Wednesday, March 17, 2010

PARALYSIS update I

The forces of nature versus the forces of evil. And the band plays on. Watching this AMs action reminds me of slow motion video of turtles making love. No volume No volatility. Absolute paralysis. Of course that does not negate the market can be easily brought higher but at what price? Can naures law continue to be violated without retribution? The short answer is YES. The more complete answer is NO.

Any call for a crash this year I meet with skepticism. Will we have some nervous fear inducing corrections?.....yes...But as Joe and I have discussed many times previously, the Fed and Gov are inextricably linked to the current policy and market manipulation. For the GS boyz to collapse this market this year or even next year is unlikely to be in the cards. It makes no sense to expend this kind of capital only to collapse it. Will they eventually??? Yes. The effects of this liquidity injection and capital system interference will be too much to bear on a weakened economic system. By calling this "weakened" I may be makeing the understatement of all time. But make no mistake they can kick this can down the road a lot longer.

The more interesting game being played is between us and the rest of the world. Our global military industrial empire is going to collapse under the weight of its expense. The protection we provide our global corporations to plunder the rest of the world resources is coming to an end. The outcome is yet to unfold but you can bet China will wind up as one of the victors. They are positioning themselves to emerge from this economic battle with unprecedented power. Their educational system is educating scientists and engineers at a rate ten times higher than ours.

Our system is educating bankers a rate ten times theirs. (humor)....But you see the difference. Wash rinse repeat. War is coming .....no doubt about it. But in what form?? Nukes? Tanks/ground troops? Air/missile strikes?? maybe maybe maybe. But the war that we are in right now behind the scenes is the one you want to watch. Watch the currency/tariff wars. Its the war you can count on. gl

Update I 1710... Look at the dollar chart before you get too bullish here....I want to see some good correction in the miners short term...besides my core has slimmed too much.

http://stockcharts.com/h-sc/ui?s=$USD&p=W&yr=2&mn=0&dy=0&id=p94987395291&a=74691808

Don't go around saying the world owes you a living. The world owes you nothing. It was here first.
Mark Twain

35 comments:

  1. Could not agree more that the war is financial, just look at Greece et.al. Referencing your earlier post on preparation, the question I have is what to do with cash??? Thanks for all you do. - Nancy

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  2. gold is becoming currency nancy....joe feels that it is a long term hold here and please accumulate as you distribute your retirement. also cash must be held for liquidity expenditures.....but physical must be held AND accumulated...

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  3. BTW nancy this is PONZI .....and it means you cannot count on anything being valid....only thing that matters here is what the next ponzi move will be...and NO ONE including Joe can predict that next move......We can only look at what we would do if we were in their shoes...We aren't so its only an educated guess. Joe has a better capacity than I in anticipating their moves but admits he is limited here.....which is why he is not buying and holding anything ...

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  4. Temo & Analyze,

    S is a good trade today, gave me the gap I wanted this morning, so is FRG.

    Joe

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  5. All,

    In general I do not read Danno's blog, last night for a change read some of the posts in his blog and this one was the EYE CATCHER from Richard, the prechter crowd have been calling for the top since S&P hit 950, most of them are devastated, this is what happens when people do not understand power of FED:

    "I would suppose that EWI is still calling for a market collapse. Three other EW sites that I follow are still indicating a big market decline. However, being right at sometime in the future is not the same as making money in a trading account. I unloaded half of my shorts early last week so I at least reduced my risk after falling for the EW and bearish sentiment on most financial blogs. I guess when the market does turn, there will be some 'see I told you so' but again that is not the same as making money."

    Joe

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  6. Ok, thanks. Joe, are you not holding alu? I will sell if you aren't holding. thnx. - Nancy

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  7. Joe,
    I caught S at at the break of the 3.53 pivot.
    Sold half my SSRI tightened stops on JAG and remaining SSRI.

    2 EW blogs I read have both been bullish and called the trend change back in Jan.

    I like Danno but I think his bearish bias is clouding his thinking. Like you said they have been calling the top since 950.

    You can be bearish on the economy (and I am) but that cannot enter into your trading decisions. Not in this casino.

    Almost time for bed. See yall in the morning.
    GL

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  8. Joe, I am riding EGO and SLW here, they are motoring ahead in a good fashion today. - Analyze.

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  9. Nancy,

    I bought ALU at 2.75 and got rid of it at 3.40. The reason I did not hold beyond 3.40 is because of the flow of the money and fast moving target of the current situation. I try to hit and take profit and move to other sets of stocks I feel I can scalp, this way not only I can take advantage of the up market, I also protect myself from algos and possible down turns. This market is challenging for me and must say exciting since it's a good test of my trading . The past couple of days I have been scalping FRG, it's giving me nice gaps.

