Cara's Commentary & Community Chat, Wed., Mar. 25, 2009

Good morning.

Upgrades:

LLTC - to Overweight @ Thomas Weisel. Price Target Raised from $24 to $28
TCK - to Buy @ UBS

Downgrade:

CHA - to Sell @ Citigroup

New:

RIMM - Kaufman Bros. Initiates Coverage with a Hold. Price Target = $50

For those who missed the Bill Murphy interview last evening, here is the replay:

http://tinyurl.com/cawzc2

March 25 (Bloomberg) -- Bill Murphy, chairman of the Gold Anti-Trust Action Committee, talks with Bloomberg's Bernard Lo about global central banks' intervention in the gold market.

Murphy, speaking from Dallas, also discusses his forecast for the price of gold. (Source: Bloomberg)

00:00 Central banks "manipulating" gold price
04:49 Gold to break through $1000 "very shortly"
Running time 07:17

Barack Obama's top campaign contributors

University of California $1,385,675
Goldman Sachs $980,945
Microsoft Corp $806,299
Harvard University $793,460
Google Inc $790,564
Citigroup Inc $657,268
JPMorgan Chase & Co $650,758

http://www.opensecrets.org/pres08/contrib.php?cycl...

John McCain's top campaign contributors

Merrill Lynch $371,295
Citigroup Inc $320,251
Morgan Stanley $271,152
Goldman Sachs $230,095
JPMorgan Chase & Co $225,557
US Government $207,829
AT&T Inc $194,913
UBS AG $182,079

Right on Craig..

who could say this to Obama & gang?

Warning...This is brutal...

http://www.youtube.com/watch?v=94lW6Y4tBXs

CF rebuffed again in takeover bid

March 24, 2009
(Reuters) — Fertilizer maker Terra Industries Inc. on Tuesday rejected rival CF Industries Holdings Inc.'s latest takeover offer, saying the bid undervalues the company and is counter to its strategic objectives.

In a letter to CF Chief Executive Stephen Wilson, Terra CEO Michael Bennett and Chairman Henry Slack rejected the proposal, which CF said on Monday it was prepared to raise by 11 percent to $30.50 for each Terra share.

Based on Terra's 97.7 million outstanding shares as of Feb. 27, the bid would be worth about $2.98 billion.

"This most recent version of your proposal continues to run counter to Terra's strategic objectives, substantially undervalues Terra both absolutely and relative to CF, and would deliver less value to our shareholders than would owning Terra on a stand-alone basis," the letter said.

Terra had previously rejected CF bids of $20 and $27.50 per share.

Man QT.....

No. It isn't because they don't feel the same. It's just that most U.S. Senators can't craft even one sentence as effective or as representative of the people they are supposed to represent.

A U.S. Senator might be almost as eloquent......but only while defending bankers, brokers and scumbags.

i have respect for bill murphy and everything he does for gold and GATA.
i agree w/ most of his thesis, especially because he knows so much more about gold than most of us could ever possibly learn.

im cautious of any calls for a quick move above $1000 for gold. it just seems too much of a given to so many of us to happen like that. gold never makes it that easy. last time a similar up spike in gold occurred in 08 we shortly moved back down to past levels when the dust settled. we have retraced about 1/2 the upward move, mostly because of the dump the occurred just prior to the big move up last week. in effect little has change other than the USD index much lower than before.

miners had a nice move yesterday and hopefully they can continue that today to spark a mini-trend. if gold can move back above the $931 resistance line in short order who knows, $1000 may just be around the corner.

gold is like the prettiest girl in the room,

"gold is like the prettiest girl in the room"

ROTFLOL!!! THAT explains everything!

platinum, however, is the smartest girl in the room.

Durable goods orders are shockingly positive. A temporary aberration?

CP- I'd like to see the same list for each of the Congressman/women, Senators and committee members who have anything to do legislatively with AIG, Fannie, Freddie, etc etc. Then I'd also like to see the relationships between the top easchelon of the Fed, Treasury, and those in HBB. I think these lists/relationships would clear up almost everything there is to know.
S

A nice start - 10 minutes in and up $1k.

I have trouble believing the large increase in durable goods orders (ex autos). What caused the increase? Government purchases of materials for infrastructure improvement? Certainly Main Street isn't in the midst of a buying spree? The US is still losing jobs at 600,000+ a month. I need to see the money before I'll buy into this number.

up 7%

Not that easy this morning to call a fade. Not sure why, maybe it's the start of EOQ accumulation? But I could be wrong.

I don't hear people around here saying Obama created this mess, but even some who had high hopes for him are now beginning to notice he is not addressing the real causes — just continuing the policies initiated under Bush.

We have the same people running nearly everything — banks, rating agencies, oversight committees etc. Or, in the case of Timmy (Paulson's understudy), propping up the bondholders interests 100%.

Obama cannot continue making people think this is a totally inherited situation much longer. This was brought on through genuine bipartisanship over a couple of decades and is like the Energizer Bunny.

Insisting the budget is critical to fixing this is too much to stomach for most who care about future generations.

Watching my exit stop.

wow! Looks like I just got a date with the prettiest girl...

Early of course, but it's looking like those who didn't get on board yesterday at the close might be getting very nervous now.
Also another good housing #.

Mark- This train's not slowing down, it's picking up speed.

If I had to guess, it's the former. Fueled by (new) short positions taken on yesterday's weakness?

"Also another good housing #."

Thanks Mark, that did it for me. Back in Teck now for the long haul.

25-Mar-09 UBS Upgrade Neutral Buy

"Why didn't you just buy it right back?"

Because it left me in the dust the second time and I didn't want to chase. I missed a big move but I'm back in to catch the rest. I'm expecting $10 or more.

Pulled up an intraday comparative chart for yesterday & today. Jump in TLT sure telegraphed the afternoon down move in XLF. Note that TLT is moving gradually down this morning, but is still elevated vs. yesterday morning.

There are always 2 sides to an argument...please keep this in mind:

http://www.nytimes.com/2009/03/25/opinion/25desant...

CP- thanks for the heads up. I've added it to my watch list. What tells you to expect another $10.00? Just trying to follow your logic here.
S

Gonna take another shot; trying to get a fill under 18.50.
Keying off the fact that 1-minute CCI(20)of ES futures is over +300; suggest s-t pullback imminent.

[edit: Trying to save pennies cost me the fill; I was 10 seconds late w/ entry.]

Still holding a core...

...

From former Treasury Secretary Paul O'Neill's interview with Frontline:
[The national debt] is going up every day. ...

