The Market Perspective

The Day the Music Died

Wednesday May 22 2013

Bye, bye Miss American Pie
Drove my Chevy to the levee but the levee was dry
Them good ole boys were drinking whiskey in Rye
Singin' this'll be the day that I die
This'll be the day that I die

Don McClean, Bye Bye American Pie

Today was highly significant. We have been writing telling you that 

The Great American Recession has begun

 A huge Deflationary Wave is being telegraphed by weak gold and silver prices

We are back to the All One Market Theory as the Dollar becomes, John Murphy's comment, the strongest currency in the world. 

Okay let's start with stocks.

On the thirty minute chart stocks took out four moving averages in one day after staying above them for the last month, case closed, the top is in. A reader asked about my positions - cash with some gsb exposure. 

Bonds

30 year yield, screaming to the upside

Today was an outside reversal day to the upside in yields. We pegged 3.4-3.6 % as the line in the sand for yields. Ben thinks he is in charge, not so Ben ,the market is in charge, you are just a player, not the player.

Currencies

Aussie Dollar 

The Australian government wants a lower currency value, it is about it get that in spades. The Aussie Dollar collapses as the US Dollar in the lower panel continues to advance. 

Crude oil

Crude oil is down three dollars in two days, note the third lower high in crude oil. This has huge implications for the current Shale Boom but no one in the oil business seems to realize this. Teh XEX energy service ETF was down 1.95%. 

Gold

Gold had a huge $60 range today, And it was down on the day. The rise in the US Dollar and the collapse in the Canadian and Aussie Dollars, suggest that  hopes for a bottom in gold are unfounded. I have enjoyed corresponding with Steve Kaplan but I must disagree with his conclusions/  Deflation is about to over take the world economies. Bernanke's plan for dropping dollars from helicopters did not work. All it did was promote stock and real estate speculation making it appear that things were getting better. 

 

I will update again tomorrow morning. 

 

 

Discounted Municipal Bonds

Weekend May 19 2013

In our previous post we noted that several closed end municipal bond funds were trading at discounts to their Net Asset Value NAV. In 2008 this  occurred among closed end funds that bought stocks and wrote options against them. Recently this started happening with Central Fund CEF. CEF is now trading at a 5.3% discount to NAV. 

Our point is that somehow the markets sense when such a fund is about to experience a loss in value. This adds a clue as to where interest rates might be headed. If bond prices are falling and we know more and more cities are in trouble, treasury rates are quickly rising, this may set the stage for Bill Gross to finally be right about a  interest rate bottom.

This writer suggests higher stock prices the next few months as a result of excess FED liquidity. That is precisely the analog I was developing in the last post. The run up in 1987 was a true socionomic moment moment when many investors piled into stocks for the first time after a five year advance. The same thing is happening now as he notes, investors are shifting money from risk off, utilities and muni bonds, to risk on, stocks. In 1987 this finally resulted in a glaring disparity with bonds yielding 7-9% and stock dividends paying less than 3%. See the charts I posted for what happened that October. 

Extreme expression of social mood occurs near the end of a move. 

Investors Dive Into Junk

Thursday May 9 2013

The Great Recession Begins

In his column today Dan Henninger notes the dismal jobs picture for young people. He goes on to note that the US begins to look like Europe, awash in diplomas, and with high youth unemployment for years. 

The Center for American Progress study is a straight-ahead description of the grim employment status and diminished earnings prospects of whites, Hispanic and especially younger blacks. The official unemployment rate for people in their late teens and post-college years is around 16%, but add in those who've given up looking or taken jobs flipping hamburgers (underemployment) and their home-alone status moves past 25%. For young blacks—the most politically misled people in America—the out-of-work number is between 40% and 50%.

Stampeded int Junk Bonds at MarketTop

The stampede into junk bonds passed another milestone, showing investors are casting aside concerns about the health of the U.S. economy for a shot at padding their pocketbooks.

The Barclays U.S. Corporate High Yield index fell to a record low of 4.97% Tuesday, marking the first time the benchmark tracking debt issued by weaker U.S. companies dropped below 5%. On Wednesday, it fell to 4.96%. The yield on the index has lost more than a percentage point this year, in a sign of hefty demand for income-producing securities. Bond yields fall when prices rise.

Yields on junk Bonds Reach New Low Page C1 WSJ Today

Weekly Junk

Here is the big picture on Junk prices since the Financial Crash. This is the weekly version. Volume is in the lower part of the graph. No one was buying at 18, but look how volume expanded at 36, twice the price at the market lows. This weekly graph also reveals the various MAs kicking in all to the upside. 

Investors always buy into the lowest yields and the highest prices at the wrong time. We noted Apple's shrewd decision to cash in on all time low rates in the biggest bond offering ever. 

A junk bond is really just a high yielding stock, the issuer and borrower each bet on continued earnings to finance the pay out. This is a reliable sign that stock prices are at peak levels. 

 Monthly Junk

The monthly graph shows an even more pronounced move into Junk. At bottom volume has steadily increased as buyers shrug off  the memory of 2008 and associated risk of JUNK. At top RSI is the most overbought ever. Oh that reminds me, did anyone notice that the Hedge Fund owning Nieman Marcus is considering taking it public?  The fund issued bonds to finance its purchase of the high end retailer. They had best hurry or the window may close. 

The mania for stocks is so strong that it may well last into the Fall as it did in 1987.  In short we could see the markets pull back to sideways through the summer and then enjoy another run up in seasonally strong August. 

Rackspace RAX

RAX recorded $362.2 M in revenue up 20% from a year ago but just 2.6 percent from last quarter. Analysts expected $367 M, a mere $4.8 M difference or shortfall. And so the stock dropped 16% or over twelve  points.

RAX stock price has collapsed over 50% in three months while earning millons of dollars.  if this can happen to RAX in three months do not think the entire market is immune. 

I offer this example as support for my contention that

The Great Recession has begun

This will mimic 1973-74 when companies made lots of money but stock prices collapsed anyway.

Politically we continue to mimic that era. Nothing is getting done in Washington. But then perhaps that is not a bd thing.

 

 

 

 

Are Stocks Headed higher Still: A Crash in Gold and Silver

Weekend April 13-+14, 2015

Monday is income tax payment deadline, the government is only marginally interested in your filing the return but insists that you pay now. It is no accident that income tax payment time is as far from the traditional election day, Nov 2, as possible on the calendar. America existed perfectly well until 1913 with no income tax. It was sold as a a tax on the rich,  a mere 1%, does this sound familiar?

