Posts Tagged ‘income disparity’

Non-Farm Friday – Will Jobs Report Restore Market Confidence?

Ouch, that really stings!  

They say you can't keep a good market down but it remains to be seen whether or not we have a good market with almost all of August and September's BS gains (see any of my posts for warnings and hedge ideaserased just 3 days into October.  

As you can see from our Big Chart, the Russell, in particular, completed it's 10% drop yesterday and, as I said to our Members in yesterday's live Chat Room as we neared the bottom:

/TF/Jasu – Just a bit oversold and, as noted yesterday (and above) it's completing a 10% drop from 1,200 at 1,080, so that's a very firm line for a bounce and that's 20% of a 120-point drop, so we're looking for 25-point bounces to 1,105 (weak) and 1,130 (strong) now.  Anything less than 1,105 today is a failure and, if not tomorrow, then expect more downside next week.  

SPY DAILY/TF is the Futures on the Russell 2000 index and already this morning we're back to 1,097, which is up $1,700 per contract (see how easy this is?) from our 1,080 entry and just a little shy of our expected weak bounce.  

We do expect resistance at 1,100 so this is a good time to take profits off the table and we can go long again over that line or flip to the S&P Futures (/ES) over 1,950 or Nasdaq (/NQ) over 4,000 or the Dow (/YM) over 16,800.  As long as they are all performing, we can be confident on the long side. 

As we discussed with our Members earlier this morning, there's no particular reason to get bullish – this is just a technical bounce we expect off our 5% lines per our 5% Rule™ and, if they trun out to be weak bounces, then we can expect another 2.5-5% of downside next week.  That means we can use those same index lines to go short if they fail as we would to go long if they succeed this morning – that will be all up
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Friday Fedapalooza – 8 Fed Speakers in One Day + Draghi!

Hang on to your hats!  

Janet Yellen speaks at 10 am, EST and she's scheduled to discuss her "Labor Dashboard" and, from that, the pontiffs will then attempt to read the tea leaves of Future Fed action.  She'll likely note that the Labor Market is generally improving but that there is no immediate reason to raise rates.  The definition of immediate will be much debated.  

If that does not confuse us enough, we will hear from 7 of the Fed Dwarves as well including Williams, Lockhart, Plosser and Bullard.  Draghi takes the stage at 2pm, EST.  In case Yellen's empty promises don't do the trick, Draghi is sure to have even emptier ones – whatever it takes to end the week on a positive note!  

Still, we're playing the day bearish (we added bear plays in yesterday's Live Member Chat and we're short /YM below 17,000 along with other Futures) as it's hard to imagine what Yellen and company can possibly say that they haven't already said.  Unlimited amounts of FREE MONEY forever is already priced into market expectations – anything less will be a severe disappointment.  Any firm mention of ending QE in the next 12 months can send the markets down sharply.  As "clarified" by Goldman Sachs:

 

With opinions mixed as to whether or not Jackson Hole will be the forum for Yellen to say something new, many are trying to figure out if it is a buy the rumor and then buy more after the fact event, a buy the rumor sell the fact event, or a do nothing with the rumors and then buy the fact if the USD is actually rallying after the fact event.

 

According to Zero Hedge, only "Full Doveish" statements are likely to lift the markets at this point.  Those would be for Yellen to:

1) Argue that the


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$29 Trillion Tuesday – Central Banksters Gone Wild!

Fake it 'till you make it.  

While it was Aristotle who said that "acting virtuous will make one virtuous" (and clearly Aristotle hasn't been to the same charity events/wealth orgies that I have, or he never would have said it), it is our modern Central Banking system that decrees that "acting like the economy is better will make the economy better."  

Now, perhaps if they had spent $29,000,000,000,000 by giving 7Bn people $4,142.85 each – we WOULD have a better economy now – but that's not what happened at all, is it?  Instead, 70,000 people and corporations (the top 0.0001%) got an average of $414M each while the other 99.9999% of us, especially the bottom 90% actually are now worse off than when the Central Banksters decided to meddle in our affairs in the first place.  