Here's the fundamental problem: How much money can a society borrow before it begins to have negative effects on our ability to borrow any more? ... When you get to the point that people won't loan you any more money as a government, you've got a horrendous problem. And it's happened to governments -- in Argentina, most famously, in recent times. Mexico was kind of in that situation until we gave them a very big loan.

... Now, what happens before that is governments raise the interest rates so that people will loan them money. ... Unfortunately, when interest rates get that high, economic activity slows down, and eventually it will stop. We're not at that level yet with our $11 trillion worth of acknowledged debt, but there's a bigger problem out there, which is $53 trillion worth of unfunded liabilities that we, the American people, have signed up for. Most of the American people don't know that we have these so-called unfunded liabilities. An important part of that is Social Security and Medicare. ...

... This financial crisis in retrospect will look like a child's game compared to what we're headed into when we have to begin raising enormous amounts of money through floating debt, or reneging on the obligations we made to people that they thought were good and clear from Social Security benefits and Medicare benefits. ...

I would invite people who think you can wish this away simply by denying it -- they need to spend enough time to investigate the facts for themselves. And if they can still believe that, I'd say they need remedial education in arithmetic. This is not a problem of quantum physics; this is about simple arithmetic, and the American people need to be educated about the simple arithmetic that's going to kick our teeth in not too far down the road. ...

Right now we've got this financial crisis, and one day we're spending $700 billion, and the next day that gets trumped by "That's not enough; we need another $300 billion." And then we have people saying, "That's not enough; we need $500 to $700 billion more." And so if that's all right and there are no limitations, why don't we make it $4 trillion, or $10 [trillion]?

... Why don't we just give every American a million dollars a year if it's really in our power to endlessly borrow money? And this is what I mean by education. People need to understand why if $1 trillion is good, $10 trillion isn't better.

... We could get ourselves into a position where people won't take our paper anymore. And that's a really desperate position to be in when we've killed the idea of good faith and credit of the United States. That could destroy our society as we've known it.

... You're asking a very radical question: Could the federal government lose its AAA rating? And the answer is yes. We dare not let that happen, but the answer is yes.

teamonfuego -

So the NYTimes just closed the sale of its last asset, it's Manhattan highrise, to keep publishing CRAP like this jerk's resignation letter to his AIG boss. This guy tries to redeem himself by 'donating' an outlandish $741,000 bonus appropriated from the U.S. taxpayer to 'charities' of his choosing to 'control' it as some noble gesture. He even goes so far to say that it's not a tax gimmick when it will certainly allow him to avoid income tax.

Are you suggesting I should feel sympathy? If he talks like a crook, walks like a crook, smells like a crook, well, teamonfuego, maybe he is a crook. Charity my a**.

what is going on with Barrick gold, cant seem to break above the 50/200 MA's while all the sr. golds are on the move.

i am eternally suspicious of this company, and their hedging program, they seem to go down when all others move up. its holding back the ETF's because of its juggernaut status. when will they ever get their act together?

I hired one of my longtime friends in the heavy equipment biz to tear down an old building on my property the last few days.

His crew is really great and one of his employees is the 'ground crew', the gopher. His name is Clinton and he is a savant.

He is one of the most incredible people I have ever met. He lives with his brother, Ian, as he can't really take care of himself....but, ask him what he was doing on February, 21, 1983 (any day really) and he can tell you the day of the week, what grade you were in that year, and what he was doing that day...EXACTLY. He remembers every person he ever met and scared the heck out of me with his mathematical ability.

He was a year behind my daughter in school, remembers her name, her age, what courses she was taking, her friends, her birthday....and he hasn't seen her since high school.

The old building was built in 1908. Clinton knew instantly who was President when it was built. TR was President. I had no clue.

I tell you, I can take care of myself, get around alright, they say I'm 'gifted'. After Clinton I feel really stupid.

Maybe they're waiting for the last hour?

He openly admits to being paid a ton. However, the point is that people's anger against people like this getting bonuses, even though he had nothing to do with the mess created by the CDS's and he is the one cleaning up the mess, is misguided. Cuomo threatening to release the names of these people is a really dangerous move, especially given that many or most of those people had nothing to do with the mess. Cuomo is inciting the mob and giving them names to go after. That is reckless.

Approaching 816.50 recent intraday support; I think it's gonna fail. {It just did...}

"If you're confident of TCK going to $10, you could sell April $7.50 puts for $1.60, no?"

Swiss - Perhaps, but I already have enough trouble with the abstract nature of today's market without adding to the complexity. Selling twice by accident yesterday is proof enough to me that selling puts and buying calls is beyond my capacity.

closed out at 4.16

His "nut" was $1 a year and no bonus after all is said and done...for generating profits for the company.

RE:>Now, on a similar note, the average world’s highest-earning hedge fund managers took home, on average, $464 million apiece in 2008.

...and the ex-CEO of RBS had his ground floor windows and S600 Merc smashed for good measure.

That public anger be a comin soon.

Do you get a 'bonus' for doing your job?

No. I haven't gotten a bonus since 2000. Maybe it's just me, but I'm a software developer and bonuses pretty much went the way of the dinosaur after the dotcom crash. And salaries have basically remained stagnant since then, too.

Volume can notably increase when hedgies, institutionals, mutual fund managers etc. hop on board . . . a number of them are holding cash, on the sidelines, perhaps nibbling or taking off (or adding to) short positions . . . the psychology factor is performance anxiety. The aforementioned don't like to underperform vs. their peers and indexes.

Remember they are piloting the big ships and we are in the smaller (hopefully speedboats) boats . . . they can make a splash when they enter the water, but we can react (turn) much quicker.

No doubt volume bears watching one way or the other.

"Do you get a 'bonus' for doing your job?"

Sending him a frozen turkey with giblets would be overpayment IMO. Go to jail. go directly to jail. Do not pass go, do not collect $200. No more palm greasing!!!

OG- Why? TA? Crude seems to be settling in @ 53.30. TIA

Craig,

Why don't you see if he can trade?

The media are spinning February new home sales big time. January is historically the lowest sales month of the year. Therefore, February has to have higher sales than January, or historical patterns are broken.

Sales should increase from Feb. through Aug., then drop from Sept. to Jan. as they do every year.

What the talking heads aren't reporting is that February sales were the lowest for any February since data collection began in 1963. And the sales weren't much above January's which was an all time low.

In today's "fugazy" marketplace, perception is all that matters for short term traders. Management of perception is the role of HB&B, government, and the media. However, for longer term considerations it is useful to understand the fundamentals.

I prefer to get my housing data analysis from blogs I consider credible such as the following two:
http://www.calculatedriskblog.com/
http://housingdoom.com/

http://www.rollingstone.com/politics/story/2679390...