Ed Carlson at Seattle Technical Advisors has an excellent analysis of the gold cycles for the bull run since it began circa 2000. Ed has published two books on the analytic methods of George Lindsay. Learn more on Ed's Amazon Page.  I published an academic review of An Aid to Timing in Journal of Contemporary Issues in Business research. 

I have arranged for readers of TMP to be able to receive Ed's special analysis on gold cycles and what to expect next. Drop an e mail request to me 

dennislelam@gmail.com

And I will pass them on to Ed ASAP 

I respect Intellectual Property Rights and will not divulge his findings. 

Here is a completely opposite view of gold, CAlafia Beach Pundit takes a negative view.

Jesse shows the Hedge Funds with a massive short metals position.

How the Gold Market Crashed  raises the issue of margin calls.

My weekly newspaper colum is featured in the next post. This week I drove from San Antonio to Laredo through the Eagle Ford shale area. The traffic on the way back Friday afternoon was ferocious. And the traffic was all trucks, virtually no cars. Eighteen wheelers, pickups, and oilfield trucks in abundance.  There were signs of massive activity everywhere. But oil dropped $2.33 Friday, not a good sign. 

The News

Last weekend we calmly and confidently predicted that The Recession had begun.  We are now a FIB five years from the top in  2008 and a FIB 13 years from the top in  2000. The weekend WSJ proclaims 

Americans  in recent weeks have cut spending in everything...suggesting a renewed skepticism in the economy after a resilient start to the new year.

Consumer Show Fresh Caution.

That resilient start to the New Year is a 40 year echo from the resilient start to Year 1973. You have been reading our prediction on this for months, it is arriving now. Toby Connor at Gold Scents suggests that as things slow, Bernanke, and the rest of the Central Bankers can only do one thing, print more money. It has already started in Japan. Another front page article in the Weeekend WSJ has our Treasury Warning the Japanese

not to hold down the value of the Yen to gain a competitive advantage. After al that is what we want to do and we cannot have the Japanese beating us to it. 

Treasury Warns Japan on Yen

And so the race to de base currencies, trying to gain a competitive advantage, among countries is well under way.  Again as Toby Connor points out, the only result here can be more money printing inflating the value of commodity prices. Every stock market run to the upside is accompanied by a flurry of commodity price increases, remember oil at $145 in July 2008?  Bob Prechter's group will be right about deflation but after a final move up in prices over the next few months. 

There are no more markets, only Central Bank Interventions.

recent comment echoed by a Market Perspective Reader

How Bear Markets Bottom

Crashes happen near the END of a bear market. In 1987 stocks had been falling for well over a month, and then that Monday in October crashed. In 2003, same thing, the Trade Center bombing brought a final crash.

 At that point investors give up all hope, tossing perfectly good securities onto the trash heap that they paid much more for only a short while back. This typified the 2003 and 2009 bottoms. A final capitulation triggering stop loss sell orders occurs. Amateurs dump holding with market orders into a a no bid environment plunging prices irrationally further. JNJ is about a blue chip as they get, take a look back at what happened. Note maximum negativ mood actualy occured on the third wave lower. The fifth wave would mark THE low in price however.

Johnson and Johnson 1987 Crash Low

I chose Johnson and Johnson as it is the bluest of clue chips, a fabulous money making machine with an ethical management. However investors tossed the shares overboard, note the gaps in the chart, selling the stock at a one third discount from where it had been at 62. This is also known as Capitulation. The above pattern amy well be what lies ahead for gold and silver. Certainly the trends are still decidedly down. 

Media coverage of the event becomes hyper negative. Gold Sinks Into Bear Territory. Every single gold bug and well respected gold blog has been dead wrong about the near direction of gold, calling for lows all the way down including TMP. And so formerly respected experts fall into a Rodney Dangerfield lack of respect. I now receive far fewer e amils than I did around the correct call for a top in September. Then I was right, since then wrong. The correct call would have been to short GLD using the weekly PAR SAR indicator, we would still be short using that indicator. Whether we had shorted GLD or bought puts we would be way ahead of the game, and my daily number of hits would far exceed where it is now. I promise to observe the weekly parabolic in the future. Regrettably the human condition is such that we learn from errors not success. 

 

So do the charts appear in capitulation format according to formula?

 

GLD Paper Gold

Volume has soared in all the metal plays. Are there any sellers left? At far right volume spiked to five times 5X the normal 10M per day volume. A gap occurred in price in an attempt to fill the massive sell orders. 

For perspective, here is how the 1987 stock crash played out.

1987 SPX

The charts are remarkably similar to the crash point. Whether this is a valid analogy remains to be seen of course. 

 

GLD Fifteen Minute Chart

Early Friday volume was runing 6 Million shares, perhaps 10X or more normal volume.

Then the last half hour, buyers emerged, was that significant? 

GDXJ

Big buying volume emerged at day's end. Monday will be interesting, perhaps a bounce to the upside?

The other really interesting thing about this is that physical gold ended the day on its dead low down like $84. But GLD and GDXJ did not, okay not a big difference but a divergence nevertheless. However in looking at last weekend's update we noted the same  end of day buying which did not keep the market from crashing this week. 

Central Fund  ended the day at a whopping 5.9% discount to the NAV. For $17.58 one could buy $18.68 worth of gold. While I do not have access to a  long term chart on discount / premium for CEF, it is highly unusual for it to trade at such  a discount. This is an example of an extreme.  Is that capitualtion or irratonal valuation or the start of a massive move out of metals?

Central Fund

Central Fund takes out its 200 week Moving Average. 

I read several blogs and updates this weekend.At this point no one knows if the metals

 - are where stocks were in Fall 2008 with a lower low still ahead

- or are like stocks in 1987 with a washout finally done so a slow climb back can begin. 

We will update. I suspect  the best place to watch these gyrations is from the sidelines with no current position in metals. As one reader noted in our opening comments, one has no way of knowing what the Big Banks will do next, and the Federal Govt allows them to do whatever they want. 

USO Paper Crude Oil

Is this the start of a 2008 type fall in oil prices?  See my article to follow in the next post.  

SPX 15 minute chart

Dick Arms was not kidding, note the volume spike at the end of the day. And it happens everyday, gee do you suppose Ben calls the boys at Goldman and says right about now would be a good buy point?

