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Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

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To learn more, sign up for David’s free newsletter and receive the free report from All About Trends – “How To Outperform 90% Of Wall Street With Just $500 A Week.” Tell David PSW sent you. – Ilene





The NYPD Does It Again

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Presented without commentary.





Five Decades of Middle Class Wages: Update

Courtesy of Doug Short.

Note from dshort: I’ve updated this series to include yesterday’s release of the October Consumer Price Index.


Here’s a perspective on personal income for production and nonsupervisory private employees going back five decades.

The Bureau of Labor Statistics has been collecting data on this workforce cohort since 1964. The government numbers provide some excellent insights on the income history of what we might think of as the private middle class wage earner.

The first snapshot shows the growth of average hourly earnings. The nominal data exhibits a relatively smooth upward trend.

Click to View
Click for a larger image

There are, however, two critical pieces of information that dramatically alter the nominal series: The average hours per week and 2) inflation.

The average hours per week has trended in quite a different direction, from around 39 hours per week in the mid-1960s to a low of 33 hours at the end of the last recession. The post-recession recovery has seen a disappointingly trivial 0.8 bounce (that’s 48 minutes).

Click to View
Click for a larger image

What about inflation? The next chart adjusts hourly earnings to the purchasing power of today’s dollar. I’ve use the familiar Consumer Price Index for Urban Consumers (usually abbreviated as the CPI) for the adjustment with a linear extrapolation for the latest month. Theoretically, the CPI is designed to reflect the cost-of-living for metropolitan-area households.

Click to View
Click for a larger image

Now let’s multiply the real average hourly earnings by the average hours per week. We thus get a hypothetical number for average weekly wages of this middle-class cohort, currently at $700 — well below its $827 peak back in the early 1970s.

Click to View
Click for a larger image

Note that this is a gross income number that doesn’t include any tax withholding or other deductions. Disposable income would be noticeably lower.

Latest Hypothetical Annual Earnings: $34,983, Down 15.4% from 42 Years Ago

If we multiply the hypothetical weekly earnings…
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Did The Tech Bubble Just Quietly Pop?

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

While some might scoff at the idea of there even being a bubble in hi-tech start-ups, it appears the massive wall of money that has been thrown at dot-com 2.0 names – all money-losing, social, mobile, cloud name-droppers – has dried up. As The TechCrunch Bubble Index shows, the last 90 days have seen startup-funding announcements collapse over 40% to their lowest level in almost 3 years

 

 

Todd Schneider explains what The TechCrunch Bubble Index is…

The TCBI measures the number of headlines on TechCrunch over the past 90 days that specifically relate to startups raising money. I defined a "startup fundraise" as one where the amount raised was at least $100,000 and less than $150 million. A higher TCBI means more TechCrunch stories about startups raising money, which might broadly indicate a vibrant fundraising environment. For example, a TCBI of 209 on November 16, 2014, means that there were 209 TechCrunch headlines about startup fundraises between August 19 and November 5, or 2.3 per day.

So wait, did the funding bubble burst in the spring of 2014?

In the spring of 2014, investors pumped more than $5 billion into startups (as reported on TechCrunch) over a 90 day period. More recently, in the fall of 2014, that number has declined by almost 40%, to just over $3 bn. The earlier TCBI graph showed a similar decline, from a high of 346 in April 2014 to a value of 209 as I write this. In fact, the TCBI is now at its lowest value since June 2012, and the percentage of all TechCrunch articles that are about startups raising money has declined from 9% to 7% in 2014 alone.

It's also possible that it is simply getting harder to raise money!

I bucketed each fundraise article based on the amount raised to see if there are any trends within investment rounds (seed, series A, etc.):

 

Source: ToddWSchneider.com





Hugh Hendry And The Deflationary Zeitgeist

Courtesy of The Automatic Earth.