For your consideration.

Cheers,Z

Off hand, I think that restrictions on mountain-top coal mining would most affect coal producers operating in the eastern U.S where mountain-top mining is prevalent (and would benefit coal operations in the Powder River Basin, Wyoming).

As for prices, it would mean less potential supply to the market, so long-term it would be bullish for coal prices. With that said, I am uncertain of the percentage of total production that comes from mountain-top mines (that would be affected by a ban).

"Remember they are piloting the big ships and we are in the smaller (hopefully speedboats) boats . . . they can make a splash when they enter the water, but we can react (turn) much quicker."

Kind of like the Somali pirates, eh?

And just like the Somali pirates, the larger entities use a horrible noise to deter us from attacking (CNBC, FETV, etc.)

Long @ 13.35

Exited @ 13.31; 1-minute MACD went negative.

Former Australian Prime Minister Savages Geithner's Performance in the Asian Crisis

Paul Keating, former Austrailian Prime Minister, gave an assessment of Timothy Geithners' performance in the Asian crisis that is sharply at odds with US reports. According to Keating, Geither completely misread the nature of the crisis, that it was the result of hot money flight, but reverted to the standard IMF "country facing currency crisis" playbook, and made a bad situation worse.

And to compound matters, the mismanagement of the Asian crisis led China to decide to build up FX reserves so it would never have to go hat in hand to the IMF. In other words, the "savings glut" that Bernanke and other economists like to portray as a cause, if not the cause, of our current financial crisis, was in response to the misguided Asian crisis program.

From the Sydney Morning Herald (hat tip reader Sean):

When Barack Obama announced his champion to rescue the world from economic ruin, it was the first time most Americans had ever heard the name Tim Geithner.

The initial impression was good....."Exactly a decade ago, he was Uncle Sam's golden-boy emissary sent into the stormy centre of what was then the world's worst financial crisis [the Asian crisis]," reported The New York Post.

The paper gushed: "Just 36 at the time, he'd been raised in Asia and knew the culture so intimately he scored successes and won confidences that other diplomats couldn't match. Geithner earned widespread plaudits for pulling together quarrelling Asian finance ministers into a $US200 billion rescue of their economies."

"A fantastic choice," said a Bank of Tokyo-Mitsubishi analyst, Chris Rupkey, as the Dow rose by nearly 6 per cent. Even one of Obama's political rivals, the hard-bitten Republican senator Richard Shelby, agreed Geithner was "up to the challenge".

If anyone in the US media had thought to ask a former Australian prime minister for his assessment, they would have heard a different view. And they would not have been so surprised at Geithner's performance since.

In a speech to a closed gathering at the Lowy Institute in Sydney on Thursday, Paul Keating gave a starkly different account of Geithner's record in handling the Asian crisis: "Tim Geithner was the Treasury line officer who wrote the IMF [International Monetary Fund] program for Indonesia in 1997-98, which was to apply current account solutions to a capital account crisis."

In other words, Geithner fundamentally misdiagnosed the problem. And his misdiagnosis led to a dreadfully wrong prescription.

Geithner thought Asia's problem was the same as the ones that had shattered Latin America in the 1980s and Mexico in 1994, a classic current account crisis. In this kind of crisis, the central cause is that the government has run impossibly big debts.

The solution? The IMF, the Washington-based emergency lender of last resort, will make loans to keep the country solvent, but on condition the government hacks back its spending. The cure addresses the ailment.

But the Asian crisis was completely different. The Asian governments that went to the IMF for emergency loans - Thailand, South Korea and Indonesia - all had sound public finances.

The problem was not government debt. It was great tsunamis of hot money in the private capital markets. When the wave rushed out, it left a credit drought behind.

But Geithner, through his influence on the IMF, imposed the same cure the IMF had imposed on Latin America and Mexico. It was the wrong cure. Indeed, it only aggravated the problem.

Keating continued: "Soeharto's government delivered 21 years of 7 per cent compound growth. It takes a gigantic fool to mess that up. But the IMF messed it up. The end result was the biggest fall in GDP in the 20th century. That dubious distinction went to Indonesia. And, of course, Soeharto lost power."

Exactly who was the "gigantic fool"? It was, obviously, the man who wrote the program, Geithner, although Keating is prepared to put the then managing director of the IMF, the Frenchman Michel Camdessus, in the same category.

Worse, Keating argued, Geithner's misjudgment had done terminal damage to the credibility of the IMF, with seismic geoeconomic consequences: "The IMF is the gun that can't shoot straight. They've been making a mess of things for the last 20-odd years, and the greatest mess they made was in east Asia in 1997-98, so much so that no east Asian state will put its head in the IMF noose."

China, in particular, drew hard conclusions from the IMF's mishandling of the Asian crisis. It decided that it would never allow itself to be dependent on the IMF, or the US, or the West generally, for its international solvency. Instead, it would build the biggest war chest the world had ever seen.

Keating continued: "This has all been noted inside the State Council of China and by the Politburo. And it's one of the reasons, perhaps the principal reason, why convertibility of the renminbi remains off the agenda for China, and it's why through a series of exchange-rate interventions each day that they've built these massive reserves....

Is this some flight of Keatingesque fancy? The former deputy governor of the Reserve Bank of Australia, Stephen Grenville, doesn't think so: "After the Asian crisis, the countries of east Asia decided that they would never go to the IMF again. The IMF is taboo in east Asia. Look at the evidence. The revealed preference of the region is that no one has gone to the IMF since, even when they needed the money."

And Asian capitals know that they have no real influence over the IMF - while European governments enjoy 40 per cent of the voting power on the IMF, Japan, China and the rest of east Asia put together have only about 16 per cent....

Keating urges that the fund should be decapitated, with control passing to the governments of the Group of 20 countries whose leaders are to meet in London on April 2. The summit, which is to include China, India and Indonesia as well as Australia, is meeting to consider solutions to the global crisis.

As for The New York Post's claim that Geithner was the hero who cajoled those quarrelsome Asians into agreeing to a $US200 billion rescue, the key fact burned into the minds of Asian elites is that the US was deaf to requests for funds. Washington did not contribute a cent of its own money to any of the emergency packages. Japan and Australia were the only nations that made loans to all three of the stricken Asian countries.

Keating went on to argue that, by frightening the Chinese into building their vast $US2 trillion foreign reserves, Geithner was responsible for the build-up of tremendous imbalance in the world financial system. This imbalance, in turn, according to Keating, contributed to the global financial crisis which has since devastated the world economy....