 NYSE Summation Index

I paired the NYSE summation Index with the SPX simply because most are more familiar with the SPX numbers. Stocks typically top into tax day which is Monday but stock indexes remain in strong upward postion. The Summation Index suggests we could see correction.

US Dollar

The US Dollar is at the top of its weekly range. the 13 week MA is no where close to breaking down through thee 34 week MA. So the US Dollar remains strong.

TLT Bonds

Bonds broke to the upside and the MACD is turning up.  

hanks for reading The Market Perspective

Dennislelam@gmail.com

 

 

 

The Market Perspective bases its information on techniques and sources that have been found to be reliable in the past, and The Market Perspective tries to base opinions on sound judgment and research, however, we do not guarantee that future results will match past performance ands no guarantee can be made that advice will be profitable. The Market Perspective accepts no money for stock recommendations and is purely motivated by its own research in recommending any stocks.  Put another way, the responsibility for decisions made from information contained in this letter lies solely with the individuals making those decisions. The editor and persons affiliated with The Market Perspective may at times have positions in securities mentioned.  Nothing contained herein represents an offer to buy or sell securities. The Market Perspective encourages investors to be diversified, and to maintain sell stops and risk control over their valuable investment capital.  No guarantee can be made to the accuracy of text or charts.

 

 

Weekly Internals Roll Over; The Recession Gets Underway !

Weekend April 6 2013

496,000 left the labor force. They retire, quit working, went back to school, or just gave up looking for work. For every Unemployed american who found a job in march, about five left the labor force ( the reason for the drop from 7.7 to 7.6% unemployment)If the administration can convince another three million Americans to leave the labor force, the President will be able to hail full employment. 

Making Work not Pay, Weekend WSJ April 6-7 2013, Page A 12

My fairly confident prediction has been that we are entering a period much like 1973-74. The markets hit a new high in January 1973. Two years later the Dow had lost half its value. The jobs report Friday is precisely how such a move begins.  Forty years later to the month, the markets hit a new high and then turn down.

 The WSJ notes that a failing education system that does not give young Americans enough skills  to compete in part of the problem. Another is that the increasing welfare food stamps, disability, etc brings a disincentive to take a low paying job. And so things get demonstrably worse as people readjust to a lower standard of living but likely don't have to work for it. This of course also increases the cash only shadow economy.  The jobs report combined with the rollover of our internal indicators caused me to declare that the Recession has begun. Other factors which we have discussed for months and year support this concluson as follows. 

Judge Ruled for Stockton CA Pensions, not bond holders.   Other cities facing pension obligations versus employees versus stakeholders versus bond holders are now likely to take bankruptcy to rescue their pension obligations. Mert Whitney was simply early and too narrow in her prediction of municipal problems. 

The Wheels are finally coming off the US Education Juggernaut - criminal indictments for cheating.  The US spends thousands of dollars per student to trail Eastern European countries in every education category. 

Delinquencies or deferrals on college loans continue to climb.  Again this is a long runn ing theme of ours, the trillion dollar debt that echoes the sub prime mess. And it won't go away. 

Downtown Office Market Struggles. The recession is underway as our headline reads. One of the biggest losers in the 1973-74 recessionwere REITs. Now it is possible to rent downtown office space like motel rooms so there are alternative.s This article notes that Downtonw Dallas already has a whopping 27 milliion SF vacant. Can that be right, is that a misprint in the article?  Note that Class B and C space in San Antonio is 42% vacant.  As the article says SA never recoverd from ATT moving to Dallas and vacating some large buildings. But I also see strip centers in the well to do north part of town that have never been occupied since construciton. 

Stock Market

Both the bullish percent in the main panel and the summation Index peaked in February. The NYSE itself held up into April. so the underpinnings are already unravelling. We are using the crossover of the 13 and 34 day exponential moving averages in the main panel. Notice the 13 crossed over in December  Now it is just almost reversing direction> A clear crossover to the down side this week will be a confirmation that things are indeed slowing down. 

NASD Summation Index Rolls Over

It is always difficult to figure out what stage of an Elliott Wave the market exhibits. Internal indicators like the Summation Index however are unequivocally clear. Notice this indicator topped early in 2011 and 2012. It is now doing the same thing at the same time this year. the NASD 100 is at the top of the chart. Notice that once the NASI broke the 13 week EMA , the indicator moved to much lower levels. This suggests the internals have peaked whether stock indexes make higher high later this year or not. Remember our two doctors featured last weekend who just now got back in the a market, whoops. 

Speaking of the tech stocks, here is an example of the sort of mood shifts now taking place. I would agree that the momentum for the growth of Rackspace is waning but look at how violently mood shifted. 

RAX

It took six months ot go from 42 to 80. But the trip back down only took two months to return to 45. 

You might put this chart on your bulletin board. There will be a lot more of this over the next two years. First Apple, then Rackspace. The number of customers, total revenue, caliber of the employees did not change significantly since last August, but social mood sure did. 

Bonds

The dow recovered from being down 172 points on the jobs report to down 40.86 by the close. So perhaps the jump above the  downtrend channel and the spike in volume  is an outlier, we shall see. Clearly investors don't wait to pull the bond trigger in a flight to safety.  All the MAs are still down with no crossovers. We will need to see continued flight to bonds for some time to turn this trend up. 

Canadian Dollar

I had a whopping 250 shares of FXC average price 97.20 and sold thursday morning for a few bucks profit. Note how the Loonie fell Friday on the jobs report and then came right back up from the uptrend line. That is an encouraging signe the commodity rally may be underway. 

US Dollar UUP ETF

UUP allows us to show intra day changes, will the support at 22.4 break?  I am guessing it will but it is going to take more sustained rally in the Canadian and Aussie Dollars.

GLD for Intra Day insight

New readers should be aware that we had it right in our call Sept 18 TMP exits positions.

Next time I will listen to myself, I should have stayed out or better yet, gone short using the prabolic SAR system. We however were lured back ahead of the bottom. We are determined to avoid that error again.

GLD is still below its downtrend line. GLD  itself needs a close over 156-157 and then 162  to turn the trend back up. I drew the red line in for GLD at that point. Until then let's not get fooled by a move like late February or March which then turned down to new lows.   A higher MACD in the lower panel is encouraging but big whoop, as Jesse says the banks must be tamed.

GLD Volume

As price dropped to a new low, the mood shifted and some buyers clearly rushed in. Was this  the final knock out blow that will set a bottom for the market?  I suspect so but as we have been wrong just a month ago we will be merely optimistic. 