    Joe

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  10. Analyze,

    The main beneficiary of FED's print machine and world wide currency devaluation is COMMODITIES including Gold, silver, base & industrial metals. FED has already spoken as far as their intermediate intentions.

    Joe

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  11. All,

    Some of the institutional fund activities for SPRINT ( S) since end of December:

    http://fundville.com/stock/S/SPRINT-NEXTEL-CORP

    Joe

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  12. Fed will continue to keep short term rates low so no alternatives exists for those sheep in US dollar play, outside of equities, bonds, and MBS. Fed has to unload about $1 trillion of the $1.25 in MBS toxic waste they have accumulated to someone besides their member banks. Guess who they will try to unload it too? Very Good times in equities should continue through March with the S&P 1225 level possibly tested(outside an unseen black swan) so the Fed can start unloading this crap without interference from Congress. I suspect a little fear (along the lines of equity growth will be flat to slightly negative going forward) will be needed around the 200 wma to induce funds/individuals and stupid sovereign nations to shift out of equities and into mbs held by the Fed. Fed wants out of the $1 trillion they are holding before the end of this year because they know where MBS values are heading in 2011+ as the unemployment and high commodity costs situation causes further defaults, plus throw in some more severe weather and natural disasters and the die is set for leveraged assets that can't be operated and maintained at these price levels.

    Sorry I am not day trading this market, since I am no where near the trading caliber of most people here and have commitments during most of the trading day. Still would recommend getting debt free, accumulating physical gold and some cash, and a survival and sanctuary plan for those hoping to make it economically over the next 5 years.

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  13. Joe...agreed! You have no idea how WRONG EWI has been for weeks now...still not backing off of their stance either(crash any day)(for months)...I'm paid up for 2 more months...I canceled my subscription today...Tonight another report will be out...standard Mon/Wed/Fri...considering today's high..oh my just can't wait to see what the new excuse is tonight...LOL And yes you can not trade using them...and yes they will say "we told you so"...problem is if you had traded following only them, you would have lost everything. Notice Precther himself is in hiding...Same with Nenner...we canceled him last month! He is even a bigger loser! About the only alerts he has been right about for 6 months has been corn and nat gas prices...Waste of time and money!
    TexasBlondie

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  14. Damn Red....I was just think'n bout load'n up sum of those MBS...probably get um for 70c on the dollar....that would be a whole 30% discount...sounds like a bargain to me....hehehhehe....(ya think it might work??) hehee I bet they pump it to the moon.

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  15. Dave,

    Oil is moving with S&P 500 & DOW. Crude oil is around 83 now, let's see if 85 can hold or not before entering DTO. DTO up to now has had strong support around 60 due to oil holding resistance around 84, if that resistance is broken then DTO can fall further, so caution is advised.

    Joe

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  16. TXB,

    If this market corrects in the short term before going up to 1225/1240, the correction would be mild and opportunity for you to load up on the stocks we talk about here . The lack of knowledge or dishonesty in the part of those so-called market experts ( crooks) is not to educate their readers about FED behavior and it's power and intentions. Stay sharp and do not fall for herd mentality and all the other bull shit news they pump every day. This market is up on the back of print money which means when FED feels it's time to unload then and only then you will see meaningful retracement. Market can stay bloated much longer than most traders can stay solvent.

    Joe

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  17. kli,

    bookmark and save my earlier post on EWI and quote from one of the traders ALONG with TXB's response and have it handy since at some point when those mthrfckers like jammer and other bull shit trolls come back and say, " see we were right", you can copy and paste what we talked about here to THEM. I have a long term memory and will let any asshole who comes back later and pretends they were right have it hard.

    Joe

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  18. Have been watching X (US Steel). GS upgraded it the other day and now it is tanking with the market up. PUMP and DUMP. GS still has it
    Jeff

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  19. yes Jeff.....that's how the game is played. GS is in complete control of virtually all aspects of the Feds market moves here .....that creates a very powerful force that is essentially monopoly market power. Virtually no force in the near term will stop it.

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  20. Kli/Joe/An/Others...another thought I've been having the last few days...if these morons(EWI) were so damn smart, seems to me they would just trade for themselves, become super rich and not need to sell advice! Has dawned on me too..all the talking heads that show up on CNBC everyday...are they on an ego trip or are they really just trying to sell/pump their own game to the retail investor? These Yahoos are giving advice out of the goodness of their hearts? NOT! Just wondering... TXB

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  21. I just can't wait for GS to get what is coming to them. It will be a great day. But, I doubt it will ever happen.
    Jeff

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  22. TXB the system requires a promotion structure and the media whether its print or videoe(CNBCetc) is de facto part of the ponzi. They don't have to sit in a back filled room to know their function. Without their participation the sheeple cannot be herded. There ....now you have it ....they are "sheepdogs"

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  23. Don't focus on GS as the source of all evil. Look within yourself. The evil of GS cannot exist without you participating...we all bear guilt as allowing the evil to exist. There will be much scapegoating but it will never address the real evil within us all.

