57, Stocks can't find foothold. Oil ended up to $79.19 a barrel, while Gold ended the day at $1,257. The VIX rose 0.46 to 28.99.  
    There isn't much news or guidance tonight, so I'll stick to Paul Krugman's latest article: The Third Depression. In it, Dr. Krugman argues that conservatives continue to obsess over inflation, when all the signs point toward deflation: America's money supply plunges at 1930s pace. What is happening, he says, is that right-wing ideologues have wrested control away from the Keynesians, and are, as I would put it, aborting the takeoff, allowing the aircraft to crash into the woods at the far end of runway. "In the face of this grim picture, you might have expected policy makers to realize that they haven’t yet done enough to promote recovery. But no: over the last few months there has been a stunning resurgence of hard-money and balanced-budget orthodoxy."
    The RBS tells clients to prepare for 'monster' money-printing by the Federal Reserve.      In this article in Telegraph, Ambrose Evans-Pritchard advances many of the points brought out by Paul Krugman, arguing the moves at fiscal stimulation last year were highly effective during that time frame, but observes, "As the Bank for International Settlements warns, sovereign debt crises are nearing "boiling point" in half the world economy." He also states, "The Krugman doctrine of perma-deficits is ruinous - and has in fact ruined Japan. The only plausible escape route for the West is a decade of fiscal austerity offset by helicopter drops of printed money, for as long as it takes."


2010-6-27:  At the G20 meeting in Toronto this weekend, U. S. Treasury Secretary Timothy Geithner sang the same song that Paul Krugman was singing a year ago: that

(1) once the central banks have fired their last shot by lowering interest rates to zero, governments must spend during a "super-recession" in order to restore consumer confidence, and restart the engines of growth, and 
(2) that the present stimulus package is inadequate, and additional fiscal stimulus will be needed to pull our oxen out of the ditch: The G20 quandary – keep spending or start trimming deficits, G20 walks tightrope between growth, deficits, and Harper and the G20 tension between the US and Europe

These articles also sound Dr. Krugman's theme that Europe plans to piggyback off the U. S. recovery, and sock it to the American taxpayer to pull Europe back to prosperity.

Europe's leaders know all this, and they're certainly brilliant and blessed with good judgment. What's their side of the story? Unfortunately, I don't know quite where to find it.
    
This article, Stocks sense the plague is coming (back), replicates the story that Paul Krugman has told: "The Group of 20 nations summit in Toronto reminds us why the outlook for jobs and global growth, as well as for markets, gets darker by the minute."
      
Market futures are slightly up tonight.


2010-6-25:  The markets ended the day up a little: Consumer sentiment hits a two-year high, but U.S. growth rate lowered for consumers, trade.  The NASDAQ Composite gained 3.07 points (0.29%) to close at 2,223.48, the Dow drifted down  8.99 points -0.09%) to close at 10,143.81, and the S&P 500 added 3.07 points (0.29%) to end at 1,076.76, Stocks can't find foothold. Oil ended up to $79.19 a barrel, while Gold ended the day at $1,257. The VIX fell 1.21 to 28.53. 
    Just as a reminder, my investment advisory service issued a "sell" signal yesterday.
    The markets are overdue for a technical bounce, and it would appear that they're getting it. Even so, it probably won't last.
    About a year ago, Paul Krugman quoted someone saying that getting the economy going again is like giving a car a running start on its way up an icy hill. If the car is traveling fast enough, it will make it to the top of the hill. If not, the car will begin to spin its wheels before it clears the top of the hill, and will then slide back down again, with dangerous consequences. The U. S. stimulus package seems to be running out, and there's the danger that Dr. Krugman's prediction will come true: the economy will fall back into recession. Meanwhile, the financial reform bill that is being finalized won't prevent end runs by the big banks, and another meltdown will be in the offing: Wall Street gets off easy, and Reform is for the populists: Holland (audio) . Of course, we haven't escaped the current meltdown yet. "While Obama may have given the bill a 90% grade, a scholar with the Brookings Institution think tank wasn't quite so generous. The reform bill, paired with other regulatory changes in the works, 'will move us perhaps two-thirds of the way from where we are now on financial regulation to where we should be,' said Douglas Elliott." Also, "'Essentially nothing in the entire legislation will reduce the potential for massive system risk as we head into the next credit cycle,' wrote Simon Johnson, a Massachusetts Institute of Technology professor, on his blog, The Baseline Scenario. Read more on his blog."


2010-6-24:  My investment service issued a "sell" signal this afternoon and I sold. It's borderline. Sentiment is unabashedly crestfallen. A technical bounce would be normal in here, but it seems to me that a crash is also a possibility.
    The markets tanked again today: Growth worries weigh on U.S. stock futures. The NASDAQ Composite lost
36.81 points (-1.63%) to close at 2,217.42, the Dow plunged  145.64 points -1.41%) to close at 10,152.80, and the S&P 500 subtracted 18.35 points (-1.68%) to end at 1,073.69, Stocks can't find foothold. Oil ended up to $76.31 a barrel, while Gold ended the day at $1,242. The VIX rose 2.83 to 29.74. 
 
   The herd is nervous tonight. Is a stampede coming tomorrow? (Note that it's a bit too early to short the markets.) There isn't much news available.
    Market futures are mixed tonight, but basically flat.


2010-6-23:  The market indices fell modestly today after several pieces of bad news: New-home sales plunge 33% to record low in May, Jobless claims rise 12,000 to 472,000, and Street struggles after Fed. The NASDAQ Composite lost 7.57 points (-0.33%) to close at 2,254.23, the Dow added  4.92 points (0.05%) to close at 10,298.442, and the S&P 500 dwindled 3.27 points (-0.03%) to end at 1,092.04, on fears that the recovery will be derailed: Recovery doubts stir Street. Oil fell $2.00 to $75.85 a barrel, while Gold ended the day at $1,238. The VIX fell 0.14 to 26.91. 
    The Federal Reserve today warned that Europe's problems will, understandably, weaken the U. S. recovery, spooking the markets: Is Fed panicked? No, just worried, May leading indicators rise; slower growth seen. Meanwhile, this Wall Street Journal article "tells all" regarding where things stand in Germany. It explains that German "Wise Man" Wolfgang Franz responded to Paul Krugman's criticisms of Germany's tight money policy (Permanent Link to Against The Super-Asinine, The Gods Themselves Contend in Vain, Paul Krugman's Page) with, "Germans wear their anti-inflation obsession as a badge of honor. Germans often say that whereas the Great Depression dominates U.S. economic thinking, Germany’s experience with hyperinflation in the 1920s is its defining economic period of the 20th century, and one that must be avoided at all costs, even if it means slower economic growth.... Germans see their government finances and trade competitiveness as an example to be followed by Greece, Portugal and other troubled countries in Europe. And they clearly don’t see the U.S. model as one worth chasing."
    It seems to me that Chief German Economic Advisor Wolfgang Franz has given no arguments justifying the new European austerity programs, but has instead pandered to the public, probably telling the majority of German citizens what they want to hear. "He put those Amerikaners in their places, nicht?" And to me that's frightening, suggesting as it does, that German financial policy is being shaped by ideology rather than logic, and by personality interactions rather than sound analysis. The analogy that comes to mind is: "When you're sliding on ice, should you slam on the brakes?" And of course, the answer is, "No, you should turn in the direction you're sliding and gradually apply the brakes." But that's counter-intuitive. The knee-jerk reaction is to slam on the brakes, worsening the skid. Paul Krugman argues that Europe is expecting the U. S. to be ia dumping ground for European exports, with the U. S. running up its deficits to pull Europe out of the mud, while the Europeans practice fiscal austerity and deficit reduction. 
    Michael Ashbaugh's Tuesday technical analysis is entitled: S&P 500 struggles to escape the 200-day average, followed by today's (subscription only) S&P violates the 200-day, bears assert control. Meanwhile, market advice is bearish: Outrunning the bear market, and How to profit from a slipping U.S. economy.
    Stock market futures are basically slightly bearish tonight.


2010-6-22:  The markets plummeted again today. The NASDAQ Composite lost 27.29 points (-1.19%) to close at 2,26180, the Dow plummeted  148.89 points (-1.43%) to close at 10,293.52, and the S&P 500 nose-dived 17.89 points (-1.61%) to end at 1,1095.31. on fears that the recovery will be derailed: Recovery doubts stir Street. Oil ended at $77.60 a barrel, while Gold was up at $1,242. The VIX rose 2.07 to 26.95. 
    For what little it's worth, it seems to me that Paul Krugman's arguments are on target regarding Europe shooting itself in the foot. Raising interest rates and cutting back on government spending at this juncture would seem to me to insure slowing economies: U.K. gets with the austerity program, and A budget of choice, not necessity. But we'll see what happens. 
    My personal incubus is the idea that we're witnessing "The Decline of the West" (a la Oswald Spengler). If Europe makes a grand mistake now, Asia could take over from the West sooner rather than later. 

    Rob Russell: Economy lacks wings  

    Mark Hulbert writes: Is a double-dip recession certain? .He concludes that it isn't: it may happen, but then again, it may not.
    A frustrated Paul Farrell is writing again about what's happening financially to take the U. S. under: An Invisible Gorilla is killing America's soul. Unfortunately, there's general agreement on Wall Street that nothing is being done to prevent another financial tsunami. And equally unfortunately, it isn't clear that we'll escape the current crunch any time soon.
    Stock market futures are up slightly tonight.


2010-6-21:  After opening up about 1% on news that China has agreed to devalue the yuan against the dollar, the markets closed down a bit today: Stocks change mind, end lower.  The NASDAQ Composite lost 20.71 points (-0.9%) to close at 2,389.09, the Dow gave back  8.23 points (-0.08%) to close at 10,442.41, and the S&P 500 dropped 4.31 points (-0.31%) to end at 1,113.20. Oil ended at $77.54 a barrel, while Gold ended the day down $8 at $1,233. The VIX dropped 0.93 to 24.88. 
    Here come the cuts This article discusses the public funding cuts and new taxes about to be levied in the UK. This looks like 1929 all over again... or at least 1937... and it looks to me like a double-dip recession followed by a long, slow recovery, at best, and Depression 2.0 at worst. If the Eurozone raises interest rates and cuts spending, slowing their economies, we know what will follow. On the other hand, I supose it could be the case that they're walking a tightrope in that if investors lose faith in Eurozone sovereign debt offerings, their debt ratings will fall, interest rates will rise, and they'll be taken from that side. Either they raise interest rates or the markets will do it for them? 
    The following articles concern investing in Asia.
    Getting ahead of the next wave .  
    No single theme will be enough  
    'Going local' has risks ... and maybe rewards  
    Now is the time to return to Asian equities (video)  
    Watch Keep your eye on the Chinese consumer (video) 


2010-6-20:  Stock market futures are up more than 1% tonight.
    This article, Stretching the market rally, offers food for thought.
    Paul Krugman has become quite frustrated and worried. The deficit hawks have taken Europe, and several countries are preparing to raise interest rates, presumably choking off the European recovery. 


2010-6-18:  The markets closed up slightly again today: Another up week for stocks. Today was options expiration day, so the significance of today's action is somewhat dubious. The NASDAQ Composite advanced 2.64 points (0.11%) to close at 2,309.80, the Dow gained 16.47 points (0.16%) to close at 10,450.64, and the S&P 500 added 1.47 points (0.13%) to end at 1,117.51. Oil ended at $77.35 a barrel, while Gold ended the day at a new high of $1,258. The VIX dropped 1.10 to 23.95.
   
Fed in a tight spot if growth slows. This article observes that the Fed has fired about all the bullets it has. The recovery is fragile and vulnerable to shocks.

    Chuck Jaffe writes: Bank reform loopholes are roadmap to trouble. Mr. Jaffe echoes Paul Farrell's warnings about another bubble and bank catastrophe ahead. The Wall Street/ banking lobbies are pushing hard and probably successfully to undercut banking reforms.
    Peter Brimelow writes Permabear is bearish The permabear is Robert Prechter of Elliott Wave fame. He suggests a trap in 2012, followed by a decline of greater than 90% by 2016.


2010-6-17:  The markets closed up slightly today, vaulting up in the last half-hour of trading. today: Stocks take last turn higher.  The NASDAQ Composite advanced 1.23 points (0.05%) to close at 2,307.16, the Dow gained 24.71 points (0.24%) to close at 10,434.17, and the S&P 500 added 1.43 points (0.13%) to end at 1,116.04. Oil ended at $76.56 a barrel, while Gold ended the day at a new high of $1,247. The VIX dropped 0.83 to 25.09.
   
Today's gains came in the face of less-than-reassuring news, summarized in these articles: Jobless claims up, remaining stubbornly high,.Philly Fed sees a June downshift
, Conference Board pegs slower U.S. growth, and Earnings warnings threaten summer. A successful auction of Spanish bonds poured oil on troubled waters, and inaugurated the last-minute market run-ups.             
     Market futures are neutral tonight.


2010-6-16:  The markets closed flat today:: Street falls flat.  The NASDAQ Composite advanced 0.05 points (0.00%) to close at 2,305.93, the Dow tacked on 4.69 points (0.05%) to close at 10,409.46, and the S&P 500 slipped 0.62 points (-0.06%) to end at 1,114.61. Oil ended at $77.54 a barrel, while Gold ended the day at $1,232. The VIX dropped 0.01 to 25.86.
   
Economists push back estimate for rate hikes. In this article, economists at 14 top U. S. banks have pushed back their forecasts for interest rate hikes until the middle of 2011. In January, they had been concerned about inflation; now their concern is about deflation. They see an economy growing at "half-speed" this year and next, with a double-dip recession "very unlikely".
 
   Mark Hulbert is next at bat with Dow Theory sees bull market near death..This article sets forth the conditions for ascertaining whether we're in a primary bear market.   

    Red flags for BP far from public eye   This article explains that traders may be quietly dumping BP stock, which could be the company's death knell. (If its total stock evaluation dropped below the value of its assets, I suppose it could become a takeover target.)    
    Stock market futures are slightly lower tonight.


2010-6-15:  The markets hopped up today by 2¼ %-2¾ %.  The NASDAQ Composite advanced 61.92 points (2.76%) to close at 2,305.88, the Dow advanceded 213.88 points (2.10%) to close at 10,404.77, and the S&P 500 climbed 25.64 points (2.35%) to end at 1,115.23. Oil ended at $76.94 a barrel, while Gold advanced to $1,237. The VIX dropped 2.71 to 25.87.
   
I hesitate to list the exchange-traded index fund that my investment advisory service has recommended because it's a paid service. However, any of the market index ultra ETFs, such as QLD or SSO, should work about as well as any other. 
  
  Tonight, Mark Hulbert discusses: Are midterm elections bad for stocks?
 
   Paul Farrell states that: Doomsday Capitalism virus is spreading.
    Leveraged ETFs can be risky.

2010-6
-15:
  My investment advisory service has just issued a "buy" signal for one of the exchange-traded 2X market indices. 


2010-6-14:  Stocks fell slightly on Moody's downgrading Greece' debt to junk status: Moody's junks Greece, Credit spreads fatten. The NASDAQ Composite advanced 0.36 points (0.02%) to close at 2,243.96, the Dow jettisoned 20.18 points (-0.20%) to close at 10,190.89, and the S&P 500 declined 1.97 points (0.44%) to end at 1,089.63. Oil ended at $75.07 a barrel, while Gold closed at $1,223. The VIX dropped 0.21 to 28.58.
    My investment advisory service is in wait-an-see mode. the S&P 500 faces resistance at 1,105.  
    Without jobs, housing rebound may take years  

    Euro worries travel to the Middle East  
    Peter Brimelow writes: Sound Advice sticks to bullish call.  


2010-6-11:  Stocks rose modestly in late trading today in the face of mixed news: Retail sales fall for first month in eight, Consumer sentiment rises, and Bulls shake off doldrums  The NASDAQ Composite advanced 24.89 points (1.12%) to close at 2,243.60, the Dow toddled up 38.54 points (0.38%) to close above 10,000, at 10,211.07, and the S&P 500 climbed 4.76 points (0.44%) to end at 1,091.60. Oil ended at $74.23 a barrel, while Gold closed at $1,228. The VIX dropped 1.78 to 28.79. .  
    The markets don't seem to have sweated the
Bleak Friday's a day away. .
   
The markets built upon yesterday's gains, though only pallidly.   
    Consumer confidence rose last month, but consumer spending fell 1.2%, confounding predictions for an 0.2% gain. Corporations are sitting on unprecedented levels of cash. Clearly, corporations are worried about the European debt crisis, and about the potential for a double-dip economy. And this means that, optimistic talk to the contrary, corporations aren't going to do much hiring until they feel it's safe to go back in the water. Still, a second day of gains is technically a positive sign.


2010-6-10:  Stocks rose smartly today: Stocks advance as euro gains, 10K Dow doesn't look back  The NASDAQ Composite advanced 59.86 points (2.77%) to close at 2,218.71, the Dow regained 273.28 points (2.76%) to close above 10,000, at 10,172.53, and the S&P 500 fell 31.15 points (2.95%) to end at 1,086.84. Oil rose to $75.88 a barrel, while Gold ended at $1,219. The VIX drooped 3.16 to 30.57.  
    The markets have once again bounced up off the bottom, although it will be important to see whether they'll exhibit follow-through tomorrow.

    Bleak Friday's a day away refers to the fact that the index of leading indicators is getting ready to go negative tomorrow.    
    Retailers are upbeat is important because it speaks to consumer confidence as well as 
    Sweatshop days coming to an end is about the predicted evolution in China of a population that isn't going to be willing to accept sweatshop conditions much longer. 
     Stock market futures are neutral a bit tonight.
    My investment advisory service is back in action today, but hasn't given muc guidance regarding what comes next.


2010-6-9:  Stocks fell, allegedly on fears that BP won't be able to pay off its claims, and that this will impact the energy sector, and it probably didn't help that Fed Chairman Ben Bernanke suggested that we might be facing a double-dip recession: Stocks relapse as euro dips, but: Fed chief remains upbeat. The NASDAQ Composite slid 11.72 points (-0.54%) to close at 2,158.25, the Dow regained 40.73 points (-0.41%) to close at a new 2010 low at 9,844, and the S&P 500 fell 6.31 points (-0.59%) to end at 1,055.69. Oil rose to $73.93 a barrel, while Gold ended at $1,231. The VIX rose 0.03 to 33.73.  
    Stock market futures are down a bit tonight.    
    The housing-market recession is not over   
    There hasn't been a peep out of my investment advisory service today. The market is bumping along at the bottom of its trading (basing?) range. It closed today only a few points above Monday's close, which put it at the February low.


2010-6-8:  Stocks rose in the last half-hour of trading today.   The NASDAQ Composite was the only index that slipped today, trimming 3.33 points (-0.15%) to close at 2,170.49, the Dow regained 123.49 points (1.26%) to end the day at a 7-month low: 9,939.98, and the S&P 500 rose 11.53 points (1.10%) to end at 1,062.00. Oil added 0.74 to reach $72.19 a barrel, while Gold dipped slightly to $1,239. The VIX fell 2.90 to 33.66.
    Irwin Kellner has written an article explaining that the Labor market is far worse than it looks, an interpretation that is shared by my investment advisory service. Brett Arends has added to this theme with Five ways jobs numbers are worse than bad.
    Mark Hulbert has written: Correction coming?.  
    Paul Farrell explains that the GDP growth fetish is bad for your money.
   Emotional breakdown ahead for economy notes that consumer confidence has suddenly taken a dive, and that it could feed on itself.  
    David Weidner's Stop financial reform. Now. is a stitch! How explains how urgent it is that the CEO's who led us into this morass be able to continue to exploit us, and transfer wealth from us to them. It's pretty funny.


