Posts Tagged ‘Obama’

Stock World Weekly: Deadlocked

Here’s the latest Stock World Weekly. Click on this link to read the full SWW: "Deadlocked" and sign in with your PSW user name and password.  (Or sign up for a FREE trial to Stock World Weekly.) 

 Excerpts reviewing the week and looking ahead

U.S. Debt Ceiling Deadlock

One line of reasoning from the “no tax hikes” crowd is the inaccurate premise that the very wealthy, the top 0.1%, are job creators. If they’re the “job creators,” it might be in the public interest to protect them from excessive taxation – thereby allowing these top 0.1% to spend money on creating jobs. This is incorrect. The overwhelming majority of U.S. jobs are ‘created’ by ordinary Americans when they spend their paychecks. Consumer spending drives about 70% of our GDP. When average Americans are struggling with high unemployment, which recently popped back up to 9.2%, they are reluctant to spend money on anything beyond basic necessities. The broader U6 unemployment number – which includes the underemployed and “discouraged workers” – is 16.2%.

Meanwhile, U.S. companies are not stepping up hiring due to weakness in the economy – there is no demand. As Paul Ashworth of Capital Economics wrote, “Businesses aren’t confident enough, and the longer this goes on, the harder it is to convince them that they should be.”  (Dearth of Demand Seen Behind Weak Hiring)

Let Them Eat Cake 

Russ Winter of Winter Watch at the Wall Street Examiner discussed the gap between what people think corporations pay in taxes, versus what they really spend. For example, Microsoft “lowers its effective tax rate a full 7% by taking foreign income to $19.2 billion from $15.4 billion, and lowering US income (and expenses) from $9.6 billion to $8.9 billion. Today MSFT is effectively a 68% foreign operation. In return it gets all the benefits of stimulus and minimizes the costs of supporting the US system…

Mark Kreiger writes a spot on piece regarding the high end luxury bubble that includes this gem - ‘The social crisis facing the country as a result of the most egregious plundering in modern American history will spell the end of the ‘high end’ theme. Buying into this trend now is like getting long Marie Antoinette’s unsevered


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The Show Must Go On

Courtesy of Jim Quinn, The Burning Platform

The Debt Ceiling Reality Show is winding down to its dramatic conclusion on August 2. I think Fox should capitalize on the drama by gathering the American Idol judges to vote on the best performance by a political hack. We can have Ryan Seacrest announce on August 1 at 11:55 pm that the winner is – THE WALL STREET MONIED INTERESTS.

  

The latest round of kabuki theatre performed by the corrupt lying thieves in Washington DC is being played out every night on the MSM. The volume of misinformation, lies, exaggerations, posturing, and propaganda is staggering. These vile excuses for leaders know that 80% of the American population wouldn’t know the difference between a debt ceiling and a drop ceiling. They use this ignorance to their advantage, as Obama warns that old people won’t get their social security checks and government drones won’t be paid. 

According to Gallup, Republicans and Independents don’t want the debt ceiling raised. The poll also indicates that at least one third of Americans don’t care. They are too outraged by the Casey Anthony verdict to focus on the economic future of our country.

Debt Ceiling Poll

I’ll let you in on a secret. The debt ceiling will be raised. Sorry to ruin the surprise, but this entire sordid episode has nothing to do with our dire economic situation. It is solely about the 2012 elections. Both parties are conducting overnight polling on which talking points are working best in convincing the sheeple that their party is less likely to be blamed. Posturing and polling are what passes for leadership in America. It is a disgusting display and will contribute to the ultimate collapse that is headed our way like a Japanese Bullet Train.

Here is a summary of where we stand according to the MSM and the political class in Washington DC:

  • The supposedly grand compromise that would have “cut” $4 trillion from future deficits fell apart last week. The Democarats wouldn’t “cut” entitlements and the Republicans wouldn’t “raise” taxes.
  • The latest proposal was down to $2 trillion of future “cuts”, but neither side would agree to what and when.
  • Now in the ultimate Washington kick the can move, Mitch “Turtle Face” McConnell has proposed that Obama increase the debt limit in three stages, while requiring him to propose offsetting spending cuts, offering a potential path out of the


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EXTEND & PRETEND IS WALL STREET’S FRIEND

Courtesy of Jim Quinn, The Burning Platform

“We now have an economy in which five banks control over 50 percent of the entire banking industry, four or five corporations own most of the mainstream media, and the top one percent of families hold a greater share of the nation’s wealth than any time since 1930.   This sort of concentration of wealth and power is a classic setup for the failure of a democratic republic and the stifling of organic economic growth.” - Jesse –http://jessescrossroadscafe.blogspot.com/

Source: Barry Ritholtz

“All of the old-timers knew that subprime mortgages were what we called neutron loans — they killed the people and left the houses.” - Louis S. Barnes, 58, a partner at Boulder West, a mortgage banking firm in Lafayette, Colo


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Michele Bachmann Says F^%* History

Courtesy of Jr. Deputy Accountant

Embarrassing.

