Daily Trading & Social Commentary for Nov. 3 Addendum

I appreciate this commentary as it essentially coincides with how I felt about the markets today, although I viewed the action as positive given the very bearish premarket after slaughter in Europe and Asia. Its good to read someone trying to put it all together for us slow pokes...

"...the disclosure by "banking" company General Electric. On page 38 of the firm's just released 10-Q, the firm indicates that the delta between its loan portfolio FMV and Book Value continues increasing, and as of September 30, hit an all time (disclosed) high of $18.8 billion.

In other words, General Electric, whose market cap is about $150 billion at last check, is likely impaired by at least $19 billion if it were forced to access the market today and sell off its loans. The $19 billion is 13% of its entire market cap. And the real number is likely much, much worse."

http://www.zerohedge.com/article/ges-19-billion-an...

To add a little color to the GE balance sheet; at 9/30/09 GE's total shareholders equity was $125 bil. If you subtract say $15 bil after tax benefits (assuming you wrote the assets to Fair Market Value), it would leave you with a total shareholders equity of $110 bil. GE's Goodwill and Intangible Assets were valued on 9/30/09 at $100 bil. Now that is deserving of at least a Triple A rating (maybe that is why Buffett is reducing his Moody's shares).

Keep reading over here at Bill's place....worldclass

ALOHA !!

Very sorry to hear about Stefanie'e H1N1 infection. My thoughts and prayers are with you and your family on this.

DITTO on all the rest ...

ALOHA !!

To further Bill's comments on the financial and economic upheaval in America I will post this link that better describes what I am seeing here in Hawaii.

LINK: http://tinyurl.com/yzxcp8k

I personally have never see so many people on unemployment or struggling with pay cuts and debt issues, which bleeds over into housing, which is what we were told by Bloomberg and CNBC to be buying in 2007! FLIP THIS HOUSE!

How's it working for you in your city?

More than one out of ten Americans are on food stamps.

Check out the chart on those unemployed longer than 27 weeks ...

Its the STOCKHOLM SYNDROME on a massive scale.

Actually you are not crazy, just maybe not a good trader at the present time. Just keep working at it and perhaps listen to your gut and not so much all the blog trading talk. I just read Bills stuff each morning or when he decides to post it and basically ignore most all the trading talk on this particular blog as most everyone here is to be frank fairly new and ignorant at trading and not the people you want to be following. Far from it in fact! I would also suggest less posting here as well and more time devoted to your trading knowledge and education.

I personally think the commentary part of caracommunity (such as this) is a complete waste of time and Bill would be better off making his commentaries and daily reports and leave it at that. If you can't garner what he is saying with these comments you have no place trading these markets.

I am sorry Bill but I would venture to say that other than you, Vad and the occasional comment by Kaimu this site is populated by jokes masquerading as day traders.

Just my entitled two cents

One of the best phrases I have ever learned is "don't trade outside your comfort zone." That doesn't mean that you shouldn't learn.

report that the recent mood is very bleak. Japan, the 2nd largest econ is in spiral.

"89 percent of NJ voters and 85 percent of VA voters said they were worried about the direction of the economy over the next year."

does that sound like we are spending on cruises, retail, and new cars?

http://bit.ly/31IVtV

Bill,
I hope your daughter feels better soon.
Frank

"Another thing that infuriates me is that despite all I have done to alert people to the dangers of the H1N1 vaccine, my daughter ill-advisedly took a flu shot and as a result contracted the disease tonight. Terrible news. With all my heart, I wish her a full and speedy recovery."

Released on 11/4/2009 8:15:00 AM For October, 2009
Prior
ADP employment -254 M/M

Actual
ADP employment -203 M/M change (000)

Highlights
ADP's payroll count fell a less severe 203,000 in October compared to the 227,000 drop in September (September revised upward from a 254,000 drop). The results point to expected improvement in Friday's employment report.