2010-6-7:  Stocks fell again today after the incoming British Prime Minister, David Cameron, reported that the British debt situation is even worse than Britishers have been told.: The NASDAQ Composite shed 45.27 points (-2.04%) to 2,173.90, the Dow dipped 115.48 points (-1.16%) to end the day at a 7-month low: 9,816.49 (-1.16%), and the S&P 500 fell another 14.41 points (-1.35%) to end at 1,050.47. Oil was basically unchanged at $71.60 a barrel, while Gold rose to $1,240. The VIX added 1.09 to 36.57.
    Stock futures are up about ⅔ percent tonight, perhaps because Ben Bernanke says he doesn't foresee a double-dip recession: Bernanke: no double dip. At the same time: Will trading-range bottom hold? (video)., and Bear market rallies elusive (video).
    One very important article is this piece from Paul Krugman: Permanent Link to Madmen in Authority.


2010-6-6:  Stock market futures are down more than 1% tonight. My investment advisory service opines that they could go as low as their February low before they turn around. (My investment advisory service in 100% in cash, but they're not shorting the markets... yet.)
    Paul Krugman reports from Europe that the G20 leaders have caved in to pressure to tighten their belts and raise interest rates, thereby choking off the nascent economic recovery: Permanent Link to Lost Decade, Here We Come. Ironically, most European countries aren't running the high debt-to-GDP that we and the UK are experiencing. In the meantime, my investment advisory service states that Friday's employment report was truly bad news. If Europe collapses, and China continues to tighten to curb real estate speculation, can we recover on our own? And what happens if we raise interest rates? I don't have a warm feeling about where the world's economies and our markets are heading.


2010-6-4:  Stocks fell precipitously today on a disappointing jobs report: Bears burn up the market, and new worries about the Eurozone:.Hungarian economy said to be in 'grave' shape The NASDAQ Composite shed 83.86 points (-3.64%) to 2,219.17, the Dow dove 323.68 points (-3.16%) to close at 9.931.22, and the S&P 500 plunged 37.89 points (-3.44%) to end at 1,064.94. Oil fell $3.53, to $71.08 a barrel, while Gold rose $9 to $1,219. The VIX added 6.17 to 35.61.
    The markets are still trading within their range. They still haven't broken below their May 26th lows.
    Mark Hulbert writes: Insiders cast a key vote of confidence 


2010-6-3:  Stocks climbed a bit more today. The NASDAQ Composite moved up 21.96 points uphill (0.95%%) to 2,303.03, the Dow rose a slight 5.74 points (0.06%) to close at 10,255.28, and the S&P 500 annexed 4.45 points (0.41%) to end at 1,102.83. Oil fell $1.73, closing at $74.59 a barrel, while Gold fell $15 to $1,208. The VIX dropped 0.71 to 29.46.
    The markets have been trading within a range over the past two weeks, edging slightly higher today. One important fact: they haven't broken below their May 26th lows.
    One issue that may weigh upon future trends is the fact that real estate may be expected to take a turn for the worse after July, because the stimulus effect of  recently allowed  purchasing breaks will fade out by the end of July.
    Tomorrow comes the monthly jobs report, and the markets are awaiting it with nail-biting anticipation.    
    Making sense of the selloff  
    Focus on investment risk, not return  
    Stock futures are slightly lower tonight.


2010-6-2:  Stocks jumped more than 2% today. The NASDAQ Composite galloped 58.74 points uphill (2.64%) to 2,281.07, the Dow rose 225.52 points (2.25%) to close at 10,249.54, and the S&P 500 annexed  27.67 points (2.58%) to end at 1,098.38. Oil fell $0.85, closing at $73.43 a barrel, while Gold fell $1 to $1,227. The VIX dropped 5.37 to 30.17.
    My investment advisory service is, of course, maintaining its "sell" signal. The S&P 500 penetrated its first lie of resistance at 1090, but still faces its next line of resistance at 1,105.
    Mark Hulbert presents the Outlook for the 10-year Treasury yield.
    The 'mac daddy' of economic indicators identifies those economic indicators that have predictive power for the equity markets.

    Stock market futures are up modestly tonight.


2010-6-1:  Stocks nose-dived today. The NASDAQ Composite pulled back 34.71 points (-1.11%) to 2,222.33, the Dow dipped 112.61 points (-1.54%) to close at 10,024.02, and the S&P 500 swooned  18.7 points (-1.72%) to end at 1,070.71. Oil fell $1.27, closing at $72.20 a barrel, while Gold climbed to $1,227. The VIX rose 3.47 to 35.54.
    My investment advisory service sent a "sell" signal today, after registering a slight gain. Stocks may be building a base for further advances, since they're still above last Wednesday's close of 1,068, but there's no assurance of that.
    This article, Bleak picture, tracks the idea that we're in a secular bear market that should end in the 2014-2018 time frame.
    Michael Ashbaugh notes that the markets are moving down: S&P 500 fails first test of 200-day moving average, according to Michael Ashbaugh.
    Mark Hulbert shows that Those suspicious late-day reversals are about par for the course.
    Paul Farrell writes: American investors: predictably stupid
    Mark Hulbert, Michael Ashbaugh, Jim Lowell, and Thomas Kee "guide you off the hot seat in June with trading tips for this still-volatile environment": See the full special report.
    Market futures are up a tad tonight.


2010-5-31:  Stock futures are neutral tonight.
    My investment advisory service observes that circumstances don't seem to point to a deeper market decline, but in the end, the investment service will follow the markets. Fear seems to be the dominant current emotion, and fear is at its peak at market bottoms. At the same time, circumstances are much better today than they were after the Lehman collapse in 2008.
    Stocks: New month, same malaise  


2010-5-28:  After yo-yoing up and down wildly all day, the markets ended down a bit more than 1%. 
The NASDAQ Composite gave up
20.64 points (-0.91%) to 2,257.04, the Dow slumped 122.36 points (-1.19%) to close at 10,136.63, and the S&P 500 sagged  13.65 points (-1.24%) to end at 1,089.41. Oil was basically unchanged, closing at $74.09 a barrel, while Gold ended at $1,216. The VIX rose 2.39 to 32.07.
    The cause of this downdraft seems to have been the downgrading of Spanish creditworthiness from AAA to AA: Spanish cut.
    Mark Hulbert warns about how overpriced Apple stock is: Apple vs. Microsoft.
    My Investment advisory service suggests that this market may retest 1,070 on the S&P 500. Today's action occurred when most traders were off on a long weekend.
    There are a couple of pundits arguing that a significant rally may lie ahead from here (although my investment advisory service notes that the intermediate trend is now down, and is playing for a short-term trade): Correction begets what?, and Peter Cardillo expects 'powerful' rally (audio).


2010-5-27:  The markets rose rose more than 2% today (Nasdaq is positive for 2010 on China's pointed denial that it intends to sell Eurobonds, and on Spain's adoption of austerity measures aimed at restoring their global competitiveness; Spain's reluctantly austere . The NASDAQ Composite hopped up 81.8 points (3.73%) to 2,277.68, the Dow skipped up 284.54 points (2.85%) to close at 10,258.99, and the S&P 500 jumped up 35.11 points (3.29%) to end at 1,103.06. Oil vaulted up $3 to close at $74.50 a barrel, while Gold ended at $1,214. The VIX fell 5.34 to 29.68.
    I'm impressed. My investment advisory service may have called it correctly after all. My advisory service is only expecting a short-term updraft. From a contrarian viewpoint, sentiment is certainly sufficiently negative for a rebound:
Investor pessimism at worst since November, Bearish sentiment is good news for investors.
    Peter Brimelow describes
Two savage skunks, two unbowed bulls.
    Crisis undermines euro  
    Chuck Jaffe warns people seeking a financial advisor against basing their choice on the advisor's credentials. Advisors have generated more than a hundred titles to try to impress potential clients. Mr. Jaffe writes that "A is for advertising", "B is for bamboozle", and "C is for credibility". "Standards vary for each role, with state or federal law dictating whether practitioners must even be registered or licensed. Even then, 'registration' is more about putting your name on file than it is about having achieved a minimum standard of education and academic excellence." Advice leaves investors hungry  
    For what very little it's worth, market futures are neutral tonight.


2010-5-26:  The markets fell about % today: Stocks swing low late. The NASDAQ Composite lost 15.05 points (-0.69%) to 2,195.88, the Dow dwindled 69.3 points (-0.69%) to close at 9,974.45, and the S&P 500 declined 6.06 points (-0.67%) to end at 1,067.95. Oil rose to $71.31 a barrel, while Gold was unchanged at $1,212. The VIX increased 0.41 to 35.02.
    Today's close was at the lowest level since this stock market correction began.
    Stock market futures are off nearly ½ % tonight. Meanwhile, the investment advised by my investment service is sitting right at the "sell" point. I could imagine my investment service recommending a sale at a loss tomorrow if this further decline is reified by tomorrow's markets. Otherwise, I don't see any relevant news items to post. 


2010-5-25:  My TopStock investment advisory service was conspicuously silent yesterday and this morning. Its founder was obviously embarrassed at what happened yesterday and again this morning, and he has said so to his subscribers. But it's not given to us mere mortals to call the day-to-day fluctuations in the markets. Attempts to hit the exact bottoms of market moves are conspicuously unsuccessful. He's advising his subscribers to take a wait-and-see position unless the indices decline a bit further (in which case, he'll advise selling at a slight loss). And given the current market rebound, his recommendations may well be vindicated: Don't panic (video). (Today has been a battle between hooves and claws and between fangs and horns. Whoosh! What a day!)
    The NASDAQ Composite lost
2.6 points (-0.12%) to 2,210.95, the Dow dropped 22.82 points (-0.23%) to close at 10,043.75, and the S&P 500 rose 0.38 points (0.04%) to end at 1,074.03. Oil fell a little to $69.32 a barrel, while Gold rose $6 to $1,200. The VIX fell 3.42 to 34.90. 
    Michael Ashbaugh says: S&P testing key level.  
    Investors in most asset classes are visibly jumpy: Libor jump underlines rising tensions, and Swap, TED spreads jump
    In Rand Paul's Wall Street, David Weidner talks about what would happen if the government stays out of everyone's lives... which is essentially what happened during the Bush II years. Businessweek ran an editorial a couple of years ago pointing out that the gap between the ultra-rich and the rest of us was the greatest it's been since 1926. From 1947 to 1973, the median U. S. standard of living climbed dramatically. Paul Krugman, in Permanent Link to The Bestest Generation, shows what's happened since then, with the bulk of the gains in GDP going to our super-rich and little or nothing trickling down to us. Anyway, David Weidner notes that what were experiencing now is the result of weak or no intervention by the federal government in e. g., banking and other financial industries (not to mention other industrial activities such as offshore drilling). I question whether the world has become a global corporatocracy that, behind the scenes, runs everything for the benefit of large corporations and the ultra-rich... but of course, I don't know. In any case, Mr. Weidner's points concern that havoc that would occur if we further weakened government. (To get a real picture of what would happen if taken to the limit, imagine how it would be if all government were abolished... no more taxes, no more police or sheriff departments, no more fire departments, no more prisons, no more law enforcement, no more courts or punishments for crimes, no more street, highway, and Interstate  maintenance, no more city garbage pickup or city sewage disposal, and no more public schools. How long do you think we'd survive when gangs of thugs came after us armed to the teeth? Of course, we could contract with "protection agencies" for protection. Welcome to Somalia and Afghanistan!)
    Mark Hulbert enumerates differences between what's happening right now and what happened in the fall of 2008: Today vs. Oct. 2008  
    As I wrote on May 12th, it's important to remember that in order for a correction to occur, the world's pre-eminent investors must be convinced that a plunge into the pit is about to take place: "Things must be scary enough that institutional investors are frightened enough to sell stocks at a loss.". They have to be stampeded into parting with all their choice positions at a loss. 
    What happens in the U. S. tomorrow will probably depend upon what happens overseas tonight.
    Stock market futures are neutral tonight, and have been slowly falling.
     Why you shouldn't sweat Europe  
     Think housing is recovering? Think again. 

2010-5
-25 (Pre-Market):
  U. S. stock market futures are following foreign stock indices down today, with U. S. futures now down about 2¼ %. 
    Paul Farrell writes: Crash is dead ahead. Sell. Get liquid. Now, while Mark Hulbert adds: Rush is on to jump on bearish bandwagon.


2010-5-24:  TopStock Portfolios did indeed issue a "buy" signal this morning, and I bought. Fortunately, I didn't have an opportunity to pass on that "buy" signal here on the website, and it's a good thing. In the last 15 minutes of trading, the indices fell almost as much today as they rose on Friday. Earlier this afternoon, when the Russell 2000 ETF "UWM" fell to the breakeven point, I sold all my shares, so I didn't participate in this afternoon's losses. Otherwise, I would have lost more than 1% of my investment. (Unfortunately, that will tie up most of my liquid cash for the next three trading days, until the trade "settles".) So much for the "doozy of a bounce", at least for today.
    The NASDAQ Composite lost
15.49 points (-0.69%) to 2,213.55, the Dow dropped 126.82 points (-1.24%) to close at 10,066.57: Wall Street's dive deepens, and the S&P 500 fell 14.04 points (-1.29%) to end at 1,073.65: Bears chase global stocks into correction. Oil remained essentially unchanged at  $70.03 a barrel, while Gold rose $16 to $1,193. The VIX fell 1.78 to 38.32. 
    Worries about Europe weighed on the markets today. Spain had to rescue one of its banks today, leading to concerns that other banks might need similar interventions: U.S. stocks end sharply down amid European worries. David Marsh warns that Europe must stick together: Europe's choice: chaos or solidarity., 
    Where are the markets headed? Here are five commentaries: Stephen: Shanghai tips Wall Street's future, Three skunks say market still stinks (Peter Brimelow), End of correction nears - but respite won't last, 7 worries for Wall Street, and Market Medics: 'Summer bummer ' looms
    The first of these articles offers the interesting observation that since 2007, the Shanghai marketplace has become a leading indicator for the U. S. markets. Right now, the Shanghai markets are down about 19% compared with 10%-12% for the U. S. market indices.
    In the second article, written by Peter Brimelow, three investment advisors who have done well during the current downturn are 100% in cash. One of them thinks that U. S. market indices will advance during the next few weeks, and then will resume their "death spiral".
    The remaining articles sound the same cautionary note: a bounce, followed by further declines. There's some talk of a "W"-shaped recession.
    Stock market futures are down about 1% tonight. (Of course, anything can happen between tonight and tomorrow afternoon's close.)


2010-5-23:  There seems to be general agreement that (1) the deeply oversold markets are due for "a doozy of a bounce", (2) hedge fund managers are engaged in "risk reduction", and (3) the world's economies are facing strong headwinds, and the bounce will be followed by a further descent into the abyss. And of course, when there's general agreement about what's going to happen next, it generally doesn't. 
    My TopStock Portfolios advisory service is alerting us subscribers to the possibility of a "buy" signal tomorrow. It's internal indicators are pointing up, and perhaps more robustly than one might expect.
    We'll see. 


2010-5-21:  Deeply oversold, the markets have staged a "dead-cat bounce" today. The NASDAQ Composite gained 25.03 points (1.14%) to 2,229.04, the Dow reclaimed 125.38 points (1.25%) to close at 10,193.39, and the S&P 500 mustered 16.1 points (1.50%) to end at 1,087.69. Oil remained essentially unchanged at  $69.84 a barrel, while Gold pulled back to $1,177. The VIX rose 5.69 to 40.10. 
   
My investment advisory service has anticipated this, predicting that today, Monday, and, maybe, Tuesday, the markets will snap back. But the problems that caused this disenchantment won't go away, and by the middle of next week, the force of gravity should take hold again.
    Mark Hulbert writes about What Dow Theory says about the sell-off, and Chuck Jaffe warns us: This fund's a winner, but not for investors.


2010-5-20:  The markets fell out of bed today, slicing through their support levels like a locomotive through fog: Market crashes technical support on Fearsome volume.  The NASDAQ Composite contracted 94.36 points (-4.11%) to 2,204.01, the Dow forfeited 376.36 points (-3.60%) to 10,068.01, and the S&P 500 dwindled 43.46 points (-3.90%) to end at 1,071.59. Oil retreated to $69.75 a barrel, while Gold pulled back to $1,183. The VIX rose 10.47 to 45.79.  
    The retrenchments in the three major market indices have all exceeded 10%, qualifying this contraction as a bona fide correction: Stock indexes enter correction mode. They've also broken below their 200-day moving averages. The S&P 500 has fallen from a high of 1,217 on April 23 to tonight's close at 1,071... a drop of 146 points or 12.0%. The Dow has backed up 1,136 points from its April 23rd high of 11,204, a decline of 10.11%. The NASDAQ Composite has slid 426 points from its April 23rd peak of 2,630... a 16.8% retreat from its highs.
    The immediate causes for today's collapse lie in headlines such as Battering ram blasts Europe's bourses, U.S. jobless claims climb 25,000 to 471,000, Leading indicators dip, and 30-year fixed-rate mortgage at 2010 low .
    My investment advisory service suggests that the attitude of major investment managers is "You won't fool me again!" Managers were blind-sided by the 2008 market crash, so this time, they're selling first and asking questions afterward; the hedge funds are selling to lower their risks. My investment advisory service is warning that it would be unwise to count on a "dead cat bounce' just yet. There is even the hint that tomorrow morning the service may issue a recommendation to short the markets, using the S&P inverse fund SDS. 
    Stock market futures are ½ % positive tonight. 
    Todd Harrison writes today: The Return of the Phantom of Deflation..  
          
2010-5-20:  Stock market futures are down between 1½ % and 1¾ % this morning, suggesting large-scale dumping of equities. My investment advisory service warns the hedge funds are selling to lower their risks. I have just bought shares of the S&P 500 double-inverse fund SDS to hedge my portfolio.


2010-5-19:  The U. S. markets dropped a bit further today, though not low enough to puncture their "sell" thresholds. The NASDAQ Composite contracted 18.89 points (-0.82%) to 2,298.37, the Dow forfeited 66.58 points (-0.63%) to 10,444.37, and the S&P 500 dwindled 5.75 points (-1.42%) to end at 1,115.05. Oil rose to $71.05 a barrel, while Gold retreated to $1,191. The VIX rose 1.77 to 35.32.  
    The S&P 500 has closed only 4 points above its May 7th low, and, after kissing its 200-day moving average, has closed just above it. In the meantime, paradoxically,  my TopStock Portfolios investment advisory service is getting more optimistic. 
    Of course, tomorrow, the markets could plunge through their May 7th lows and keep on plunging. The ramparts we'll watch..
    China official: Wall Street is barbaric: This well-written article by Andrew Sheng, chief advisor to the China Banking Regulatory Commission, reflects what many of us feel. 
    Paul Krugman draws attention to the deflationary trend in the U. S.: Permanent Link to Feeling Deflated  
    In A portfolio for all seasons, Mark Hulbert describes a mutual fund that has done relatively well (with an 8%-per-year average rate of gain) over the past ten years.
    Market futures are a little higher tonight.


2010-5-18:  The U. S. markets closed down again today, but closed above their may 7th low of 1,111. The NASDAQ Composite fell 36.97 points (-1.57%) to 2,317.26, the Dow tumbled 114.88 points (-1.08%) to 10,510.95, and the S&P 500 stumbled 16.16 points (-1.42%) to end at 1,120.78. Oil rose to $69.33 a barrel, while Gold retreated to $1,223. The VIX fell 2.71 to 33.55.  
    Tomorrow could tell the tale regarding whether the markets are going to pass or fail their retest of their May 7 low (and futures are down nearly 1% tonight). If the S&P 500 fails to close above 1,111 tomorrow afternoon, it will probably signal a steepening fall in the markets.
    Paul Krugman points out that a falling Euro may actually benefit the U. S. recovery over the short term by lowering oil prices and interest rates: Permanent Link to Negative Linkage.  
    Paul Farrell writes: 12 ways to cash in on the 'collapse of Eaarth'
    Mark Hulbert writes about the Consequences of heavy volatility. His conclusion: there aren't any correlations between market volatility and the future direction of the stock market. (Last Friday, he wrote that advisors were bearish than after the "Flash Crash": Wall of Worry.)


