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Prepared by the good people at Random Walk, LLC. (and Scott)
Great Morning
Closing Prices From Yesterday
Yesterday and Today
Yesterday
Surprise
We opened yesterday very strongly. The Dow just missed 17,100 by a smidgeon. The SPX was as high as 1977. Then came the reversal. Just as we were up 80 points we swung down to a negative -80 points on the day. We stabilized and closed slightly down. This was a surprise to me, but it was mostly predicated by the RUT.
LESSON:
The E-minis vacillate around what the current news is. Sometimes weird things are going on in the currencies and the E-minis follow that. Other times it is bonds. Right now they are keep a close eye on the Russell. This index has been beaten down dramatically over the last few weeks. The Dow made a late in the day rally in an attempt to close up on the day, but that failed after the RUT fell from a negative 5 to a negative 9 on the day.
Below you will see the RUT index for Friday and yesterday. Once the RUT could not break above Friday’s highs it fell and took the rest of the market with it.
TODAY
Today we have two economic numbers out. You can skip the JOLT number. Not even Joe Q. āuneducatedā Public believes the jobs numbers. They can feel what the numbers are not saying. There are no REAL jobs ā just crap jobs at Starbucks. On CNBC today they had a poll for their program viewers where they asked if the job numbers are improving. An astonishing 84% said they are not, and this when unemployment broke through 5.9%.
I have been saying the job numbers are manipulated, manufactured, don’t report accurate data, are rigged, etc. No one believes that until they can feel it. The middle class is evaporating under the last two administrations (Bush and Obama). I am not saying the cause (whether it was Bush, Clinton, Clinton’s demand to give people who can’t afford homes mortgages, etc.). I am simply saying that the jobs that are created are those that a rhesus monkey could do, and do not support a family. And this administration and the previous apparently don;t know/care how to fix it. They only know how to win elections.
So now that we have the jobs issue out of the way, what about consumer credit? It will likely show an increase because one must live, even if you can’t afford to live. But that is not to say people are buying iPhones, new cars, etc. It really doesnāt give any meaningful forward looking information ā even for an economist.
Then what?
We are going to do what we are going to do. Maybe not today, but it will then be tomorrow or the next…..We will go higher as more money goes into stocks because there is NO PLACE to put it. Some might start to linger into commodities as they have been hit so hard they are becoming attractive again. You really think oil is going to stay below $90 and gas below $3 a gallon forever?
But this is getting us close to the end. I still don;t know when the end is going to be. Much of it depends on the Fed, or if earnings really start coming in poor.
FUTURE
Earnings are coming up. What will accelerate my fears is if we see earnings coming in line (slightly better, same, slightly worse) but no increase in revenue. That means it is BALL GAME for this economy. Europe is a mess. China is a mess. Russia is going back to the stone age (some of it self-inflicted through sanctions). We are the last shining light, but are we the dog or have we become the tail?
POT is held each Wednesday night at 7:00pm eastern.
Updates coming individually
Too much fun stuff for everyone who is not in POT, or they would be confused. We don’t like confusing people more than we already do.
ThisĀ began last week.
Individual update coming.
Too True To Be Funny
Has Rush been off his medication?
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Of Course It Does
Attorney Stuff
DISCLAIMER (Seriously!)
Trading is almost as much fun as black jack in Vegas, but without all the annoying distractions of free drinks, Broadway shows, gorgeous people with low morals, and free buffets. It also has about the same odds of success, so when you lose all your money you wont have to walk past a smiling pit boss. Even Bruce Wayne lost everything with options in The Dark Knight Rises, and Superman keeps his day job at the Daily Planet newspaper.
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