The rich are indeed getting stunningly richer with the Forbes 400 (richest Americans) AVERAGING $800M gains in 2013 as the stock market (where most of their money is) rose over 30%.  Again – AVERAGE gains of $800M per Billionaire!  Once you get past #50 on the list (Google's Eric Schmidt with $8.3Bn), that's AT LEAST 10% of their total net worth added in a single year!

 As I said in our recent trade review "Thank You Sir, MAY I Have Another", if they are just going to keep giving away money like this – we're going to just have to keep taking it (through our many bullish trade ideas) but, at some point, the music will stop and you'd BETTER be able to find a chair fast!  

There's a very good reason the Corporate Media is constantly telling you how bad "class warfare" would be - BECAUSE THEY ARE ALREADY WINNING THE WAR AND YOU ARE NOT EVEN FIGHTING!!!

Like any good game of musical chairs, we have no idea when the music is going to stop, so we all have to keep dancing around like nothing is wrong until it does.  As I pointed out yesterday, it's very easy to pay $150Bn for Amazon (at $327 per share) with money you just printed because…
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Top 1% Tuesday – $105,637 for Me, $80 for You!

Wheeeeeee – isn't this economy FANTASTIC?

It sure is for those of us in the top 1% (1.4M) - people earning over $352,000 in annual income.  We made $105,637 more Dollars in 2010 than we did in 2009 – thanks in large part to the Fed's fantastic policy of printing more and more money, which lets us borrow cheaply or invest with leverage in inflating equity as the Dollar collapses.  Sure the Dollar collapsing hurts everyone – but an extra $105,637 keeps us ahead of inflation, right? 

I'm stil jealous of course (good Capitalists are always jealous), as the top .01% (14,000 of us) – who earn an average of $23.8M, were able to add another $4.2M to their annual incomes in 2010.  That's 52,500 TIMES the average $80 increase earned by the bottom 99% (thank goodness we're not one of THEM!).  That's right, somehow, the riff-raff in the bottom 99% managed to grab 7% of the Nation's total increase in income – clearly Congress needs to make immediate changes to prevent this travesty from happening again! 

Steve Rattner has a different opinion, saying:  "The only way to redress the income imbalance is by implementing policies that are oriented toward reversing the forces that caused it. That means letting the Bush tax cuts expire for the wealthy and adding money to some of the programs that House Republicans seek to cut. Allowing this disparity to continue is both bad economic policy and bad social policy. We owe those at the bottom a fairer shot at moving up."

That's Commie talk!  If we allow the bottom 99% to make a fair share of the money, they would make 5% more and you know they would only SPEND it on stuff they need TO LIVE.  Then our companies would have to provide more goods and services to the bottom 99% and jobs would be created and we, at the top, would have to WAIT for the money to trickle UP from the bottom as only companies that do a good job servicing the bottom 99% would increase in value.  Even worse, we may have to WORK (a four-letter word) to provide goods and services for the people who have money in order to EARN (another four-letter word) our Incomes.  That's no fun for us at all! 

We like it when we get ALL the money and we create just the jobs we choose by buying really…
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Monday Madness – G20 FinMins Set Two Week Deadline

Two weeks!  

European leaders have two weeks to settle differences and flesh out a strategy to terminate their sovereign debt crisis as global finance chiefs warn failure to do so would endanger the world economy.  “The risk of a recession would be increased dramatically were the Europeans to fail to accomplish goals that they’ve set for themselves,” Canadian Finance Minister Jim Flaherty said after the G-20 meeting on Saturday.

The Brussels meeting “has the potential to turn into a positive historic moment,” Joachim Fels, London-based chief economist at Morgan Stanley, wrote in a note to clients yesterday. “But it could also easily turn into a negative catalyst.”

Europe’s plan, which has still to be made public, includes writing down Greek bonds by as much as 50 percent, establishing a backstop for banks and magnifying the strength of the 440 billion-euro ($611 billion) temporary rescue fund known as the European Financial Stability Facility.  “The plan has the right elements,” U.S. Treasury Secretary Timothy F. Geithner said in Paris. “They clearly have more work to do on the strategy and the details.” 