2010-5-17:  After falling around 2%, the market indices turned around and finished slightly positive. The markets have been retesting last week's lows. This is a classic pattern for a market breakdown, and we could have seen the bottom for this pullback. The NASDAQ Composite ended the day up 7.38 points (0.38%) to 2,354.23, the Dow inched up 5.67 points (0.05%) to 10,625.83, and the S&P 500 minced up 1.26 points (0.11%) to end at 1,136.94. Oil rose to $73.61 a barrel, while Gold retreated to $1,222. The VIX fell 0.4 to 30.84.  
    The news is wonderfully grim and scary... which is just what's needed to drive the markets down. (You have to realize that financial news isn't like other news. There are enormous amounts of money riding on which way the markets move. It would be ingenuous, I should think, to suppose that Rupert Murdoch bought Marketwatch, the Wall Street Journal, and other key financial news organs just for their advertising revenue.) In any case, the news jibes with the current dip.
    Debt vigilantes put Europe on notice
    Five investment ideas to play the next sovereign debt crisis  
    Financial maelstrom has cast doubt on even U.S. Treasurys  
    Be careful, Europe  
    Sovereign funds' 2009  
    Second debt storm brewing  
    New stage for debt crisis  
    Why Europe may kill the U.S. recovery  
    2010's next stock crash: 1987 all over again This article warns that current  price-to-earnings ratios, at 22 on the S&P 500, and S7P 500 dividend yields at 1.8%, are dangerously high. Yes, but... P/E ratios are high during and coming out of a recession. Stock prices are based upon next year's anticipated earnings, which, coming out of a major recession, tend to rebound rapidly. I don't have those numbers handy so I can't be sure about what I'm saying here, but I'd be slow to uncritically accept the article's conclusions. Dividends are a more compelling question, but considering what we've been through, rising dividends might also be in the cards.

2010-5-17:  Stock market futures are down slightly tonight.


2010-5-14:  A last-minute buying spree brought the indices a little out of their doldrums. The NASDAQ Composite ended the day down 47.51 points (-1.98%) to 2,346.85, the Dow sacrificed 162.79 points (-1.51%) to 10,620.16, and the S&P 500 shranked 21.76 points (-1.88%) to end at 1,135.68. Oil fell to $71.89 a barrel, while Gold retreated to $1,231, finally responding to the rising dollar. The VIX rose 4.73 to 31.41.
    The proximate cause of this week's downward spiral would seem to be rooted in angst over the Eurozone debt crisis: EU can't be rid of hangover. At this time, I don't have any further indications of what comes next: U.S. stocks to stay on shaky ground in week ahead. I may know more by Sunday night.


2010-5-13:  The markets tumbled today.  The NASDAQ Composite was down 30.66 points (-1.26%) to 2,394.36, the Dow gave up 113.96 points (-1.05%) to 10,782.85, and the S&P 500 subtracted 14.23 points (-1.21%) to end at 1,157.44. Oil fell to $73.94 a barrel, while Gold retreated 9 points to $1,234: In markets tug-of-war, gold holds the key. The VIX rose 1.29 to 26.80.
    The day started reasonably well: Weekly jobless claims fall 4,000 to 444,000; Weekly Jobless Claims Edge Down, But.... Matters were adjudged to be looking up in Europe: Calling Off The Funeral?. The dollar was rising (Dollar's rising) even as gold was falling. There were some neutral articles: Does the 200-Day Moving Average Really Matter?, Lessons learned from the 'flash crash', Keep your distance, Track volatility via VIX, and Weidner on confidence-trick markets. Stocks were steadily moving up.
    Then the bad news hit: Treasurys lower after 30-year bond sale
Portugal's turn to bite the bullet, China must hike rates or else, and U.S. stocks lapse more amid retail disappointment. The markets dove sharply, falling off a cliff about two hours before the close.
    By way of aftershocks: Market Medics: How long can markets rule?, and
Sell non-U.S. stocks on debt crisis: Wilmington
    This kind of bad news and these kinds of bad days are part and parcel of equity investing. What's significant is the fact that the market indices are flirting with their 50-day moving averages. 


2010-5-12:  The markets rose about 1½ % today: Stocks clawing way back. The NASDAQ Composite was up 49.71 points (2.09%) to 2,425.02, the Dow scampered up 148.65 points (1.38%) to 10,896.91, and the S&P 500 added 15.88 points (1.37%) to end at 1,171.67. Oil closed a little lower at $75.65 a barrel, while Gold hit a new all-time high at $1,243: Gold reaches for the stars. The VIX fell 2.8 to 25.522.
    The Dow and the NASDAQ Composite are just now penetrating their 50-day moving averages. The S&P 500 hasn't quite made the crossing just yet.
    Mark Hulbert discusses the Debate about May 6 dive misses the point . He cites work that predicts 10% daily drops in the markets have occurred about once every 6¼ years. They happen when big institutional investors get spooked about the markets and stampede out of the marketplace.
    It's curious that the dollar is rising, which should make the price of gold and oil fall, but the price of gold is rising faster than a rising dollar can cheapen it. A "flight to safety" is driving the dollar higher, and is also running up the price of gold: Why gold is breaking records.
    This is the wall of worry that the stock market climbs. Things must be scary enough that institutional investors are frightened enough to sell stocks at a loss. (I have to admit, though, that when Paul Krugman didn't know whether or not European governments would be willing to take the bold, decisive steps necessary to keep the Eurozone from splintering, it was time for me to worry, too.)  
    Todd Harrison has written a "Minyan Market Musing": The war on capitalism.
    Market Edge: Behind bear-market rallies (video)  

    Market futures are off a tad tonight.


2010-5-11 (After the Bell):  The markets closed slightly lower today. The NASDAQ Composite was up 0.64 points (0.03%) to 2,375.31, the Dow dipped  36.88 points (-0.34%) to 10,748.26, and the S&P 500 parted with 3.94 points (-0.34%) to end at 1,155.79. Oil closed a little lower at $75.86 a barrel, while Gold hit a new all-time high at $1,228: Gold soars to record high. The VIX fell a smidge to 28.32.
    Stock market futures are down
0.02%-to-0.25% tonight... nothing dramatic.
    Michael Ashbaugh suggests that the primary uptrend is still intact, but that the S&P 500 will be back and fill in the trading range between 1,067 and 1,167 until it breaks above 1,180 (which should give us a second chance to buy lower than where we are now). 
    David Weidner writes, Don't blame the glitch on machines
    Jim O'Sullivan, chief economist for MF Global, writes that the Recovery won't be derailed
    Paul Farrell offers: Buffett joins greed Conspiracy
    Irwin Kellner weighs in with: Dollar's rise is double-edged sword.
    Mark Hulbert: Insiders' response to last week's plunge. Insiders' sell-to-buy ratio has gone from bearish at the market's peak in April to neutral right now.
    Economist Andy Xie points to a new global economic crisis in 2012: 'V' is for 'Vulnerable'.
    One piece of good news: Job creation ramps up.

2010-5-11 (Before the Bell):  Market futures are down this morning about ¼th as much as they were up yesterday morning.


2010-5-10 (After the Bell):  The markets closed close to where their futures predicted, with a last-minute buying surge boosting closing prices. At the close, the NASDAQ Composite was up 109.03 points (4.81%) to 2,374.67, the Dow is up  another 404.71 points 3.9%) to 10,785.14, and the S&P 500 has advanced 48.85 points (4.4%) to end at 1,159.73. Oil rebounded $2.29 to $77.34 a barrel, while Gold subtracted $9 to close at $1,202: The VIX jumped 8.15 to 40.9. The VIX cratered 12.11 to 28.84. 
    After an initial boost, the market indices flat-lined for the rest of the day, drifting down a bit during the afternoon, but reclaiming their losses near the end of the day (with a strong selling surge in the last minute or two). Given this flat performance, it's hard to know where prices will go next. I bought three ETFs before the markets opened this morning, paying the elevated prices I would have paid if I had waited 15 minutes or so. (You have to ask: who bought these stocks before the markets opened, or immediately after the markets opened? I presume that someone has to be buying them in order to bring their prices up. For example, between 9:31 and 9:32 Eastern time this morning, S&P 500 rose from 1,132 to 1,142. Someone had to have been able to buy at 9:31 when the S&P was at 1,132... someone who could have made a killing. How does that work?) One of the ETF's I bought rose $420, while the other two lost a few dollars when the markets drifted down a little this afternoon. I sold them and booked a net profit of, probably, $350 after commissions. Now, if I had kept that ETF, I would be looking at (an unrealized) gain of $780, but that's the way it goes. 
    The real question is: where do the markets go from here? To rise from here, the indices will have to break through their old levels of support, which have now become new levels of resistance.
    From a longer-term perspective, Europe isn't out of the woods yet. A near-term slump may well be in our horoscopes: Permanent Link to Second Thoughts?.
    Mark Hulbert is suggesting tonight that today's resurgence may be little more than a technical bounce: Street just being contrary? (See also: MarketWatch First Take: Breaking analysis.
    My investment advisory service is also less than certain that today's action is a prelude to further stock market gains.
    Here's another Goldman-Sachs type of article: Bets against clients.

2010-5-10 (Before the Bell):  The futures markets are up more than 4% before the market opens: A rescue package that works, A massive relief rally. At this moment (an hour-and-a-half before the bell rings) the NASDAQ Composite is up 77.75 points (4.21%) to 2,343.39, the Dow is up  another 403 points 3.9%) to 10,883.43, and the S&P 500 has advanced 50.2 points (4.53%) to end at 1,161.28. These gains approximately equal last Thursday's and Friday's combined losses.
    This is a rum go. How can anyone make money in a market that moves this drastically while out of reach of ordinary investors? I suspect there will be beating of breasts and gnashing of teeth over this on the part of the investing public. I'll be eager to hear what my investment advisory service has to say about this after moving its subscribers to 100% cash last week (though early enough to have avoided most of last week's losses).
    I suspect that after the initial stampede takes place, the markets will pull back as the anticipatory buzz fades, and the realities of this tough situation reasserts itself. (Already, the Dow futures have pulled back to
376.)
    I have entered pre-market purchase orders for a few ETFs that I want to own to put me back where I was before this pullback began, re-investing about 10% of the value of my portfolio..

2010-5
-9:
  What a difference 24 hours can make! European finance ministers have agreed (IMF approves Greece loan as Europe tries to stem crisis) to do "whatever it takes" (Europe plays zone defense) to rescue Greece, and have pledged $900 billion to shore up the PIIGS (Portugal, Ireland, Italy, Greece, and Spain): Europe and U.S. step up rescue efforts. Simultaneously, the Fed has announced plans to beef up the U. S. lending program as the stimulus package runs out: Fed to reopen dollar swaps. As a result, market futures have gone from 1% to 2% underwater to more than 2½ % above water. The S&P 500 is already up almost 30 points. If these futures hold up tomorrow morning, I may buy some attractive stocks before the market opens (getting the opening price, whatever that turns out to be). But we'll see.
    There could be panic buying as investors scramble to scoop up bargains before they disappear.
    Keep watching this spot..

2010-5
-8:
  There is, after all, some news tonight. My investment advisory service has warned that no satisfactory explanation has been forthcoming for Thursday's 993-point plunge in the Dow, and that is this doesn't happen soon, professional investors like them are going to lose confidence in the U. S. markets. This could lead to Todd Harrison's "Black Monday" (Todd Harrison dissects the 1,000-point plunge). Ominously, market futures are off between 1% and 2% tonight. Of course, it's nearly 36 hours until the markets open, so a lot can happen between now and then. Meanwhile, here's an article warning of the expiration of the fiscal stimulus program: Goodbye, stimulus. Hello, teacher cuts.
    Of course, when the markets fall, the news is always bad enough to shake confidence in the system. Otherwise, the markets wouldn't continue to fall. Still, I might do more selling on Monday, and, possibly, buy an Exchange-Traded Fund that bets against the markets in order to to hedge the mutual funds that I really can't sell without paying a short-term penalty.


2010-5-7:  The markets fell again today: May brings stock mayhem. The NASDAQ Composite plunged 54 points (-2.33%) to close at 2,265.64, the Dow lost another 139.89 points (-1.33%) to 10,380.43, and the S&P 500 fell 17.27 points (-1.53%) to end at 1,110.88. Oil dropped $1.70 to $75.11 a barrel, while Gold added $16 to close at $1,210: Gold surges on 'alternative currency' appeal. The VIX jumped 8.15 to 40.95
    The VIX jumping from 16.6 to 41 in two weeks is one of the stories here. The last time the VIX was this high was on April 7th of last year, after peaking at 51 when the indices bottomed on March 6, 2009. 
    That's a lot of angst.
    The indices are relentlessly following trend lines down: Worst first five days of May in Dow's history. The rate and persistence of this selling suggests to me a shift in the markets: 'Sell in May' adage in full force. So far, there's no sign of a bottom forming.
    This is clearly more than a routine pullback. Since the U. S. recovery is continuing apace: 290,000 jobs created, That's the best job growth in 10 years, and Permanent Link to Jobs, Jobs, Jobs, what's happening must portend problems six-to-nine months out.
    Since the indices have all broken below their 50-day moving averages, it's past time to have left the party.
    The number one problem facing the world seems to be the European debt crisis. In Permanent Link to A Cross Of Gold, Paul Krugman observes that switching to the Euro without a central government set the stage for the economic straitjacket in which Greece finds itself today. In Permanent Link to Greek End Game, he explains how tight Greece' straitjacket is. And in Permanent Link to O Nao!, he observes that Portugal's interest rates are "where Greece was only a few weeks ago". He suggests that Anno Dominie 2010 may be shaping up to be Anno Domino.
    In Todd Harrison dissects the 1,000-point plunge, the author revisits the crushing debt overhang problem again, and relates that his antennae are picking vibration like those he experienced in September, 2008. (He suggests that a Black Monday may be in the offing.)
    In 5 Myths about the European debt crisis, the authors dispel some of the overheated concerns about the European debt crisis, but close on an ominous note.
    What you should do about market's selloff also ends on a cautionary, if not ominous note: "Greece is the wild card. The euro zone crisis could end with Greece, or that country could be the tip of a giant iceberg, as subprime mortgages were to U.S. financial markets at the outset of the credit crisis." 
    But in the end, the markets will rebound. Right now, they're down about 9%, which makes selling less attractive than it was. There will come a time to buy, and the right moves can generate significant profits as the markets move back up. (In the end we can anticipate a buying opportunity.)
    Two more-optimistic articles are Art Hogan calls for calm — it's not an omen, and Dow 12,000, sooner than you think 


2010-5-6:  The markets absolutely crashed today: Wall Street washout. The NASDAQ Composite plummeted 82.65 points (-3.44%) to close at 2,319.64, the Dow dove 347.80 points (-3.2%) to 10,520.32, and the S&P 500 fell 37.76 points (-3.34%) to end the day at 1,128.13. Oil dropped $3.15 to $76.82 a barrel (Oil ends 3.6% lower as panic selling takes over), while Gold added $33 to close at $1,208: Gold surges on 'alternative currency' appeal. The VIX jumped 9.75 to 34.62
    Meanwhile, in Sentiment slams the Street, Mark Hulbert observes that the fact that gold rose at the same time the dollar rose reveals that investors were in a state of panic today. (At one point, the Dow was down 993 points, "its biggest intraday drop on record"!) there is reason to believe that someone somewhere made mistake and "pushed the wrong button": Bizarre pace of plunge points to trading snafu.
    On the other hand, the ECB (European Central Bank) President, Claude Trichet, after today's meeting of the ECB mouthed such Herbert-Hoover platitudes as "Current rates remain appropriate", "The economic recovery in the Eurozone is continuing", and "Risks to the outlook are broadly balanced." Instead of announcing decisive actions, he tried to pretend the problems did
n't exist, and the world's markets reacted accordingly.
    At the same time, there was some mildly bad news. Jobless claims for the past week weren't down quite as much as was predicted, and the unemployment rate is probably going to remain at 9.7%: Jobs slowly returning on Main Street. However, days like today alternate with days that are better than expected. In other-less-than-good news, Debt fears push Libor to highest since August. The Libor (London Inter-Bank Overnight Rate) skyrocketed  during the fall of 2008. In another piece of worrisome news, Moody's warns of Greek contagion for (European) banks.
    Meanwhile, the markets are now quite oversold on a short-term basis.
    In spite of riots in the street, Greek parliament approves government austerity plan
    Todd Harrison has written tonight: Europe traces U.S.'s battle plan, arguing that Europe is attempting the same minimization tactics that the U. S. practiced in 2008 until the plaster began to fall from the ceiling.
    Today's 993-point plunge occurred at 2:49 p. m. Eastern time, and is being  blamed on programmed trading blip that triggered a computerized "sell" chain reaction.
    Market futures are up significantly tonight.
    John Williams: A Hyper-Inflationary Great Depression Is Coming. I picked up this last article from the general news. I haven't a clue what kind of credibility this has.


2010-5-5:  The markets fell again today on European debt concerns:
    Treasury yields hit 2010 lows on Europe fears  
    Speculators drawing a bead on Spain    
    Moody's: Portugal bond ratings under review  
    Todd Harrison: Code-red time in Europe?     
  . The NASDAQ Composite sank
21.96 points (-0.96%) to close at 2,402.29, the Dow dropped 58.65 points (-0.54%) to 10,868.12, and the S&P 500 dipped 7.33 points (-2.38%0.66%) to end the day at 1,165.87. Oil dropped $3.19 to $79.97 a barrel, while Gold added $7 to close at $1,176. The VIX jumped 1.07 to 24.91 .
    Paul Krugman has a thought-provoking article tonight Permanent Link to Greek End Game tonight that points out that a Greek default is, perhaps, too optimistic(!) The real and greater threat is "that Greece will end up leaving the Euro, too." In the meantime, austerity measures on the part of the Greek government have led to violent, deadly riots: Protests over austerity measures turn deadly.
    The article The real euro story: U.S. is back tends, maybe, to put this European situation in perspective. The U. S. dollar has risen because it has been perceived as a safe haven in a perilous storm. This rising dollar has contributed to a falling stock market that has been  primed to fall at any time, and has just been waiting for a trigger. A week ago today, I linked to Mark Hulbert's article explaining that foreign economic crises like this have arisen several times in the past, but have been resolved: A Greek tragicomedy.
    If you haven't already sold, you may want to ride this out. In all likelihood, the market will correct over a period of weeks or months, and then work its way up to new highs.
    Of course, the 2008 meltdown started this way, too, creeping up on everyone until it finally pounced. (The trigger was the collapse of Lehman Brothers, leading to money market funds "breaking the buck", with a run on funds and bank accounts only days away.)
    Mark Hulbert notes that there are Fewer and fewer good-quality stocks.
    Stock market futures are moving up tonight.

2010-5-5 (Morning):  My investment advisory newsletter observes this morning that the markets may bounce, but that there has been a decay in the fundamentals over the past week. And let's face it, this market is overdue for one of its periodic pullbacks. (Please see the charts below.)
    It's also the case that, with the economy on the mend, this is, presumably, still a cyclical bull market. In Europe, things may have to get bad enough to justify decisive measures before taking decisive measures can become politically acceptable. Of course, all of this thinking is priced into the stock market. But it may be safe to simply ride out this market pullback, and wait for it to rise again above its present level.. 


2010-5-4:  In spite of the fact that there was good economic news today: April likely to show on-track consumer recovery , the markets have crashed:  U.S. stocks down sharply as world troubles weigh, Ugly day on Street, and Spain, Portugal CDS spreads climb further   
 . The NASDAQ Composite dove
74.49 points (-2.98%98%) gain to close at 2,424.25, the Dow plummeted 222.19 points (-1.99%)99%) to 11,929.64, and the S&P 500 free-fell 28.66 points (-2.38%2.38%) to end the day at 1,173.60. Oil dropped $3.49 to $82.68 a barrel, while Gold fell $10 to close at $1,174. The VIX jumped 4 to .
   