Released on 11/4/2009 10:00:00 AM For October, 2009

Prior 50.9
Consensus 51.6
Consensus Range 50.0 to 52.3
Actual 50.6

Market Consensus Before Announcement
The composite index from the ISM non-manufacturing survey finally pushed beyond the breakeven mark of 50, rising to 50.9 in September for a solid 2-1/2 point gain. And we may see further improvement in October as the new orders index rose more than 4 points to 54.2. Also, the backlogs index spiked 10-1/2 points to 51.5 to underscore the strength.

i agree with fedrico - hey "golong" - why not "goaway" - why would you discourage free flowing ideas - i for one post my trades so that i feel committed to the trade and would like any insights into the opinions of others who might have an edge - imho as opposed to your "entitled opinion"

If the markets stay up this high all day long I will be looking to move the money I put into SPY back into cash at the close. I didn't expect this much of a move this quickly and I put a lot into it.

By the way, I'm constantly looking at periods back in time to correlate what is going on today and the three periods I'm constantly drawn to are:
1938
1975
1982/83

I think it's very interesting to see how the overall market performed after a move of 40 to 60% because, as Vad suggests, investor psychology plays a far greater role in the outcomes of the markets than anything else. And investor psychology is centered around how human beings perceive conditions in the economy, reactions to moves in the markets, and the like.

One period I'm paying particular attention to is 1982/83. They had a similar 60% move up during a period when absolutely no one believed in the market. Unemployment was unusually high, the economy was coming out of a nasty recession, and they had a very tumultuous period of high inflation and war just before it. Not everything was the same as now, but it was similar. Anyway, I charted GE, C, IBM, and JPM against the SPY and the only company that outperformed the market in the 9 months after the market went up 60% and pulled back about 6% was C. And it outperformed by quite a bit. Now, C was a much different beast than it is now but it's interesting that a bank was the outperformer. Does anyone know if they were more of a regional bank back then?

Man child leave this country alone; we don't need someone wet behind the ears apologizing to the world where no apology is warranted; take your socialist ideas and your socialist/communist associates and remake yourself into something of which the American people can be proud; you are wasting your time and the United State's time so address energy matters (oil and gas exploration, nuclear, and address the "green" aspects when you have the science; global warming and the proposed legislation is a sick joke whose entire intent is to redistribute grobal wealth (I have seen the groups where redistribution is to be aimed and it is an utter waste, aim your abortion interests in this direction instead); get a spine and do what is necessary to win the wars where the United States is involved, forget about the possible impact on the enemy do what is necessary to win.

i was wrong - there was a draw - stop loss hit at 12.40 - bought at 12.67 - NEXT

A first step... http://finance.yahoo.com/news/Monsanto-Opens-First...

Come on, admit it, Go.... You miss living in the US !

Calculated Risk is reporting that the new homebuyer credit bill in Congress contains provisions to extend the Net Operating Loss (NOL) carryback from 2 years to 5 years. This would allow homebuilders to apply recent losses back 5 years and claim refunds for income taxes paid in the boom years. So if this passes, you might see a spike up in the homebuilders. So heads up if you are shorting these.

Bill - I missed your note...I hope your daughter has a quick recovery. One of my good friends just contracted the disease and after about 10 days he's getting back to normal...

Mr. Cara,
Just a quick note to wish you peace in the wake of your daughters illness.
Thank you for all you do for others.
Barry

barry

I wonder how willing to make disparaging remarks would some contributors be if they were doing so under their real names instead of from behind a "handle".

Bill, two of my extended family members also had H1N1...they are ding fine.

Hope all is well with you and yours

Bill, yes, I would be remiss if I did not wish your daughter a speedy recovery. After all family is the most important bond in life if not always recognized.

May your daughter get well soon.

@Bill,

Wishing all the best to your daughter.

Many thanks to the work that you have done to us in this forum. I have learned a lot from you and other people in this community.

Once gain, many thanks.

golong,

That wasn't very nice of you to say. so if you admit you know more, and only glean value by Bill's posts and occasional post by Kaimu & Vad, and are extracting value from Bill's knowledge for free, why not contribute and add some value and teach us something.

As i have clearly stated i am in a "i want to learn mode". Why not educate as a return favor for the value you take away for free from Bill's blog?

I have learned A LOT from not only Bill's main posts, but reading the commentary and asking questions to numerous members here.

Thanks bazz.