Jack Delano Colored drivers entrance, U.S. 1, NY Avenue, Washington, DC Jun 1940

It’s funny how things roll at times. When I wrote yesterday’s Making Money While The World Burns, and quoted Hugh Hendry, one of my heroes – well, close, I love the man for his brain  I hesitated, but thought his words were a great way to start a discussion on what people do when faced with certain conundrums. I certainly never meant to attack Hugh, though words can always be construed to mean things they were not meant to mean.

David Stockman picked up the essay (Jim Kunstler told me to use that word) and retitled it Making Money While The World Burns – The Troubling Case Of Hugh Hendry. Bless David for all the great work he does, and I would never even suggest he shouldn’t add that bit, that’s entirely his prerogative, but I myself would never call Hugh Hendry a ‘troubling case’.

I merely wanted to get a discussion going, and maybe to get people thinking about what they choose and why. Not to judge anyone, who am I to do that, but to get people to ask why they act the way they do, and what it is that makes them tick.

If I would want to judge anyone, it would be the politicians and central bankers who pretend they serve the public and then turn on a dime and screw that same public. Hugh Hendry doesn’t pretend to be anything he’s not. However, I can still ask questions about why he chooses to do what he does, and use that as a mirror, for lack of a better term, to gauge where I stand, what I think, and put that out there for my readers.

But I’m not Hugh Hendry, I’m not a hedge-fund manager, and I don’t morally judge people or tell them what to do and what not. That would be like starting a religion, separating right from wrong for other people, and I have no design on that. I’ll admit I thought about that religion thing in the…
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What Does Oil Say About the True State of the Global Economy?

Courtesy of ZeroHedge. View original post here.

Submitted by Phoenix Capital Research.

The markets erupted higher this morning on a surprise interest rate cut from China. For those who like to keep track of the madness, this brings the total number of interest rate cuts by Central Banks since the 2008 crisis to well north of 520.

 

US stocks as denoted by the S&P 500 have been in a large megaphone pattern since September. The megaphone, like most technical patterns, is in fact a consolidation pattern that can breakout either way. We’ve now broken out to the upside.

 

 

Stocks are extremely overbought in the short-term. In the medium-term, forecasting just where this move will lead is a fool’s errand as it entails attempting to predict just what the dozens of Central Bankers of the world will say or do in the next week or so.

 

In simple terms, stocks need to correct. Whether the Central Bankers will let this happen or not remains to be seen.

 

Elsewhere in the markets, Oil has broken out of a massive multi-year triangle pattern and is now back at levels not seen since 2010.

 

 

It’s been a brutal bloodbath and has brought many of the Oil majors down to levels at which they are looking attractive from a valuation perspective. Some, such as BP, are approaching Price to Cash Flow multiples not seen since 2008. Others, such as Exxon and Conoco Phillips still have a ways to go.

 

Company

Symbol

2008 P/CF

Current P/CF

Exxon

XOM

6.9

8.6

Conoco

COP

3.5

5.1

BP

BP

3.9

4.2

Chevron

CVX

5.1

6.3

 

Remember, Oil is closely linked to the global economy. What does it say about the true state of affairs that oil is back at levels last seen in 2009-2010… while stocks are at new all time highs?

 

Take note and prepare.

 

If you’ve yet to take action to prepare for the second round of the financial crisis, we offer a FREE investment report Financial Crisis "Round Two" Survival Guide that outlines easy, simple to follow strategies you can use to not only protect your portfolio from a market downturn, but actually produce profits.

 

You can pick up a FREE copy at:

http://www.phoenixcapitalmarketing.com/roundtwo.html

 

Best Regards

Phoenix Capital Research

 

 

 

 

 





Have Central Banks Entered An Undeclared War?

Courtesy of Charles Hugh-Smith of OfTwoMinds

The monetary tectonic plates are shifting, and predicting the next global financial earthquake is relatively easy.

I recently suggested that the devaluation of the yen was Japan's Monetary Pearl Harbor: a direct attack on the currencies of its major trading partners: the euro (European Union), the won (South Korea), the Australian dollar (AUD) and the U.S. dollar (USD), which affects both the U.S. and China since China's currency, the renminbi, is pegged to the USD.