My investment advisory service sent out a "
sell" signal to its subscribers just before today's close. If you failed to sell today, you can probably do about as well selling tomorrow morning.
    Tonight, after the markets closed, the China and Emerging markets Report sent a special bulletin observing that the Halter (Chinese) Index has punched below its 50-day moving average. The Report recommends selling a portion of the portfolio but holding onto the rest of it.
    These "buys" and "sells" are rule-based, and don't depend upon soul-searching, seat-of-the-pants decisions. They can be wrong, but they're designed to prevent major carnage.
   
Paul Farrell writes: The Goldman conspiracy, and Mark Hulbert observes that High level of bullishness greases skids of correction .
   
Two downbeat articles were: A retail recovery could be short-lived , and Pimco's El-Erian: Greek crisis is not over.
    Michael Ashbaugh comments that U.S. markets threaten technical shift: Ashbaugh.
    Market futures are down slightly tonight.  

2010-5-4 (Just Before the Close):  SELL!  My investment advisory service, correct 80% of the time, has just issued a "Sell!" signal (the first since early this year).

2010-5
-4 (Late Morning):
  The Dow and the S&P 500 have both broken below their 25-day moving averages, and are flirting with their 50-day moving averages. Any further deterioration will lead to a "sell" signal. The current malaise is coming from fears that the member countries of the European Union won't approve the bailout package that has been crafted to save Greece from default, and a threat of a downgrading of Spain's debt.
    Stay tuned.


2010-5-3:  The market indices have risen more than 1% today on the back of more good news: Manufacturing expands again, and Consumers are back. The NASDAQ Composite rose 37.55 points (1.53%) gain to close at 2,498.74, the Dow advanced 143.22 points (1.3%) to 11,151.83, and the S&P 500 tacked on 15.57 points (1.37%) to end the day at 1,202.26. Oil was essentially unchanged at $86.18 a barrel, while Gold added $2 to close at $1,183. The VIX fell 1.86 to 21.89. 
    Mark Hulbert offers Financials that are better than Goldman, and Peter Brimelow writes about Head and shoulders vs. Dow Theory
    In Searching for great deals, four investment advisors suggest strategies for making money in May: 
- Gilani: Play the VIX in May; 

- Kahn: Hot solar stocks, 
- Hulbert: Retail, leisure stocks, and      
- Murphy: Three biotech picks.      
    See the full special report for story links, video clips, more.  
    Here are additional articles by Wall Street insiders.
    Houses ... and the lying liars who sell them  
    'Buy' means 'sell' in Goldman's world Outside the Box:- MarketWatch  
    Goldman case shows Wall Street's true colors      

2010-5-2:  Market futures are up a bit tonight, probably because a rescue plan with teeth in it has been crafted for Greece.


2010-4-30:  The markets broke down today, falling more than it rose yesterday..  The NASDAQ Composite tumbled 50.73 points (-2.02%) gain to close at 2,461.19, the Dow crumbled 158.71 points (-1.42%) to 11,008.61, and the S&P 500 stumbled 20.09 points (-1.67%) to end the day at 1,186.69. Oil increased to $86.15 a barrel, while Gold added $12 to close at $1,181. The VIX fell 3.61 to 22.65
    Why this sell-off? My investment advisory service suggests that it's because +there are clouds overhanging the markets this weekend (Spain downgraded by Fifa, too, and Mark Hulbert's Sentiment nears dangerous levels), and traders may have chosen to sell out of risky positions until Monday to make sure they aren't caught short over the weekend. We'll know on Monday whether this was just a programmed-trading maneuver or whether it signifies the beginning of a more audacious pullback.
    Among the articles that seemed as though they might be useful are: Street's Goldman reaction may be an overreaction, and Willard tells how to play Goldman now.
    Several articles:
Web sites let you invest like the top pros
Five China investments to make right now
The dividend strategies that best juice returns
How to climb the stock market's wall of worry,
concern investment strategies. Here are two other general-information articles.
    Labor force polarized as middle-skill jobs vanish 
    The back story of the great Apple-Adobe rift


2010-4-29:  The markets galloped upward again today. The NASDAQ Composite posted a 40.19 points (1.63%) gain to close at 2,511.92, the Dow gained 122.15 points (1.1%) to 11,107.32, and the S&P 500 added 15.42 points (1.29%) to end the day at 1,206.78. Oil rebounded to $85.30 a barrel, while Gold subtracted $4 to close at $1,168. The VIX fell 2.64 to 17.44
   
There was quite a lot of good news today that helped offset concerns over the Grecian issue. Most of this good news involved individual earnings reports, but initial jobless claims were also lower: Initial jobless claims fall by 11,000 to 448,000.
    Peter Brimelow writes: Paranoid bear has met enemy, still bearish.
    An Elliott wave theorist proposes: Don't worry about downward Dow -- yet .
    David Callaway posits that the Fed is delaying a day of reckoning that must soon impact the stock market: Fed can't delay market storm: David Callaway.
    And in the "Winter of Our Discontent" vein come Todd Harricon's Poster child for class warfare, and Goldman's glitzy new home.
    Stock market futures are down slightly tonight.   


2010-4-28:  The markets moved up today, in spite of the fact that Standard & Poors added Spain to its list of downgraded sovereign lenders: S&P rains down on Spain. The NASDAQ Composite minced up 0.26 points (0.01%) to close at 2,471.73, the Dow gained 53.28 points (0.48%) to 11,045.27, and the S&P 500 added 7.65 points (0.65%) to end the day at 1,196.36. Oil rebounded to $83.32 a barrel, while Gold added $3 to close at $1,172. The VIX fell 1.73 to 20.08.
    In A Greek tragicomedy, Mark Hulbert explains why Wall Street hasn't been more distraught than it has over the unfolding European sovereign credit imbroglio. Similar regional crises have arisen in the past, and have been contained.
    This morning's early articles were more concerned about the Eurozone dangers:  'De-facto' Greek default 80% sure: Global Insight; Europe fears next shoe — if Greece falls; Crib notes for contagion; The way out: Four difficult steps; than were the day's ater articles: Gravity's grip; and European CDS spreads drop with rising bailout bets.
    My investment advisory service was quite concerned over the effects of this impromptu market reversal, but not enough to warrant any portfolio changes. Other market news was good. There were improvements in consumer confidence, in the Case/Schiller housing index, and in the Richmond Fed Manufacturing Index. With today's recovery, immediate sell recommendations may not be in the offing.
    The problem is that downgrading of Greek, Portuguese, and Spanish bonds raises the costs of borrowing for countries that can least afford to pay high interest rates: My big fat Greek market bloodbath. Furthermore, the rates for all European countries tend to rise when confidence in one or a few of them is shaken. It's like a run on the banks. In September, 2008, the U. S. Federal Reserve thwarted a run on U. S. money market funds that threatened to lead within days to a run on U. S. banks. (Once people start to run scared, they tend to withdraw their money and ask questions afterward.) Unfortunately for present purposes, unlike the U. S., the EU doesn't have centralized fiscal and political institutions that can act fast in an emergency. Also, there's a great deal of civic discontent over what's happening. But the risk here is that of falling dominoes.  
    For whatever it may be worth, market futures are flat tonight.
    Paul Krugman's latest article on the European Union crisis, Permanent Link to How Reversible Is The Euro?, ends with "I think I'll go hide under the table now."


2010-4-27:  The markets took dives into the canvas today, dropping by 2%-or-more, on S&P's downgrading of Greek sovereign debt to junk status, with Portuguese debt ratings not far behind: Greece cut to junk, Greek, Portuguese ratings reignite debt crisis. The NASDAQ Composite tumbled 51.48 points (-2.04%) to close at 2,471.47, the Dow plunged 213.04 points (-1.9%) to 10,991.99, and the S&P 500 shed 28.34 points (-2.34%) to end the day at 1,212.05. Oil fell to $81.80 a barrel, while Gold added $17 to close at $1,170. The VIX rose 5.34 to 21.81.
    Paul Krugman is quite concerned about the consequences of the sovereign debt situation: Permanent Link to The Cohesion Crisis, opining that Greece will probably have to default on its debt. Todd Harrison sees this Greek debt situation as a possible replay of the 2008 bank meltdown, except that this time, there's no overall government that can ride to the rescue: A Five-Step Guide to Contagion. (However, the Greek and Portuguese bailouts would add up to an order-of-magnitude less than the funding required for the 2008 bank bailouts.) Michael Ashbaugh, in his weekly technical analysis of the market indices, notes that these Greek debt crises have had only short-term effects on the financial indices, suggesting that this might be a good time to buy: Staking out the S&P's near-term technical support. He mentions that the intermediate-term trend is still up and still intact. (Stock market futures are slightly positive tonight.)
    My investment advisory service hasn't warned of dire consequences from this contretemps.
    What am I going to do tomorrow? If my investment advisory service doesn't indicate otherwise, and if stock market futures are up tomorrow morning, I may do some bargain-hunting, picking up additional shares of the NASDAQ 2X Fund QLD and a few Chinese bellweathers.
    For anyone seeking commentaries that make the bearish case, Investment portfolio for the truly paranoid, and Paul Farrell's Six investing rules for a worst-case scenario ought to fill the bill.
    A couple of articles dealing with the public reactions to what's coming to light on Wall Street are GM's False Claim That Bailout Was Paid Back "in Full" Breaks Advertising's Rule No.1 and Goldman Knowingly Sold Garbage Barges.
    Mark Hulbert writes Wall Street cheer absent on Main Street. He explains that Wall Street is giddy with the stock market returns of the past year, but individual investors have put virtually all of their money in bond funds, followed by international funds, with only a percent or two allocated to domestic stock funds. Individual investors are convinced that the system is rigged against them, and is playing games with them. He notes that we have to look back to the 1974-1982 period to find a similar period of disillusionment, and that this period was part of an 8-year secular bear market that didn't end until the indices hit bottom in August, 1982. Well, yeah, that's the way I see things panning out. I don't expect the current secular bear market to end until sometime between 2014-2018. 
2010-4-27:  The markets took dives into the canvas today, dropping by 2%-or-more, on S&P's downgrading of Greek sovereign debt to junk status, with Portuguese debt ratings not far behind: Greece cut to junk, Greek, Portuguese ratings reignite debt crisis.
The NASDAQ Composite tumbled 51.48 points (-2.04%) to close at 2,471.47, the Dow plunged 213.04 points (-1.9%) to 10,991.99, and the S&P 500 shed 28.34 points (-2.34%) to end the day at 1,212.05. Oil fell to $81.80 a barrel, while Gold added $17 to close at $1,170. The VIX rose 5.34 to 21.81.
    Paul Krugman is quite concerned about the consequences of the sovereign debt situation: Permanent Link to The Cohesion Crisis, opining that Greece will probably have to default on its debt. Todd Harrison sees this Greek debt situation as a possible replay of the 2008 bank meltdown, except that this time, there's no overall government that can ride to the rescue: A Five-Step Guide to Contagion. (However, the Greek and Portuguese bailouts would add up to an order-of-magnitude less than the funding required for the 2008 bank bailouts.) Michael Ashbaugh, in his weekly technical analysis of the market indices, notes that these Greek debt crises have had only short-term effects on the financial indices, suggesting that this might be a good time to buy: Staking out the S&P's near-term technical support. He mentions that the intermediate-term trend is still up and still intact. (Stock market futures are slightly positive tonight.)
    My investment advisory service hasn't warned of dire consequences from this contretemps.
    What am I going to do tomorrow? If my investment advisory service doesn't indicate otherwise, and if stock market futures are up tomorrow morning, I may do some bargain-hunting, picking up additional shares of the NASDAQ 2X Fund QLD and a few Chinese bellweathers.
    For anyone seeking commentaries that make the bearish case, Investment portfolio for the truly paranoid, and Paul Farrell's Six investing rules for a worst-case scenario ought to fill the bill.
    A couple of articles dealing with the public reactions to what's coming to light on Wall Street are GM's False Claim That Bailout Was Paid Back "in Full" Breaks Advertising's Rule No.1 and Goldman Knowingly Sold Garbage Barges.
    Mark Hulbert writes Wall Street cheer absent on Main Street. He explains that Wall Street is giddy with the stock market returns of the past year, but individual investors have put virtually all of their money in bond funds, followed by international funds, with only a percent or two allocated to domestic stock funds. Individual investors are convinced that the system is rigged against them, and is playing games with them. He notes that we have to look back to the 1974-1982 period to find a similar period of disillusionment, and that this period was part of an 8-year secular bear market that didn't end until the indices hit bottom in August, 1982. Well, yeah, that's the way I see things panning out. I don't expect the current secular bear market to end until sometime between 2014-2018. In the meantime, I'll use moving averages and my investment advisory services to tell me when to buy and when to sell.

    
    


2010-4-26:  After soaring overnight, the markets fell back a little today: Sixth straight gain for Dow ... barely. The NASDAQ Composite lost 7.2 points, (-0.28%) to close at 2,522.95, the Dow inched up 0.75 points (0.01%), to 11,205.03, and the S&P 500 dropped 5.23 points (-0.45%) to close at 1,212.05. Oil fell to $83.82 a barrel, while Gold was unchanged at $1,154. The VIX rose 0.85 to 17.87.
    My investment advisory service observes that a recovery is virtually assured. The markets are quite "overbought" on a short-term basis, but intermediate-term, all their indicators look good. Still, an intermediate-term (two month) reversal could occur at any time. Otherwise, there isn't much news.
    Economist Andy Xie writes: China's economy gone wild.


2010-4-23:  Once again, the indices have moved higher, establishing new 2009-2010 highs, perhaps because of upbeat housing sales in March:.New-home sales on march The NASDAQ Composite jumped 69.99 points, (0.63%) to close at 2,530.15, the Dow eased up 9.37 points (0.08%), to 11,204.28, and the S&P 500 tacked on 8.61 points (0.71%) to close at 1,217.28. Oil hit $85.12 a barrel, while Gold climbed to $1,154. The VIX again increased 0.15 to 16.62.
    The indices are pretty well holding to their trend lines. At some point, an inevitable pullback will have to occur: "Sell in May and go away"? In the meantime, the markets are continuing to climb in stealth mode.
    In the meantime, the Chinese index ETF, FXI (See the chart below), has dropped to its 25-day trend line, making Chinese stocks better buys than usual. I like (and own) the January, 2012, FXI $25 call, giving me roughly 2:1 leverage on the FXI China index fund.


2010-4-22:  After spending the day underwater, the indices rose a bit today at the close. The NASDAQ Composite edged up 14.46 points, (0.58% to close at 2,519.07, the Dow eased up 9.37 points (0.08%), to 11,134.29, and the S&P 500 rose 2.73 points (0.23%) to close at 1,208.67. Oil was all-but-unchanged at $83.56 a barrel, while Gold subtracted $3 to close at $1,140. The VIX increased 0.15 to 16.47.
    Three investment advisory articles are linked here: Latin America's perfect decade, Spilled blood would bury mortgage fraudsters, and Apple stock to reach $1,000? (video).
    My investment advisory service attributes today's initial market plunge to fresh worries over sovereign debt, including some bigger players than Greece.


2010-4-21:  The indices closed little-changed and mixed today. The NASDAQ Composite edged up 4.3 points, (0.17% to close at 2,504.61, the Dow eased up 7.86 points (0.07%), to 11,124.92, and the S&P 500 slipped  1.23 points (-0.1%) to close at 1,205.94. Oil moved rose to $83.75 a barrel, while Gold added $9 to close at $1,148. The VIX increased 0.56 to 16.28.
    Goldman Sachs continues to attract commentaries: Abacus octopus, The good war?, Goldman Sachs: The Poster Child for Class Warfare, and Goldman Lawsuit Tip of the Iceberg?  
    Mark Hulbert writes about A rare buy signal with a good record. This signal, provided by Ned Davis Research, just occurred, rarely occurs, and foretells a market that, on average, is 38% higher a year later. Ned Davis warns that there are no certainties in the marketplace, but also states: "When would it have paid to go against this indicator?"
    My investment advisory service has also mentioned several of these rare bull-market signals over the past six months that have predicted considerably higher stock prices over the next year or two..
    Stock market futures are down modestly tonight.


2010-4-20:  The indices have climbed again today. The NASDAQ Composite jumped 20.2 points, (0.81% to close at 2,500.31, the Dow climbed 25.01 points (0.23%), to 11,117.06, and the S&P 500 advanced 9.69 points (0.81%) to close at 1,207.17. Oil moved down sharply to $82.99 a barrel, while Gold added $2 to close at $1,139. The VIX leaped 1.61 to 15.73.
    Tonight, after hours, Yahoo and Apple have reported strong profits, and market futures are up modestly.
    There are several articles tonight dealing with the SEC's charges that Goldman Sachs defrauded its investors:
Goldman signals defiance, Top Goldman lawyer 'disappointed' at SEC, Counsel: We'd never intentionally mislead (audio), Gasparino and Friedman talk Goldman, and CDO case steals Goldman's profit thunder
    It's reached the point where even Wall Street columnists are appalled at the looting that's taking place: Wall Street robs investors -- again, Ten things we can learn from Michael Lewis, and
Obama vs. Goldman's Reaganomics.
    In
Fuld recalls Lehman's last days, Richard Fuld, the former CEO of Lehman Brothers, is allegedly denying any wrongdoing on his, or Lehman Brothers' part.


2010-4-19:  The indices have ended the day with the NASDAQ down 1 point, but with the Dow and the S&P 500 up. The NASDAQ Composite was off 1.15 points, (-0.05%) to close at 2,480.11, the Dow climbed 73.39 points (0.67%), to 11,1092.05, and the S&P 500 advanced 5.39 points (0.45%) to close at 1,197.52. Oil moved down sharply to $81.63 a barrel, while Gold shaved $2 to close at $1,136. The VIX leaped 1.02 to 17.34.
    Positive news, such as the pre-opening announcement: March leading indicators rise; recovery continuing, seems to have turned last night's downturn around.  
    Craig Stephens warns that things look ominous in China: Happily ever after for Goldilocks economy Craig Stephen's This Week in China - MarketWatch.
    Market futures are minutely negative tonight... basically neutral.
2010-4-19 (Monday Morning):  The indices have gone positive this morning! (Go figure.)


2010-4-18:  The indices are down horridly tonight, more than they were on Friday, with the Nasdaq down 32 points the Dow off 145 points, and the S&P 500 underwater by 23 points, and the indices are continuing to fall. My investment advisory service suggests that this could be the right-on-schedule beginning of another pullback.


2010-4-16:  The Dow tumbled triple digits today: Goldman spooks the Street. The NASDAQ Composite plunged 34.43 points, (-1.34%) to close at 2,481.26, the Dow dove 125.91 points (-1.13%), to 11,1018.66, and the S&P 500 fell a resounding 19.54 points (-1.16%) to close at 1,191.16. Oil moved down sharply to $82.97 a barrel, while Gold plummeted $23 to close at $1,138. The VIX leaped 2.47 to 18.36.
   
The markets apparently tanked today on news that Goldman Sachs has been charged by the SEC with outright, deliberate manipulation and fraud. My investment advisory service suggests that pullbacks on bad news like this rarely last, and that it might be a good time to buy. In the meantime, money is continuing to pour into stocks now that a recovery seems virtually assured.
    Mark Hulbert writes that although stocks have continued to climb lately, investment advice has become more pessimistic, which, from a contrarian viewpoint, is bullish: The bulls are smiling  
    A golden mystery discusses the paradox of gold falling when the news is bad and should provoke a flight to quality (viz.: gold).


2010-4-15:  The markets eked out uneven gains today.  The NASDAQ Composite added 10.03 points, (0.43%) to close at 2,515.69, the Dow sidled up 21.46 points (0.19%), to 11,144.57, and the S&P 500 added a meager 1.02 points (0.08%) to close at 1,211.67. Oil moved down slightly to $85.23 a barrel, while Gold ended at $1,159. The VIX rose a trifle to 15.89.
    The markets fell this morning after am unexpected rise in the unemployment rate, but this may have arisen because of the Easter holiday: Jobless claims up in second straight increase.
    Peter Brimelow observes that Sound advice was sound. ("Sound Advice" is the name of an investment advisory firm.)