"That is the fundamental cause of the problem - the imbalance is the fundamental cause."

"It is enough for the experienced trader to perceive that something is wrong. He must not expect the tape to become a lecturer. His job is to listen for it to say "Get out!" and not wait for it to submit a legal brief for approval."
-- Jesse Livermore

Am troubled by the lack of liquidity in ERY; much lower than w/ ERX.

Long @ 28.04
Out via stop @ 28.11
Lots of slippage; stop was 28.15.

I see CTAB bailed on TCK this morning, but I think there's more upside to come...

Oh My, it looks like somehow we have built a system where incompetent people play havoc of a magnitude that could send us to stone age (take AIG management, Geithner etc)..... Maybe we need to unplug ourselves from this matrix :)

Where did you see that?

Bill's daily

Thx

Interactive Brokers (IBKR) has taken about 10% of my (very nice, thank you) profits thus far today. Thinking of going long the stock to recapture some.

edit: Not now; on a pullback.

A buy and sit position. I have some stink bids in for UXG but have failed to hit them yet.

Do we, as a community, have any consensus of how to play this? Bill is calling 2K gold and I have had that same feeling for some time but have failed to pull the trigger even to trade lately. How do people feel about DGP, GDX etc.....

From other posts I know people here are skeptical of GLD.

Thoughts group?

See Bill's daily.

He loaded up yesterday on a couple of miners, I think.

I sold my FAS, BGU, SPY. Overall volume is pretty low and hitting resistance in the 8K region

U.S. Stocks Rally, Extend S&P 500’s Best Monthly Gain Since ’87

March 25 (Bloomberg) -- U.S. stocks rose, extending the best monthly rally since 1987 for the Standard & Poor’s 500 Index, as unexpected growth in durable-goods orders and new-home sales spurred speculation the economy is stabilizing.

http://www.bloomberg.com/apps/news?pid=20601087&si...

RE:>Galileo, a 17th century Italian physicist said, “I do not feel obliged to believe that the same God who has endowed us with the sense, reason, and intellect has intended us to forego their use.”

Well, the church should have burnt him while they had the chance. Then none of this would have ever happened. ;)

Sell 200 shares TNA at 19.06 Limit GTC
03/25/09 10:08 Filled 100 at 19.06
03/25/09 10:08 Filled 100 at 19.06

...

Heart's just not in it.

I purchased a kindle and I LOVE it! I have always been a reader, but have not had time/luxury the last few years to find books and read. It is very easy to wirelessly download books/samples from Amazon. There are also so many free books, that I have read more in the last month than the last year. I can also check my basic email and google reader easily, although not elegantly. I can see the kindle price not being a barrier to ;) older people who love to read, but haven't. I'm embarrassed to say I also like to increase the font size on demand.

To sum up, people who purchase the kindle will be able to read more books and if times improve, I could see the ITunes model of downloading books to take off. Right now, it this environment, I am trying to read the free ones first before I pay for the best sellers.

I have loaded my trading pdf files onto it for perusal and reference. If I was a student, I don't think it could replace a text to mark up and dog ear the pages.

IMHO

Thanks Miggs. I love the product from what I have seen. I'm thinking of getting it as gifts for my family.

As I write I see BKS is down 6+%...could it be because of this?

Nasd Dow SP turning red
1 trillion isn't near enough, Geithner give the banksters more money....please!
That won't even start to cover retention bonuses let alone a little profit so they can restart paying themselves multi million dollars salaries again.

I make a remark about "not chasing", or "not catching a bus", would someone (Vad and his 2x4 perhaps) slap me upside the head and tell me to suck it up and get on board (pun?) already? Please? Thanks!

Long Yamana

update...got out lost 80 bucks story over I'm going to the beach.

Looks like the rally's over too eh?

It includes the Disciplined Investor and other reports I used to print out and read (or not) when I had time. I do have to convert them using a free software package before I load them onto the kindle via a USB connection. Just having them available has increased how often I refer to them. I have read that complex charts and technical documents do not convert well.

Unless the market ends up with a BIG plunge down today (which will shake out many weak hands and increase the chances of a rally tomorrow), I'll just place a buy stop limit order (say on FAS) above today's closing price. The market opened higher today and then moved down. Tomorrow, the people will be weary of bidding the prices up before the open, and so the chances of a down open, I think, would be higher (unless, as I said, we have a BIG plunge today). So if I place a buy stop limit order for tomorrow, then it will either not get triggered at all (if the plunge continues) or will be caught on the way up after the market opens lower and starts to move up. This is all just speculation, of course...

David- Well, you made 19% on the trade. And we both know FAS is not a buy-and-hold vehicle. So I would say you got what you wanted out of it.

"And we both know FAS is not a buy-and-hold vehicle."

Well, even if XLF moves two steps forward and one step back, then FAS will still rise 4.5X over the period when XLF doubles. So FAS *can* be used as a buy-and-hold in an upward-sloping market. I have a feeling that I won't be able to re-enter FAS at a lower price than $6.13 and will feel left out when I see it at $8+.

Overall, I have a feeling that the market rally that started a couple of weeks ago will go higher than anyone thinks. It will be something like the rally that started in March of last year, which went up for 2 months despite the obviously worsening fundamentals and most people on this board eventually gave up shorting it, figuring that Paulson can print as much money as he wants and take this market to arbitrary heights.

" I have a feeling that I won't be able to re-enter FAS at a lower price than $6.13 and will feel left out when I see it at $8+."

Then why not pick some up now @ 5.62?

Treasury auctions were bad today...this is what i was fearing would happen last week when the fed agreed to buy up long dated treasurys. People are going to demand higher rates on treasurys because the risk profile of the u.s. is higher with all of these bailouts. If the rates on treasurys rise significantly its game set match for our economy

Les- I guess the market was listening when you cracked your whip yesterday.

Beginning to think we are near the end of this bear rally. FAZ is getting fairly close to
a macd-x on the daily chart and RSI7 is in agreement. Would probably still be several more
days before the macd finally makes that cross, and FAZ could double by then. Also seeing the beginnings of a divergence in macd histogram. Opinions?

volume is also increasing last few days, so i think its headed up from here

So if bond prices fall due to FED buying, wouldn't this wealth go elsewhere like into stocks? Follow the money. Of course there might be some hysteresis delay to accommodate conservative money's need to develop an appetite?

Sure wish I'd known to anticipate a sell off...

Fortunate timing as skf is making its move. Setting stop above my buy price now to cover my butt.

Markets began to sell off i think in conjunction with the soft debt auction by the govt, in conjunction to a natural profit taking from the recent gargantuan move.

lets see what the last hour brings.