Though there have been no overt (public) counter-attacks, this may not reflect monetary peace so much as an undeclared war. Correspondent Mark G. observed that the current geopolitical backdrop is considerably more unsettled than the relatively benign global chessboard in 2008:
 
"The Eurozone and the Pacific Rim now have a pair of regional wars being fought out primarily by financial and monetary means. We can infer that the major central banks won't be anywhere near as cooperative during a crisis as they were in 2008."
 
While the American-European financial sanctions against Russia and Russia's counter-moves are being waged in public, the public response of the Korean and Chinese central banks to Japan's massive devaluation has been limited to grumbling.
 
But it is unlikely that other central banks are limiting their response to Japan's aggressive devaluation to words.
 
Let's start by noting that central banks play two games: one is pure public relations: marionettes on strings beat deflation with sticks and declare they'll save financial parasites with "whatever it takes" monetary policies.
 
Meanwhile, their actions may be mere shadows of the bold policies being trumpeted, or they may be extremes nobody dares make public, for example the Federal Reserve's $16 trillion bailout of literally the entire Western banking sector in the last Global Financial Meltdown.
 
(The Levy Institute came up with $29 trillion after poring over all the data):
 
The U.S. Fed has remained mute, but the yen devaluation has destabilized the global monetary order, whether the Fed acknowledges it publicly or not.
 
Unsurprisingly, central bank public statements don't mention that competing devaluations share certain characteristics with circular firing squads. Beggar thy neighbor policies destabilize


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RBS Shares Tumble After Admitting Stress Test “Error”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Dear Mr. Draghi, we are very sorry but we messed up on the ‘stress test’. The Royal Bank of Scotland shares are sliding after it admitted that it made an error – not in favor the bank – in its stress test calculations…

*RBS: CET1 STRESS TEST RATIOS OVERSTATED ON CALCULATION ERROR

Under the corrected Adverse Scenario, RBS capital cushion was slashed from 6.7% to 5.7% (just barely above the 5.5% minimum). Still – we should all trust the stress tests as ‘proof’ how strong Europe’s banking system is. What a farce!!

 

 

As Bloomberg reports,

Royal Bank of Scotland Group Plc fell as much as 2.9 percent in London trading after the lender said it overstated its capital ratios in European stress tests.

 

RBS’s fully loaded 2016 common equity Tier 1 ratio, a measure of financial strength, should be 5.7 percent instead of the 6.7 percent reported on Oct. 26, the bank said in a statement today. That’s still above the 5.5 percent minimum, RBS said.

 

The stress-test modeling “did not adequately reflect” deferred tax asset deductions, RBS said. The bank said it remains “on target” to boost its capital ratio to 11 percent by the end of 2015.

*  *  *





Here Is The Only Thing You Need To Know As Goldman’s|New York Fed’s Bill Dudley Testifies To The Senate

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

As everyone listens in silence as Goldman’s New York Fed’s Bill Dudley gets emotional during his Senate Banking Committee testimony, and his only response to why there is Goldman capture of the NY Fed being that $3 trillion in Fed excess reserves have made banks “stable”, yet why absolutely nothing will change, there is only one thing everyone needs to see to understand just how the system works.

Presenting the total donations by Goldman Sachs to members of Congress in 2014 alone via OpenSecrets.

Q.E.D.

 

And yes, it cost Goldman only $1.8 million to purchase Congress for one more year.





S&P 500 “Most Overbought” Since Feb 2012

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The explosive surge in US equity markets off the ‘Bullard’ lows have swung the Relative Strength Index (RSI) from its most oversold in 24 months to the most overbought in 33 months in a record amount of time. The last time the market was this ‘overbought’, the S&P 500 fell almost 11% in the following few weeks…

 

 

Chart: Bloomberg





 
 
 

Zero Hedge

The NYPD Does It Again

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Presented without commentary.

BREAKING: New York City police commissioner says "accidental discharge" from police officer's weapon may have killed man in Brooklyn.