    Kevin Marder advises: Ignore the technical market at your peril
   
Tracking the VIX suggests that the behavior of the VIX (Volatility Index) isn't typical of a market top.
    Market futures are down significantly tonight (0.33%)  Google and Advanced Micro Devices have disappointed: Google tumbles; AMD falls after reports.
    Two other interesting news releases are A new order of the ages?, and Can Republicans remain the Party of 'No'? (video).


2010-4-14:  The markets "broke out" higher today (though not above their intermediate-term trend lines) in the face of more economic good news: Bernanke paints picture, Heider: We're in the middle of 'V' recovery (audio), and Inflation's at a standstill in March. The NASDAQ Composite added 38.87 points, (1.58%) to close at 2,504.86, the Dow sidled up 103.69 points (0.94%), to 11,123.11, and the S&P 500 added a meager 13.35 points (1.12%) to close at 1,210.65. Oil moved up tot $85.96 a barrel, while Gold stayed put at $1,156. The VIX moved down  0.41 to close at 15.79.
    Hearty earnings helped keep the markets' mini-rallies in gear: Bulls keep rally alive with 5. Mark Hulbert warns us that The insiders pick up their selling.
    The Dow would have to reach something like 11,400 to bump up against its intermediate-term (since March, 2009) trend line, and the S&P 500 would have to clear something like 1,240 to assault its trend line, or about 2½ % above where they are now to reach the upper boundaries of their channels.
    The NASDAQ Composite is probably already at its upper trend line..


2010-4-13:  The markets creaked slightly higher again today. The NASDAQ Composite added 8.12 points, (0.33%) to close at 2,465.99, the Dow sidled up 13.45 points (0.12%), to 11,019.42, and the S&P 500 added a meager 0.82 points (0.07%) to close at 1,197.30. Oil was essentially unchanged at $84.33 a barrel, as was Gold at $1,156. The VIX moved up 0.62 to close at 16.20(!) (There must be a story behind the escalation of the VIX, but I don't know what it is.)
    The Fed's Lacker says recovery still distant "from one of the deepest recessions on record". Another article says, "You call this a recovery?"
     Michael Ashbaugh's weekly column is on tap: Ashbaugh's eye on S&P. while Mark Hulbert writes that the Struggle to close above 11,000 is telling. He advises us to see whether the Dow will surge this week, or whether we'll witness "the listless meandering of a tired market".
    Paul Farrell replays some of the advice handed out in the fall of 2007 and in early 2008 in: New Dow high ahead? Happy talk feeds sheep
    The market indices are up a little tonight.


2010-4-12:  The markets inched a little higher: Dow industrials to 11,000, Stores signal shoppers are back in malls. The NASDAQ Composite added 3.82 points, (0.16%) to close at 2,457.87, the Dow sidled up 9.07 points (0.08%), to close above 11,000, at 11,006.42, and the S&P 500 acdded 2.11 points (0.18%), closing at 1,196.48. Oil retreated to $84.27 a barrel, while Gold closed down slightly at $1,157. The VIX moved down 0.56 to close at 15.58.
    Tomorrow is "Turnaround Tuesday", and stocks are down a bit tonight.
    The market indices are close to their upper trend lines. My investment advisory service is primed for a reversal, but that hasn't happened yet, and until it does, the service' advice will be to stay fully invested. 
    Earnings season began with Alcoa's report after today's close. Alcoa's earnings weren't as bad as expected, but they weren't terribly good, either. There may be a bit of hesitation over the next few days.
    How to invest for end of world - video.


2010-4-11:  Stock market futures are up sharply tonight (about 1%), probably because of a bailout plan just announced for Greece. 


2010-4-9:  The markets strutted to new highs today:  Dow industrials to 11,000, Stores signal shoppers are back in malls. The NASDAQ Composite rose 17.54 points, (0.71%) to close at 2,454.05, the Dow regained 70.28 points (0.64%), briefly penetrating the Dow = 11,000 line before falling back to 10,997.35, and the S&P 500 accrued 7.93 points (0.67%), closing at 1,194.37. Oil retreated to $84.92 a barrel, while Gold closed at $1,161. The VIX moved down 0.34 to close at 16.14.
   
Where do we go from here? Mark Hulbert writes, Market correction could be coming.
    One of the interesting contemplations for me is the fact that everyone is expecting a correction of 5% or greater, and that, like me, they can see that it should occur right around an S&P 500 level of 1,200, or in other words, about where the markets are right now. Does that mean that this won't happen? (On the other hand, the VIX is getting down into relatively complacent territory.) 
    A reader recently resurrected Todd Harrison's mid-2009 warnings about the "widow's peak" and the "W"-shaped recovery that he predicted that didn't happen. Of course, Paul Krugman was in the same camp.
    Great Leap Forward: Five-ways-to-play-the-China-market-now: 2010-04-09  


2010-4-8:  The markets moved back up today: Market Snapshot: Bulls head back to 11,000, Stores signal shoppers are back in malls. The NASDAQ Composite rose 5.65 points (precisely as much as it fell yesterday), (0.23%) to close at 2,436.81, the Dow regained 29.55 points (0.27%) to close at 10,927.07, and the S&P 500 disgorged 3.99 points (0.34%), closing at 1,186,44. Oil was essentially unchanged at $85.70 a barrel, while Gold closed at $1,152. The VIX moved down 0.14 to close at 16.48.
   
Where do we go from here? With hope rising, is the end near for stocks?, while Peter Brimelow writes: Advance/Decline line signals bull market.
     Also of possible interest: Was this a 'Great Recession':, Market Edge: Deficit protection.


2010-4-7:  The markets fell today on a dismal report on consumer confidence: Street takes late-day slide.. The NASDAQ Composite fell 5.65 points, (-0.23%) to close at 2,431.16, the Dow tumbled 72.47 points (-0.66%) to close at 10,897.52, within 30 points of 12,000, and the S&P 500 disgorged 6.99 points (-0.59%), closing at 1,182.45. Oil jumped to $85.88 a barrel, while Gold rose to $1,153. The VIX moved up 0.39 to close at 16.66.
   
As I mentioned last night, the markets are extremely overbought on an intermediate-term basis. This article puts it in perspective: Market Snapshot: Down day called overdue. Mark Hulbert offers: Some worth more than in October 2007, and Todd Harrison talks about Using markets past to navigate the present. In one of the comments on this article, a reader 
   Today may have been a "bad-news day", representing an opportunity to buy on a slight pullback rather than the beginning of another down-wave. Still, the stock market is vulnerable to a reversal at any time.
   Here are two other articles that might or might not be of interest: Steep trader pay on Wall Street is no surprise, and Goldman still doesn't get it.  


2010-4-6:  The markets ended the day little changed: Dow dips, S&P 500 gains, Retail rallies on best monthly sales in 16 years. The NASDAQ Composite rose 7.28 points, (0.3%) to close at 2,436.81, the Dow slipped down 3.56 points (-0.03%) to close at 10,969.99, within 30 points of 12,000, and the S&P 500 slipped up 2.00 points (0.17%), closing at 1,189.44. Oil jumped to $86.74 a barrel, while Gold rose to $1,132. The VIX dropped 0.79 to close at 16.23.
    
My investment advisory service observes that the markets are extremely overbought on an intermediate-term basis, but their still positive until they turn negative. Looking at the charts, they appeared to be forming a top last week, but then they pushed through to a new round of highs. At the same time, if the S&P 500 reaches 1,200, it will have hit the upper trend line that has been topping the dips for the past year. If interest rates on 10-year Treasuries rise much above 4%, that could also adversely impact equity prices.
     David Weidner writes: Bailed-out banks feast on bankrupt customers.
     Michael Ashbaugh writes: S&P 500 lifts within view of major resistance.


2010-4-5:  The markets galloped uphill again today, with all three major market indices hitting new highs: Stocks, oil, bonds recoup most of their losses, and Dow just shy of 11,000 level. The NASDAQ Composite rose 26.95 points, (01.12%%) to close at 2,429.53, the Dow added 46.48 points (0.43%) to close at 10,973.55,  and the S&P 500 advanced 9.34 points (0.79%), closing at 1,187.44. Oil jumped to $86.74 a barrel, while Gold rose to $1,132. The VIX dropped 0.3 to close at 17.17.
    Mark Hulbert advises us that Dow 11,000 is not a big deal, while Peter Brimelow updates us concerning Radical gold bugs vs. Wall Street
  
    Meanwhile, interest rates are rising: Back up to 4%. Although the Fed is holding its interest rate at 0.25%, the general market is pricing a recovery into interest rates, as are crude oil prices. Price targets  for Apple computer shares are being repriced upwards (to $300 a share) after a strong 1st-day showing for the iPad: .
    Market futures are down slightly tonight.


2010-4-1:  The markets charged back up today; Bulls gulping up April fuel, and  Manufacturing index at 6-yr. high. The NASDAQ Composite rose 4.62 points, (0.19%) to close at 2,402.58, the Dow added 70.44 points (0.65%) to close at 10,927.07,  and the S&P 500 advanced 8.67 points (0.74%), closing at 1,17810. Oil jumped to $84.87 a barrel, while Gold rose to $1,114\\26. The VIX dropped 0.12 to close at 17.47.
    
Peter Brimelow reports that the Aden sisters have reversed their aversion to  stocks, at least for the intermediate term: Adens turn bullish on stocks, economy.  
    Two other warnings: Rebound is real — but fragile, and Recovery to be quite muted: Fed's Dudley. Among other news: Top guys' bottom lines, and Wall Street more powerful now?


2010-3-31:  The markets fell somewhat today: ADP data reflect continued U.S. job losses. The NASDAQ Composite gave back 12.73 points, (-0.53%) to close at 2,397.96 , the Dow shed 50.79 points (-0.47%) to close at 10,856.63 (Dow creeps toward 11,000)and the S&P 500, declined 3.84 points (-0.33%), closed at 1,169.43. Oil fell slightly to $83.33 a barrel, while Gold rose to $1,114. The VIX increased 0.46 to close at 17.59.
   
This S&P 500 article, 'Way too late to chase the market,' S&P says, sets a 2010 year-end goal for the S&P 500 of 1,215. Since it recently reached 1,180, that doesn't look like much of a prospect for the year. My investment advisory service is ready to reverse course at any time, but is still registering strong intermediate-term upward momentum. Stay tuned.
    Stock market futures are mixed tonight.


2010-3-30:  The markets rose slightly today. The NASDAQ Composite added 6.33 points, (0.23%) to close at 2,410.69 , the Dow annexed 11.56 points (0.11%) to close at 10,907.42 (Dow creeps toward 11,000) and the S&P 500, which was unchanged at 0.05 points (0.00%), closed at 1,173.27. Oil rose slightly to $82.55 a barrel, while gold fell slightly to $1,106. The VIX fell 0.46 to close at 17.13.
    The markets are still inching upward. My advisory service observes that ends of quarters are typically tepid, especially with
Mixed news on the homes front
    Michael Ashbaugh weighs in on Chin today: Ashbaugh weighs China play, and Paul Farrell discusses How Lazy Portfolios will whip 2010 collapse.
  
  One money pro offers a peek at his finances  
    Stock market futures are down a little tonight ahead of the last day of the first quarter of 2010.


2010-3-29:  The markets rose smartly today and stayed there. The NASDAQ Composite gained 9.23 points, (0.39%) to close at 2,404.36 , the Dow annexed 45.5 points (0.42%) to close at 10,895.86, and the S&P 500, climbed 6.63 points (0.57%), closed at 1,173.22. Oil jumped to $82.44 a barrel. Gold rose slightly to $1,112. The VIX fell 0.18 to close at 17.59.
    The markets are continuing to chug upward.
    Tonight's articles: Recovery driving stocks, and Springer: Follow the data... "When you invest with your head, things look pretty good."


2010-3-26:  The markets rose smartly today; then finished flat to down. The NASDAQ Composite slipped 2.28 points, (-0.1%) to close at 2,395.13 , the Dow annexed 9.15 points (0.08%) to close at 10,850.36, and the S&P 500, up minutely at 0.86 points (0.07%), closed at 1,166.59. Oil declined slightly to $80.13 a barrel. Gold rose slightly to $1,104. The VIX fell 0.63 to close at 17.77.
    Mark Hulbert notes that Thursday was a "key reversal day"  that may be signaling a top to the current market mini-cycle (The day the market topped), and of course, possibly, to the current cyclical bull market (although I personally doubt that). Sentiment has gotten entirely too bullish. If it turns around sharply, then perhaps the bull market can resume; otherwise, it's out to pasture for the bull. However, my investment advisory, while acknowledging the same concerns as those Mark Hulbert has expressed, concludes at least for the moment, intermediate-term momentum is still intact, and could carry equities higher before this wave exhausts itself. 
    Rising interest rates are said to be in the cards: When Bill Gross is bond-bearish, listen.  
    Another article, Banks as co-conspirators, suggests that some new chicanery may surface in conjunction with our suite of banking scandals..
   Two other articles: Corporate profits expand most in 25 years, and Eight lobbyists per lawmaker in health reform, tell their stories with their titles.


2010-3-25:  The markets rose smartly today; then finished flat to down. The NASDAQ Composite slipped 1.35 points, (-0.08%) to close at 2,397.41 , the Dow slipped up 5.06 points ((0.05%) to close at 10,841.21, and the S&P 500, after breeching the 1,180 high-water mark, ended off 1.99 points (-0.17%) to close at 1,165.73. Oil was essentially unchanged at $80.53 a barrel. Gold rose slightly to $1,092. The VIX rose a 0.85 to close at 18.40.
    There were several factors that entered into the day's price action: Dow forfeits 100-point gain. Basically, a rising dollar was behind the falling markets.
    When will U.S. stocks finally throw in towel? 
    Why won't emerging markets emerge?


2010-3-24:  The markets fell today in the face of the downgrading of Portugal's credit rating from AA to AA-, and lackluster durable goods and housing data: Retreat after two-day rally. The NASDAQ Composite dropped 16.48 points, (-0.68%) to close at 2,398.76 , the Dow slumped 52.68 points (-0.48%) to close at 10,836.15, and the S&P 500 ended off 6.45 points (-0.55%) to close at 1,167.72. Oil fell to $80.40 a barrel. Gold plummeted to $1,089. The VIX rose a sharp 1.2 to close at 17.83.
    Mark Hulbert's article states What bullish quarter means for the year, and Todd Harrison cites Ten reasons why this is not a bull market.
    Market futures are neither up nor down tonight.


2010-3-23:  The markets have moved up again today, breaking to new (post-March 2009) highs.  The NASDAQ Composite gained 19.84 points, (0.83%) to close at 2,415.24 , the Dow galloped 102.94 points (0.95%) to close at 10,888.83, and the S&P 500 mustered 8.36 points (0.72%) to close at 1,174.17. Oil closed down at $81.94 a barrel. Gold rose to $1,106. The VIX fell 0.54 to to a new post-March low of 16.33.
    One piece of bad news today: housing sales fell for the third month in a row: Existing condition, prompting Marketwatch' Dr. Irwin Kellner to pen: Where have all the (house) buyers gone?  I would offer the idea that the severe winter most of the country has faced might have something to do with this situation.
    Mark Hulbert avers: Market's rise on health reform was no surprise.  
    Micheal Aashbaugh, in his weekly technical column, observes: S&P 500 passes big test.
    Finally, Walmart has joined Best Buy in announcing that they will begin selling 3-D TVs before the year is up: 3-D TV for the masses. Of course, the success of 3-D TV will be contingent upon the availability of 3-D content. However, these big-box vendors probably wouldn't be adding 3-D TVs to their marketing lines if they weren't assured of a boost in 3-D TV programming.


2010-3-22:  Surprise, surprise! The markets moved up instead of down. The NASDAQ Composite regained 20.99 points, (0.88%) to close at 2,395.40 , the Dow rose 43.91 points (0.41%) to close at 10,785.89, and the S&P 500 recovered 5.91 points (0.51%) to close at 1,165.81. Oil closed down at $81.25 a barrel. Gold fell to $1,101. The VIX fell 0.1 to 16.87.
    Mark Hulbert notes that sentiment indicators are at dangerously optimistic levels:.Sentiment conditions not so bullish.  
    This article, Why there will be a double-dip, is strictly someone's individual opinion.
    The author of this article makes the interesting point that the expansion of medical insurance to cover many of those who are presently uninsured will expand medical services and call for more physicians: Marshall Loeb: Consequences of 219-212 vote.  

2010-3
-21 Early:
  Market indices are off about 1% tonight, presumably because a health care bill has been signed in the House of Representatives. This suggests to me that tomorrow will present a good, though short-lived, buying opportunity. You could probably buy on Monday and sell at a profit on Tuesday.


2010-3-19:  The market have fallen a bit. The NASDAQ Composite tumbled 16.87 points, (-0.71%) to close at 2,374.81 , the Dow subtracted 37.19 points (-0.35%) to close at 10,741.98, and the S&P 500 coughed up 5.93 points (-0.51%) to close at 1,159.90. Oil closed down at $80.58 a barrel. Gold fell to $1,107. The VIX rose (finally) 0.35 to 16.97.  
    There wasn't much news today. Today's retrenchment was on schedule.
    Here's an article that presents the case that if the government hadn't stepped in when it did, we would have gone down the tubes. During the week of September 16-23, 2008, when The Primary Fund "broke the buck" (see "2008-9-16"), I sold almost all of my stocks and transferred the money into a U. S. Treasury fund. I was also preparing to withdraw our money from the bank because the Federal Deposit Insurance Corporation was running low on insurance funds. We were facing a world divided into the the quick and the destitute. However unnecessary or unreasonable it might be, if runs begin on banks, you'd better be the among the first customers to arrive. Only swift action by the Federal Reserve that week kept a trickle from turning into a flood. Face it, the government saved us.


2010-3-18:  The market took a breather today. The NASDAQ Composite minced upward 2.19 points, (0.09%) to close at 2,391.28 , the Dow added 45.5 points (0.42%) to close at 10,779.17 (bringing the Dow solidly in line with the other indices, and also confirming a new high in the Transportation Index), and the S&P 500 dropped 0.38 points (-0.03%) to close at 1,165.83. Oil closed down at $82.20 a barrel. Gold remained at $1,125. The VIX fell another 0.29 to 16.62.  
    All the news today was good. So why didn't the markets soar? Probably because the markets are overbought over the short term. Some backing and filling, if not downright, decline, is due. My advisory service observes that the markets are approaching an overbought condition even in the intermediate term... the markets have become frothy. Still, the short-term and intermediate-term trends are still up.
    Tomorrow is a quadruple witching hour.
    The SEC's investor protection fantasy  
    Mark Hulbert writesL Letters that foresaw 2008 crash are skeptical, and Peter Brimelow explains that Superbear Allmon is still hibernating.
    Market futures are neutral-to-down tonight.
    A short-term pullback is manifestly in order here.


2010-3-17:  The markets treaded north again. The Dow finally caught up with the NASDAQ Composite and the S&P 500 in registering new post-March, 2009 highs. The NASDAQ Composite advanced 11.08 points, (0.47%) to close at 2,389.09 , the Dow added 47.69 points (0.45%) to close at 10,733.67, and the S&P 500 accrued 6.75 points (0.58%) to close at 1,166.21. Oil closed back up at $82.70 a barrel. Gold incremented to $1,125. The VIX fell another 0.78 to 16.91.  
    Right now, if this market wave brings the indices up to their trend lines, the S&P 500 would hit something like 1,190 before taking a dive again amid renewed talk about a double-dip recession. A typical draw-down might put the S&P 500 in the low 1100's, although the stock market never quite repeats itself.
    My investment advisory service assesses this to be a strong updraft that could carry the S&P 500 to 1200. But this isn't the best time to be buying.
    Rally looks frothy  


2010-3-16:  After reassuring words from the Fed, Same rates, same wording, the markets broke through resistance levels to resume their upward course. The NASDAQ Composite advanced 15.8 points, (0.67%) to close at 2,378.01 , the Dow added 43.83 points (0.41%) to close at 10,685.98, and the S&P 500 jumped 8.95 points (0.78%) to close at 1,159.46. Only the Dow has failed to exceed its recent high, but is within spitting distance of that point (10,725). Oil closed back up at $81.76 a barrel. Gold hopped up to $1,122. The VIX fell 0.42 (exactly as much as it rose yesterday) to 17.58.  
   Michael Ashbaugh's weekly column, Mid-caps break out, S&P 500 challenging resistance,  
    Mark Hulbert warns against making sports-related investment decisions during March: It's called March Madness for a reason.
    Another article, Catching up with small caps, warns that small caps, which have done very well over the past year, probably won't outperform during 2010. 
    Stock market futures are flat tonight.
    Using the 200-day moving average..