Forgiving afternoon w/skf

cut it short bad karmaCash Sell 200 shares TNA at 16.5 Stop Loss GTC

03/25/09 15:15 Filled 200 at 16.5099

taking the 7% and not looking back...

"Or do you think that the stock traders do not believe the rising oil price, thinking that it is just a temporary phenomenon?"

you nailed it. that's my thinking.

Darn day job! Why won't they just pay me yet leave me alone!

"...the average world’s highest-earning hedge fund managers took home, on average, $464 million apiece in 2008."

And they will still be allowed to pay the tax in the 15% bracket, I believe.

Same assessment in a nutshell...

EU presidency: US economic plans 'a way to hell'

By RAF CASERT, The Associated Press
6:10 a.m. March 25, 2009

STRASBOURG, France — A top European Union politician on Wednesday slammed U.S. plans to spend its way out of recession as "a way to hell."

Czech Prime Minister Mirek Topolanek, whose country currently holds the EU presidency, told the European Parliament that President Barack Obama's massive stimulus package and banking bailout "will undermine the stability of the global financial market."

teamonfuego - "If the rates on treasurys rise significantly its game set match for our economy"

Wasn't it in Top Gun Cougar said to Maverick "Game Over Dude, Game Over!"

Ken Lewis CEO, BAC..... issues statement that Bank Of America will "start" Tarp repayment as soon as next month.
Here comes the million dollar bonuses for the irreplaceable BAC brokers.
Come seven, come 11.
Now all Lewis has to do is issue the bonuses for a overlooked prior year performance, 2005 or 2006, as long as he stays clear of 2008. People are so busy struggling to survive they'll never catch on!

I believe you are thinking of Bill Paxton in Aliens where he said "Game over, man, game over!"

that was a nice comeback for the markets

David - I think it's best to buy on the extreme bearishness and sell on the extreme bullishness. Today was a prime example of this.

It's not easy, though.

Ask yourself: is it any coincidence that the market was in the middle of breaking support around 800 that BAC came out and announced they will repay their TARP funds early right before close? This is a game and we're the ones being gamed.

Hmmm, people are feeling like left out and bought at the end. David, I think ERX follows market instead of energy prices.

ha, think you spoke too soon there 2nd.

but the monkey into close suggests, IMHO, an early sell off possible on opening tomorrow?

Tough market to be trading in, from my novice viewpoint.

RE:>Wasn't it in Top Gun Cougar said to Maverick "Game Over Dude, Game Over!

Ah now you're talking my youth!

FD: I'm 34. Does that still qualify me as young in this crowd??

No. Cougar lost it, turned in his wings.

That be wolf man at the beach volley ball court.

night all.

No kidding NYU....

Was in at 98 and sold at 106, then flipped to FAS and held on until just before the close.

I was a little early on SKF but lucked out. Nice que by both you and then 2nd on FAS. Why am I not surprised? I got faked out of FAS at 6.03, but got back in when the XLF turned positive. Positively whacky!

"Bill Paxton in Aliens where he said "Game over, man, game over!"

Yes, that's the one! Speaking of aliens, congress should prepare some special H1B visas to replace all the deserters from the banking industry. They could call them H1B&B's.

Dear A.I.G., I Quit!

The following is a letter sent on Tuesday by Jake DeSantis, an executive vice president of the American International Group’s financial products unit, to Edward M. Liddy, the chief executive of A.I.G.

DEAR Mr. Liddy,

It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context:

I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in — or responsible for — the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage.

After 12 months of hard work dismantling the company — during which A.I.G. reassured us many times we would be rewarded in March 2009 — we in the financial products unit have been betrayed by A.I.G. and are being unfairly persecuted by elected officials. In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself.

I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down.

You and I have never met or spoken to each other, so I’d like to tell you about myself. I was raised by schoolteachers working multiple jobs in a world of closing steel mills. My hard work earned me acceptance to M.I.T., and the institute’s generous financial aid enabled me to attend. I had fulfilled my American dream.

I started at this company in 1998 as an equity trader, became the head of equity and commodity trading and, a couple of years before A.I.G.’s meltdown last September, was named the head of business development for commodities. Over this period the equity and commodity units were consistently profitable — in most years generating net profits of well over $100 million. Most recently, during the dismantling of A.I.G.-F.P., I was an integral player in the pending sale of its well-regarded commodity index business to UBS. As you know, business unit sales like this are crucial to A.I.G.’s effort to repay the American taxpayer.

The profitability of the businesses with which I was associated clearly supported my compensation. I never received any pay resulting from the credit default swaps that are now losing so much money. I did, however, like many others here, lose a significant portion of my life savings in the form of deferred compensation invested in the capital of A.I.G.-F.P. because of those losses. In this way I have personally suffered from this controversial activity — directly as well as indirectly with the rest of the taxpayers.

I have the utmost respect for the civic duty that you are now performing at A.I.G. You are as blameless for these credit default swap losses as I am. You answered your country’s call and you are taking a tremendous beating for it.

But you also are aware that most of the employees of your financial products unit had nothing to do with the large losses. And I am disappointed and frustrated over your lack of support for us. I and many others in the unit feel betrayed that you failed to stand up for us in the face of untrue and unfair accusations from certain members of Congress last Wednesday and from the press over our retention payments, and that you didn’t defend us against the baseless and reckless comments made by the attorneys general of New York and Connecticut.

My guess is that in October, when you learned of these retention contracts, you realized that the employees of the financial products unit needed some incentive to stay and that the contracts, being both ethical and useful, should be left to stand. That’s probably why A.I.G. management assured us on three occasions during that month that the company would “live up to its commitment” to honor the contract guarantees.

That may be why you decided to accelerate by three months more than a quarter of the amounts due under the contracts. That action signified to us your support, and was hardly something that one would do if he truly found the contracts “distasteful.”

That may also be why you authorized the balance of the payments on March 13.

At no time during the past six months that you have been leading A.I.G. did you ask us to revise, renegotiate or break these contracts — until several hours before your appearance last week before Congress.

I think your initial decision to honor the contracts was both ethical and financially astute, but it seems to have been politically unwise. It’s now apparent that you either misunderstood the agreements that you had made — tacit or otherwise — with the Federal Reserve, the Treasury, various members of Congress and Attorney General Andrew Cuomo of New York, or were not strong enough to withstand the shifting political winds.

You’ve now asked the current employees of A.I.G.-F.P. to repay these earnings. As you can imagine, there has been a tremendous amount of serious thought and heated discussion about how we should respond to this breach of trust.

