Wednesday, July 30, 2008
Tuesday, July 29, 2008
watching
PBW is a clean energy ETF with solar holdings that we all have on our watchlists.
SLX is a steel ETF that might be a good play this week as we saw some big moves today in AKS, RS, MTL (bullish hammer after capitulation?), X, MT, et al..
SLX is a steel ETF that might be a good play this week as we saw some big moves today in AKS, RS, MTL (bullish hammer after capitulation?), X, MT, et al..
Monday, July 28, 2008
Clinton's Role
An interesting read via Stewie's blog regarding the mortgage crisis. Jason Leavitt does a fantastic job summing up the role's played by each variable of the mortgage melt-down. But, ultimately, Bill Clinton seems to deserve to be held accountable as well. Leavitt writes;
"...on November 12, 1999. With the CEO of Citigroup looking over his shoulder, Bill Clinton signed into law the Gramm-Leach-Bliley Act which repealed the Glass-Steagall Act of 1933.
The Gramm-Leach-Bliley Act permitted commercial and investment banks to consolidate, and almost overnight behemoth financial service companies that supplied everything to everybody were born. Smith-Barney, Salomon Brothers, PaineWebber and many other well-known and respected investment banks were gobbled up by Citibank, JP Morgan etc, and while the lay public didn’t have a clue what was going on, conflict of interests were rampant. Suddenly the banking arm of one of these financial service companies was pressuring the investment arm to raise its ratings on stocks to help lubricate the deal-making process. (As a quick side note, Citigroup played a major role lobbying for an end to Glass-Steagall. Starting in 1998, the finance, insurance and real estate industries together spent more than $200 million to get Glass-Steagall repealed, and not so coincidentally, only a couple days after Clinton signed Gramm-Leach-Bliley into law, recently-departed Treasury Secretary Robert Rubin was hired by Citigroup as a member of its 3-person office of the chairman.)
If you start with today and work backwards with intentions of figuring out when “all this mess started,” you’ll find many parties that played a role in adding fuel to a fire which was spinning out of control, but your journey won’t end until November 12, 1999 when Bill Clinton tore down the walls within the financial community.
I’m not going to go as far to say if Bill Clinton had not repealed Glass-Steagall, we wouldn’t be in the financial situation we’re in, but I can certainly say it would have been much more mild and probably isolated. When second and third parties are involved in a transaction, more due diligence is done, more scrutiny is applied, and less risk is taken."
It's a very interesting read. And to top it all off, the article ends with a great photo of Bill Clinton after signing the Gramm-Leach-Bliley Act. Looks like a circle-jerk at an occult sacrifice...not that I know what one of those would look like, but I've seen some movies.
"...on November 12, 1999. With the CEO of Citigroup looking over his shoulder, Bill Clinton signed into law the Gramm-Leach-Bliley Act which repealed the Glass-Steagall Act of 1933.
The Gramm-Leach-Bliley Act permitted commercial and investment banks to consolidate, and almost overnight behemoth financial service companies that supplied everything to everybody were born. Smith-Barney, Salomon Brothers, PaineWebber and many other well-known and respected investment banks were gobbled up by Citibank, JP Morgan etc, and while the lay public didn’t have a clue what was going on, conflict of interests were rampant. Suddenly the banking arm of one of these financial service companies was pressuring the investment arm to raise its ratings on stocks to help lubricate the deal-making process. (As a quick side note, Citigroup played a major role lobbying for an end to Glass-Steagall. Starting in 1998, the finance, insurance and real estate industries together spent more than $200 million to get Glass-Steagall repealed, and not so coincidentally, only a couple days after Clinton signed Gramm-Leach-Bliley into law, recently-departed Treasury Secretary Robert Rubin was hired by Citigroup as a member of its 3-person office of the chairman.)
If you start with today and work backwards with intentions of figuring out when “all this mess started,” you’ll find many parties that played a role in adding fuel to a fire which was spinning out of control, but your journey won’t end until November 12, 1999 when Bill Clinton tore down the walls within the financial community.
I’m not going to go as far to say if Bill Clinton had not repealed Glass-Steagall, we wouldn’t be in the financial situation we’re in, but I can certainly say it would have been much more mild and probably isolated. When second and third parties are involved in a transaction, more due diligence is done, more scrutiny is applied, and less risk is taken."
It's a very interesting read. And to top it all off, the article ends with a great photo of Bill Clinton after signing the Gramm-Leach-Bliley Act. Looks like a circle-jerk at an occult sacrifice...not that I know what one of those would look like, but I've seen some movies.