2010-3-15:  The markets marked time again today. The NASDAQ Composite fell 5.45 points, (-0.23%) to close at 2,362.21, , the Dow gained 17.46 points (0.16%) to close at 10,642.15, and the S&P 500 shimmied up 0.52 points (0.05%) to close at 1,150.51. Oil closed down at $79.58 a barrel. Gold slipped slightly to $1,106. The VIX rose 0.42 to 18.00.  
    Peter Brimelow writes: Yuan ruckus doesn't stop China bull.  
    My advisory service considers any pullbacks right now to be buying opportunities.
    Stock market futures are very slightly positive tonight.
   Paul Farrell writes, 'Wall Street' sequel an omen of U.S. collapse.


2010-3-12:  The markets marked time today, going nowhere. The NASDAQ Composite shrank 0.8 points, (-0.03%) to close at 2,367.66, , the Dow moved up  ascended 12.85 points (0.12%) to close at 10,624.69, and the S&P 500 subtracted 0.25 points (-0.02%)) to close at 1,149.99. Oil closed up at $81.24 a barrel. Gold slipped slightly to $1,107. The VIX was down 0.48 to 17.58.  
    It would appear that the market is near the tops of its current mini-cycle. It will probably have little farther to run, and will then pull back again to regroup. This isn't a good time to buy, and it could be a good time to sell if you wanted to play these waves. My investment advisory service is looking for a modest 2%-3%, 3-or-4-day  pullback within the present multi-week mini-cycle. They would be buyers on such a dip.
    Here are a few articles:  Beating the China policy sell-offJobless claims down,  Looming collapse in Greece just a myth, Some gold timers blame market for fall.
    Another article, This is the right time for stocks, argues that the breakout patterns for many stocks, coupled with the fact that the broad market is still outpacing the Dow, is indicative of a market that is going higher for at least the next six months.


2010-3-11:  The S&P 500 caught up with the NASDAQ Composite by making a new high for this year (by 0.01 points). The NASDAQ Composite gained 9.51 points, (0.4%) to close at 2,368.46, which is yet another new high after its 3/9/2009 low, the Dow moved up  44.51 points (0.42%) to close at 10,611.84, and the S&P 500 added 4.63 points (0.4%) to close at 1,150.24. Oil closed up at $82.18 a barrel. Gold was unchanged at $1,108. The VIX was down 0.51 to 18.51.  
    It would appear that the market is near the tops of its current mini-cycle. It will probably have little farther to run, and will then pull back again to regroup. This isn't a good time to buy, and it could be a good time to sell if you wanted to play these waves.
    Here are a few articles:  Beating the China policy sell-offJobless claims down,  Looming collapse in Greece just a myth, Some gold timers blame market for fall.


2010-3-10:  The NASDAQ and the S&P 500 were up yet again today. The NASDAQ Composite gained 18.27 points, (0.78%) to close at 2,358.95, which is yet another new high after its 3/9/2009 low, the Dow rose a measly  2.95 points (0.03%) to close at 10,567.33, and the S&P 500 acquired 5.16 points (0.45%) to close at 1,145.61. Oil closed up at $81.97 a barrel. Gold dropped to $1,108. The VIX was up (a good sign) 0.65 to 18.57.   
    Mark Hulbert asks the rhetorical question: Which letters called the market bottom?
    Todd Harrison has just delivered these thtree articles, The witch hunt widens on Wall Street, Random Thoughts: Crisis Averted!,and This is an interesting article regarding the VIX-S&P relationship.
   Here are two articles about 3D TV, Best Buy takes 3-D lead, and Digits: The push for 3-D TV., and here are two articles about electric cars: The future is now, and • China's BYD may build in California.
    Stock market futures are down tonight, seemingly in response to unpleasant inflation news out of China.


2010-3-9:  The markets closed up modestly today.  The NASDAQ Composite gained 8.47 points, (0.36%) to close at 2,340.68, which is another new high after its 3/9/2009 low, the Dow regained 11.86 points (11.86%) to close at 10,564.38, and the S&P 500 added 1.95 points (0.17%) to close at 1,140.45. Oil closed up at $81.55 a barrel. Gold dropped to $1,122. The VIX was up (a good sign) 0.13 to 17.92.
   Among the articles today are Michael Ashnaugh's Banks face exam: Ashbaugh, Mark Hulbert: What not to learn, Paul Farrell's The rise and certain fall of the American Empire, and David Weidner's Populist politics not Wall Street's cup of tea.  
    Futures are neutral tonight.


2010-3-8:  The markets closed flat for the day. The NASDAQ Composite was up 5.86 points, (0.25%) to close at 2,332.21, which is a new high after its 3/9/2009 low, the Dow fell 13.68 points (-0.13%) to close at 10,552.52, and the S&P 500 retrenched 0.2 points (-0.02%) to close at 1,138.50. Oil closed up at $81.75 a barrel. Gold dropped to $1,125. The VIX was up (a good sign) 0.37 to 17.79.
    In the commodities arena: Why the crystal ball is clouded.
    This article, Playing Year 2 of the bull market, notes that the second year of a bull market generally echoes the first. "Since 1949, Stovall said, small-caps have returned 22% on average in the second year of a rally, while large-caps rose 15%. Year Two's best sectors have been cyclical plays: consumer discretionary, financials, technology, and industrials." The article observes that the average lifespan for a cyclical bull market within a secular bear market (like the 1966-1982 super-bear market) is 17 months. (Seventeen months from March, 2009, will arrive in August, 2010.) The article also mentions that some emerging markets (China? Brazil?) are in secular bull markets. My investment advisory service warns that earnings are being overstated, and, given that we're in a secular (2000 - 2016?) secular bear market, we'll experience lower lows before the next secular bull market begins, but for now, the sort-term and intermediate-term trends are up.
    Arends: GE has been a disaster under Jeff Immelt
    Chuck Jaffe: Beware of numbers games  Mr. Jaffe is warning about mutual fund managers claiming great annual gains for their mutual funds without mentioning that longer-term, they're down.
    Don't follow the fad, say Callaway and Hulbert (video)


2010-3-5:  The markets roared today on truly good news. The February jobs report, Unemployment's in check, 'Job data signal economy turning corner (video)', The job-market and consumer news is good, and bad, while still showing a decline of 36,000 jobs (perhaps because of bad weather), fell less than expected, and continued the string of muted job losses that characterized the latter half of 2009 (see the chart below). Meanwhile, total unemployment remained steady at 9.7%. Next month's unemployment number may swing back above the line.
    Also, the (China) Halter Index rose back above both its 50-day and its 25-day moving averages.

    The NASDAQ Composite charged up
34.04 points, (1.48%) to close at 2,326.35, the Dow racked up 122.06 points (1.17%) to close at 10,566.20, and the S&P 500 ran up 15.73 points (1.4%) to close at 1,138.70. Oil closed up at $81.50 a barrel. Gold rose to $1,138. The VIX fell 1.3 to 17.42.
    The NASDAQ hit a new 2009-2010 high today, whereas the Dow and the S&P did not. Curiously, the markets advanced today even though the dollar also rose: Dollar up
    If the market indices fail to register new highs within the next week or two, it will suggest an intermediate market top in which the indices approach but don't quite reach their previous highs, and gradually work their way lower. But if the indices manage to  move a little higher, my advisory inputs have been suggesting rising markets through April or May, followed by a possible second leg of the recession. It will all depend upon whether the world's economies have been sufficiently stimulated to "re-prime the pumps", so that consumer demand can take up the slack left by the declining stimulus packages. 
    Mark Hulbert is warning that, now that it appears the economy is recovering, Advisory bullishness nears too-high levels. Generally, about the time professional investment managers quit lying awake nights worrying about a bear market, it's time for the next bear market to begin.
    Here's an article on Warren Buffett's prowess: Blown out by Warren Buffett, and here are some alternative energy articles: T. Boone Pickens' slimmer wind plan, Renewable energy faces opposition (video), ECO-nomics: Craig Venter on Making Synthetic Fuel (video), Doerr waiting for energy's 'Netscape moment', and The future of the electric car market.


2010-3-4:  The markets advanced today. The NASDAQ Composite ended up at 11.63 points, (0.51%) to close at 2,292.31, the Dow added 47.38 points (0.46%) to close at 10,444.14, and the S&P 500 climbed 4.18 points (0.37%) to close at 1,122.97. Oil closed up at $80.62 a barrel. Gold slipped to $1,134. The VIX fell 0.11 to 18.72.
   
  The news? U.S. jobless claims fall, halting run of advances, Productivity picks up pace, 30-year fixed-rate mortgage back below 5%, and U.S. factory orders rise 1.7% in January. Of course, the news wasn't all peaches and cream. There was also Monster's online employment index on the rise, and Pending home sales fall 7.6% in January.
  
   Stock market futures are slightly positive tonight. Meanwhile, the China Halter Index has turned up, and the China and Emerging Markets Report recommends buying back into Chinese stocks.


2010-3-3:  The markets headed up today, but fell back after a speech on the new health care bill by President Obama. The NASDAQ Composite closed down a sliver at 0.11 points, (0.00%) to close at 2,280.68, the Dow tumbled 9.22 points (-0.09%) to close at 10,396.76, and the S&P 500 crawled up 0.48 points (0.04%) to close at 1,118.79. Oil closed up at $80.93 a barrel. Gold surged again, ending the day at $1,144. The VIX fell 0.23 to 18.83.
   
Health care stocks fell today following the President's speech... which made it a good day to buy stocks. Although the weather may have skewed February's jobs reports, the pace of job losses is slowing. One advisor notes that last year's Market tailwinds are dead.
    Mark Hulbert has written about Active vs. passive investments, while Dogs of the Dow teach investors new tricks.
    Stock market futures are down slightly tonight.


2010-3-2:  It's "Turnaround Tuesday", and the markets have all but done that. The NASDAQ Composite laid on 7.22 points, (0.32%) to close at 2,280.79, the Dow squeaked up 2.19 points (0.76%) to close at 10,405.98, and the S&P 500 crawled up 2.6 points (0.23%) to close at 1,118.31. Oil closed at $79.74 a barrel. Gold surged, ending the day at $1,137. The VIX fell 0.19 to 19.07.
    Michael Ashbaugh notes that the indices have punched through their resistance levels (their 50-day moving averages): U.S. markets edge above significant resistance.
    Stock market futures are flat tonight. Other than that, there isn't much news.


2010-3-1:  Today saw higher market indices across the board: Street starts March strong; ; Spending rises; and Manufacturing expanding. The NASDAQ Composite pole-vaulteded 35.31 points, (1.58%) to close at 2,273.57, the Dow improved 78.53 points (0.76%) to close at 10,403.79, and the S&P 500 swelled  11.22 points (1.02%) to close at 1,115.71. Oil closed at $78,75 a barrel. Gold was essentially unchanged, ending the day at $1,118. The VIX fell 0.24 to 19.26.
    My investment advisory service advised that if the markets closed up as high tonight as they were this morning, they stand a good chance of revisiting their January highs. That would amount to 1,150 for the S&P 500, 2,320 for the NASDAQ, and 10,700 for the Dow.
    The indices aren't awfully far away from there. The NASDAQ is about 2% below its January high, and the Dow and the S&P 500 are still off about 3%.
    As the title implies, the heavy February snowstorms that swept the nation were responsible for declines in days worked (as well as, no doubt, other productivity deficiencies): Data set to reveal a job market clouded by storms in February  
    Peter Brimelow and Edwin Rubenstein write: Parsing 200 years of gold trades  This article notes that gold, after 175 years of fluctuating between $0.75 and $1.50, is currently trading at 3.26 times its inflation adjusted 1801 price.... i. e., its odds of falling are much greater than its odds of rising.
    Market static signals (video)  "Once-clear leading economic indicators such as the Treasury yield curve are now widely disputed. But what growth trend is priced into stocks?"


2010-2-28:  My investment advisory services consider last week's bullish response to Fed Chairman Bernanke's testimony to Congress to suggest a compelling short-term bullish signal. They're recommending accumulation upon weakness.
    Stock market futures are up about 0.45% tonight.


2010-2-26:  The markets managed to post slight gains today.  The NASDAQ Composite annexed 4.04 points, (0.18%) to close at 2,238.26, the Dow tiptoed up 4.23 points (0.04%) to close at 10,325.26, and the S&P 500 ended up 1.55 points (0.14%) to close at 1,104.49. Oil closed at $79.66 a barrel. Gold gained $10, ending the day at $1,119. The VIX fell 0.6 to 19.50.
    Mark Hulbert writes that stocks are Neither overvalued nor undervalued.
    Morgan Stanley CEO Jamie Dimon discusses the Odds of a double dip, with the tmplication that the odds have risen. 


2010-2-25  The markets have resisted well the thorny economic news that greeted investors this morning. The NASDAQ Composite bled 1.68 points, (-0.08%) to close at 2,234.22, the Dow sank 53.13 points (-0.51%) to close at 10,321.03, and the S&P 500 split the difference at 2.3 points (-0.21%) to close at 1,102.94. Oil closed at $78.17 a barrel. Gold gained $11, ending the day at $1,108. The VIX fell 0.17 to 20.10.
    Stock market futures are up a little tonight.

2010-
2-25 (Mid-Morning):
  Given the worrisome character of today's opening, it might be worth mentioning that my leading investment advisory service estimates that Fed Chairman  Ben Bernanke's reassurance that no rate hikes are in the offing is trumping poor economic news. Mark Hulbert adds to this optimism by observing that consumer confidence tends to bottom out shortly after an economic turnaround is underway: Darkness before dawn. Stocks faced more bad news this morning: U.S. stocks dig selves hole.


2010-2-24:  The markets rebounded today. The NASDAQ Composite gained 22.46 points, (1.01%) to close at 2,235.90, the Dow rose 91.75 points (0.85%) to close at 10,374.16, and the S&P 500 added 10.64 points (0.97%) to close at 1,105.24. Oil closed at $80.00 a barrel. Gold dropped $6, ending the day at $1,097. The VIX rose 1.1 to 20.27.
    Fed Chairman Ben Bernanke has testified before Congress that the U. S. economy is not yet in a sustainable, private-sector recovery: 'Economy can't go it alone, Bernanke comforts market.
    More bad news assailed investors today: New-home-sales nadir, Trouble ahead for banks, and Doubts hang over recovery.
    Irwin Kellner is warning of impending inflation (Inflation is faster than it looks), and Paul Krugman has cited him as someone who's gone around the bend: Permanent Link to A Hawk For All Seasons. (A few items such as chicken have risen in price, while other staples have fallen in price. With massive unemployment and a stimulus package that's beginning to decline, Dr. Krugman sees deflation as a greater imminent threat than inflation.)
    David Weidner's insights into Goldman Sachs are chronicled here: Goldman's gatekeeper.
    Another thought-provoking article: Insurers' power growing into monopolies. What's meaningful about these articles to me is the fact that they're emanating from conservative Wall Street news organs.
    My investment advisory newsletters have been advising that the markets are poised to break either up or down from here.


2010-2-23:  The markets declined markedly today. The NASDAQ Composite fell a resounding 28.59 points, (-1.28%) to close at 2,213.44, the Dow backed off 100.97 points (-0.97%) to close at 10,282.41, and the S&P 500 closed down 13.41 points (-1.21%) to close at 1,094.60. Oil fell to $8.82 a barrel, closing at $80.05 a barrel. Gold dropped $10, ending the day at $1,103. The VIX rose 1.43 to 21.37.
   
The markets fell the way they did today because consumer sentiment unexpectedly plummeted today: Consumers recoil. Other bad news didn't help, either: King's ransom, 'Troubled bank' list grows, and Mixed view of home prices.
    The only good news lay in Michael Ashbaugh's regular Tuesday technical assessment: Small caps back bullish case, Ashbaugh says.
    My investment advisory service still considers this to be a buying opportunity.
    Stock market futures are off slightly tonight.


2010-2-22:  The markets fell back slightly today. The NASDAQ Composite fell a paltrey 1.84 points, (-1.84%) to close at 2,242.03, the Dow backed off 18.97 points (-0.18%) to close at 10,383.38, and the S&P 500 closed down 1.16 points (-0.1%) to close at 1,108.01 Oil surmounted $80 a barrel, closing at $80.05 a barrel. Gold dropped $9, ending the day at $1,113. The VIX fell 0.08 to 19.94.
   
My advisory service observes that the bulls pssed an acid test on Friday when they failed to crumple in the face of bad news. They may fall back a little today, but their general direction is up.
    Paul Farrell writes:Death of U.S. capitalism: The final 10 scenes.
    Paul Krugman is warning of the threat of renewed deflation as the stimulus runs out: Permanent Link to Inflation Perceptions, and Permanent Link to Is the Fed Getting Ready to Tighten?.


2010-2-19:  The markets rose yet another day, penetrating their resistance zones. Although the Fed announced that it is raising the discount rate by ¼ %, and although Dell reported disappointing earnings, the markets managed to squeeze out small gains again today. The NASDAQ Composite inched up 2.16 points, (0.1%) to close at 2,243.87, the Dow gained 9.45 points (0.09%) to close at 10,402.35, and the S&P 500 closed up 2.42 points (0.22%) to close at 1,109.17. Oil approached $80 a barrel, closing at $79.90 a barrel. Gold added $3, ending the day at $1,122. The VIX fell 0.57 to 20.06.
    I guess the best you can say about today's price action is that it could have been worse.
   
Mark Hulbert writes: Parsing reaction to Fed's surprise move.   
    Premium shocker: 69% increase


2010-2-18:  The markets rose again today, fetching up against the overhead resistance that Michael Ashbaugh described on Tuesday. 
    The markets rose modestly today. The NASDAQ Composite tacked on
15.42 points, (0.69%) to close at 2,241.71, the Dow added 83.66 points (0.81%) to close at 10,392.40, and the S&P 500 advanced 7.24 points (0.66%) to close at 1,106.75. Oil moved down to $78.39 a barrel. Gold was unchanged at $1,119. The VIX fell 1.09 to 20.63.
    The markets fell today when a plane crashed into the side of an office building in Austin, TX, on rumors that this was a terrorist act. In fact, it was one individual objecting to capitalistic greed and federal spending ("A pox on both your houses!")
   
The U. S. Federal Reserve hiked its discount rate today from 0.5% to 0.75% in an effort to get banks to start loaning money again: Fed hikes discount rate. This has led to a "jump" in the dollar tonight, and to a sharp drop in stock market futures. 
   
I bought back into a couple of mutual funds today (just in time for tomorrow's pullback).


2010-2-17:  The markets rose modestly today. The NASDAQ Composite tacked on 12.1 points, (0.55%) to close at 2,226.29, the Dow added 40.43 points (0.39%) to close at 10,309.24, and the S&P 500 advanced 4.64 points (0.42%) to close at 1,099.51. Oil moved down to $76.82 a barrel. Gold was unchanged at $1,120. The VIX fell 0.48 to 22.25.
   
For clues to today's rises, consider Earnings, data boost stocks and Insider stock buying points to hope for rebound (viideo).

    Today's buying is taking place against a backdrop of continuing dire forecasts by Todd Harrison and Paul Krugman. 

2010-
2-17:
  My best investment advisory newsletter has just flashed a buy signal. The market indices have broken above important resistance levels. I've bought the leveraged (2-to-1) NASDAQ Composite index Exchange Traded Fund QLD.