Upon reflection Here is the Bottom Line on Gold and Silver PAR SAR on Central Fund

The weekly PAR SAR issued a sell signal just weeks after our exit. This weekly indicator has been

right all the way down. Until we get a weekly close over 20.44 there is no reason to be long, simple as that.

Ratio of CRB to Stocks

MACD and RSI are turning up but the ratio itself is a long way from recovery. 

Crude Oil Daily

I am more optimisitc on oil than most. The energy stocks in the next panel have turned down with the overall stock market. But the convergence of moving averages above along with the potential low in gold and silver suggests the commodity sector is gearing for a final run up. 

Unleaded Gasoline

Unleadeed gasooine looks to be makigng its third higher low or will in the next couple of weeks. 

 Bottom Line

Stocks are repeating their action from 40 years ago. the message of the NASD Summation Index is clear, it is headed down. Commodity prices show signs of bottoming as a final thrust up is expected. This is a  a result of Central Bank Money printing world wide.  

Socionomics

Coincident with the rollover in the NASD and stocks in general, the President's popularity has now fallen to about even on the approval disapproval scale.  While I am not a fan of the Administrations policies, the point here is to demonstrate that policicians in general will fall into further disfavor as negative mood drives markets down. The same thing happened to Richard Nixon forty years ago. The same thing happened to Bush I in his re election period in about the same time frame 20 eyears ago. AS the market is making a five year top, expect approval ratings to fall much lower than in 2011. 

The Big Picture on Mood

The high for the NDX around Year 2000 was 4816. the low in 2009 was 1016.

4816 + 101016 = 5832 / 2 = 2916. A rally in Apple coul take us there but at any rate the markets are now about half way back in their total range to the top. This would be a typical re tracement in a period of stagnation, which is just what we are in. 

Thanks for reading The Market Perspective

Dennislelam@gmail.com

 

 

 

The Market Perspective bases its information on techniques and sources that have been found to be reliable in the past, and The Market Perspective tries to base opinions on sound judgment and research, however, we do not guarantee that future results will match past performance ands no guarantee can be made that advice will be profitable. The Market Perspective accepts no money for stock recommendations and is purely motivated by its own research in recommending any stocks.  Put another way, the responsibility for decisions made from information contained in this letter lies solely with the individuals making those decisions. The editor and persons affiliated with The Market Perspective may at times have positions in securities mentioned.  Nothing contained herein represents an offer to buy or sell securities. The Market Perspective encourages investors to be diversified, and to maintain sell stops and risk control over their valuable investment capital.  No guarantee can be made to the accuracy of text or charts.

 

 

This Time It's Not Different

Weekend March 9 2013

“After several depressing years, wealthy drivers in Europe think the worst is behind us, and they’ll start spending again on their favorite cars,” said Fabio Barone, the owner of two Ferraris and chairman of Passione Rossa, an owners’ club.

Ferrari $1.3 M Hybrid Hits Resurgent Luxury Market

Thanks for an alert reader for sending us this link. It it typical thinking at market tops that this time it is different, just because we are back at the same level which preceded the last crash, how could it happen again?  Today Jaguar, Bentley, Rolls, Ferrari jockey for the ultra luxury market, in the US in the 1930s it was Auburn, Cord, Duesenberg, all out of business by the end of that decade. 

Our last two posts listed significant instances of mood change. We would add at least one more. Harry Browne, Libertarian candidate for President observed that if either existing party were to disappear, it would be the Republicans. The Democrats stand for something whereas the Republican are an ever shifting mirage. Lindsey Graham and John McCain are grappling with Rubio and Rand for national control of that party.

I just thought Bentley's operation was expensive, how about million dollar dog! Thanks to a reader for bringing this expansive story to our attention. Bentley is our adopted stray who is recovering from knee surgery. Stitches are out, has to be reminded of restraint!

Stocks

Stocks continue to power up the advance decline volume is in heady territory but not backing down. This is typical of the seasonal high for stocks going into April 15 tax time. 

Re living the Fall of Apple

On balance volume turned on that proverbial dime at the top for Apple. This could be instructive in watching other stocks at their recent high like say, how about Google.

Google

Google dropped 80 points in one day last October. Now price has jumped to a new high, note the gap up at far right and then pulled back along with a small retreat in OBV at bottom. This looks like the start of the same set up from last october, don't you think? GOOG is 160 points above its 200 day MA.

Bonds finally Give Way

TLT held to 116 throughout February. The lure of stocks at all time highs is causing the public to shed its love affair with low yielding bonds for high priced stocks. As Jim Cramer says, you gotta buy now, we of course are not saying that at TMP.

Weekly TLT likely headed to...

The weekly parabolic stop and reverse gave another sell signal at the start of the year. This past week it broke through its second Moving Average. Real support lies at the 200 week MA of 100.

Copper

You better stop
Look around
Here it comes, here it comes, here it comes, here it comes
Here comes your nine-teenth nervous breakdown.

Rolling Stones, Nineteenth Nervous Breakdown

CNBC has been flashing headlines on screen about how Copper has reached a new three month low-surely a version of the 19th nervous breakdown. They of course neglected to suggest that might be a buying opportunity, Cramer was taking the time recommending stocks of course. 

Copper fell with gold this past month. It is putting in a higher low in price. At bottom MACD is curling up. 

COPX

After extensive negative publicity on the sector, copper miners look for a bottom and turn up. Again this is another significant event of the past week. 

 

US Dollar versus Canadian Dollar

The puzzle piece that still does not fit is the US Dollar. It reached another high Friday. The Canadian Dollar shown in red also had a nice bounce Friday. The Aussie still lacks an upward bias. 

GDXJ....and now the moment we have all waited for....

GDXJ appears to have found some footing along with XME, COPX, SIL. On balance volume is beginning to bounce at bottom. OBV also bounced on the weekly chart, not shown. So the last phase of the bull market since March 2009 hs begun. Commodity producers and commodity prices are moving up as a result of excessive money printing world wide. 

Unleaded Gasoline

We suggested a few days back that gasoline wold fill this gap and then begin climbing once more. Here we go. Local news is forever focusing on the pump price which lags the futures about three weeks. Expect cute young ladies on tv announcing that consumers are finally getting relief at the pump this next week. But the real story is that prices will be at new highs over the next three months. 

 Crude Oil

The Previous high was $110. Let's set our sites on that number for now. At bottom the Energy Service XES pulled back and now advances. While it is clearly higher, it is perhaps the best way to play energy to the upside. 