DIA
DIA had a trend-day to the downside. It set up a base break at $113.10 early in the morning. It then consolidated around $112.20, tagged the 20MA (Inverse Holy Grail) before continuing lower. Consolidation then took place for an hour and a half at around $111.65 (which coincides with a 61.8% Fibonacci retracement from the high of July 22 and low of July 15) before breaking lower. Pretty text-book stuff.
Same story with the Q's.
Something to keep in mind with these trend days comes from today's post at AfraidtoTrade.com, Corey writes:
Same story with the Q's.
Something to keep in mind with these trend days comes from today's post at AfraidtoTrade.com, Corey writes:"Most trend days begin with two common characteristics:
A low-range day prior (usually a NR7 or a doji pattern)
A (relatively) large opening gap
The last two trend days (the last was the previous Thursday) had slight but not ultra-range contraction, but neither began with a large opening gap. In fact, both were ‘creeping’ trends, which tend to be the most insidious, hidden style of trend days. Lack of an opening gap can lull us into complacency as we fail to recognize the potential for the trend day to unfold. It’s far easier to anticipate a large intrday trend day move if the initial gap occurs (and especially if there’s some sort of major news announcement)."
Friday, July 25, 2008
Thursday, July 24, 2008
Tuesday, July 22, 2008
Ca. Homes
Kah-li-for-nia foreclosures topped a 20-year high this past quarter with 63,061. That's a cash value of more than $26-billion in loans (figuring a median price for a single-family detached home in California, as of March 2008, was $413,980).yikes!
R
Ryder System Inc., had a big move today (looks like it would have made a good Over-Night Hold, perhaps we'll see some follow through tomorrow morning?).
Monday, July 21, 2008
Thursday, July 17, 2008
Dollar Index
This is a follow-up to my post yesterday regarding the U.S. Dollar index. It's beginning to look like a bearish flag formation taking shape (following the H&S pattern). Being that I don't have a forex account, nor a futures account, to take a position in this set-up I'm left trying to figure out other ways to take advantage of what might be a measured move to the downside for the U.S. Dollar Index. Here's what I came up with; First a chart of the current U.S. Dollar Index position:
Some vehicles to look into for a play on futures or forex are available through such places as invescopowershares. The first is DBV; it "is comprised of currency futures contracts on certain G10 currencies and is designed to exploit the trend that currencies associated with relatively high interest rates, on average, tend to rise in value relative to currencies associated with relatively low interest rates." Looks like a potential break-out candidate.
There's also UDN; "designed to replicate the performance of being short the US Dollar" against a basket of currencies like that of the U.S. Dollar Index.
Not as much bang for your buck as directly playing futures or forex (I really have to open one account or the other), but a viable option. If I come across any other options I'll update this post with them.
Some vehicles to look into for a play on futures or forex are available through such places as invescopowershares. The first is DBV; it "is comprised of currency futures contracts on certain G10 currencies and is designed to exploit the trend that currencies associated with relatively high interest rates, on average, tend to rise in value relative to currencies associated with relatively low interest rates." Looks like a potential break-out candidate.
There's also UDN; "designed to replicate the performance of being short the US Dollar" against a basket of currencies like that of the U.S. Dollar Index.
Not as much bang for your buck as directly playing futures or forex (I really have to open one account or the other), but a viable option. If I come across any other options I'll update this post with them.
When fast is too slow
The difference between a 1-minute chart and roughly a 30-second chart.
1-minute
30-seconds
1-minute
30-seconds
reads
Three great reads can be found here:
The Big Picture - Stick it to 'em
Who Holds all that "Agency Debt?" (a whopping 25% of GDP, or $1-trillion is held by China)
Why can't people take sound advice when it's smacking them in the face? Here's an excerpt from this link; taking note it was written in September of '07:
"...if loans were extended to people who shouldn't have received them, real estate prices would have been bid up higher than they should have been. And it is a propagation mechanism in the sense that, as long as house prices continued to rise, all sins were forgiven. Even a completely fraudulent loan would not go into default when there's sufficient price appreciation, since the perpetrator is better off repaying the loan in order to enjoy the capital gain.The problem is that, as this process gets undone, both effects operate in reverse. A credit crunch means that some people who should get loans don't receive them, depressing real estate prices, and as prices fall, some loans will become delinquent that otherwise might not. If such fundamentals are indeed contributing factors on the way up and the way down, the magnitude of the resulting decline in real estate prices, and their implications for default rates, could be much bigger than the reassuring numbers Mishkin invites us to remember based on the historical variability of these series. What worries me in particular is, if we see this much in the way of delinquencies and short-term credit concerns in the current economic environment, in which GDP has still been growing and house price declines are quite modest, what can we expect with a full-blown recession and, say, a 20% decline in average real estate values?"