The G-20 officials — who met to prepare for a Nov. 3-4 gathering of leaders in Cannes, France (and we're fondly remembering London's 2009 meeting with the graphic on the right) — said in a statement that the world economy faces “heightened tensions and significant downside risks.” European authorities must “decisively address the current challenges through a comprehensive plan.

The policy makers held out the possibility of rewarding European action with more aid from the International Monetary Fund, while splitting over whether the Washington-based lender’s $390 billion war chest needs topping up.  Europe’s latest strategy hinges on putting Greece, whose government forecasts its debt to reach 172 percent of gross domestic product in 2012, on a sustainable path. Austerity has plunged the country deeper into recession and provoked civil unrest that threatens political stability.

My reaction to this in Member Chat this Morning was to call for shorting the jacked up Dow Futures (/YM) at 11,600, saying:  

Speaking of the illusion of power – yet another G20 meeting ends with yet another plan to have a plan but this time, for some insane reason, they only gave


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Which is the Bigger Threat: Terrorism or Wall Street Bonuses?

Which is the Bigger Threat: Terrorism or Wall Street Bonuses?

By Wallace C. Turbeville, courtesy of New Deal 2.0

stockmarket-1500001

The current system of trader compensation will continue to decay the heart of Wall Street.

Which is a greater threat to the nation — terrorism or the relentless decline of middle income families? Unless we abandon our core values out of unwarranted fear, terror cannot fundamentally change our way of life. The number of people affected by growing income disparity is vast. When I was a student, income disparity was indicative of an underdeveloped and unstable society.

The government appropriately devotes enormous resources to protect our lives and property from terrorism. It is unthinkable that a leader would display any weakness opposing this threat. Politicians have stiff backbones when it comes to terrorism.

In contrast, the government is timid and half-hearted in its approach to the system which perversely rewards a few Wall Street traders with billions of dollars of bonuses, yet allows the foundation to decay.

Kenneth Feinberg issued his report identifying outrageous Wall Street compensation of executives despite their role in the financial disaster and bail out. He proposed that the banks voluntarily adopt “brake provisions” that permit boards of directors to nullify bonuses in the event of a new financial crisis.

He might have more success asking the lions of the Serengeti to give the wildebeests a sporting chance of making an escape.

Over the last fifteen years, the financial sector’s percentage of GDP has increased dramatically. At the same time, the median family income stagnated and then declined.  I do not believe that this is a coincidence.

The large banks have changed. They slice and dice the constituent elements of a stagnant economy, squeezing value out in ever more sophisticated ways. Wall Street has turned away from its roll as the financial backer of industry and commerce. In the short term, it is more profitable for them to use their capital for trading. Newfangled software and MIT “quants” allow the traders to “rip the faces off” of corporate counterparties and investors which were once trusted clients.

These young traders are simply doing what America has told them to do.  They are allowed to earn obscene amounts of money using the advantageous information, technology and capital of their employers. Making money from less powerful counterparties is like shooting fish in a barrel.  The banks make so much money that…
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America is 234 Years Old Today – Is It Finished?

"The average age of the world’s greatest civilizations has been two hundred years. These nations have progressed through this sequence. From bondage to spiritual faith; from spiritual faith to great courage; from courage to liberty; from liberty to abundance, from abundance to complacency; from complacency to apathy, from apathy to dependence, from dependence back into bondage." – Professor Joseph Olson

Is America, then, living on borrowed time?  Are we so far past our prime and so into old age as a civilization that we are now senile and oblivious to our present surroundings, causing a danger to ourselves and others?  Do we find ourselves living in the past and repeating the same old tales of our former glories over and over again to anyone who will listen?  Are we barely kept alive by various medications that only stave off conditions that are getting worse every day while still imagining that, if there were a need, we could rise up and be strong again — but not today as there's rice pudding for desert and we don't want to miss that!

Well I have news for you – This country isn't old and it isn't sick but it has been drugged and it has been beaten down and robbed and I am going to tell you that I not only saw it happen, but I think I got a pretty good look at the 10,000 guys who did it.  It was the top 0.01%!  Who are the top 0,01%?  They are the top 10,000 income earners in the United States of America.  If you THINK you are in the top 0.01%, you are not.  People in the top 10,000 know only KNOW they are in the top 0.01% but they know where they rank as well.  The median ANNUAL income of a person in the top 0.01% is $50,000,0000.  They have $350,000,000 in assets and, since 1978, that is an increase of 550% – how have you done the past 30 years?