GDXJ to SPX

The ratio chart of gdxj to stocks shown by spx finally begins a reversal. Note the volume spike at top and the curl up in MACD at bottom. 

Bottom Line

Markets now enter the final phase duplicating the move from late 2007 to mid 2008. This period saw stocks topping and commodity prices wildly surging. Oil as mentioned many times here hit $145, then collapsed to $35 by Christmas. Whether that will be repeated remnains to be seen but the road map is clear. Clear meaning stocks topping while commodities make new highs. 

Stock favorites like Apple and RAX have already begun their respective bear markets. We suggested earlier that Google's  pattern looks the same as when it last fell. 

What could go wrong on the way to US Energy Independence?  It costs a $70 a barrel to drill for oil and gas. A collapse in the price of oil later this year would be a disaster for all the money now betting on Eagle Ford, North Dakota, and the Permain Basin once again. We will monitor that situation. 

I just went to gmail and found another thoughtful question from a reader. The reader noted my comparison with 1973-74, did I really think we might fall 50% again. Indeed, let me share my answer as his was an excellent question, and clearly he and I are thinking on the same lines,I completed these posts just as he wrote. My reply below.

 

We are clearly thinking on the same track at the same time. I was just finishing three or four posts for TMP this weekend. The reason for so much is that exactly like yourself we have not seen this level of complacency since 2007-08 or March 2000.  And believe me this is the way it was in 1973. You could have gotten astronomic odds against a bet that Ross Perot would go out of the stock business but that is exactly what happened. I have listed all these events as clear evidence it is 1973 all over again. 

You ask, could  the whole thing could collapse 50% and that is an excellent point. Apple just collapsed 39% in six months!!!!!!! Apple was the guaranteed cannot fail no debt sitting on $137 billion cash Wall Street Darling... And last October everyone on CNBC thought Apple was going to 1000, not whether it was but how fast would it get there, remember NASD 5000 on CNBC in March 2000,  

Bill Griffeth was beside himself excitedly announcing every new 1,000 point rung on the NASD ladder. same thing. Recall the last 3,000 NASD points then happened in a matter of months after an 18 year climb. 

Dennislelam@gmail.com

 

 

 

The Market Perspective bases its information on techniques and sources that have been found to be reliable in the past, and The Market Perspective tries to base opinions on sound judgment and research, however, we do not guarantee that future results will match past performance ands no guarantee can be made that advice will be profitable. The Market Perspective accepts no money for stock recommendations and is purely motivated by its own research in recommending any stocks.  Put another way, the responsibility for decisions made from information contained in this letter lies solely with the individuals making those decisions. The editor and persons affiliated with The Market Perspective may at times have positions in securities mentioned.  Nothing contained herein represents an offer to buy or sell securities. The Market Perspective encourages investors to be diversified, and to maintain sell stops and risk control over their valuable investment capital.  No guarantee can be made to the accuracy of text or charts.

 

Stocks Eye All Time Highs: US Dollar Soars

Weekend March 2, 2013

What matters exponentially more than that MBA is the set of skills and accomplishments that got you into business school in the first place. 

A Smart Investor Would Skip the MBA, page C 3 Weekend WSJ

Student Loan Delinquency Rate is Increasing

One of our long term themes at TMP is the increasingly dangerous level of college debt with no collateral. Passing a certified exam wold be cheaper and preferable to an MBA, as I discovered with my own MBA in the real world workplace. I returned to UT Austin, studied a semester and passed the CPA exam on my first attempt. Good idea. Oncxe this dawns on college students we may have an over abundance of college space just as we do with retail space. 

CNBC did note on screen yesterday  how close each of the major indexes were to re visiting 2007-2008 highs. So let's take a look.

Monthly SPX

Stockcharts reports the high in October 2007 as 1576.09, a mere 57.89 points or 3.8 percent higher. We suspect the market will go higher still, notice it shook off the blather about the Sequester Friday. 

As always the internals of the market provide more clues than the price index itself, let's take a look.

NYSE Summation Index

Now this is truly interesting, spend some time looking a this.

• Notice that the indicators do not all top or bottomn at the same time. 
• The NYSI bottomed in mid year 2006 and 2012 at the same level, -500! Red Arrows
• NYSI then topped just over 1,000 shown by the blue arrows, then turned down!
• The actual price index,the NYSE  held up well into 2007, in fact peaking that fall
• Now as then price is still climbing. 
• In
• In  the lower panel MACD peaked well after the summation index in 2007 and before the price index topped out in the highest panel.
• Now MACD is still climbing. 
• The actual internal high for NYSI occurred in 2009 on the big rebound in the market. 
• If history repeats, 
•     the summation index may have registered its final high
•     MACD should top next while NYSE is still climbing

Taken altogether there is compelling evidence of a forthcoming market top in the price index. The idea that we are starting a new bull market from such elevated levels is not born out by internal analysis. This is a highly dangerous market as owners of Rackspace and Apple have recently learned. 

 Bonds

Junk is all the rage these days as Federal Reserve policy pushes investors away from safety and into the far reaches of the risk spectrum.

Drunk On Junk, Rushing to Risk

In low interest rate environments the unwitting public always grabs for yield with out thought to the risk involved. We should expect fresh highs in Junk and that is just what we are getting.

JUNK

Junk was trading just under 30 pre 2008 crisis. The desire for yield has now pushed it another 33% to 40. That means the fund has that much further to fall in the next downturn. It is truly typical of past market peaks, ie low interest rates,  that investors are pouring money into these funds at these levels. 

TLT Govt Bonds

Two things are supporting this bond market.

The $85 Billion  per month the FED purchases.

The fear in the market that scurries investors back to low yields with each market hiccup. 

TLT is in a downtrend channel. But 116 remains support for now. 

The US Dollar Goes Vertical - Daily Chart

Money is clearly fleeing to the US Dollar, hence gold tanked. It may well be that the international Debt Crisis is getting under way. There are reports of another Argentine default, the messy Italian Elections, and the realization that nothing really changed in Europe, 25% unemployment in Spain and Greece, and so it goes. 

Weekly US Dollar

 The break out on the weekly chart is significant. Can we assume that

the race for dollars to satisfy debt has begun

this will generate a powerful deflationary wave around the world adversely affecting emerging markets whose main exports are commodities, Mid East are you watching this?