Listen, we know no one pays attention in school. We know history is ignored by everyone except history buffs who are into that whole thing (JDA is guilty of skipping history class in high school, by that point TLP was likely working on his 3rd history PhD) and we know that we can, as a society assaulted with a constant stream of tweets, status updates and 24 hour news, barely remember what happened last week let alone in the last few centuries. Surely Bachmann isn’t the only one to make a mistake like this but really, Michele? Really?

Her entire team needs to be fired for sending her out there looking like that.

Then again, in her defense, if you ask an American elementary school kid about Abraham Lincoln’s position on slavery, you might be told that he fought bravely to free the slaves. The Great Emancipator, the textbooks call him.

That’s what I was taught, you too?

The truth, however, is that Lincoln, like Bachmann, was a politician just doing what he had to do. The Emancipation Proclamation was a political move, you’re a sucker if you believe anything else. Worse? Honest Abe offered good government money to pay off slave-owners to get their slaves out of town as part of his 1860 presidential campaign:

In 1860, the 3,185 slaves in the District of Columbia were owned by just two percent of the District’s residents. In April 1862, Lincoln arranged to have a bill introduced in Congress that would compensate District slave-holders an average of $300 for each slave. An additional $100,000 was appropriated 

to be expended under the direction of the President of the United States, to aid in the colonization and settlement of such free persons of African descent now residing in said District, including those to be liberated by this act, as may desire to emigrate to the Republic of Haiti or Liberia, or such other country beyond the limits of the United States as the President may determine.

When he signed the bill into law on April 16, Lincoln stated: "I am gratified that the two principles of compensation, and colonization, are both recognized, and practically applied in the act."

And there’s this quote, which you should know if you are not a high schooler skipping history class: "My paramount object in this…
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One Reaction to the Obama State of the Union Address That Made Sense

Courtesy of Jesse’s Americain Cafe

It amazes me that the discussion on change centers on ‘improving competitiveness’ when the crisis was caused by a massive financial fraud and political and regulatory failure that goes largely unresolved and unrepaired, sucking the life out of the real economy and spreading corruption of thought and action. Slogans and code words are the substance of the public policy discussion in the US and Europe, and I think with the intent to deceive, a propaganda campaign. The mainstream media in the States is owned by a handful of powerful corporations. But fewer and fewer turn to the mainstream media anymore.

"In addition, any economist will tell you that when the free market fails a black market emerges. The blogs are the black market of information." 

David B. Collum, Cornell University

As for competitiveness, the current global trade regime is underpinned with and founded on a fraud, a set of managed currencies pinned to the US dollar and under the control of a banking cartel. There is no real free trade, only an illusion of such, promoted by the rapacity of multinational corporations and their partners in authoritarian governments.

The only real competition I can see is the race to destroy the middle class and reduce the public around the world to the least common denominator of slavery, serfdom, and servitude, with the dollar and the jackboot as their weapons.

From Mark Thoma:

"Eliminating regulation: The idea is that removing unnecessary regulation will improve our ability to innovate, and this will help the economy create new, good jobs. However, it wasn’t lack of innovation or lack of competitiveness that got us into this mess, it was an out of control financial sector. 

The President talked about eliminating unnecessary regulation, but far too little was said about the need to implement new regulations where they are needed. In addition, by focusing so much on helping business, the president risks sending the message that what is good for business is necessarily good for the nation. (Risk? As the risk of sounding snarky, that is the reason for the season. It was the corporate FIRE sector that caused the financial crisis in the first place. – Jesse)

Businesses need the right environment to thrive, but we must not lose sight of the fact that it’s the skills of the people that work at businesses that matters most. Our ultimate goal is the best possible life for


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Stock World Weekly

Here’s the newest: Stock World Weekly Newsletter. Comments welcome! – Ilene 

Jobs Cartoon

Archives here. 