Go figure, they popped out of their wedge today to the upside, and of course the US$ tanks, so I'm still about flat. This market/US$ correlation totally kills my US trades :(

Starting to think the only US trade worth doing is on the short side. That way I get double benefit when it goes in my direction (rising US$, rising short position).

Zerohedge http://bit.ly/3QEZoM

Link to GS 10Q at SEC, Edgar database: http://bit.ly/2GBMFf

Hi Golong,

The first sentence on Bill's website reads (Bill Cara invites "all students" of the market to "freely read and discuss" capital markets and social equity.)

Happy Trading!

vb

Good Morning, papa..
MON looks strong, but those Nov. $ 65's keep me guessing... oh well, as always, I'll stay in front of the screen till days end... best of trades, baz

about the remaining stimulas money will not be used anytime soon ? I was on the front porch and could not see who made the statement.. This would seem to not bode well for the ' infrastructure ' equities...

it ain't stellar.

CSCO reports today after the close.

http://stockcharts.com/charts/gallery.html?csco

ALOHA !!

I agree Bill ... I often imagine what gold and silver would look like if JP Morgan did not exist. Is it a conflict of interest to have JP Morgan as custodian of huge amounts of gold via ETFs and also be the largest gold short on the COMEX? Does the SEC care about that?

Next we have the same one-dimensional analysis of gold again from Roubini.

"There is no inflation or “near-depression” to drive gold prices that high, Roubini said today at the Inside Commodities Conference in New York. If a severe depression came to pass, with investors buying canned goods and hiding out in log cabins, “maybe you want some gold in that scenario,” Roubini said.

“Maybe it will reach $1,100 or so but $1,500 or $2,000 is nonsense,” Roubini said. Gold rose to a record $1,096.20 today on the New York Mercantile Exchange’s Comex division on speculation that central banks and investors will purchase the metal to hedge against a declining dollar."

Here is a man who daily dissects everything from interest rates at the US FED and the German Bundesbank and yet all he can say about gold is the same old tired "inflation/deflation" debate. He pays no attention at all to the massive marketable and non-marketable US DEBT being accumulated over at the US Treasury. He mentions not one word of geopolitical events. He mentions nothing about JP Morgan and I doubt he even knows about the Blanchard Coin lawsuit. He forgoes any analysis on mining production or supply and demand. And the topper of all he mentions not a single syllable of the huge counterparty liabilities that infest every government and central bank on the planet. This constant reference to gold as only an inflation or deflation hedge is absurd and even a high school principal can talk about that!

If I didn't know better I would swear he wants the POG to go down. I would think that the US FED or JP Morgan hired Roubini.

Lets look at what a "great trader" was back before 1929 ...

"Kennedy made a large fortune as a stock market and commodity investor and by investing in real estate and a wide range of industries. He never built a significant business from scratch, but his timing as both buyer and seller was usually excellent. Sometimes he made use of inside information in ways which would later be made illegal, but regulations were lighter in his era. He later became the first chairman of the SEC. When Fortune magazine published its first list of the richest people in the United States in 1957 it placed him in the $200–400 million band ($1.51-3.03 billion today[4]), meaning that it estimated him to be between the ninth and sixteenth richest person in the United States at that time."

Early ventures

After graduating from Harvard in 1912, he took his first job as a state-employed bank examiner. This allowed him to learn a great deal about the banking industry. In 1913, the Columbia Trust Bank, in which his father held a significant share, was under threat of takeover. Kennedy, borrowing $45,000 ($966,970 today[4]) from family and friends, bought back control and at age 25 was rewarded by being elected the bank's president, "the youngest in America."

Kennedy emerged as a highly successful entrepreneur with an eye for value. For example he turned a handsome profit from ownership of Old Colony Realty Associates, Inc., which bought distressed real estate.

Although skeptical of American involvement in World War I, he sought to participate in war-time production as an assistant general-manager of Bethlehem Steel, at a major shipyard in Quincy, Massachusetts. There he oversaw the production of transports and warships critical to the war. This job brought him into contact with the Assistant Secretary of the Navy, Franklin Delano Roosevelt.

