Market Update
Friday, 03 September 2010 08:23
Steve Meyers
First of all, yesterday was a travel day for me and I was unable to get mobile access to post a closing audio blog. Next week should get back to normal.
This is a rally I want to fade but it may be smart to wait to see what the commander-in-chief (cough) has up his sleeve for his talk this a.m. Will he tout the fantasic -50K job loss? 2 1/2 years into the recession and we are STILL losing jobs! Recovery? Please. What a rigged game this has become. The yen and treasuries started tanking a full 15 seconds before the report. Managing expectations is what this government is all about. Better than expected numbers is now the propaganda. Lower expectations down so much that anything is a relef.
Technically we have rallied up to our top resistance and should fail. The Dow will open near 10,450 which should be near the high of the rally. No volume again on the rally and today will be worse. Again, I am looking to get aggressive but next week may be a better time.
Employment Numbers
Friday, 03 September 2010 08:09
Steve Meyers
August Total Non Farm Payrolls Come At -54K On Consensus Of -105K, Unchanged From July, Unemployment Rate 9.6%, Birth Death Adds 115K
Private payrolls come in at +67K as Birth Death adds 115K, compared to just 6K previously, as U-6 rises from 16.5 to 16.7%, highest since April. Total Part time workers (all industries) increased by 401k from 18,157 to 18,558; part time workers for economic reasons increased by 331K. Workweek unchanged month over month at 34.2 hours, with average hourly earnings up slightly from 0.2% to 0.3%. 42% of the unemployed were out of a job for 27 weeks or READ MORE
Can You Hear Me Now? 17th Weekly Fund Outflow As Equity Fund Redemptions Accelerate
Thursday, 02 September 2010 09:18
Steve Meyers
This is just getting silly: perhaps the next update on ICI mutual fund flows should occur if there is an inflow for once...ever again. In the meantime,
ICI reports
we have just recorded the 17th
consecutive
weekly outflow from domestic equity mutual funds, and what's worse for mutual funds' depleted liquidity ratios, it is now accelerating, hitting a total of $4.3 billion, a more than 50% increase from last week's $2.7 billion. YTD outflows have now hit $54 billion, as ever more capital is going into far safer fixed income instruments. As a reminder, here is what Rosenberg said on the issue yesterday: "
As for liquidity ratios, equity funds portfolio manages have theirs at an all-time low of 3.4%, down from 3.8% in June
. Tack on the fact that there are really not very many shorts to be covered – since the market peaked in April, short interest is 4.3% of the S&P 500 market cap (in August 2008 it was 6%) and
there’s not a whole lot of underlying fund-flow support for the stock market here.
" As for this being a contrarian signal, hopefully all those who see this as a buying opportunity can also find a way to make the now retiring baby boomers about 10 years younger and force them away from fixed income capital reallocation. Oh, and fix the broken market and restore investor confidence that the casino is only modestly rigged.
READ MORE
Commentary: Overdose: The Next Financial Crisis
Wednesday, 01 September 2010 14:54
Chuck Ludwigsen
The Global Perspectives Update team invites your comments here on the featured YouTube video, 'Overdose: The Next Financial Crisis '.
Rosenberg On The Visible Hand Of Central Planning (ZH)
Wednesday, 01 September 2010 14:09
Steve Meyers
So you thought communist states go down without a fight? Wrong: here is Rosenberg who explains why both China and the US are now actively involved in the business of propping up anything and everything. And totally off topic, Rosie confirms that the liquidity trends in the mutual fund industry continue to deteriorate: "
As for liquidity ratios, equity funds portfolio manages have theirs at an all-time low of 3.4%, down from 3.8% in June.
Tack on the fact that there are really not very many shorts to be covered – since the market peaked in April, short interest is 4.3% of the S&P 500 market cap (in August 2008 it was 6%) and there’s not a whole lot of underlying fund-flow support for the stock market here." In other words, throw in a few more market down days, a few more weeks of redemptions (and at 16 weeks in a row, there is no reason why this should change), and the liquidation theme will promptly be added to the new normal.
READ MORE
Update
Wednesday, 01 September 2010 09:35
Steve Meyers
I will be out this morning. Audio posted
Today's message
Tuesday, 31 August 2010 14:15
Steve Meyers
Proverbs 6:27 Can a man take fire in his bosom, and his clothes not be burned?