The Big Picture - Stick it to 'em
Who Holds all that "Agency Debt?" (a whopping 25% of GDP, or $1-trillion is held by China)
Why can't people take sound advice when it's smacking them in the face? Here's an excerpt from this link; taking note it was written in September of '07:
"...if loans were extended to people who shouldn't have received them, real estate prices would have been bid up higher than they should have been. And it is a propagation mechanism in the sense that, as long as house prices continued to rise, all sins were forgiven. Even a completely fraudulent loan would not go into default when there's sufficient price appreciation, since the perpetrator is better off repaying the loan in order to enjoy the capital gain.The problem is that, as this process gets undone, both effects operate in reverse. A credit crunch means that some people who should get loans don't receive them, depressing real estate prices, and as prices fall, some loans will become delinquent that otherwise might not. If such fundamentals are indeed contributing factors on the way up and the way down, the magnitude of the resulting decline in real estate prices, and their implications for default rates, could be much bigger than the reassuring numbers Mishkin invites us to remember based on the historical variability of these series. What worries me in particular is, if we see this much in the way of delinquencies and short-term credit concerns in the current economic environment, in which GDP has still been growing and house price declines are quite modest, what can we expect with a full-blown recession and, say, a 20% decline in average real estate values?"
Wednesday, July 16, 2008
U.S. Dollar; Effed in the A?
With CPI numbers coming in larger than expected and inflation fears hinging with the Fed., concerns over the U.S. Dollar are prevalent.
Typically you see Head and Shoulders patterns at the top of bullish trends, but that doesn't mean they can't appear during consolidation of a bearish move. In this particular case in the U.S. Dollar index the short-term trend was up from the period between late April and mid-June before falling through it's trend line, pulling back and forming the right shoulder. Currently the index is struggling to stay above it's neckline, which we should expect it to do being that it's at a major level of support. A measured move from this point below the neckline would put this index at fresh lows in the $69.55 area. Check out patternsite.com for determining patterns and the measurement guidelines. Also, check out etftrends for ways to hedge against a bearish dollar through ETF's and ETN's. Particularly; FXE, ERO, DBV (Ascending Triangle on this one).
Typically you see Head and Shoulders patterns at the top of bullish trends, but that doesn't mean they can't appear during consolidation of a bearish move. In this particular case in the U.S. Dollar index the short-term trend was up from the period between late April and mid-June before falling through it's trend line, pulling back and forming the right shoulder. Currently the index is struggling to stay above it's neckline, which we should expect it to do being that it's at a major level of support. A measured move from this point below the neckline would put this index at fresh lows in the $69.55 area. Check out patternsite.com for determining patterns and the measurement guidelines. Also, check out etftrends for ways to hedge against a bearish dollar through ETF's and ETN's. Particularly; FXE, ERO, DBV (Ascending Triangle on this one).
Tuesday, July 15, 2008
Broadening Wedge
It appears Biotech is attracting attention currently. Here is a Broadening Wedge pattern that's taken shape in BMRN. If for nothing else, it will be interesting to watch and see how it reacts. From patternsite.com a measured move would put a break-out/-down at +/- 12%, while keeping in mind the possibility of a partial decline (explained in the patternsite.com) before the breaking move.
No Run on Banks
The big news today....there's no need for a run on your bank. And, in case you were thinking of making a run on your bank, you now (for the next 30-days at least) can't short (without already owning) FNM and FRE; as well as other big names like, LEH, MS, MER, GS.
A classic "cover-your-going-broke-ass" move. What can you expect though? We have to protect those CEO's and institutional holders of LEH, MS, et al., before their holdings are worthless, right? How would you feel if you owned 2.7-million shares as head of MS? Imagine how Barclay's feels while they're stuck holding 48-million shares in Morgan Stanley.
They're scared shitless.