Wall Street

In 1919, he joined the prominent stock brokerage firm of Hayden, Stone & Co. where he became an expert in dealing in the unregulated stock market of the day, engaging in tactics that would later be labeled insider trading and market manipulation. In 1923, he left, and set up his own investment company, becoming a multi-millionaire during the bull market of the 1920s.

David Kennedy, author of Freedom From Fear, describes the Wall Street of the Kennedy era:
“(It) was a strikingly information-starved environment. Many firms whose securities were publicly traded published no regular reports or issued reports whose data were so arbitrarily selected and capriciously audited as to be worse than useless. It was this circumstance that had conferred such awesome power on a handful of investment bankers like J.P. Morgan, because they commanded a virtual monopoly of the information necessary for making sound financial decisions. Especially in the secondary markets, where reliable information was all but impossible for the average investor to come by, opportunities abounded for insider manipulation and wildcat speculation. ”

The Crash

Kennedy formed alliances with several other Irish-Catholic money men, including Charles E. Mitchell, Michael J. Meehan and Bernard Smith. He helped establish the Libby-Owens-Ford stock pool, an arrangement in which Kennedy and colleagues created a scarcity of Libby-Owens-Ford stock to drive up the value of their own holdings in the stock, using inside information and the public's lack of knowledge. Pool operators would bribe journalists to present information in the most advantageous manner. Attempts to corner stocks were made that would cause the price to go up, and bear raids could cause the price to collapse downward. Kennedy got into a bidding war seeking control of founder John Hertz's company Yellow Cab.[5]

Kennedy later claimed he knew the rampant stock speculation of the late 1920s would lead to a crash. It is said that he knew it was time to get out of the market when he received stock tips from a shoe-shine boy.[6]

It has been noted that during the Depression Kennedy vastly increased his financial fortune by investing most of it in real estate. In 1929, Kennedy's fortune was estimated to be $4 million (equivalent to $49.8 million today[4]). By 1935, his wealth had increased to $180 million (equivalent to $2.8 billion today[4]). According to Time Magazine, Kennedy survived the crash "because he possessed a passion for facts, a complete lack of sentiment and a marvelous sense of timing."[7]

Investments in movie production, liquor importing, real estate

Kennedy made huge profits from reorganizing and refinancing several Hollywood studios. Film production in the US was much more decentralized than it is today, with many different movie studios producing film product. One small studio was FBO, Film Booking Offices of America, which specialized in Westerns produced cheaply. Its owner was in financial trouble and asked Kennedy to help find a new owner. Kennedy formed his own group of investors and bought it for $1.5 million ($18.2 million today[4]).

Kennedy moved to Hollywood in March 1926 to focus on running the studio. Movie studios were then permitted to own exhibition companies which were necessary to get their films on local screens. With that in mind, in a hostile buyout, he acquired the Keith-Albee-Orpheum Theaters Corporation (KAO) which had more than seven hundred vaudeville movie theaters across the United States. He later purchased another production studio called Pathe Exchange.

In October 1928, he formally merged his film companies FBO and KAO to form Radio-Keith-Orpheum (RKO) and made a large amount of money in the process. Then, keen to buy the Pantages Theatre chain, which had 63 profitable theaters, Kennedy made an offer of $8 million ($99.5 million today). It was declined. He then stopped distributing his movies to Pantages. Still, Alexander Pantages declined to sell. However, when Pantages was later charged and tried for rape, his reputation took a battering and he accepted Kennedy's revised offer of $3.5 million ($43.5 million today[4]).

It is estimated that Kennedy made over $5 million ($62.2 million today[4]) from his investments in Hollywood. During his affair with film star Gloria Swanson, he arranged the financing for her films The Love of Sunya (1927) and the ill-fated Queen Kelly (1928).

Kennedy was allegedly involved in the illegal importation and distribution of alcohol during Prohibition in the United States. After Prohibition ended, Kennedy consolidated an even larger fortune when his company, Somerset Importers, became the exclusive American agent for Gordon's Dry Gin and Dewar's Scotch. Anticipating the end of Prohibition, he assembled a large inventory of stock, which he later sold for a profit of millions of dollars when Prohibition was repealed in 1933. He invested this money in residential and commercial real estate in New York, and Hialeah Race Track in Hialeah, Florida. His most important purchase was the largest office building in the country, Chicago's Merchandise Mart, which gave his family an important base in that city and an alliance with the Irish-American political leadership there.