Yesterday, a 400-year dormant volcano erupted in Indonesia spewing lava and sand high into the sky. It reminded me of another volcano that erupted in 1991.
Mount Pinatubo, dormant for over 500 years, began to erupt on June 12, 1991, and three days later exploded with twice the power of the 1980 Mount St. Helen's eruption. The release of power blasted a cubic mile off the mountaintop and the earth shook for eight hours. The eruption produced an ash cloud that rose over 50,000 feet into the atmosphere. If that wasn't enough, Typhoon Yunga then struck the island nation with fierce winds and torrential rains which mixed with the ash creating what the locals called "Black Saturday!"
The United States was forced to abandon and eventually close Clark Air Force base, located just a few miles from Mount Pinatubo, due to the devastating blanket of fallen ash. When a vulcanologist was asked to account for the widespread damage which sent thousands of American soldiers and Filipinos fleeing, he replied, "When a volcano is silent for many years, people forget it's a volcano and begin to treat it like a mountain."
Now here's a lesson from nature. We should always be aware of how our sinful nature has the potential to erupt. It would be a big mistake to ignore this possibility simply because it has lain dormant for a season...even a seemingly long one.
Solomon writes a profound statement in his book of Proverbs, which, when paraphrased goes something like this; "Can someone play with fire in his lap without incinerating his clothes?"
The enemy of our souls would love for us to believe that we can somehow play with sin, without it negatively affecting our spirit and our walk with the Lord -- oh how deceptive Satan can be!
D.L. Moody was a fairly simple man and I love the way he dealt with sin. He said, "When you're thinking sin, think scripture!"
Friend, let's be on guard! Sin is a dormant volcano which can erupt at ANY moment and set our house on fire. How do we prepare? First, by being aware of the possibility...then...;"Thy word have I hid in my heart that I might not sin against thee". [Psalm 119:11] Let's meditate upon His Word, allowing it to sink deep into our minds and our hearts, so that the only fire which burns there...is the fire of God's Holy Spirit. Amen.
Market Update
Tuesday, 31 August 2010 13:11
Steve Meyers
Chop Suey is on the menu today. We sit and wait for any movement to tip us off. The ranges could narrow going into Friday's number. Will 1040 give way or will they run back up to 1070? We only have to wait 3 days to get our answer. The whole system is in jeopardy. That is why we see so many hedge funds shutting their doors. This will only get worse going forward. Forget running the market up, with everybody wanting to hit the exits, just holding it up is a monumental task. Bad news is everywhere. When we do get a "positive" number, there is always a story behind it. We will continue to chop until we break 1040 or we get above 1080. Treasuries have regained all of their Friday losses. Who predicted that? Nobody that I read. I have been trading a very long time and I never could have imagined what kind of markets we have today. I too may soon walk away.
Don't get fooled by Bernanke
Tuesday, 31 August 2010 11:19
Steve Meyers
By Brett Arends
BOSTON (MarketWatch) -- When are investors going to stop getting suckered by Ben Bernanke?
The Dow Jones Industrial Average (DJIA 10,051, +40.86, +0.41%) jumped nearly 200 points Friday after the Federal Reserve chairman's pep talk on the economy. Worldwide markets followed suit. And long-term interest rates rose on his sunnier outlook.
Yes, the Fed chairman seemed to rule out a double dip. And yes, he said he stands ready to pump more money into the system if it should falter.
But so what?
 Reuters
Federal Reserve Chairman Ben Bernanke (R) speaks with Federal Reserve Vice Chairman Donald Kohn.
READ MORE
On forecasts, the Fed chairman is about as useful as a New England weatherman.
As for the talk of more quantitative easing: A close reading of Bernanke's word's make you wonder if he even understands the crisis at all.
Let's look at the forecasts first. "I expect the economy to continue to expand in the second half of this year, albeit at a relatively modest pace," Bernanke said at Jackson Hole.
Richard Russell - Fiat Money To Meet Its End (King World)
Monday, 30 August 2010 21:46
Steve Meyers
Richard Russell - Fiat Money To Meet Its End
In Richard Russell’s latest commentary, the Godfather of newsletter writers discusses bear markets, gold, silver and fiat money. Russell is always focused on the big picture. This time he highlights the biggest fraud of the last half a century and how it will end. Here are a few snippets from his latest commentary...
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