2010-2-16:  The markets climbed heartily today: Stocks surge on recovery hopes. The NASDAQ Composite rose handily by 30.66 points, (1.4%) to close at 2,214.19, the Dow was up 169.67 points (1.68%) to close at 10,268.81, and the S&P 500 advanced 19.36 points (1.8%) to close at 1,094.87. Oil moved up to $77.26 a barrel. Gold lost $30 to end the day at $1,120. The VIX fell 0.48 to 22.25.
    Michael Ashbaugh's Tuesday column sets forth the S&P's current upper  resistance lines at 1,085 and 1,104m with major support at 1,044. As long as the S&P remains above its 200-day moving average, now at 1,120, an intermediate-term uptrend is in place .At the same time, the S&P is below its 50-day moving average, and, quoth Monsieur Ashbaugh, whichever way it breaks out will set a new trend.
    Mark Hulbert writes: Contrarians say this is only a correction.
    Citigroup's plan: profit from the next crisis


2010-2-12:  The markets ended mixed today, with the NASDAQ Composite up 6 and the Dow down 45. 
    The NASDAQ Composite climbed
6.12 points, (0.38%) to close at 2,183.53, the Dow dropped 45.05 points (-0.44%) to close at 10,099.14, and the S&P 500 slipped 10.34 points (-0.27%) to close at 1,075.51. Oil moved down $0.99 to $74.13 a barrel. Gold lost $5 to end the day at $1,090. The VIX fell 1.23 to 22.73.
    Dubai's sovereign debt is back in the news: Dubai debt concern grows.
    China announced a new surprise tightening of its bank reserve requirements casting a shadow over the Chinese marketplace. Also, Europe posted a  weaker-than-expected advance in its combined GDP.
    Marketwatch' Chuck Jaffe warns that shorting the market right now using Proshares Ultra-Short funds could be hazardous to your portfolio: Betting against stocks now could be stupid  


2010-2-11:  The markets rose today on news that the EU will bail out Greece: E.U. offers support for Greece, and that first time jobless claims have fallen to 440,000, after rising in January: Lowest claims in months
    The NASDAQ Composite climbed
29.54 points, (1.38%) to close at 2,177.41, the Dow advanced 105.88 points (1.05%) to close at 10,144.19, and the S&P 500 added unto itself 10.34 points (0.97%) to close at 1,078.47. Oil advanced $0.64 to $75.12 a barrel. Gold gained $18 to end the day at $1,095. The VIX fell 1.41 to 23.99.
    The markets have been forming a base at these low levels in the biggest pullback since last March. They're now better-positioned to advance, after scaring rookies like me into selling. (Bull markets invariably climb a wall of worry in which even the pros are shaken down to give up part of their gains as the markets climb amid dire news.)
    At the same time, there's still the possibility for further sovereign defaults and related Eurozone problems.


2010-2-10:  After yo-yoing down and up, the markets closed down a little today. 
    The NASDAQ Composite backed off
3 points, (-0.14%) to close at 2,147.87, the Dow subtracted 20.26 points (-0.2%) to close at 10,038.38, and the S&P 500 parted with 2.39 points (-0.22%) to close at 1,068.13. Oil advanced $0.90 to $74.68 a barrel. Gold dropped $1 to end the day at $1,076. The VIX fell 0.6 to 25.40.
    Todd Harrison expands upon his remarks about the impact that the European debt crisis can have on U. S. markets: Why European debt matters to the U.S.
    Dow Theory theorists are either bearish, or have set high hurdles that the Dow must surmount to keep a rally going: Dow Theory letters challenge the bulls
    Citigroup's Peter D'Antonio believes that the U. S. economy "is beginning to grow on its own steam": 'Virtuous cycle' of growth coming
    Housing is evincing distressing signs of a double-dip in real estate prices: Double-dip drops.  
    Fed Chairman Ben Bernanke outlined his exit strategy today: Exit keyed to economy, Bernanke says.  Chairman Bernanke's remarks are thought to have unsettled the markets a bit. Add to that the fact that Greece' deficit may be larger than has been officially reported, and the fact that this was the kind of pattern that preceded the autumn, 2008, market scare, and you have grounds for a cautious day in the trading pits.


2010-2-9:  The markets rebounded today, relieved that the European Union may intervene to prop up Greece. Note, though, that Todd Harrison points out that this  eerily echoes the situation in the fall of 2008... both literally and figuratively... when the U. S. government rescued Countrywide and established the precedent for rescuing AIG, Fannie Mae, Fannie Mac, and the big investment banks: Random Thoughts: Achtung Baby!. Spain Portugal, and Ireland could be next.
    The NASDAQ Composite popped
24.82 points, (1.17%) to close at 2,150.87, the Dow annexed 150.25 points (1.52%) to close at 10,058.64, and the S&P 500 rose 13.78 points (1.3%) to close at 1,070.52. Oil advanced $2.07 to $73.78 a barrel. Gold added $6 to end the day at $1,071. The VIX fell 0.51 to 26.00.
    So far, the chart pattern for this pullback is typical of a down-trending market, That said, it's also worth noting that Friday's action, where the S&P dropped 20 points from where it opened, and then closed up 2 points from where it opened could be construed to be a key reversal day although it was program-driven and probably wasn't..
    Mark Hulbert's article,
What the mutual fund cash level tells us, explains that although mutual fund cash levels are quite low by historical standards, mutual fund managers have little incentive, with the Fed funds interest rate at zero, to park money in money market instruments. The bad news is that even after taking this very-low interest rate environment into account, the markets seldom make much headway when mutual fund cash levels are as low as they are now.
    Paul Farrell warns of the train wreck that he believes lies just ahead: How to invest for the debt-bomb explosion.
    David Weidner warns that banks are making investments with depositors' money that just as risky as they were in 2007: Wall Street's latest contagion goes global. The banks have learned that governments will bail them out, and competition, negligible interest rates (not passed on to bank customers), and "Roaring Twenties" mentalities are driving the financial community toward another bubble-induced collapse. 
    I could imagine that banks have little incentive to lend money to businesses and consumers when they can invest other people's money in stocks, bonds, and real estate, and at least for a while, make more money than they could lending money like stodgy old bankers. Then at the end of the year, they can give themselves  multimillion-dollar bonuses. They know that it can't go on forever, and if they get a pink slip, they'll cry all the way to the bank. But in the meantime... In the meantime, as Paul Farrell observes, there are 42,000 lobbyists, and corporations can now spend more money than ever funding politicians. How sweet it is!
    This is sheer fantasy on my part... one possible scenario concocted by an outsider. But it seems possible.
    I don't read David Weidner as a bomb-throwing firebrand. (:-)


2010-2-8:  The markets closed at their lowest level since this pullback began. The NASDAQ Composite declined 15.07 points, -0.7%) to close at 2,126.05, the Dow dropped 103.84 points (-1.04%) to close at 9,908.39, and the S&P 500 fell  3.08 points (-0.89%) to close at 1,056.74. Oil fell sharply to $71.70 a barrel. Gold fell $13 to end the day at $1,066. The VIX climbed 0.4 to 26.51.
    I haven't yet shorted the market, nor have my advisory services, but it could happen at any time.
       The analyst interviewed in this video clip thinks that although there's overheating in certain parts of the Chinese economy, it has reached bubble proportions: How fast is China likely to cool?  
  

2010-
2-8 (Mid-Morning):
  The markets rose last Friday morning, then fell precipitously, and then rose equally precipitously into the close. The reasons for these gyrations was that, early on, the markets got some moderately good news in the form of the Friday unemployment reports. Then came word that Portugal had eschewed an austerity program, and had instead decided to go the well and borrow money however their regional governments chose. Portugal then held a Treasury auction, where the country was only able to sell $300,000,000 of the $500,000,000 it was trying to sell. Coming on the heels of the Greek debt crisis, and concerns about Spanish and Eastern European debt, this sent shock waves through the financial community. This, in turn, sparked a flight to the perceived safety of the dollar.
    Toward the end of the day, computerized trading programs drove the markets up as dramatically as they'd fallen.


2010-2-5:  The markets fell deep into bear country today, but then rallied sharply toward the end of the trading day, closing up for the day. Wall Street swinging back: . The NASDAQ Composite climbed 15.69 points, (0,74%) to close at 2,141,12, the Dow rallied 10.05 points (0.1%) to close at 10,012.23, and the S&P 500 advanced 3.08 points (0.29%) to close at 1,066.19. Oil fell sharply to $71.42 a barrel. Gold fell $10 to end the day at $1,054. The VIX climbed 0.03 to 26.11.
   Dow reclaims 10,000  
   Dollar extends gains   
   Jobless rate below 10%  
   Jobs showing signs of life  
   Data don't tell us what we want 
   One of my investment advisory services suggests that the current contraction is a correction in an ongoing cyclical bull market rather than the beginning of a new cyclical bear market because of technical indicators that have indicated something other than a bull market top. Still, no one can be sure. The advisory service thinks that this is the first leg in a two- or three-stage market correction. If so, there will be better buying opportunities ahead.
    The S&P 500 penetrated the 1,045 level today, which, at -9%, puts it close to a 10% correction. (This would occur at 1,035.)
    The dollar continued its rise today because of a flight to the relative safety of the dollar (along with some further unwinding of the dollar carry trade, as nervous hedge-fund traders who bet against the dollar sold stocks to cover their bets against the dollar.).


2010-2-4:  The markets fell down a flight of stairs today. The indices are penetrating resistance levels. The NASDAQ Composite plunged 65.48 points, (-3.11%) to close at 2,125.43, the Dow sagged 268.37 points (-2.61%) to close at 10,002.18, and the S&P 500 parted with 34.17 points (-3.11%) to close at 1,063.11. Oil fell sharply to $73.07 a barrel. Gold ended at $1,064. The VIX climbed 4.5 to 26.10.
   
Why did the markets plunge today? Here are a few reasons: Dollar up to 7-month high, Euro-zone whack-a-mole, and Dow holds tight to 10,000. Presumably, the dollar has risen because of worries about the safety of European sovereign debt. Bad news coming in Friday jobs report.
    Market futures are up slightly tonight.


2010-2-3:  The markets were mixed today.. The NASDAQ Composite rose 0.85 points, (0.04%) to close at 2,190.91, the Dow dropped 26.3 points (-0.26%) to close at 10,270.55, and the S&P 500 lost 6.04 points (-0.55%) to close down at 1,097.28. Oil was little-changed at $76.83 a barrel. Gold ended at $1,112. The VIX climbed 0.12 to 21.60.
   
Why did the markets pause today? U.S. stocks snap win-streak as health shares drop, Planned layoffs rise for first time since July, and Wall Street counting down to Friday's jobs report
    Todd Harrison is sticking by his guns that a day of reckoning is still coming: Welcome to the politics of policy.
    My investment service is still awaiting a decisive break above resistance levels before re-committing to putting money back (long) into the stock market.
 
   Stock market futures are neutral again tonight.


2010-2-2:  The markets have moved up again today. The NASDAQ Composite rose 18.86 points, (0.87%) to close at 2,190,06, the Dow gained 111.32 points (1.09%) to close at 10,296.85, and the S&P 500 added 14.13 points (1.3%) to close up at 1,103.32. Oil jumped up to $76.90 a barrel. Gold ended at $1,118. The VIX dropped 1.11 to 21.48.
  
   The markets were up today because Pending home sales up 1%, recover from Nov. plunge, Best two-day rise in three months
   
The shape of the market plots, below, suggest that at least a few days of recovery are in the offing, and this could be the beginning of another rise from a dip. However, the indices are well below their 50-day moving averages, and it was time to sell
   
I won't get a scheduled update from my investment advisory services until just before the market opens tomorrow.
    As of today (Tuesday), my investment advisory service is still in cash. If that changes, I'll let you know.
    The article The world is starting to worry about China observes that the Chinese markets are already down 10%, and that arguments that the Chinese government is only tightening up for a few weeks is typical of the classic "this time, it's different" refrain. 
    Paul Farrell warns Our debt time bomb is ready to go ka-boom. Paul Krugman is also warning about a potential second leg of this recession.
    Stock market futures are neutral tonight.


2010-2-1:  The markets, strongly oversold on a short-term basis, have rebounded today. The NASDAQ Composite rose 23.85 points, (1.11%) to close at 2,171.20, the Dow gained 118.2 points (1.17%) to close at 10,185.53, and the S&P 500 added 15.32 points (1.43%) to close up at 1,089.19. Oil jumped up to $74.95 a barrel. Gold ended at $1,105. The VIX dropped 2.03 to 22.59.
   
The shape of the market plots, below, suggest that at least a few days of recovery are in the offing, and this could be the beginning of another rise from a dip. However, the indices are well below their 50-day moving averages, and it was time to sell
   
I won't get a scheduled update from my investment advisory services until just before the market opens tomorrow.
    Low follows stimulus high in China   
    Valuations point to more correction


2010-1-29:  Once again, the market indices fell steeply closing at another new low for this dip (correction?). This dip now enjoys the dubious distinction of being both the deepest in absolute numbers (76 points on the S&P 500... about 6%... though not the deepest dip percentage-wise) since the market bottomed last March.  The NASDAQ Composite relinquished 31.65 points, (-1.45%) to close at 2,147.35, the Dow dipped 53.13 points (-0.52%) to close at 10,067.33, and the S&P 500 subtracted 10.66 points (-0.98%) to 1,073.87. Oil closed at $72.89 a barrel. Gold ended at $1,083. The VIX rose 0.89 to 24.62.
   
Today's news was good: Fourth-quarter GDP was up 5.7% in the third quarter--1% more than expected, and consumer confidence showed a welcome gain. The consensus forecast for GDP growth going forward is about 3&. The 2009 GDP came in at $14.3 trillion, so a 3% gain would put it at $14.7 trillion by the end of 2010. So why didn't the markets rise? Could it have been because of a rising dollar, forcing further unwinding of the dollar trade, and selling of assets to cover hedge fund bets against the dollar? There's no discussion in the news tonight explaining what's going on. 
    The Cabot's China and Emerging Markets Report is still 50% in Chinese stocks and recommending the purchase of two Chinese stocks... this, after the Halter index has broken far below not only its 50-day moving average but also its 200-day moving average. I sold the remainder of my Chinese stocks today--about 15% of my portfolio. I'm now about 72% in cash.
    Mark Hulbert has written January by the numbers, showing that the track record of the January barometer isn't all that good.


2010-1-28:  The market indices fell steeply today, closing at a new low for this dip (correction?). The NASDAQ Composite fell 17.88 points, (-1.91%) to close at 2,179.00, the Dow dropped 115.7 points (-1.13%) to close at 10,120.46, and the S&P 500 subtracted 12.97 points (-1.18%) to 1,084.53. Oil closed at $73.76 a barrel. Gold ended at $1,086. The VIX rose 0.57 to 23.73.
 
   According to Morningstar, the reasons for today's tumble are:
(1)  the fact that U. S. jobless claims fell by 8,000 last week to 470,000 vs. the consensus projection of 450,000,
(2)  durable goods orders rose just 0.3% vs. the consensus forecast of 2%, and
(3)  Apple and Qualcomm reported disappointing earnings.
   
Whatever the arguments, the fact is that market indices have fallen below their 50-day moving averages, and even below their 200-day moving averages. I'm planning either another round of selling tomorrow or the purchase of inverse funds or puts to hedge the rest of my portfolio. (The ETF's can be sold outright, while my remaining mutual funds might profit from puts that would offset their potential losses... a "collar").
    Here's a rundown on Apple's new iPad: Apple launches iPad tablet device.
    Stock market futures are up slightly tonight.


2010-1-27:  The market indices eked out modest gains today. The NASDAQ Composite rose 17.88 points, (0.8%) to close at 2,221.41, the Dow took on 41.87 points (0.41%) to close at 10,236.16, and the S&P 500 added 5.33 points (0.49%) to 1,097.50. Oil closed at $73.43 a barrel. Gold ended at $1,087. The VIX fell 1.41 to 23.14.
 
   The fact that the markets have paused rather than immediately plunging down farther is at least a little positive. Still, the indices are below their 50-day moving averages. The fact that Nouriel ("Dr. Doom") Roubini foresees a recovery at all (Roubini sees a slow recovery) has to contribute a little to investor confidence.
    Mark Hulbert points out that small stocks have their day primarily during the month of December: After end of January, size does matter .
    Todd Harrison shines a spotlight on what's really happening in: The Washington witch hunt hits home.
    Former Treasury Secretary Paulson, grilled today for the bailout of American International Group, told Congress that the unemployment rate would have hit 25% if the bailout hadn't taken place: Paulson: 25% unemployment rate without AIG bailout. One reader ("Siteleader") writing in observes that the Shadowstats unemployment estimate is about 22% right now... which raises the question: if the unemployment percentage is only 3% below that at the 1932 nadir of the Great Depression, why don' we have the social unrest  that manifested itself in the soup kitchens, the bread lines, and the "shanty-towns" of 1932 (not to mention the Veterans' March on Washington? 
    I would suggest three speculations concerning why, possibly, this hasn't happened (so far). 
    First, there were no safety nets in 1932... no Social Security, no unemployment insurance, and not many relatively secure government jobs. Today, there are often relatives with secure income streams who can provide aid and comfort. Also, there was probably a significant fraction of the 1932 population that was underemployed but not reported as part of the 25% peak unemployment figure (unlike the current 22% unemployment number above). 
    Second, dual-wage-earner families weren't at all as common in 1932 as they are today. In 1932, when the principal breadwinner was laid off, the family income went to zero. Today, one spouse may still be employed after the other has been released.
    Third, in 1932, fear stalked the land, as conditions continued to deteriorate. Today, the economy appears to be recovering.
   
Stock market futures are up strongly tonight.


2010-1-26:  Although stock market futures were down sharply last night, the markets rose substantially and then fell back today: U.S. stocks end down after late-day swoon. The NASDAQ Composite dropped 5.51 points, (-0.32%) to close at 2,203,73, the Dow gave up a negligible 2.57 points (-0.03%) to close at 10,194.29, and the S&P 500 shed 4.61 points (-0.42%) to 1,092.17. Oil ended the day at $75.12 a barrel. Gold ended at $1,096. The VIX fell 0.86 to 24.59.
   
Michael Ashbaugh observes that Trends are violated. The intermediate-term trend is now down, and if stocks go up, the S&P 500 will face resistance at 1115, which is where its 50- moving average lies, and where it closed at the end of last year.
  
Chuck Jaffe: Bull market has more room to run   


2010-1-25:  The markets rose modestly today. Whether this marks a bottom or is merely a dead-cat bounce remains to be seen. The NASDAQ Composite gained an exiguous 5.51 points, (0.25%) to close at 2,210.80, the Dow climbed a paltry 23.88 points (0.23%) to close at 10,196.86, and the S&P 500 rose 5.02 points (0.46%) to 1,096.78. Oil ended the day at $75.12 a barrel. Gold ended at $1,096. The VIX fell 1.9 to 25.41.
    I'm retaining the paragraph below from last Friday's commentary because it's probably worth repeating.
    "The markets are certainly overdue for a 10%-or-greater correction: Correction long overdue (video). However, this is happening with extreme rapidity (as shown in the charts below), although the magnitudes of the daily moves don't match those of the panicky October of 2008. This article: Earnings only part of story, explains that although earnings are rising, revenues aren't  The earnings are coming from cost-cutting, etc., and don't reflect a reviving consumer economy.
    "On the other hand, the World Fund announced on Wednesday that the worst of the financial crisis has passed: Where will the next crisis hit?
    "I'm more than 50% in cash, and I may hedge my remaining long positions by buying a double-inverse index Exchange-Traded Fund on Monday."
    One reason given for Friday's stock swoon was the report that Fed Chairman Ben Bernanke's reappointment was in question. Wall Street sent a strong message to Congress that they don't want the Fed to be held hostage to the November elections.
    After-hours earnings and revenue reports from Apple and Texas Instruments have shown strong gains from a year ago.
    Perma-bear Jeremy Gratham warns that Investors face new stock-market bubble: Grantham.