So here you go. I left off the political side of Kennedy since that is well known. There you go the same cartel of Harvard politicians and bankers ... the same interventions and manipulations and the same old scandals with the same old crises.

Now what's changed exactly?

One statement makes me question Mr. Rogers. He said " what bubble (oil )? ...Its down 70% from its high "... He used this same rationale to ridicule people who said the same thing about the equity markets during the crash......( what bubble... they're down 50% from their highs )... guess it depends on which side of the fence one's on...

Trannies and russell red, financials up less than s&p. And I think the mkt will interpret both a hawkish and dovish statement bearishly because of how royally screwed we are either way.

He's made a followup post:
http://bit.ly/3QEZoM

Excerpt:
When a firm's trading performance challenges not only all preconceptions of realistic trading, but also of statistical distributions, one can merely stand back and watch in awe. Attached is a graphic of what a rigged, backstopped and manipulated market is all about. The chart demonstrates Goldman's YTD trading track record: out of 194 trading days in 2009, the firm has made over $100 million on 116 occasions! This alone accounts for $11.6 billion in revenue (and is likely much more as Goldman could have easily had a $1 billion trading day in the rightmost bracket as it is open ended). Assuming midline averages for any given bucket and multiplying by the amount of days that the firm traded within these, Goldman Sachs has made $15 billion courtesy of the skewed and very highly improbable (but not impossible, thank you taxpayers and Ben Bernanke) chart.

I see that and maybe, ala BC's disgust with maniputation, people just don't feel comfortable thinking outside the box on this one.

Little johnny is hoping he can pay off his BELOC (bicycle equity line of credit)...they learn fast in America, the fishbowl that is rank from all the dead fish and lack of scavengers;sorry, I did say America, the home of the brave and unenlightened.

will they dive when the dollar strengthens? Bill remarked he was going to buy some at a future date. They are under invested or wrongly situated I think for a dollar strenghtening. I do not know their book however and they may be correctly situated...the dollar could fall more than I am thinking...the wash will get cleaned one way or the other...I hope I am not wearing my shirt when it does get to the washer.

All for the paltry amount of $6.7B... and yet all the hoopla. One wonder what the IMF can do with this vast amount? (help the U.S. pay its debt interest accrued for an hour or two?).

Too much ado about nothing? It seems all the gold transactions are peanuts compared with the amount of money and debt out there.

According to my industry sources, including the Community Mortgage Banking Project and Community Lenders of America, Glen Corso, their president says the new risk renention limits being proposed in the Financial Stability Improvment Housing Act as per H.R.1728 "the sedondary market could come to a grinding halt" if the Frank RR proposal is adopted. We could be limited from hundreds or thousands of local mortgage lenders down to five to ten lenders.

The call to action would be to clarify the language in this bill that deals with risk retention to allow smaller lenders to make 'good loans' with 5% or less risk retention required. Otherwise, you might just go for the big five in your portfolio. The 10% RR number proposed by Barny Frank will kill these smaller banks.

Express your concerns to your representatives: www.congress.org

WASHINGTON (MarketWatch) -- Fewer businesses were hiring in October, even as production and new orders increased in U.S. nonmanufacturing industries, the Institute for Supply Management said Wednesday.

Led by a sharp decline in employment, the ISM nonmanufacturing index slipped to 50.6% from 50.9% in September.

Readings above 50% indicate that more firms said business is improving than said it's worsening.

It was the second straight month above 50% after 11 months of contraction. Economists surveyed by MarketWatch were expecting the ISM nonmanufacturing index to rise to 51.5%.

On balance, the ISM report confirms that the recovery is continuing into the fourth quarter, said economists for RDQ Economics. However, "the recovery in the services sector remains fragile," said economists for Wells Fargo Securities.

Nine of 18 industries were growing in October. Businesses "are mostly cautious about business conditions and the overall economy," the ISM said.

The decline in the ISM employment index, along with a sobering ADP report, "suggests downside risk for Friday's October jobs report," said economists for Action Economics. Economists surveyed by MarketWatch currently expect a decline of 150,000 in October nonfarm payrolls.