Most world debt is denominated in dollars. It takes dollars to re pay debt so the race is on for dollars. commodities priced in dollars become cheaper.  Here is a good example.

Crude OIl

Crude oil has a near perfect inverse correlation with the US Dollar shown at top.

Copper

Copper looks just like crude oil for the same reason, a strong dollar. 

Ratio Chart Gold to the SPX

The correlation at bottom shows gold negatively correlated to stocks since the high in 2011. This suports Jesse's thesis late this week, Jesse's Cafe Americain, that gold will rise when stocks fall. This chart is telling us there is no reason to buy gold until this reverses. the 5  wave labels are sheer guesswork on my part. 

Gold 

Gold has reached its 125 week moving average, the first visit since the crisis. 

Notice the 200 week MA is down at 1400. Given the strength of the US Dollar, gold could go there. 

GDX to SPX, Looks Like its Back to the  2008 lows

A couple of weeks back I did not think the miners would re visit the 2008 lows relative to stocks, my mnd is changed. I don't see any support between here and the 2008 low, do you?

We linked to an article earlier this week, Feb 26,   which analyzed Barrick's cost of gold production to be $1300. The  author concluded gold was therefore not going back to $1300. But a look at the US Dollar chart suggests otherwise. Indeed, commodity markets go below the cost of production at market extremes, this pushes the weak players out of the market, those with marginal properties or too much debt or both. 

As gold has fallen from 1800 to 1575, the profit margins of gold miners with a cost of $1300 are being squeezed. If gold falls to 1400, recall that is the 200 week moving average, then there will be little to no margin left. The miners will be at break even, the stock value will be nill. So we could see a complete price collapse in the miners before this  is done, which is what that extreme low was in October 2008. 

Monday February 25 was option expiration for gold. The succeeding days would tell us if anyone would step up and buy pushing the price back over 1600,  the majority did not. 

GDX to Gold, Historic undervaluation revisited

This chart suggests that if history repeats, we should see a resolution over the next two months. Of course there is nothing to keep the chart from going to a new low either. GDX bottomed at 15.48 in 2008, less than half where it is today. Now that I think about it, perhaps GDX is the item that is irrationaly priced

I have considerably lightened my exposure to the miners, that was painful but we are near shall we say uncharted territory. 

In October 2008 Gold ranged from $681 - $936, doubling that would be 1362 to 1872, which at least replicates the upper end of the current range. Is that a fair analogy, I don't know. 

GDX ramged from, $15.48 - $34.71. 

My point is that the potential for mining stocks to get cut in half in price over the next two months is real. 

Bottom Line

There is reason to believe that the internal indicators have topped for major stock indexes. MACD and the indexes themselves should put in their highs later this year. The Dollar has broken out in an impressive parabolic rise. This has toppled commodity prices. Expect commodity exporting countries to be hit hard as a result. Gold miners are being squeezed with the price drop in gold. Evidence has been presented that even more severe drops in the miners may lie immediately ahead. And it makes sense that the FED in concert with the big banks would try to drop gold prior to even more money printing. 

Socionomics

In her column last week, Peggy Noonan stated things could not get much worse in terms of hostility between the President and the House. I suggested she was quite wrong. Since then the President, like the spoiled kid who owns the football we are playing with, wants to punish everyone for not doing his bidding. The 'cut' of 2.3%, remember we borrow 40 cents of each dollar spent. Obama  said would reduce Border Patrol Salaries 10%. an aircraft carrier has been docked in Norfolk rather than sent back to the mid East. Business and bases in San Antonio are threatened. it is truly a Presidential snit fit. 

We have written extensively of a coming hardening of attitudes and negative emotion. Look no further than the White House to see it. 

Dennislelam@gmail.com

 

 

The Market Perspective bases its information on techniques and sources that have been found to be reliable in the past, and The Market Perspective tries to base opinions on sound judgment and research, however, we do not guarantee that future results will match past performance ands no guarantee can be made that advice will be profitable. The Market Perspective accepts no money for stock recommendations and is purely motivated by its own research in recommending any stocks.  Put another way, the responsibility for decisions made from information contained in this letter lies solely with the individuals making those decisions. The editor and persons affiliated with The Market Perspective may at times have positions in securities mentioned.  Nothing contained herein represents an offer to buy or sell securities. The Market Perspective encourages investors to be diversified, and to maintain sell stops and risk control over their valuable investment capital.  No guarantee can be made to the accuracy of text or charts.

 

Things Really Never Improved Much

Weekend February 23 2013

Special note to readers. Go Daddy only sent us an email along with the rest of their daily spam that our domain name rental was about to expire. As I trash what looks like spam,and Go Daddy certainly made no effort to contact me otherwise, the site was down for a couple of days. This past week.Thanks to alert readers who informed us of the problem. We should be good for another year now. 

__________________

Yet unemployment is close to 27% in Spain and Greece. The eurozone economy shrank even faster throughout 2012. The economic fundamentals in France are getting worse.Will German taxpayers be willing or able to bail out the French, don't count on it.

Why the Euro Crisis Isn't Over Page A11 Weekend WSJ

TMP - Nothing ever changed in Europe people just stopped worrying about it. 

It  further sours the sourest White House Capitol Hill relationship of modern political history. That relationship probably can't get worse...

Peggy Noonan Government by Freakout Page A 13 Weekend WSJ

TMP - Once again Peggy misses the import of socionomics. This relationship is happening at DOW 14,000, with employment at least  somewhat better. Let each of those measures get worse and Peggy you ain't seen what sour really looks like. Social mood across the country is still relatively positive, the finger pointing for responsibility for the economy is just getting underway. It is as though Jimmy Carter had won his re-election. 

Two things Metal Bulls Got Wrong About QE This write correctly observs that the US dollar is up, see chart below

We start this weekend with the currencies.

Euro

At top the Canadian Dollar falls. In the center the Euro has fallen back to its uptrend line. It needs to reverse to keep its upward move alive. At bottom the Australian Dollar needs to rally quickly. Otherwise gold will fall again. 

Bonds TLT

This chart of TLT looks more like a correction than a collapse. MACD looks to be bottoming, price ahs made a higher low at its second MA. 

Gold

As I have said many times there are other sites that count elliott waves, I am no expert. Above there are at least two potential counts. One is that the Large Wave Three ended Wednesday. The spike in volume suggests some sort of ending wave. And it moved up the next two days. Another possibility is that five waves have ended if Red 3 was in fact the end of a large Wave 3. But frankly the drop does not look big enough to be a third wave, the overall drop does. 