— Reuters U.S. News (@ReutersUS) November 21, 2014

...

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Chart School

Five Decades of Middle Class Wages: Update

Courtesy of Doug Short.

Note from dshort: I've updated this series to include yesterday's release of the October Consumer Price Index.

Here's a perspective on personal income for production and nonsupervisory private employees going back five decades.

The Bureau of Labor Statistics has been collecting data on this workforce cohort since 1964. The government numbers provide some excellent insights on the income history of what we might think of as the private middle class wage earner.

The first snapshot shows the growth of average hourly earnings. The nominal data exhibits a relatively smooth upward trend.


...



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Phil's Favorites

Hugh Hendry And The Deflationary Zeitgeist

Courtesy of The Automatic Earth.


Jack Delano Colored drivers entrance, U.S. 1, NY Avenue, Washington, DC Jun 1940

It’s funny how things roll at times. When I wrote yesterday’s Making Money While The World Burns, and quoted Hugh Hendry, one of my heroes – well, close, I love the man for his brain – I hesitated, but thought his words were a great way to start a discussion on what people do when faced with certain conundrums. I certainly never meant to attack Hugh, though words can always be construed to mean things they were not meant to mean.

David Stockman picked up the essay (Jim Kunstler told me to use that word) an...



more from Ilene

All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

more from David

Market Shadows

EZCH - Not So EZ Year

EZCH - Not So EZ Year

By Ilene 

After a disappointing quarter and some probable tax-selling, EZchip might be a good turnaround for next year.

So I'm thinking we'll sell a stock or two out of Paul's otherwise neglected Virtual Portfolio (check back) and add EZCH.

...

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OpTrader

Swing trading portfolio - week of November 17th, 2014

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Sabrient

Sector Detector: Investors make up new rules for their new market paradigm

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Courtesy of Sabrient Systems and Gradient Analytics

By Scott Martindale

Investors in U.S. equities seem to have embraced a new market paradigm in which upside spikes come more swiftly than the downside selloffs. Remember when it used to be the other way around? When fear was stronger than greed? The market is consolidating its gains off the early-October V-bottom reversal, and no one seems to be in any hurry to unload shares this time around, with the holidays rapidly approaching and all. After all, there are bright blue skies directly overhead giving hope and respite from the early freeze blanketing the country.

In this weekly update, I give my view of the current market environment, offer...



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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

The newest Stock World Weekly is ready. Click here for the this weekend's reading and sign in with your PSW user name and password. 

Picture credit: AnnaER at Pixabay. 

...

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Digital Currencies

Ukraine Central Bank Bans Bitcoin "To Protect Citizens" From Financing Terrorism

If you would have supposed that Ukraine had enough problems to make banning bitcoins a backburner issue, you'd have been wrong. The rationale, "to protect consumers' rights" makes little to no sense... The other one, "to keep money in the country" makes more sense. 

Ukraine Central Bank Bans Bitcoin "To Protect Citizens" From Financing Terrorism

Courtesy of ZeroHedge. View original post here.

The Hryvnia has collapsed to new record lows near 15/USD this morning. The Central Bank and bankers "agreed to keep UAH at 15-16/USD" but are &qu...



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Option Review

Yamana Gold call options sink

Yamana Gold call options sink

By Andrew Wilkinson at Interactive Brokers

A four-year low for the spot price of gold has had a devastating impact on Yamana Gold (Ticker: AUY), with shares in the name down at the lowest price in six years. Some option traders were especially keen to sell premium and appear to see few signs of a lasting rebound within the next five months. The price of gold suffered again Wednesday as the dollar strengthened and stock prices advanced. The post price of gold fell to $1145 adding further pain to share prices of gold miners. Shares in Yamana Gold tumbled to $3.62 and the lowest price since 2008 as call option sellers used the April expiration contract to write premium at the $5.00 strike. That strike is now 38% above the price of the stock. Premium writers took in around 16-cents per contract o...



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Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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