ADP reported earlier Wednesday that private-sector companies shed 203,000 jobs in October, the fewest since July 2008.

The new orders index rose to 55.6% from 54.2%. The production index rose to 55.2% from 55.1%.

The employment index fell to five-month low of 41.1% from 44.3% in September. The percentage of companies adding workers fell from 13% in September to a record-low 5% in October, matching the low reached last November.

Only three of 18 industries said they were adding employees in October: real estate, mining and management services.

The inventory index fell to 43% from 47.5%, indicating more inventory reductions. Most firms said their inventories were still too high.

The private ISM surveys purchasing managers each month, asking them if business is better or worse than the month before. The ISM tracks the breadth of change, not the magnitude.

Another deal for a select group in an effort to pad the economic outlook.

How about a larger write-off for individuals whose 401(k) went south? How about a tax rebate for people out of a job?

How about just getting on with the real business of governing and letting the "free market" do what it does better than all these butt-in-skis in Washington?

This micromanaging is not the kind of change I will EVER believe in!

I noticed that KGC has been falling or underperforming the other miners that I track. Does anyone have any insight on this? No position. TIA

I do not have any special insight except I was reading here that they lowered production amounts I think...don't really know the specifics...someone does, you can rest assured of that.

I saw this clip this morning ,Niall Ferguson speaking out against Goldman Sach at the Aspen Institute event on Capitalism and the Future,I cant find anything other than this short clip which I had to search hard for.Anyone seen a longer fuller version or transcript?It was introduced in a belittling manner when refering to Niall Ferguson and kept short to mislead.

http://tinyurl.com/yd9fq6e

Loannetter -

Any bank having a cash reserve ratio below 10% is just plain stupid. Since when did franctional-reserve banking start to work with no reserves? Bye-bye secondary market (euphemism for securitization of Main St. debt). As a mortgage broker, you're working for King Barney now, not Lord Freddie and Lady Fannie. Your FHA loans will be processed through three choices: Bank of America, Bank of America, or Bank of America. Mortgage terms will be non-negotiable but a small processing fee of $100 will be considered for your trouble.

http://tinyurl.com/yjykxdu

Bill -

Sorry to hear your daughter is sick. Here's to a speedy recovery.

ALOHA !!

Nooyi is on crack!

Ferguson feels like a Marxist Lennininst with Goldman Sachs running the US government. Does he have any feelings for the US FED?

SLR(ASX) up 12%+ last night.

Sold my calls at $2.96...waiting for a little better entry

adding to my positions now and taking a coffee break.

As i am sure Bernanke and Co. will ramp this into the close.

Explanation for Kinross

They are having trouble generating free cash flow....

http://www.mineweb.com/mineweb/view/mineweb/en/pag...

Naturally, as soon as I gave up on my shorts, the market spike turned around. Well, the pros supposedly feel no regret about being stopped out and are ready to try several times before nailing the trade they like. So I have just re-purchased at $21.97 all the FAZ shares I sold earlier today at $21.64. I will wait to put on the full FCX short position until $USD breaks out above its 50-day MA.

found, I sold some December $115 puts on FSLR a couple of days ago at $7.50, which will either give me an entry at $107.50 (3% above the March low) or a return of 6.5% in about 1.5 months if the options expire.

If these big boys are so healthy, questionable, why have they not taken a sustainable spike?

edit: It is hard not to leave footprints when whan walking through partly dry cement;that is were the bodies are burried in China and were the Banksters would like to put some of our dear American citizens!

Will we let them have their way with us or will we put a stop in place or lie open to continued risk, even though we "know" America is the greatest experiment ever to unfold, literally.

Has anyone noticed the spelling situation with the blog?

sorry about your daughter. my daughter, son and daughter in law just got the shot.

Vad, what have you done to me?!