So, instead of allowing the entities responsible for this mess to pay the consequences (and accept the risks they took on) we'll just help them defer accountability, give them carte blanche to the Fed, and hand the costs over to tax payers. Thank goodness we have Henry Paulson as Treasury Secretary; who would know better what to do in an economic situation like this than an ex-head of Goldman Sachs?
phheewww
A classic "cover-your-going-broke-ass" move. What can you expect though? We have to protect those CEO's and institutional holders of LEH, MS, et al., before their holdings are worthless, right? How would you feel if you owned 2.7-million shares as head of MS? Imagine how Barclay's feels while they're stuck holding 48-million shares in Morgan Stanley.
They're scared shitless.
So, instead of allowing the entities responsible for this mess to pay the consequences (and accept the risks they took on) we'll just help them defer accountability, give them carte blanche to the Fed, and hand the costs over to tax payers. Thank goodness we have Henry Paulson as Treasury Secretary; who would know better what to do in an economic situation like this than an ex-head of Goldman Sachs?
phheewww
Things that make you go "Oh Sh@!"
NOT WORK APPROPRIATE!:
- We the people are being assured, our deposits are safe. In other words, don't go making a run on your bank. hmmmm
- Wholesale inflation jumped 1.8% from May to June.
- Don't worry, that stimulus check will kick-start our economy.
- Is Bush the new Costanza? Should we suspect the opposite of what he thinks will happen?
- The Euro is the new Dollar.
- Brazil expanding beyond major cities.
- And I thought watching 30 stocks during the day was tough.
- The next big commodity?
- VW spending $1-billion for plant in Tenn. That's only $627-million after the Euro/Dollar exchange rate, what a deal!
- We the people are being assured, our deposits are safe. In other words, don't go making a run on your bank. hmmmm
- Wholesale inflation jumped 1.8% from May to June.
- Don't worry, that stimulus check will kick-start our economy.
- Is Bush the new Costanza? Should we suspect the opposite of what he thinks will happen?
- The Euro is the new Dollar.
- Brazil expanding beyond major cities.
- And I thought watching 30 stocks during the day was tough.
- The next big commodity?
- VW spending $1-billion for plant in Tenn. That's only $627-million after the Euro/Dollar exchange rate, what a deal!
Monday, July 14, 2008
DUG
As the price of oil rises, so has the ETF DUG (Ultra-Short Oil & Gas) recently. Check out the information included on seekingalpha.com, which also shows a chart representing the drop in U.S. & Global oil demand.
Check out the ETF for USO also which seems to be looking kinda toppy with that hanging man, followed by an inside doji bar, and a momentum divergence.
Check out the ETF for USO also which seems to be looking kinda toppy with that hanging man, followed by an inside doji bar, and a momentum divergence.
3G costs
AAPL sold 1-million 3G iphones this past weekend. At $199 per phone that works out to be $199-million in 3-days. We've learned that the previous iphone was costing Apple $246-$281 (depending on the model) to manufacture. Well, not only has Apple improved the technology behind the fancy phones, they also likely cut their production costs in half. The current 3G model could be coming in at around $100-$160 (depending on the model) to manufacture, according to speculation from a tear-down specialist company (they speculate b/c they have yet to actually tear down the new 3G).
So, that brings the profit margin, after manufacturing costs, to around $99,500,000.00 in 3-days. Not a bad weekend's work.
So, that brings the profit margin, after manufacturing costs, to around $99,500,000.00 in 3-days. Not a bad weekend's work.
Sunday, July 13, 2008
Ca. eFfed in the A
This guy rocks. Of course, I have to give credit to ibankcoin for The Fly's post of Mr. Mortgage's most recent post. This particular video just applies more to my surrounding economy. California is in for a world of hurt with this mortgage crisis. 4.25 years of supply in the housing market is just huge.
Thursday, July 10, 2008
DIA
Finding it very difficult to get back into the swing of things this week. Took a little piece short in the DIA this afternoon, just before it tanked. So, that was nice.
Catching up on reading all the blogs out there. It seems there's a lot more reliable information there than going with the news services.
Catching up on reading all the blogs out there. It seems there's a lot more reliable information there than going with the news services.
Monday, July 07, 2008
Home
Back from the road trip to the Kate Wolf festival in smoky northern california. A relaxing time hanging out and listening to folk music. I didn't think I liked folk music before attending the festival, but have since changed my mind. It was nice to watch people with obvious talent, either lyrically, instrumentally, or both. Here are a few of my favorite performers at the Kate Wolf festival:
Todd Snider
The Wailin Jennys
David Lindley
Todd Snider
The Wailin Jennys
David Lindley
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