As most of us have done nothing wrong, guilt is not a motivation to surrender our earnings. We have worked 12 long months under these contracts and now deserve to be paid as promised. None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house.

Many of the employees have, in the past six months, turned down job offers from more stable employers, based on A.I.G.’s assurances that the contracts would be honored. They are now angry about having been misled by A.I.G.’s promises and are not inclined to return the money as a favor to you.

The only real motivation that anyone at A.I.G.-F.P. now has is fear. Mr. Cuomo has threatened to “name and shame,” and his counterpart in Connecticut, Richard Blumenthal, has made similar threats — even though attorneys general are supposed to stand for due process, to conduct trials in courts and not the press.

So what am I to do? There’s no easy answer. I know that because of hard work I have benefited more than most during the economic boom and have saved enough that my family is unlikely to suffer devastating losses during the current bust. Some might argue that members of my profession have been overpaid, and I wouldn’t disagree.

That is why I have decided to donate 100 percent of the effective after-tax proceeds of my retention payment directly to organizations that are helping people who are suffering from the global downturn. This is not a tax-deduction gimmick; I simply believe that I at least deserve to dictate how my earnings are spent, and do not want to see them disappear back into the obscurity of A.I.G.’s or the federal government’s budget. Our earnings have caused such a distraction for so many from the more pressing issues our country faces, and I would like to see my share of it benefit those truly in need.

On March 16 I received a payment from A.I.G. amounting to $742,006.40, after taxes. In light of the uncertainty over the ultimate taxation and legal status of this payment, the actual amount I donate may be less — in fact, it may end up being far less if the recent House bill raising the tax on the retention payments to 90 percent stands. Once all the money is donated, you will immediately receive a list of all recipients.

This choice is right for me. I wish others at A.I.G.-F.P. luck finding peace with their difficult decision, and only hope their judgment is not clouded by fear.

Mr. Liddy, I wish you success in your commitment to return the money extended by the American government, and luck with the continued unwinding of the company’s diverse businesses — especially those remaining credit default swaps. I’ll continue over the short term to help make sure no balls are dropped, but after what’s happened this past week I can’t remain much longer — there is too much bad blood. I’m not sure how you will greet my resignation, but at least Attorney General Blumenthal should be relieved that I’ll leave under my own power and will not need to be “shoved out the door.”

Sincerely,

Jake DeSantis

Re. "It's supply and demand. I hope we didn't do away with that...LOL!"

Why, yes they did. Nobody wanted the toxic waste of mortgages and CDSs, now HB&B will fight for it to make Billions out of it, all paid for by your grandchildren.

in AUY leaps and loving it.

Nice piece on Gold this am by Bill. My comment is:

What motivation would the gubermints of the world have to lessen their influence on Gold and not have Wall Street insiders to help? Possibly honesty, fairness, integrity and social equity. However, those qualities don't motivate those who rule. They are ideals that we are aware of, and they sound good. When they rule a business, a home an individual, it is beautiful. However, I doubt O'bama will have the motivation to chase down the capital market problems that Bill see's. Instead, the way Timmy and Ben have spoken lately on "the need for more Fed and Treasury power" in capital markets, we are probably being set up for a stronger FED with a strangle hold on the Treasury Dept......then enter China and it's talk on the buck, growing concerns in the middle east in the coming months and years and poof! Oil and Gold seem like the biggest winners......IMHO :-)

I have taken Bills que's on Gold these past few months and am learning to trade the miners...it's working, but I'm still a novice. BA of late, and CVX seems to work when bought on weakness. If Gold goes to 2000 the next year or so, I will be in great shape.

I'm wondering how many weak treasury auctions it is going to take before the FED become's the biggest buyer?

Have a great week every one.

Here's a summary from the White House Office of Management and Budget:

http://www.whitehouse.gov/omb/assets/fy2010_new_er...

"

Re. "It's supply and demand. I hope we didn't do away with that...LOL!"

Why, yes they did. Nobody wanted the toxic waste of mortgages and CDSs, now HB&B will fight for it to make Billions out of it, all paid for by your grandchildren."

HB&B will be held responsible for repaying their loans, and hopefully accountable for the economic damage created. Let's not overlook the role conflicted interests had in setting up this, greatest transfer of wealth in the history of mankind.

Debt monetization by the fed is not to avoid repudiation if debt.
The auction was a bad omen and the market isn't happy with the actions by the fed and congress.

This is a double edge sword because many central banks own bonds of banks and INS companies.
Also sovereign funds and elitists.

Now we missed the boat, there will be NO HYPER inflation. None not for a long time or until 20-30% of the s&p goes under.
There will be no reflation until the bad debt is paid/defaulted. The game that Ben is playing is there only to benefit those he serves and that isn't tax payers. If it was we would vote him out. Get that?

There will not be velocity if people have no jobs, afraid of losing their jobs,are leveraged to much or have to much debt, don't want to borrow and don't want to spend/consume. Please understand that. Social mood has shifted and that is the market.
Savings rare will increase and eventually the fudged government numbers won't be able to hide that, increase spending numbers.

On higher borrowing costs for the government WILL not mean inflation, this will lead to massive deflation. This will lead to a bond collapse in the private sector! The government has the unlimited con I mean taxing authority to raise income. Sure tax receipts will be about 60% of what the government thinks they will collect and yes that will play tricks on the dollar.
The dollar is a better currency than the EURo because it is a real currency euro is not.

When us bond rates go way up, it will be reguarded as a pop bubble. No way, we can print payments with the hegemony and we can raise taxes. When those rates get high enough they will look attractive to investors as risk return. Money will flee from private bonds to public bonds, private bonds will collapse companies will not be able to afford to finance operations becuase spreads are to high over government debt! Companies will dissapear and so will debt, it will default the supply of dollars will dissapear and that worthless currency that we call the us peso will have value because of supply down and demand up for higher returns.

We are borrowing a ton but Japan has a 170% public debt to gdp. Did they ever have inflation? Nope and they did this without a hegemony.

Look at the other side of the coin. Over the next two to four years emotions are going to pull and push from every direction. We will think the dollar is going to collapse but it won't.

We will think gold will moonshoot and keep going but it won't. It will go up a bunch! But it won't stay there, necessity will be importance.

Stay logical not emotional.

Heli Ben's grand experiment will fail as you can't serve the few in hope to prosper the market is mug bigger than that.

Monetary supply increase is not inflation, driving down the long en of the curve only subsidized rates and pulls a little more demand forward, not inflation. The Fed will not allow stores money supply into the economy, they are only recycling it to keep banking assets (consumer loans credits) artificially high. Eventually it will default and the debt will be destoyed.
Net net we spent and borrowed to much, until the cycle clears we will experiance a malaise as intervention prohibits natural market corrections.