Attached is what looks like a fairly convincing cup and handle formation on TWM (russel short, probably similar on any russel related chart). Promising volume, just waiting for handle break... took a position with stop slightly looser than on the chart

Edit: also seen the russel charted as double top with downside target about 8% below where it is now

You said: "It seems all the gold transactions are peanuts compared with the amount of money and debt out there"

The current value of all gold ever mined is reported to be $5.1 Trillion ($1090 oz)

Government debt is set to head towards $13 Trillion and perhaps $75+ Trillion including unfunded promises

The global value of all assets probably peaked around $120 Trillion ....after the recent adjustments to asset values
of $30-50 Trillion, global wealth may be $80-90 Trillion.

So gold is only 3-3.5% of estimated global wealth at current price levels
If the Interventionists lose control of the gold price, the market could raise the value of those peanuts substantially.

Question is... as gold slowly rises... how much is the other ponzi stuff really worth?

The billion dollar skyscraper now worth $500 million The $600,000 house now $380,000
The over-leveraged corporate buyouts now experiencing default and bankruptcy and the excessively leveraged derivative bets. The $100 million loan now worth $20m.

FAZ had a spike up a little while ago and hit the sell limit order I placed for it yesterday at $23, after picking up 100 shares after hours at $22.11.

Also, I see that the SRS buy stop order I placed last night at $10.01 was triggered for 200 shares, and I placed a sell limit order on these shares at $10.50. Just collecting small profits, mostly for moral satisfaction at this point. :)

Ron Paul got strong support for his HR1207 but after delivery to the committee of Rep.Mel Watts, the congressman from a gerrymandered district in North Carolina whose top supporters as of 2008 were Wachovia/Chase, the ABA, Bank of America and American Express, gutted the bill.

Ron said the bill “has been stripped of provisions that would remove Fed exemptions from audits of transactions with foreign central banks, monetary policy deliberations, transactions made under the direction of the Federal Open Market Committee and communications between the Board, the reserve banks and staff.”

Paul may try to add an ammendment restoring those items which were cut on the House floor when the bill comes up.

As to the outcome.... ye who has the gold

SAN FRANCISCO (MarketWatch) -- Whole Foods Market (WFMI 29.26, -2.80, -8.73%) late Wednesday reported fiscal fourth-quarter net income jumped to $28.7 million, or 20 cents a share, up from $1.5 million, or 1 cent a share, a year ago. Sales rose 2.3% to $1.83 billion. Analysts had forecast the largest U.S. organic-grocery chain to earn 18 cents a share on sales of $1.84 billion, according to FactSet Research. Identical store sales -- a key barometer of grocer health - fell 2.3% compared to a decline of 0.5% in the same period last year. While same-store sales have fallen in recent quarters the magnitude is easing. "We believe our sales have stabilized and officially turned the corner," CEO John Mackey said in a statement. Whole Foods shares closed at $32.06 ahead of the earnings report. The stock has more than tripled in value this year.

I shorted TIF and WFMI at 33.49 a week ago, just got out after hour at 29.18. Probably it will go down some more, but it's safe than sorry.

Dr. Strangelove, Perhaps I should agree with you on that point!

However, it is apparent you know banks and I know brokering. From what I do know about this issue, Risk Retention is not the same as reserves required by FDIC. Your local savings and loan or credit union is doing fine by making 'good low risk loans' with their current RR ratios. Raising that figure to 10% will kill their ability to lend.

FHA is fine with brokers making 1% origination, thank you.

Yes, sad...you know what I did? I phoned those co-sponsors provided by campaign for liberty newletter and thanked them and was polite. They need all the reinforcement they can get because when the arm ringing starts, they will need to develope some of the discipline we are learning here and its not like theoretical stuff which I had plenty in university. Good on Monday, maybe, but not the books always and formost.

GS developed the "Holy Grail" in 2007 and updated to "Holy Grail V2.0" in 2009. Here are the performance charts from their 10-Qs and 10-Ks:

http://www.tradersquest.de/2009/11/04/goldman-sach...

Out of curiosity i checked the quarterly income statements of WFMI, and for the 4 quarter preceding this reported one, the non-recurring expenses looked like this:

5-Jul-09 12-Apr-09 18-Jan-09 28-Sep-08
28,972 18,440 19,141 42,310

so their same quarter a year ago had about $20 million more in non-recurring expenses than the next 2 quarters, and their profit jumped about $27 million. So really, if they had non-recurring expenses this quarter of $15 million, voila, profit jump.

