Thursday June 14, 2012
The investments we have recommended are in general making a series of higher lows. Risk off assets of TLT and the US Dollar are slowly stair stepping down even as the media announces the 137th day of death for Greece, Italy, Spain, and Lower Slobbovia. Take a look.
XME Metals and Mining
XME has round ready buyers at 38.5 and then moved up. each time it hit that level.
XES Energy Service
Despite the hysteria over what OPEC will or won't do at their meeting this weekend someone is buying the XES Energy Service Sector and driving it higher. By the way the last recorded history of OPEC actually doing anything occurred in 1979 with the second oil embargo. Since then it has been all talk no action.When will someone notice that the chief function of OPEC is to support the hospitality industry in Vienna?
Central Fund advanced as gold crested $1600.
TLT Bonds, UUP US Dollar
Despite the numerous 100+ point moves up and down in the stock market, since June began the trend in TLT and the Dollar is down, not a great deal I grant but as our title today suggests, slowly we turn.
Inverse H & S SPX
An alert reader of TMP points out numerous inverse head and shoulder patterns, here is the big one.
Thoughts on Euro Debt
The graphics seem better on Bloomberg than CNBC and the hysteria level among the Female Announcers is even higher. Spanish Debt at 7% one screams. Well what has really happened is that the interest rates for Europe have returned to what one might term normal levels. As Dan Henninger suggests in his column in today's WSJ, if Europe would follow the lead of Wisconsin, New Jersey, and Indiana, cut taxes and spending and reward innovation instead of taxing it, everyone might go back to work.
Here is the real irony that you are not hearing on television.
In 2008 after years of denying reality, GM and Chrysler succumbed to decades of unfunded pension promises. They had never paid any debt off but always rolled it over in ever higher totals. Finally the cash ran out. The the US Government which has been doing exactly the same thing since Nixon abandoned the gold standards, rolling debt over never re paying any, bailed out GM and Chrysler. Uncle Sam paid the union pension funds doing exactly zero zip nada for stock and bond holders.
Now the world beats a path to the US Debt Door. Following GM's lead the US response to its difficulties has been to pile debt ever higher in both the Bush and Obama administrations. In a final ironic twist, the world has flocked to buy US Debt which is paying a 30 year low in yield. Even a slight bump in inflation expectations would quickly submerge the US bond values.
You tell me is the greater irony the Debt Conundrum above or
the fact that we sent nuclear powered ships to resuce carbon production in Kuwait since we refuse to power our cities the same way we power Navy ships (nuclear), and have for six decades.....
We report you decide....thanks for reading The Market Perspective and thanks to the media for ignoring hte obvious (higher lows in stock indices) otherwise what would we write about?