The scary part of what my soap box talk is political implications from the consistant blunders!
---forgive my spelling and typos. Post from cell phone.
Could not resist!
:)
Edit: with the consumer at record low savings rate, are they going to buy stuff on credit like cars at 20% interest?
Oh with 10% u3 rates?
Or higher. No way. Companies have been spoiled along with consumers over the last two decades if artificially low rates. This allows for cheap consumption which fuels velocity and creates inflation.

That era is gone. Welcome to paying cash and buying when you new it. Yes people will still finance stuff.

I've read the Zimbabwe story and I don't see any similarities between them and us so any reference to it makes little sense in my mind.

My belief is that the leverage placed throughout our entire economy over the past 15 years will cause deflation for at least a few more years regardless of the printing that goes on. The value of our currency will continue to be strong relative to other currencies even though it seems logical that it will be weak due to printing (in my mind this logic ignores the huge leverage throughout the entire system that trumps any printing). The fact is this printing of money has not been released into the economy in any way...it is just making banks whole on some crappy investments. Banks aren't lending this money because they need it just to remain solvent, although even that is debatable. These same banks haven't written down their assets to properly reflect the true value of them.

I'm realizing how dumb it is to get rid of MTM...banks will only value them at prices that allow them to remain solvent...by not properly valuing these they will always have these crappy underperforming assets on their balance sheets causing them to be less reluctant to loan because they will be worried about these underperforming assets continuing to turn into losses. And this PPIP plan assumes that banks will be willing to sell assets at a market price of say $.60 on the dollar when they are in fact currently valued at $0.85 on the dollar. The banks have little room to move as far as taking additional losses because of their required reserve ratios, forcing them to only take offers that will keep them solvent. This is a huge problem with this whole bailout system the Fed/Treasury has put into place. It causes significant stagnation just like the Japanese experienced in the 90's.

So I see a world where the price of oil bottoms at $15-20 USD/barrel, where the S&P bottoms somewhere around 450-500, where the price of gold ranges somewhere between 750 and 1000, and where the government released unemployment rate peaks at 11-12% (while the rate including those looking for jobs and not finding them and those working part time b/c they cant find a FT job going to 20%).

This doesnt mean we all can't trade this market. I'm just going with the flow and know that I can be wrong.

David- Before you place any buy limit orders, let me run this by you. Thanks to an email from babybear, I've been pondering the best way to beat the volatility decay in the 3x funds. My opening shot would be:

(a) Minimize your holding period. Intraday, if possible. There will be times you miss a gap up the following morning. But you get to pat yourself on the back on the overwhelming majority of days it gaps down.

(b) The only exception to (a)? A bet the current trend continues in your favor for at least another day. You will have to determine your own odds/use your own risk tolerance, but there will be days when gap up odds will be, say, 2:1. For me, it's worth a stack of chips.

(c) Sit back and relax. Something you're already good at. Sip coffee. Play music. Open your mail. There will usually be a time during the day (if not this one, then certainly the next) when it takes off in one direction or the other. You want a reasonable drop/spike, at least 10-15%. Then spend a minute or two opening a position (long or short).

(d) Once you've opened a position, you will need to sit back again, but only a zombie would be able to truly relax (keeping position size 'reasonable' [something you need to work out for yourself] is one way to do it). You should have some kind of streaming quote going somewhere in the background. The position will almost always reverse. When it hits your target (again, make it reasonable), waste no time. No need to wait for outsize gains (let's say >20-25%) because, let's face it, you haven't worked that hard!

Don't make the mistake of waiting for outsize gains. Although I took partial profits at 7.34 yesterday, I let 7+ go by several times the past two days for the remainder of the position, waiting for a spike to 8, before settling for 6.38 today. Had I not hesitated to sell into the opening euphoria this morning, I probably would have taken a larger position at 5.62, and held out for more than 6.01. Psychology rules when it comes to playing- it's all mental.

Jack,
Ontario has a mandatory community service requirement for students in order to graduate from high school. Each student is required to put in 40 hours of community service time (10 hours per year). It is up to the student to make the contacts and find something suitable. The types of activities and organizations are wide-ranging - everything from helping with elections, doing environmental projects, helping with community service organizations and volunteering with community sport programs. Our daughter does laundry for a homeless program once each week during the winter.

I don't know how the proposed legislation differs from the program in Ontario. I see it as a positive part of their education. There is nothing "big brother" about it.

Well Kiron,

In the USA I was proudly raised to believe I (and my kids) lived in a "free country", and that "eternal vigilance is the price of freedom" - Thomas Jefferson.

By the way, I'm in favor of my kids CHOOSING to volunteer. That's what VOLUNTEER used to mean!

Mark- My take on today's market is that it once again played us all. There is no way to outguess the market. I give it an A+ for sucking in new money at the open, shaking them down in the afternoon, then thumbing its nose at them on its way back up. What's new? LOL.

I'm hoping I outguessed the market today. I bought some SSO right when things started to go from negative to positive in the afternoon.

Rob.

2nd- "My take on today's market is that it once again played us all. There is no way to outguess the market."

Sure didn't seen to play you at all. I missed a profit exit on ERX, to greedy, and couldn't/wouldn't pull the trigger on TNA near the close. I'm used to the ebb and flow in high level sports. Emotions, fatigue, desire, luck all contribute to the outcome.

Today just really felt different. Sorry if I'm bugging ya'.

heard on the radio that 10% of Italy's GDP is tourism and thats seriously affected this year (no american tourists...), more shoes to drop in Europe like this

Amazing how this kind of ideas seem to rise from ashes, in all times and countries, time and again, no matter how many times they discredit themselves... question "what's next", rhetoric or theoretic for many, is purely practical for anyone who lived in USSR, and we know the answer. Here is what's next:

Subbotnik: http://en.wikipedia.org/wiki/Subbotnik

Napravlenie: can't find any English references, means state-directed place of work for 3 years after graduating from university or college, literally anywhere in the country - Siberia, Far East, wherever state deems needed.

Mandatory work on farms, anywhere from 1 day to a month, for university students, professors, scientific lab workers etc.

If you think this is too crazy - so did those with remnants of sanity in the USSR. Oh, and all that "mandatory volunteerism" invoked no deep humanitarian feelings in people, nothing but cynicism in fact. Students sometimes perceived it as fun; only totally brainwashed accepted the premise of "everyone's helping everyone else".

Mark- Didn't mean to be flip. Overall, I'm bullish.