 

Now we are (or used to be) a pretty rich country and the median income of the 118M people who earn enough money to pay income taxes is about $50,000 but the cost of living in the same country as people who earn an average of 976 times more than that is pretty high as well (see "The Dooh Nibor Economy").  Even worse, The 10,000 paid just $112Bn in taxes last year – that's
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The Top 1% Control 42% of the Wealth – Servitude for the Rest of US!

Courtesty of My Budget 360:

financial-wealth-united-statesMany Americans are not buying the recent stock market rally

This is being reflected in multiple polls showing negative attitudes towards the economy and Wall Street.  Wall Street is so disconnected from the average American that they fail to see the 27 million unemployed and underemployed Americans that now have a harder time believing the gospel of financial engineering prosperity.  Americans have a reason to be dubious regarding the recovery because jobs are the main push for most Americans.  A recent study shows that over 70 percent of Americans derive their monthly income from an actual W-2 job.  In other words, working is the prime mover and source of their income.  Yet the financial elite have very little understanding of this concept.  Why?  42 percent of financial wealth is controlled by the top 1 percent.  We would need to go back to the Great Depression to see such lopsided data.

Many Americans are still struggling at the depths of this recession.  We have 37 million Americans on food stamps and many wait until midnight of the last day of the month so checks can clear to buy food at Wal-Mart.  Do you think these people are starring at the stock market?  The overall data is much worse:


Source:  William Domhoff

If we break the data down further we will find that 93 percent of all financial wealth is controlled by the top 10 percent of the country.  That is why these people are cheering their one cent share increase while layoffs keep on improving the bottom line.  But what bottom line are we talking about here?  The Wall Street crowd would like you to believe that all is now good that the stock market has rallied 60+ percent.  Of course they are happy because they control most of this wealth.  Yet the typical American still has negative views on the economy because they actually have to work to earn a living:

gallup-economics

The above daily poll asks Americans about their view on the health of the economy.  Only 13 percent believe the economy is good or excellent.  Funny how that correlates with the top 10 percent who control 93 percent of wealth.  Many Americans were sold the illusion of the bubble.  They were sold on the idea that their homes were worth so much more than they really were. …
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Income for the Masses Not Keeping Up… For 40 Years

Income for the Masses Not Keeping Up… For 40 Years

Courtesy of Jake at Econompic Data

A few weeks ago I detailed the divergence in household incomes showing the top 5% of earrners gained mightily over the past 40 years relative to lower level incomes. But in comparing all those income brackets to the growth of the broader economy (on a per capita basis), even those top 5% earners’ didn’t keep up with the pace.

household income

So over the past 40 years, the only individuals that have seen their incomes increase at / or greater than the level of GDP were those earning more than those in the top 5% (think top 1%).

Source: Census

 


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Phil's Favorites

World hunger is increasing thanks to wars and climate change

 

World hunger is increasing thanks to wars and climate change

Courtesy of Leah SambergUniversity of Minnesota

Smallholder agriculture in southern Ethiopia. Smallholder farmers are particularly vulnerable to food insecurity. Leah Samberg

Around the globe, about 815 million people – 11 percent of the world’s population – went hungry in 2016, according to the latest data from the United Nations. This was the first increase in more than 15 years.

Between 1990 and 2015, due largely to a set of sweeping initiatives by the global community, the proportion of undernourished people in the world was cut in half. In 2015, U.N. member countries adopted t...



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Zero Hedge

Amazon Strikes Deal With Landlords To Install Lockers In Apartment Buildings

Courtesy of ZeroHedge. View original post here.

Since the dawn of the e-commerce era, the largest US landlords have loudly complained about the crush of packages flooding mailrooms at apartment properties across the country.

One apartment owner went so far as to stop accepting packages altogether, while others have experimented with increasingly novel ways to process residents’ mail.

Now, Amazon is stepping in with a solution to a problem that it’s largely responsible for creating. ...