2010-1-22:  The markets have tumbled for the third day in a row. They've nose-dived more than 5% in three days... something not seen since the October massacre of 2008. The NASDAQ Composite lost 60.41 points, (-2.67%) to close at 2,205.29, the Dow plunged 216.9 points (-2.09%) to close at 10,172.98, and the S&P 500 dove 24.72 points (-2.21%) to 1,091.76. Oil ended the day at $74.54 a barrel. Gold doffed another $11 to end at $1,092. The VIX shot up 5.04 to 27.31.
    The markets are certainly overdue for a 10%-or-greater correction: Correction long overdue (video). However, this is happening with extreme rapidity (as shown in the charts below), although the magnitudes of the daily moves don't match those of the panicky October of 2008. This article: Earnings only part of story, explains that although earnings are rising, revenues aren't  The earnings are coming from cost-cutting, etc., and don't reflect a reviving consumer economy.
    On the other hand, the World Fund announced on Wednesday that the worst of the financial crisis has passed: Where will the next crisis hit?
    I'm more than 50% in cash, and I may hedge my remaining long positions by buying a double-inverse index Exchange-Traded Fund on Monday.
    Howard Gold writes: Read Six big predictions for 2010.
    Four other articles that might be of interest are:
    Dust still settling on Street 
    Here come the corporate dollars
    Mark Hulbert: A second look at second years 
    Nouriel Roubini: Don't depend on China


2010-1-21:  As of today's close, the "sell" decision is still looking timely. The NASDAQ Composite lost 25.55 points, (-1.12%) to close at 2,265.70, the Dow plunged 213.27 points (-2.01%) to close at 10,389.88, and the S&P 500 dove 21.56 points (-1.89%) to 1,116.48. Oil ended the day at $75.98 a barrel. Gold doffed another $10 to end at $1,103. The VIX shot up 3.58 to 22.27.
    The headlines read: Unpleasant surprise in first-time jobless claims, and Paul Krugman is saying, "No reason to panic", but that "Quite aside from everything else going on, the economic recovery isn’t looking very good."
    Right now, the S&P 500 has violated its 25-day moving average and is touching its 50-day moving average. The Dow has broken below both of those moving averages. The NASDAQ has closed below its 25-day average, but is still comfortably above its 50-day average. But my advisory service has issued a "sell" recommendation, and I'm now about 30% in cash.
    The Cabot China and Emerging Markets Report is recommending selling a couple of stocks but holding the rest and even buying two Chinese stocks.
    Weidner sees a return to sanity in banking     

2010-1-21 (Mid-Afternoon):  My investment advisory service has just flashed a "sell" signal. I'm going to be moving into cash.
2010-1-21 (Late Morning)
:
  The stock market is being driven downward by programmed trading caused by the dollar breaching an important upside barrier against the Euro. Traders, especially at hedge funds, who have borrowed money that has taken advantage of the relatively low cost of the dollar and then reinvested that money in stocks and commodities are dumping their stocks and commodity contracts because their computers have issued warnings that they must cover their bets that the dollar wouldn't rise.
    What's at risk here is the possibility of the unwinding of the dollar carry trade.
    Stay tuned. If the markets continue to fall, it may be time for a "sell" signal later today. (Personally, I'm also waiting for today's Cabot China and Emerging Markets newsletter update. So far, there haven't been any emails advising its subscribers to sell.)


2010-1-20:  The indices fell today approximately as much as they rose yesterday. The reason is political. Yesterday's election of a Republican Senator to replace Democrat Ted Kennedy is being interpreted as a development that will strengthen the dollar, which, in turn, has led to some short-covering of bets against the dollar. And lately, the equity markets have moved down when the dollar has moved up. The NASDAQ Composite lost 29.15 points, (-1.26%) to close at 2,291.25, the Dow backed up 115.78 points (-1.14%) to close at 10,603.15, and the S&P 500 gave up 12.19 points (-1.06%) to 1,138.04. Oil ended the day at $77.62 a barrel. Gold doffed $27 to end at $1,113. The VIX rose 0.33 to 18.68.
    December home sales were disappointing: Builder stocks fall on FHA news, housing starts. Mark Hulbert observes what my advisory service has observed: that the breadth and continuing drift to new highs argues for still-higher highs ahead: New high data suggests new highs ahead. However, the World Bank today offered a sobering prospect for a second leg of a double-dip recession this year: World Bank worried about recovery.


2010-1-19:  The indices gained more today than they lost last Friday, reaching new post-recession highs. The NASDAQ Composite increased 32.41 points, (1.42%) to close at 2,320.40, the Dow climbed 115.78 points (1.09%) to close at 10,725.43, and the S&P 500 closed up 14.2 points (1.25%) to 1,150.23. Oil ended the day at $78.59 a barrel. Gold donned $13 to end at $1,141. The VIX fell 0.33 to 17.58.
    The reason for today's exuberance: a Republican won Ted Kennedy's Senate seat in Massachusetts, breaking the Democrats' filibuster-proof control of the Senate, and endangering the passage of the new health care bill, allowing health care companies to keep raising their prices and their earnings: Obamacare at the precipice
    And that's about all the news that I can find tonight.


2010-1-15:  The indices all took a major hit.. The NASDAQ Composite backed up 28.75 points, (-1.24) to close at 2,287.99, the Dow dropped 100.9 points (-0.94%) to close at 10,609,655, and the S&P 500 closed down 12.43 points (-1.08%) to 1,136.03. Oil fell further to $78.00 a barrel. Gold doffed $13 to end at $1,131. The VIX rose a modest 0.28 to 17.91.
    Why did the markets fall like this? Marketwatch' take: Bank fee, tarred as Chavez tactic, roils the industry. However, my advisory services still haven't thrown in the towel. The China and Emerging Markets newsletter sees the current Chinese slump as a buying opportunity. (I hope they're right!)
   Mark Hulbert: Contrarian sentiment picture improves.


2010-1-14:  The indices all eked out sufficient gains today to close at their highest levels since 2008. The NASDAQ Composite tiptoed up 8.84 points, (0.38%) to close at 2,316.74, the Dow gained 29.78 points (0.28%) to close at 10,710.55, and the S&P 500 closed up 2.78 points (0.24%) to 1,148.46. Oil fell further to $79.00 a barrel. Gold added $7 to end at $1,144. The VIX subtracted 0.22 to close at 17.63.
    Intel reported better-than-expected earnings, buoying the tech sector.
    Stock market futures are down tonight.


2010-1-13:  The indices all climbed today almost as much as they declined yesterday. The NASDAQ Composite rose 25.59 points, (1.12%) to close at 2,307.90, the Dow gained 53.51 points (0.5%) to close at 10,680.77 and the S&P 500 closed up 9.46 points (-0.91%) to 1,145.68. Oil fell further to $79.87 a barrel. Gold added $9 to end at $1,138. The VIX subtracted 0.4 to close at 17.85.
    I mentioned yesterday that there will probably be at least one 10%-or-greater correction this year, and that it/they will have to be scary enough to cause enough professional money managers sleepless nights that they'll be willing to sell stocks at lower prices than their pre-correction levels. However, over the next few years, barring a severe "black swan" event, the world's economies will recover, and world stock markets will probably be higher than they are today. 
    Nearer-term, Todd Harrison points out that "individual investor exposure to stocks is the highest since October 2007 while exposure to cash is at levels last seen in August 2000". He observes that greed has replaced fear as the motif describing  current stock market psychology.
    Topstock Portfolios confirms that investor sentiment is at levels not seen since the fall of 2007. These markers are worrisome because they suggest that the fuel that has powered the current market rally has been expended.
    In August, 1982, after rising from 777 on the Dow (which was both a cyclical bear market bottom, and a super-bear market bottom), the Dow peaked at 1200 on June 25, 1983 (10½ months later). It then entered a greater-then-20% corrective phase that lasted until August, 1984, over a year later. We're approaching 10½ months from March 6, 2009. This kind of horrendous correction could happen again. Short-term, it looks to me as though a "buy" signal is still in effect, but a major correction could come at any time. And we are still in a roughly-16-year, super-bear- market half-cycle until 2014-to-2018. While I certainly respect the prognostications of Blackrock's chief investment officer, Bob Doll, there may be thrills, spills, and chills before we get where Mr. Doll anticipates that we're going, and I don't think my nervous system could stand another back-to-back downturn. Accordingly, I'm not going to get aggressive just yet.
    Meanwhile, China's FXI (see below) is continuing to fall, and is well below its 50-day moving average.


2010-1-12:  The indices all declined today. The NASDAQ Composite sank 30.1 points, (-1.3%) to close at 2,282.31, the Dow lost 36.73 points (-0.34%) to close at 10,627.26 and the S&P 500 subsided 10.76 points (`0.17%) to 1,146.98. Oil dropped to $80.06 a barrel. Gold plummeted $1,129. The VIX rose 0.7 to 18.25.
    I mentioned yesterday that the VIX ran mostly below its present level of about 18  (see the last chart below) for 3½ years from the beginning of 2004 through the middle of 2007, so the fact that it's presently around 18 isn't necessarily cause for alarm. But what's distinctive about the present situation is the steep downward slope of the VIX since it peaked at 96 in October, 2008. It's also interesting to look at how rapidly the VIX shot up in 2008. On August 29th, it closed at 19.43. By the end of September, it had climbed to 47. Then it topped out three weeks later, on October 23rd, at the aforementioned 96 ( not quite eight weeks after August 29th), though it closed that day, thanks to federal reassurances, at about 67. Two days later, it closed at 80, with its highest close, at 80.86, coming on November 20th. What's significant about this is how fast it happened, and how fast it could happen again in 2010 or 2011.
    As of tonight, the S&P 500 is up about 70% from last year's low, while my portfolio is only up 40%. Disappointing as this is, it's important to realize that last year's debacle was categorically different from anything that has occurred since the Great Depression. This is the first time in 80 years that recessions haven't been under the control of the Federal Reserve. Only heroic and desperate measures by the Federal Reserve and the Treasury Department saved this country from the Great Depression 2.0. and it's my notion that there were no a priori assurances that what they did would work. The last two years have seen what I hope will have been a once-in-a-lifetime financial meltdown. Unusual cautionary measures were in order.
    The question now is what to do about recovering from this. The S&P 500 is still about 35% below its 2007 high. In the meantime, global trade is just beginning to pick up. China is starting to export again. (With respect to China, it's worth noting that the China index FXI has topped and is rolling over... see below China has just begun raising interest rates to cool the Chinese economy in order to head off inflation and/or a real estate bubble.) However, it may still make sense to invest in calls on the international ETF EEM. The risk here is that dwindling liquidity will hit emerging markets once interest rates start to rise. And interest rates are going to rise unless the world's economies collapse again. Still, international funds are still, like the U. S., down about 30% from their highs.
    There are other investment areas such as alternative energy that may well match or exceed the broad domestic and international marketplaces over the coming year or so. 
    One problem is that there will probably be one or two 10%-or-greater corrections this year. This can only happen if a majority of investing professionals can be persuaded that the recovery is stalling out, and that we're heading for a waterfall. That means that the news will be very scary, and that it will probably become advisable to sell, and even to short the market during the year.

(To be continued)


2010-1-11:  The indices closed mixed today. The NASDAQ Composite fell 4.76 points, (-0.31%) to close at 2,312.41, the Dow added 45.60 points (0.43%) to close at 10,663.99 and the S&P 500 rose 2 points (`0.17%) to 1,146.98. Oil dropped a little to $81.88 a barrel. Gold closed up at $1,152. The VIX fell 0.58 to 17.55.
   
Here are two divergent articles concerning what's in store for 2010. With respect to the first, Storm clouds forming over market, the author comments on the low values for the VIX (the so-called "fear index"). It may be worth noting in this regard that from early 2004 until the middle of 2007, the VIX spent most of its time at levels below tonight's close at 17.55. The other article is Dawn of the Decade: The Bull Case for 2010.
    I'd like to write more more about this, but we took Amber to Toys R'Us this evening as compensation for having to take an H1N1 flu shot this afternoon, and I spent the rest of the evening on the floor playing house with her, and reading her bedtime stories. The one interlude when I stole to the computer to update today's investment interpretations was truncated when Amber stole to the computer to tell me that the dolls that came with her little plastic castle were too tall to fit in the castle. (And sure enough, she's right.)


2010-1-8: All three indices rose again today, with the NASDAQ Composite pole-vaulting, to more than offset yesterday's slight decline. The indices continue to rise in stealth mode. The NASDAQ Composite climbed 17.12 points, (0.74%) to close at 2,317.17, the Dow added 11.33 points (0.11%) to close at 10,618.19, and the S&P 500 rose 3.29 points (`0.29%) to 1,144.98. Oil gain a little to $82.75 a barrel. Gold closed up at $1,139. The VIX fell 0.93 to 18.13.
   
Today's job report was a shocker, with 85,000 jobs lost instead of the hoped-for few-thousand jobs added: U.S. payrolls shed 85,000 jobs To add to the concerns, U. S. investors set a new record in paying down credit card debt: U.S. consumer credit down record $17.49 bln. As commendable as this is for long-term consumer financial strength, short-term, it's a dagger aimed at the heart of the economic recovery. The financial news is starting to get pessimistic
   
I'm going to rerun yesterday's interview with Bob Doll because of its significance.


    "Some pivotally important news: here is a set of predictions by a prophet with an outstanding track record in forecasting market trends: the chief investment officer of the Blackrock hedge fund, Bob Doll. I've taken this list from one of my favorite investment newsletters (along with the Cabot China and Emerging Markets Newsletter): TopStock Portfolios. Of course, no one can be 100% right when it comes to "playing" the stock market, but I'm quite impressed with the savvy and the solid judgment exhibited by David Moenning and his associates.
    "Anyway, here's the set of predictions:
(1) The economy should grow 3%-3.5% this year... i. e. this won't be a double-dip recession.
(2) Job growth will turn positive, but unemployment will remain high for several years.
(3) Earnings should rise about 30% to $80 a share, suggesting a stock market that could sustain a return to 2007 highs.
(4) With worldwide excess capacity and high unemployment, inflation won't reappear this year,
(5) Although the Federal Reserve may not raise its rates, interest rates will rise across the board.
(6) We haven't had a 10%-or-greater correction since the March 6th, 2009, low. We can probably expect one or two such corrections this year.
(7) Emerging markets will continue to outperform.
(8) Health care, technology, and telecommunications are good investment areas.
(9) Mergers and acquisitions will accelerate.
(10) Democrats will continue to control Congress. (Of course, Democrats will automatically continue to control Congress through 2010, since there will be no actual changes in Congress until January 2, 2011.)

    "What's important to me about this is the conclusion that there won't be a double-dip recession in 2010. Of course, I'll automatically sell if the market heads south, but this forecast helps take the chill off the worst recession since The Great Depression. I'll be taking a more-aggressive stance moving forward. Specifically, I'll be investing more in long-term, deep-in-the-money (conservative) call options on index exchange-traded funds (ETFs). What calls? Well, the Nasdaq Composite ETF QQQ has a $30 January, 2011, call option, -ZVXAD, that might be of interest.
    "I'll write more about this over the weekend..
    "Tomorrow morning comes the big jobs report.

    "At long last, payrolls may gain."


    Unfortunately, payrolls didn't gain.
   The current uptick is getting ripe for at least a modest pullback. It probably makes sense to wait for that before buying.
    Here are Ten investment ideas for 2010.

 


2010-1-7: The Dow and the S&P gained a little today, while the Nasdaq fell slightly. The indices are sneaking up. The NASDAQ Composite ended the day down 1.04 points, (-0.06%) to close at 2,300.05, the Dow added 33.18 points (0.31%) to close at 10,606.86, and the S&P 500 rose 4.55 points (`0.4%) to 1,141.69. Oil dropped a little to $82.20 a barrel. Gold declined $3 to $1,134. The VIX fell 0.1 to 19.06.
   
Some pivotally important news: here is a set of predictions by a prophet with an outstanding track record in forecasting market trends: the chief investment officer of the Blackrock hedge fund, Bob Doll. I've taken this list from one of my favorite investment newsletters (along with the Cabot China and Emerging Markets Newsletter): TopStock Portfolios. Of course, no one can be 100% right when it comes to "playing" the stock market, but I'm quite impressed with the savvy and the solid judgment exhibited by David Moenning and his associates.
    Anyway, here's the set of predictions:
(1) The economy should grow 3%-3.5% this year... i. e. this won't be a double-dip recession.
(2) Job growth will turn positive, but unemployment will remain high for several years.
(3) Earnings should rise about 30% to $80 a share, suggesting a stock market that could sustain a return to 2007 highs.
(4) With worldwide excess capacity and high unemployment, inflation won't reappear this year,
(5) Although the Federal Reserve may not raise its rates, interest rates will rise across the board.
(6) We haven't had a 10%-or-greater correction since the March 6th, 2009, low. We can probably expect one or two such corrections this year.
(7) Emerging markets will continue to outperform.
(8) Health care, technology, and telecommunications are good investment areas.
(9) Mergers and acquisitions will accelerate.
(10) Democrats will continue to control Congress. (Of course, Democrats will automatically continue to control Congress through 2010, since there will be no actual changes in Congress until January 2, 2011.)

    What's important to me about this is the conclusion that there won't be a double-dip recession in 2010. Of course, I'll automatically sell if the market heads south, but this forecast helps take the chill off the worst recession since The Great Depression. I'll be taking a more-aggressive stance moving forward. Specifically, I'll be investing more in long-term, deep-in-the-money (conservative) call options on index exchange-traded funds (ETFs). What calls? Well, the Nasdaq Composite ETF QQQ has a $30 January, 2011, call option, -ZVXAD, that might be of interest.
    I'll write more about this over the weekend..
    Tomorrow morning comes the big jobs report.

    At long last, payrolls may gain.


2010-1-6: The markets more or less treaded water again today. The NASDAQ Composite ended the day down 7.62 points, (-0.33%) to close at 2,301.09, the Dow inched up 1.66 points (0.02%) to close at 10,573.68, and the S&P 500 annexed 0.62 points (`0.05%) to 1,137.14. Oil climbed to $83.04 a barrel. Gold gained $18 to $1,137. The VIX fell 0.19 to 19.16.
    There wasn't a lot of openly published news today.
Private payrolls shed 84,000: ADP was presumably good news compared to the 600,000+ layoff numbers that prevailed last spring. One study notes that a number of bears are capitulating ("Too much of a bullish thing"), which,  from a contrarian point of view, isn't a good sign. 


2010-1-5: The markets more or less treaded water today. The NASDAQ Composite ended the day up 0.29 points, (0.01%) to close at 2,308.71, the Dow gave back 11.94 points (-0.11%) to close at 10,572.02, and the S&P 500 annexed 3.53 points (`0.31%) to 1,136.52. Oil climbed to $81.90 a barrel. Gold gained $0 to $1,119. The VIX fell 0.69 to 19.35.
    This week's issue of BusinessWeek has a lead article entitled, "In Wall Street's Pocket", that details the way Wall Street firms have dodged any meaningful reforms, and have set the stage for the next credit implosion. 
    Here are several articles which may warrant attention: Irwin Kellner: Time the demise of ultralow rates, Mark Hulbert on Inflation versus deflation, Todd Harrison on Ten themes for 2010, Foreign stocks for 2010?, and Senators debate bank reform in private.


2010-1-4: The markets rose 1½ % or more today. The NASDAQ Composite ended the day up 39.27 points, (1.73%) to close at 2,308.42, the Dow leaped 155.91 points (1.5%) to close at 10,583.96, and the S&P 500 jumped 17.89 points (`.6%) to 1,132.99. Oil climbed to $81.64 a barrel. Gold gained $23 to start the year at  $1,120. The VIX fell 1.64 to 20.04. 
    As soon as I'm able, I hope to write something about stock market expectations for 2010, but at the moment, the current Arctic cold snap has Amber at home with Tommie and myself all day, and I'm spending virtually all of my time with our little three-year-old colleen. 
    Mark Hulbert suggests that we may be seeing A consumer-led recovery?, while Peter Brimelow presents the case for further gains in China: China still offers opportunities. Mark Hulbert also tells us: Hulbert: First day may mean little, and Paul Farrell adds: Paul Farrell: 12 Dr. Dooms shred 2010 investing optimism.