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One Investment Strategy for Q1 2011: Cash, Baby, All the Way

Charles Hugh Smith agrees with us on the wisdom of cash: One Investment Strategy for Q1 2011: Cash, Baby, All the Way  - Ilene 

Piggy bank with crumpled dollar bills

Courtesy of Charles Hugh Smith

In response to readers’ requests, I disclose my own amateur’s Investment Strategy for Q1 2011: cash is king, and the U.S. dollar looks good simply because almost everyone expects it to collapse. 

Despite my oft-avowed amateur-market-observer status, readers often ask me for advice or opinions on where to put their capital. This is not advice (please read the HUGE GIANT BIG FAT DISCLAIMER below), it is a disclosure of my own personal opinion, what we might call "one investment strategy of many possible investment strategies" for the first quarter of 2011: cash, baby, cash all the way.

Why am I in cash? Because I don’t trust the parallel rallies, and I am extremely skeptical of the various "stories" which are driving the rallies. Why am I skeptical? Because everybody and their sister has bought into the stories, and a one-sided trade is rarely the winning one.

Yes, it’s my contrarian nature: when everyone is a believer in a "story" that is too good to be true, then I become skeptical. This often gets me in trouble. When everyone was buying GM at $50, I was shorting it. When everyone was buying Fannie Mae at $60, I was shorting it (via puts). Both GM and FNM were obviously, painfully insolvent, but it took practically forever for reality to intrude on the fantasy/narrative that each firm was a "solid blue chip" investment with numerous analyst recommendations. In the meantime, I lost money treading water for quarter after quarter.

So even though the market is clearly top-heavy, the short-side trade may yet be ground down by the Fed’s prop-job and the Wall Street/Central State partnership’s desperate desire to use a rising stock market as a propaganda proxy for the "recovery."

(Hey, just borrow and squander roughly 13% of GDP, year after year after year (roughly 45% of the entire Federal budget), and you might stimulate a modest "recovery," too.)

So let’s examine each of the "stories" driving the rallies.

1. The global recovery is solid, and Central State stimulus and quantitative easing will keep growth rising and interest rates low. This narrative drives capital into "risk assets," i.e. stock markets, commodities, FX carry trades, Chinese real estate, junk bonds, etc.

I’m not really sure…
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Post Mortem for the World’s Reserve Currency

This is a thoughtful analysis by Mike Whitney showing what a financial mess we’re in – the proverbial rock and a hard place scenario. – Ilene 

Post Mortem for the World’s Reserve Currency

Courtesy of MIKE WHITNEY, originally published at CounterPunch and Global Research

money printingPaul Volcker is worried about the future of the dollar and for good reason. The Fed has initiated a program (Quantitative Easing) that presages an end to Bretton Woods 2 and replaces it with different system altogether. Naturally, that’s made trading partners pretty nervous. Despite the unfairness of the present system--where export-dependent countries recycle capital to US markets to sustain demand—most nations would rather stick with the "devil they know", then venture into the unknown.  But US allies weren’t consulted on the matter.  The Fed unilaterally decided that the only way to fight deflation and high unemployment in the US, was by weakening the dollar and making US exports more competitive. Hence QE2.

But that means that the US will be battling for the same export market as everyone else, which will inevitably shrink global demand for goods and services.  This is a major change in the Fed’s policy and there’s a good chance it will backfire. Here’s the deal: If US markets no longer provide sufficient demand for foreign exports, then there will be less incentive to trade in dollars. Thus, QE poses a real threat to the dollar’s position as the world’s reserve currency.   

Here’s what Volcker said:  “The growing sense around much of the world is that we have lost both relative economic strength and more important, we have lost a coherent successful governing model to be emulated by the rest of the world. Instead, we’re faced with broken financial markets, underperformance of our economy and a fractious political climate…..The  question is whether the exceptional role of the dollar can be maintained." 

This is a good summary of the problems facing the dollar. Notice that Volcker did not invoke the doomsday scenario that one hears so often on the Internet, that China, which has more than $1 trillion in US Treasuries and dollar-backed assets, will one day pull the plug on the USA and send the dollar plunging.  While that’s technically possible, it’s not going to happen. China has no intention of crashing the dollar and thrusting its own economy into a long-term slump.  In fact, China has…
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Jim Chanos: “Adam Smith will get his Revenge on China’s Real Estate Bubble”

Courtesy of Mish

China bulls may wish to consider the other side of the story as noted by Chanos in China Overbuilding to ‘Hit a Wall’

“Construction is 60-plus percent of GDP, compared to exports of 5,” said Chanos, who is the founder and president of Kynikos Associates.