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  24. GS is more of a tool (the best at what they do, with JPM a close second) Kli of the current 300 ruling families and the existing banking cabal. Currently it is more of an imbalance in the system as consumption/war based capitalism has massively overleveraged and most of the debt needs to be repudiated for capitalism to rise once more from the ashes of Kondratiev winter fireplace, in combination with the end of the Grand Super Cycle. The old order will fight with every tooth and nail to maintain the status quo and what is known rather than letting go and accepting the inevitable revolution of change heralding the next cycle.

    As for EWI they fail to accept the power of Central Banks and manipulation of the charts due to their belief in market efficiencies, great in theory and over the very long term, worthless in the short term when bonuses and hanging from a lamp post are at stake.

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  25. TXB,

    The talking heads you are refering to have only one loyalty and that loyalty is to their closest and richest clients and no one else, what you hear on air especially from CNBC is a dog and pony show to make sure your awareness and thought process remains in the state of limbo. They operate based on the concept of rich & powerful rule and the rest are sheep made for slaughter. Nenner and the other main stream cronies are under the payroll of GS and other powerful entities which means they are in the business of misinformation and disinformation. It's important for you to understand how the system works since they do not teach that to you or your family. Once in a blue moon they tell the truth to keep folks interested just like when vegas once in a while lets you win some so you get addicted and come back for more.

    Joe

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  26. Kli, Joe, Immred, & Analyze -

    Just wanted to thank you guys for your insights. This is by far the best place to get 'real' information and ideas. I only trade a few times a month, but read this blog everyday. I feel all of the EWT guys can't grasp that the economy and the market are two different animals, and that's what has destroyed them. Being bias is a good way to go broke. Basic TA and keeping the thought in your head that the FED will not let the market fall here is a better strategy than yelling P3 has begun with any 100 pt down day. Keep up the great work.

    Rhino

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  27. EWI and CNBC both play on a common thing that keeps people biased and on the wrong side of a trade, long after anyone thinking logically would abandon it: PRIDE. Some of these people would rather go broke than admit they are wrong. EWI is wrong so much they need to run their system as a cult rather than a method, there is a brainwashing factor involved. I sometimes go to those blogs to see the comments, just because I cannot get over how out to lunch they are, it is a sadistic form of entertainment. But that's fine, they are over here too, and altering counts to get on the right side of it once they read the posts here, but claiming it is their own analysis and wave count later Heheee. - Analyze.

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  28. I am suspicious of any paid stock service. I gave up all my subscriptions in 08 and started learning on my own. I have always suceeded in the school of hard knocks.

    Joe, Kli, Analyze and Red all give exceptional information without any strings attached.

    So far its been a good week. All positions profitable and closed with the exception of a tiny bit of SWC that I am still holding.

    I will be watching for gaps on the stocks previously mentioned here.

    08 was an easy year for anyone short. 09 was easy for anyone long. This year is a true test of trading skills, understanding the range and watching for gaps is working well.

    I thnk CNBC provides good entertainment but once the bell rings I turn it off and watch the charts.

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  29. China is a study in adaptability. To think that within our lifetime, China has come from anti-intellectual and anti-education to glorifying those things today. Under Mao, everyone was to be a peasant and shun fine things, even the luxury of flowers or the pleasure of dancing. We are not so adaptible. But once Japan was the clear threat to US dominance and now its not. China's supposed supremacy may be just as fleeting.

    I see the intellectual appeal of gold, but worry that too many are making the sales pitch. Once China has its fill, there will be no put under gold.

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  30. Thats a very well written thoughtful piece.......just one little problem.....Japan did not have a population or demographics....China CAN compete with us based upon its massive population and our waning influence in the world's resource chest. When you remove your moral high ground from the equation and make it clear that you will forcibly exert your economic will then if it becomes a choice your game may have a problem. Chiina is planning decades .....we are trying to fill the hole we dug. gl

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  31. Perhaps, Kli. Our financial boys taught capitalism to the communist Russians and they managed to blow-up their bond market by 1998. China may have a steeper learning curve than you think as it attempts to run a centrally-planned command economy as a capitalist enterprise. We're already seeing malinvestment in empty cities.

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  32. It took America what, a hundred years after the revolutionary war for our capitalist society to get its act together?

    Anyone betting against China over the longer term must enjoy peeing in the wind. It's unfathomable a country that large would, or even could, move to being a more open and democratic society overnight.

    Don't lose sight of that when thinking about China. They'll get there, inch by inch.

    On the upside, by the time their economy matures, it will probably be more capitalist than communist even if they still consider themselves as such.

    The Russians...well...one only needs to study history to see why they are just a perpetual failure as a progressive society/political/economic system. They never learn.

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