 Jesses's Cafe Americain sugggests the gold market may have found footing at  1550-1575. Indeed it hit 1550 this past week. But he wants to examine the options expiration on Monday.

 Weekly Gold

The bull case is that 

• weekly gold recorded a slightly higher low
• Sentimentis massivelynegative, the WSJ ran a comment yesterday that owning mining stocks was like tying rocks to your feet
• Gold pulled back from its lowest intra day price by the end of the day Wednesday
• Central Bank money printing will surely eventually send gold higher. 
• The bears ried to break support at 1550 and failed 

 The bear case is that

• the same group of bulls has been bullish all the way down and keeps re inventing their story on every drop
  buying into every drop thinking that is THE bottom is precisely how a bear market begins
• the 200 week MA for gold lies lower at 1400, note the 125 week MA has now been breached
• a brief rally here and then a plunge to 1400 would make for a more convincing five wave decline
• support at 1550 will be tested again, just run the market back up so they can short it again.

Bear Case - Stocks now Outperforming Gold on the Weekly Chart

SPX to Gold - Uh Oh!

When this ratio chart is falling, Gold is outperforming Stocks.  When this chart is rising, stocks are outperforming Gold.

Note that the ratio has now risen above all weekly moving averages. This can only change if spx falls relative to gold. This is the first time this has happened in five years. One reader of TMP warns gold may be in for a far larger tumble than most imagine. This charts backs up that few. 

Daily GDXJ

While the chart is massively over sold GDXJ just went to its lowest price ever which is hardly reassuring. 

Weekly GDXJ

The weekly chart also suggests some sort of low should be at hand. The weekly lags the daily so the turn up which shows in the daily is not as evident in the weekly. 

Thirty Minute GDXJ

The thirty minute chart shows that the massive selling in GDXJ subsided on Wednesday. Somce upward correction is now taking place.  Everyone who shorted GDXJ has to buy their stock back to take a profit. That will perhaps help support a rally. 

So what happened? A massive bear raid on gold was staged by funds and banks. 

Here is one view, there are no markets just interventions by Central Banks

Internal Indicators

150 day  Percent of Stocks

Here we used FIB ratio Moving Averages of 13,21,34 weeks. The MAs are still climbing RSI at top is bending, MACD has not rolled over at bottom. 

Summation Index NYSE

The summation index turned red and started dropping this past week. MACD looks toppy. 

Stocks are making the third big high since Year  2000 and Year 2007-08. We are a FIB 13 years from Year 2000 and a FIB 5 years from 2008. The VIX jumped and fell back this week. but do nnot underestimate the determnation of the FED to keep things afloat. Stock are far too overbought to participate at this point. 

Gold and metals and miners should enjoy a relief rally to the upside. But the graph of SPX to GOLD suggests the tenor of that market has changed.We will watch this sector closely and continue to report. 

Socionomics

We wil have an update in a separate post about personal safety. We have warned of  a forthcoming hardening of attitudes. A careless  attitude can rbecome quite dangerous in this environment. More in our next post. 

RAX

Rackspace has been one of the hottest stocks around, and a real newsmaker here in San Antonio. And then the market became disenchanted. Notice how quickly the mood changed, more of this will follow in the overall market the next two years.

Dennislelam@gmail.com

 

 

The Market Perspective bases its information on techniques and sources that have been found to be reliable in the past, and The Market Perspective tries to base opinions on sound judgment and research, however, we do not guarantee that future results will match past performance ands no guarantee can be made that advice will be profitable. The Market Perspective accepts no money for stock recommendations and is purely motivated by its own research in recommending any stocks.  Put another way, the responsibility for decisions made from information contained in this letter lies solely with the individuals making those decisions. The editor and persons affiliated with The Market Perspective may at times have positions in securities mentioned.  Nothing contained herein represents an offer to buy or sell securities. The Market Perspective encourages investors to be diversified, and to maintain sell stops and risk control over their valuable investment capital.  No guarantee can be made to the accuracy of text or charts.

 

 

Re Thinking The Market Positions

Weekend February 16 2013

Wal Mart Feb Sales a Disaster The higher payroll tax kicks in and has an immediate effect at discount chains.

Gold benefits from a currency war.  Maybe but it did not this week as the dollar strengthened Thursday and Friday. 

G20 announces 'no currency war.' Take your pick of the above or this one. I suspect we have a parallel with OPCE trying to control oil prices. The problem is that OPEC members always cheat on their production. In the end nothing holds the G 20 together and it will be every country for itself. 

Half the states will not partner with the Federal Govt on Exchanges This is a continuation of the many dynamics of what we term The New Civil War. The New Civil War pits one area of the country against another. This dynamic takes multiple shapes of union shop versus open shop and now Obamacare splinters the states in yet another fashion. 

Socionomic Observation Recall that the US tried a Confederacy of State before it adopted a constitution. Even back then, a loose coalition of states without a Central Authority simply did not work. This is the problem with Europe adopting the Euro today, there is no enforcement mechanism. The New Civil War is causing one rift after another changing the country into red and blue, union shop and open shop, insurance exchange and no insurance exchange. I can imagine the government trying to strong arm states into this by withholding various Federal Funds which will only ramp up The New Civil War. Breaking News, speaking of the New Civil War an alert reader of TMP sent this week's cover of Barrons, Obama the Greek, The USA Can Be Greece.

Our belief that gold would bottom and rally waseither  negated this past week or delayed until next week. I regret not paying more attention to my own analysis here and less to the thoughts of others. I followed the latter rather than my own instincts. The result was incorrect advice in TMP which I sincerely regret. That is not an excuse but that is what happened. Recounting the last few months...

We were long commodity stocks, had nice gains and exited in mid September 2012. The charts and commentary are all still up. This was a correct move. 

Our mistake was re entering at lower prices thinking a low was forming in those same commodity stocks.  We did suggest a low occurred in stocks in mid November but have consistently warned to avoid the stock market the lst few weeks. Indexes have revisited previous highs from Year 2000 and 2007. 

Again we seriously regret our error. Now let's refocus on our longer term view that the markets are likely entering a repeat of 1973-74. The Wal Mart headline may well be the kick off to such an event. The fact that a two point increase in social security tax would be felt nationally at the reail level says a lot about just how fragile the economy is here. 

Markets are closed in the US on Monday but will be open in Asia. There is not a lot of point is speculating today, we might as well see what happens in Asia on Monday, we will comment again on Monday as the action unfolds. 