“The problem is that consumption as a percentage of Chinese economy has declined in the last 10 years, from 40 to 35 percent. It’s all real estate,” he said. After the US, China has the world’s second largest economy.

Chanos said that steel, iron ore, cement and other materials needed for construction will be "under pressure."


Video Notes

China is building US-priced condos where the average income is $3500 per person.

Margins on Chinese companies are razor thin. If China hikes rates substantially most companies in China will lose money. Chanos thinks they already are. "Every company we have looked at has accounting issues. The lower you get in the story the more interesting it becomes."

If China implodes, Chanos thinks the US will fare relatively well on the basis "Europe exports more to China than the US, and that South America is dependent on China as are parts of Asia."

When asked about the sustainability of what China is doing, Chanos commented that a lot of what the state is doing is "misdirected investment" in order to keep nominal growth. At the end of the day, that will come back to haunt them.

Chanos mentioned Adam Smith a couple of times in the interview. Adam Smith is author of The Wealth of Nations.

"Adam Smith will get his revenge in China’s real estate market. It is very difficult to manage these kinds of bubbles."

I happen to agree with Chanos on all counts, adding that an implosion in China, or even a significant slowdown would be beneficial to the US dollar. For additional discussion of the US dollar please see Williams Calls for "Great Hyperinflationary Great Depression"; A Very Easy Rebuttal

Mike "Mish" Shedlock

Originally published at Mish’s Global Economic Trend AnalysisJim Chanos: "Adam Smith will get his Revenge on China’s Real Estate Bubble"


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Just Another Manic Monday – Stagflation Official in China

Wheeee, everything must be great! 

We are crushing our levels as the market flies ever higher.  Our 11,500 target on the Dow looks sure to be tested and we're already flipping bullish with our "Breakout Defense" trades, in which our goal is to make 5,000% in 5 trades or less.  We are not ashamed to jump on the bullish bandwagon – if they are giving away money, we'll stand in line with everyone else, only we'll take a larger share – thank you very much.  We certainly know how to use leverage just like a Bankster – we have a spread and we're not afraid to use it!  

Speaking of Banksters, the must-read article of the weekend is the NY Times piece that goes into surprising details of secret bank meetings that are regularly held in NY where the Gang of 12 (just 9 of them) do their best to manipulate the derivatives market, influence regulations and regulators and, of course, crush their competition.  The article even goes so far as to name my old friends at ICE as possibly maybe having something to do with these shenanigans and I am SHOCKED at these allegations as the good people at ICE were so good about telling me how I had things all wrong when I made similar statements last year (which I now legally know cannot be proven and therefore must not be true).  

And thank goodness that the commodity and derivatives clearinghouse that was founded by Big Banks and is controlled by Big Banks cannot be proven to be operating in favor of Big Banks because we wouldn't want to think that the Big Banks had some preferential treatment (beyond the access to the discount window and the TARP money and the POMO money, etc.) – that would just be unAmerican.  By unAmerican, I mean the old America that they write about in the Declaration of Independence and the original Constitution, of course – not the Corporate Kleptocracy this country has developed into.  Under the new guidelines, leveraging your influence and having the government rob the people to increase your profits on which you don't pay taxes is the very definition of patriotism, isn't it?  

VIXAh well…  As I said last…
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Zero Hedge

Leaving The EU's Customs Union Is The Only Logical Step For A Truly "Global Britain"

Courtesy of ZeroHedge. View original post here.

Authored by Vincenzo Scarpetta via Open Europe,

As UK Prime Minister Theresa May prepares to trigger the Article 50 EU exit mechanism on Wednesday, Open Europe has published a ne...



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ValueWalk

Undervalued and Undiscovered Flanigan's Enterprises Inc. Well Positioned For Growth

By The Acquirer's Multiple. Originally published at ValueWalk.

One of the cheapest stocks in our Acquirer’s Multiple, Small & Micro CapStock Screener is Flanigan’s Enterprises, Inc. (NYSEMKT:BDL). With a market cap around $46 million, few investors have ever heard of this great nano-cap.