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ValueWalk

Marc Faber's America in Black and White

By Steve Slavin. Originally published at ValueWalk.

It is truly amazing that even in our era of supposed political correctness, a respected financial advisor like Marc Faber, aka Dr. Doom, could publicly make the claim that the United States is much better off than it would have been if it had been colonized by blacks rather than whites. Even in the age of Trump, it seems that only the extreme rightwing hate groups have openly expressed such racist views.

In fairness, Faber did get one thing right: If America had been colonized by blacks instead of whites, our nation would certainly have been a very different place from what it is today.

...



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Chart School

More of the Same

Courtesy of Declan.

There was little change on the day-to-day machinations of the market. The S&P is riding along upper channel resistance with technicals still bullish.


The Nasdaq is caught in a halfway house with bullish technicals and a relative advantage of the index against the S&P.


The Russell 2000 is...

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Digital Currencies

BDC's Crypto Corner

 

BDC’s Crypto Corner

By Biodieselchris

Hello fellow PSW-ers. I've been interested in cryptocurrencies (informally, "cryptos" or "coins") since 2011 when I first heard about Bitcoin, Since that time I've become somewhat of a subject matter expert and personal investor in Bitcoin and other alternative cryptocurrencies ("altcoins"). I have even started one of my own!

I've been posting comments about cryptos in Phil's daily post from time to time. Recently, Phil and I got on a call and he asked if I would like to run a blog on his site specifically about cryptos, which I thought was a great idea. My goal would be to educate members on what I know about how coins work, how I research coins (what I find interesting), how exactly one can...



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Insider Scoop

Subscriber Growth Strength Bolsters Netflix Q3

Courtesy of Benzinga.

Related NFLX The Market In 5 Minutes: Netflix, Goldman Sachs, And Morgan Stanley Keep The Earnings Beats Going ...

http://www.insidercow.com/ more from Insider

Mapping The Market

Puts things in perspective

Courtesy of Jean-Luc

Puts things in perspective:

The circles don't look to be to scale much!

...

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Biotech

Circadian rhythm Nobel: what they discovered and why it matters

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

 

Circadian rhythm Nobel: what they discovered and why it matters

Courtesy of Sally Ferguson, CQUniversity Australia

Today, the “beautiful mechanism” of the body clock, and the group of cells in our brain where it all happens, have shot to prominence. The 2017 Nobel Prize in Physiology or Medicine has been awarded to Jeffrey C. Hall, Michael Rosbash and Michael W. Young for their work on describing the molecular cogs and wheels inside our biological clock.

In the 18th century an astronomer by the name of Jean Jacques d'Ortuous de Ma...



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Members' Corner

Day of Last Dances

News today has been relentlessly terrible. A horrific mass murder happened last night in Las Vegas. (Our politician's abject failure to address gun control is beyond sickening.) And today, reports that Tom Petty died of a heart attack, followed by reports that Tom Petty is not dead, and now reports confirming that Tom Petty has passed away. 

...

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OpTrader

Swing trading portfolio - week of September 11th, 2017

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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Promotions

NewsWare: Watch Today's Webinar!

 

We have a great guest at today's webinar!

Bill Olsen from NewsWare will be giving us a fun and lively demonstration of the advantages that real-time news provides. NewsWare is a market intelligence tool for news. In today's data driven markets, it is truly beneficial to have a tool that delivers access to the professional sources where you can obtain the facts in real time.

Join our webinar, free, it's open to all. 

Just click here at 1 pm est and join in!

[For more information on NewsWare, click here. For a list of prices: NewsWar...



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Kimble Charting Solutions

Brazil; Waterfall in prices starting? Impact U.S.?

Courtesy of Chris Kimble.

Below looks at the Brazil ETF (EWZ) over the last decade. The rally over the past year has it facing a critical level, from a Power of the Pattern perspective.

CLICK ON CHART TO ENLARGE

EWZ is facing dual resistance at (1), while in a 9-year down trend of lower highs and lower lows. The counter trend rally over the past 17-months has it testing key falling resistance. Did the counter trend reflation rally just end at dual resistance???

If EWZ b...



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All About Trends

Mid-Day Update

Reminder: Harlan 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...

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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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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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