My buy-and-hold will remain in place until I sense this bear-market rally coming to a reversal in a major way and/or it hits gains that common sense tells me to lock in. That could be next week, this summer, or a year from now. My working template is the 'generational low' that Kass talked about.

As for the trading portfolio, I'm now leaning more towards pure intraday trading, as the kind of gains we saw on Monday took much of the wind out of my 'conviction' for an upside move. Should we continue to trade sideways for awhile and work off the overbought condition, that conviction could return, and lead to longer holding periods. A retest of the lows would do the same.

2nd- Thanks, Man.

"I'm now leaning more towards pure intraday trading, as the kind of gains we saw on Monday took much of the wind out of my 'conviction' for an upside move."

Monday didn't do it for me but today did. I have to admit, leaving the office up 8% on TNA and checking through my phone, down 6% was a little unnerving. I'll think about this tonight but my reaction now is to remove some of the "crack",(3X), from my portfolio. Hard to play Craps when I have to leave the table AND my chips for the bulk of the game.
BTW- Did you get my e-mail a few days ago?

Shiva- Could you add the chart? For some reason I can't bring it up on Schwab. TIA

Here is the buddy bill S277 that goes along with the House bill hr1388.
You'll have to look for what you need because it's rather long. By the way...if you do read it, you'll be one up on any senator or representative.
Even so, what your government reps votes on, and what gets printed in the final bill is only known by the special interest groups that run the government.

S 277 http://www.govtrack.us/congress/bill....

Here is the first draft that went through the house

HR1388 http://www.govtrack.us/congress/bill....

A Letter to Mr Jake DeSantis:

DEAR Mr DeSantis,

I find your "Letter of Resignation" to be a craftily devised document prepared with the same vagueness and lack of transparency that no doubt exists in the AIG CDS insurance contracts you attempt to divorce your Financial Products unit from. What is cleverly lacking here is a date of resignation, or the words "resign immmediately". Your statements "I'll continue over the short term" and "I can't remain much longer" are blatant attempts to get yourself fired and thereby open the door to litigation for wrongful dismissal in hopes of an even larger payday than the ones you have been so fortunate to have been given up to this point. While I am amazed that you would couch within the letter your C.V., I doubt that future employment will deliver the same income as what you have enjoyed at the expensive of many others less fortunate and lacking in street smarts. Yes, AIG is very large and casts a large net. However, most AIG products and services are not provided with a gun to your client's head so I can assume that future business prospects are very dim as clients will elect to take their business elsewhere whenever the opportunities present themselves. Perhaps you can look for the light switch and turn it off on your way out.

Sincerely,

TerryC

Craig - I couldn't agree more however, a declining dollar is dependent upon other currencies staying put. That ain't gonna happen. Much of Europe is worse off than us.

Having debt during a deflationary period is devastating. Incomes fall, asset prices fall...but your debt stays the same.

Washington Post Staff Writers
Thursday, March 26, 2009; Page A01

Treasury Secretary Timothy F. Geithner plans to propose today a sweeping expansion of federal authority over the financial system, breaking from an era in which the government stood back from financial markets and allowed participants to decide how much risk to take in the pursuit of profit.

The administration also will seek to impose uniform standards on all large financial firms, including banks, an unprecedented step that would place significant limits on the scope and risk of their activities.

Most of these initiatives would require legislation.

Interesting times, but I think I had enough for one lifetime!

I also agree wholeheartedly with most of what you write, except the velocity of money part. All this debt is being used to bailout banks and buy treasuries, so it never really enters the system, hence there isn't really any velocity, is there? I mean, issuing debt to buy treasuries is basically like burying the money in the back yard, and occasionally digging it up to add interest every once in a while.

"issuing debt to buy treasuries"

I feel dumber for having typed it, but that's the best solution our leaders can come up with. Amazing...

norm - All the insolvent Wall Street banks talk about deflation. The billionaires (Buffet, Julian Roberts, Jim Rogers, etc) are all saying inflation. I question investment advice from insolvent people.

proudPapa - Velocity is the next step coming. Many assets are financed and falling asset prices cause default, a vicious cycle. The currency will be adjusted enough to get ahead of falling asset prices in attempt to stop the spiral and swing the pendulum back towards the inflationary zone. This process may take some time, but there isn't much time remaining... Some say the current effort isn't great enough and they may be correct. Let's hope this isn't the case.

Geithner was saying this AM (or was it yesterday?) that the mistake governments make is not doing enough.

IOW we're not done by a long shot. Personally I think helicopter Ben was a serious understatement. I'm thinking a craft the size of the one in close encounters of the third kind, with thousands of sorties, would be closer to the scale needed.

I can't even imagine what that many trillions could be like. We previously only used the word Billions, but we are in a whole new range now. They sure are getting accustomed to the T word. I guess we better get used to it.

I think it's just as Kaimu says. You could be a killer trader but you are trading for something valued in a fiat currency on the ropes of debt. We can all see that on the inflation adjusted gold/S&P historical charts. In real purchasing power we really haven't gone anywhere for over ten years now. Not because the markets were down, but because the USD is.

3/25/09 - "A big round of layoffs is expected in IBM’s U.S. global business services unit, with some of the jobs heading to India, according to a report in the Wall Street Journal.

The number of jobs affected is unknown and IBM didn’t comment on the workforce reduction. But the WSJ points out that the group is the company’s largest in both revenue and employment, with 180,000 employees worldwide. "

http://www.semiconductor.net/article/CA6646606.html

ok, these are going track monthly prices of the underlyings.... definitely casino style

http://finance.yahoo.com/news/Direxion-To-Tie-Leve...

But Vad, volunteerism is back in vogue in Russia!

http://tinyurl.com/crmlt7

March 26 (Bloomberg) -- Mitsubishi UFJ Financial Group Inc. and Morgan Stanley said they plan to merge their Japan securities businesses, forming what would be the nation’s third- largest brokerage firm.

The companies will hold a press briefing on the merger, in which Mitsubishi UFJ will hold 60 percent, at 4:30 p.m. Tokyo time, they said in a joint statement to the Tokyo Stock Exchange.

This is where the word "voluntee" comes in. Hopefully it will be used in the new legislation as well. It's kind of like the concept of "preemptive retaliation" used by divorce lawyers.

Thanks teamonfuego, some good airing out of conflicting thoughts live on tv. Not everyday we see that.

http://ronsen.blogspot.com/2009/03/one-day-at-time...

Poor bond auction and rocket ship close. Who said the market has no sense of humor?

Twiggs.
http://www.incrediblecharts.com/tradingdiary/tradi...