Flanigan’s Enterprises, Inc. (Flanigan’s) operates a chain of full-service restaurants and package liquor stores in South Florida. The company operates package liquor stores under the Big Daddy’s Liquors name, which offer private label liquors, beer, and wines; and restaurants under ...



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Phil's Favorites

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Oil Producers Consider Output Cut Extension as Support Grows (Bloomberg)

Oil producers pledged to consider extending their pact limiting supply, as half a dozen nations said more time was needed to drain swollen stockpiles.

Oil Speculators Can't Dump Rally Bets Fast Enough Amid Glut (Bloomberg)

The bullish sentiment following OPEC’s deal is almost all gone.

...



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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Oil Producers Consider Output Cut Extension as Support Grows (Bloomberg)

Oil producers pledged to consider extending their pact limiting supply, as half a dozen nations said more time was needed to drain swollen stockpiles.

Oil Speculators Can't Dump Rally Bets Fast Enough Amid Glut (Bloomberg)

The bullish sentiment following OPEC’s deal is almost all gone.

...



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Chart School

Mixed bag of tricks; but good chance of market swing lows

Courtesy of Declan.

The damage was done premarket and value buyers were quick to take advantage. The index which benefited the most was the Nasdaq. It started today just above the 50-day MA and rallied off that. Volume wasn't great and the technical picture didn't really improve, but action like today's can prove to be a good starting point for a swing low.


Despite the gain in the Nasdaq, Breadth metrics are weakening but are neither overbought nor oversold.  The next strong swing low will likely take a tag of the light green ...

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OpTrader

Swing trading portfolio - week of March 27th, 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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Kimble Charting Solutions

Stocks and Bonds; Critical change of direction in play?

Courtesy of Chris Kimble.

Since the summer of 2016, stocks have done very well and bonds have been thumped, as rates have risen sharply. Is it time for these trends to take a break? Below compares the performance of the S&P 500, with the popular bond ETF TLT over the past 9-months.

CLICK ON CHART TO ENLARGE

The performance spread between stocks and bonds over the past 9-months is a big one! Rare to see the spread between the two...



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Members' Corner

More Natterings

Courtesy of The Nattering Naybob

[Click on the titles for the full articles.]

A Quick $20 Trick?

Summary

Discussion, critique and analysis of the potential impacts on equity, bond, commodity, capital and asset markets regarding the following:

  • Last time out, Sinbad The Sailor, QuickLogic.
  • GlobalFoundries, Jha, Smartron and cricket.
  • Quick money, fungible, demographics, QUIK focus.

Last Time Out

Monetary policy is just one form of policy that effects capital,...



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Digital Currencies

Bitcoin Tumbles Below Gold As China Tightens Regulations

Courtesy of Zero Hedge

Having rebounded rapidly from the ETF-decision disappointment, Bitcoin suffered another major setback overnight as Chinese regulators are circulating new guidelines that, if enacted, would require exchanges to verify the identity of clients and adhere to banking regulations.

A New York startup called Chainalysis estimated that roughly $2 billion of bitcoin moved out of China in 2016.

As The Wall Street Journal reports, the move to regulate bitcoin exchanges brings assurance that Chinese authorities will tolerate some level of trading, after months of uncertainty. A draft of the guidelines also indicates th...



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Mapping The Market

Congress begins rolling back Obama's broadband privacy rules

Courtesy of Jean Luc

I am trying to remember who on this board said that people wanted to Trump because they want their freedom back. Well….

Congress begins rolling back Obama's broadband privacy rules

By Daniel Cooper, Endgadget

ISPs will soon be able to sell your most private data without your consent.

As expected, Republicans in Congress have begun the process of rolling back the FCC's broadband privacy rules which prevent excessive surveillance. Arizona Republican Jeff Flake introduced a resolution to scrub the rules, using Congress' powers to invalidate recently-approved federal regulations. Reuters reports that the move has broad support, with 34 other names throwing their weight behind the res...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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Biotech

The Medicines Company: Insider Buying

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

I'm seeing huge insider buying in the biotech company The Medicines Company (MDCO). The price has already moved up around 7%, but these buys are significant, in the millions of dollars range. ~ Ilene

 

 

 

Insider transaction table and buying vs. selling graphic above from insidercow.com.

Chart below from Yahoo.com

...

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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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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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