Gold

I have attempted to outline a five wave pattern. If Wave One equals Wave Five, 1575 might be support but clearly 1525 is longer term 'support.' If this is the start of our massive deflationary wave of course support means nothing. 

However, we know that extreme expression of social mood happens near the end of a trend. Gold has dropped $200 but it is only now that numerous posts are sounding the alarm. A panic represents irrational herding near the end of a trend. GDX below has lost a third of its value. It is individual investors cashing out causing sales of mining  stocks which further depresses the price at this time. 

GDX Weekly

Does 40 mean anything as support? At this point we cannot know. 

GDX Daily

The CCI indicator is higher  now than on the last drop. Price was 8 bucks above the 200 day MA at the top and is now six bucks below. Symmetry anyone?

US Dollar, Bonds

The Dollar Bonds Shorter Term

The Dollar moved up the last two days. But it has yet to take out the 200 day Moving Average. So far this is a third lower high. At top bonds have sold off. MACD is indecisive.

Stock Market

This weekly high low indicator now flashes an island reversal signal at the top of the recent run up. MACD is at max in the lower panel. 

Bottom Line

It is possible that a world wide massive devaluation began this past week. This would be the start of a world melt down in risk assets. That is one scenario.

Another scenario is that extreme mood is occurring near fo this trend. We would prefer this resolution! The resolution of gold will probably not be known until later this next week after the US markets open and the intial orders placed  after a three day weekend are executed. Blogs and gold sites  are chattering that importatnt support was taken out at1625, suggesting a waterfall decline ahead. That may be the most supportive comment but we have no way of knowing at this point. A failure of the US Dollar and a rally in the Canadian and Aussie Dollars next week would help gold. 

Stocks remain in a topping formation.  

Before there was CNBC there was Financial News Network FNN. FNN became CNBC. In the 1980s a chap named Al Frank was featured on the show. Al was an ordinary guy who had started his investment letter with a mimeograph machine. He was long stocks going into the crash of 1987. Of all the talking heads back then, he was the only one to come on the show after the crash  and apologized for his outright long positions. I admired that. 

I regret my overly bullish stance on gold, my apologies in the best Al Frank tradtition. Even if things turn out as we expected we were way way early and failed to follow our own instincts.  Gold may yet bottom as everyone is now so negative on it and the US Dollar may pull back. We will report. 

 

I would enjoy hearing from readers, several of you have written with extremely constructive and insightful observations about the markets. It is good  to know we have attracted such sophisticated readers. 

Dennislelam@gmail.com

 

 

The Market Perspective bases its information on techniques and sources that have been found to be reliable in the past, and The Market Perspective tries to base opinions on sound judgment and research, however, we do not guarantee that future results will match past performance ands no guarantee can be made that advice will be profitable. The Market Perspective accepts no money for stock recommendations and is purely motivated by its own research in recommending any stocks.  Put another way, the responsibility for decisions made from information contained in this letter lies solely with the individuals making those decisions. The editor and persons affiliated with The Market Perspective may at times have positions in securities mentioned.  Nothing contained herein represents an offer to buy or sell securities. The Market Perspective encourages investors to be diversified, and to maintain sell stops and risk control over their valuable investment capital.  No guarantee can be made to the accuracy of text or charts.

 

Minute by Minute

Thursday Feb 14 2012

But minute by minute by minute by minute 
I keep holding on 
Oh, minute by minute by minute by minute 
I keep holding on 

Michael McDonald, Doobie Brothers

it's tough to watch holdings falling in value. One's natural reaction is not to say

Hey this is wonderful I get to buy for less money on the next purchase. If we were buying avocados at the grocery that would be our take on it, but on Wall Street buyers want purchases to advance in price. 

So we have been watching minute by minute, and as noted yesterday afternoon, buyers have been quietly tiptoeing in on some purchases. 

OH but first

Central Banks  purchase the most gold since 1964

The Central Bankers know the money printing game will end badly, they are preparing for it now, gold is the money politicians cannot print from trees. 

Eurozone Recession Deepens as Germany Falters

All markets do not top simultaneously. Think about the progression. Several years back I put on my student blog, Iceland Melts. Then ireland melted. Then the Club Med countries Greece Portugal Italy Spain were all in trouble, and still are, nothing has changed, just like our sub prime mortgage crisis. These are like a 1950s sci fi movie, the Monsters That Won't Die!  Now Germany slows, of course it does, as the rest of Europe is out of work there are fewer customers for Germany's higher priced goods. 

An interview with Jim Rogers is always fun.

As Ed McMahon used to ask Johnny Carson, how tough is it?  Well it's so tough that even the 

Bars and Strip Clubs feel the pinch As Barclays lays off thousands there is less discretionary income for such frivolity. 

Okay now that I am back at my MacBook Pro we can look at some charts. 

GDX

These charts explain today's title, minute by minute. At top the XME bottomed at the end of January, see the pattern of higher lows. 

At bototm, REMX looks to have bototmed Feb 7, sure it could falter here but so far so good.

In the main panel GDX lags these two but sellers have not really decisively broken 41.50. We might see a spike lower in GDX and GDXJ, one reader wonders if we see 17.50 in GDXJ today. 

Canadian Dollar

Currency charts are end of day on stockcharts so we cannot show an intrady hourly as we did with GDX but, the effect is much the same. The Canadian loonie  made its low at the end of January and then re tested it Monday, at a higher level. 

This is why it is important to examine intraday actions in multiple markets to sense when bottoms might be forming. They don't happen at once. CNBC will likely still be crowing about new lows in the gold price as many commodity producers have already bottomed.

New York Stock Exchange Index

Another reader suggests that major stock indexes peaked yesterday.   With the summation index above its Sept high in the lower panel and the price index in the main panel 800 points over the 200 day MA, that looks to be the case. Over bought signals have been flashing for the last two weeks. 

Bonds

Money continues to exit the bond market shown by TLT. Notice the MA ribbons are turning down? Three of them broke the 200 bar MA, the rout shold begin shortly.  The dollar is marking time in the bottom panel. I am thinking there is too much weakness in Europe for the Dollar to really break here but it ain't over for another few months. 

Okay,we hope this was a ray of assurance along with your morning coffee that we are on track for

a pull back in stocks perhaps over the next two weeks

a re surgence in out of favor commodity producers

if you are doubting our advice, call a Central Banker and ask what they are buying!

thanks for reading TMP.