Now i got curious, and opened up todays 8K

this qtr last yrs qtr
Pre-opening expenses: 10,602 15,151
Relocation, store closure
and lease termination costs: 3,248 27,159
Totals: 13,850 42,310 (same as above)

So yep, their non-recurring expenses were way down, thus profit jump. Time to rejoice!! Think of all the jobs created by the reduced non-recurring expenses!!

edit: here are links to 8K and yahoo stats:

http://www.sec.gov/Archives/edgar/data/865436/0001...

http://finance.yahoo.com/q/is?s=WFMI

A quote from link below..

"As Alistair Darling acknowledged in Newcastle this week, the airline industry and travellers are being penalised to help pay for the enormous cost of rescuing rotten banks. 'We need to raise money to pay for some of things we have done ... Northern Rock has cost a lot of money.'
IATA boss Giovanni Bisignani argues the UK tax rise could not come at worse time for an industry losing money hand over fist and will do little to curb emissions.What is really appalling is that airlines and consumers are being asked to pick up the bill for the bankrupt banks. Yet so far we have seen little effort to place a supertax on bank bonuses or impose a levy on casino banking activities.The badly run banks like Northern Rock and Royal Bank of Scotland drove Britain to the brink. It is they who should be paying for their rapacious behaviour."

http://tinyurl.com/yeg5ryk

Also £30 billion more to be injected into Lloyds Tsb and RBS.When will it all stop?
http://tinyurl.com/y8zr5yo

ALOHA !!

Meeting of the Federal Open Market Committee on
December 9, 2003
A meeting of the Federal Open Market Committee was held in the offices of the
Board of Governors of the Federal Reserve System in Washington, D.C., on Tuesday,
December 9, 2003, at 9:00 a.m. Those present were the following:
Mr. Greenspan, Chairman
Mr. Geithner, Vice Chairman
Mr. Bernanke
Ms. Bies
Mr. Broaddus
Mr. Ferguson
Mr. Gramlich
Mr. Guynn
Mr. Kohn
Mr. Moskow
Mr. Olson
Mr. Parry
Mr. Hoenig, Mses. Minehan and Pianalto, Messrs. Poole and Stewart, Alternate Members of the Federal Open Market Committee
Messrs. McTeer and Santomero, Presidents of the Federal Reserve Banks of Dallas and Philadelphia respectively
Mr. Reinhart, Secretary and Economist
Mr. Bernard, Deputy Secretary
Ms. Smith, Assistant Secretary
Mr. Mattingly, General Counsel
Ms. Johnson, Economist
Mr. Stockton, Economist

PAGE 10 ...

CHAIRMAN GREENSPAN. As I’m sure you know, the Federal Reserve has continuously given away its surpluses for political reasons if for no other reason.

MR. POOLE. We have this issue potentially as well. Our issue is complicated a bit—or differs from the issue in Japan—because we have member banks that are shareholders and I think that under the law the member bank capital is actually at risk under the Federal Reserve Act. I’m asking the question particularly for Japan, but it does apply to us, too.

MR. KOS. I don’t have the specific number, but I believe about 10 percent of Japan’s overall reserves are held at the central bank.

MR. POOLE. Of dollar reserves?

MR. KOS. Of their overall reserves.

CHAIRMAN GREENSPAN. The rest is in the Ministry of Finance.

MR. KOS. The rest is in the Ministry of Finance. All of the intervention-related activity is by the Ministry of Finance. The bigger risk to the Bank of Japan’s balance sheet is probably their holdings of government securities at interest rates of zero and credit risks based on borrowings from the Bank by some lower-rated entities. Recently you may have seen some press references to a loss that the Bank of Japan reported.

MR. POOLE. Well, there was an article in the Financial Times. That article also pointed out something that I thought was quite interesting. It said that the Bank of Japan is moving away from valuing its balance sheet on a current market value basis and toward valuing it on an amortized original cost basis. That, of course, would protect the appearance of the balance sheet, though not the reality, should there be a large depreciation in the value of their government bond holdings.

LINK: http://tinyurl.com/yh97t4h

"It said that the Bank of Japan is moving away from valuing its balance sheet on a current market value basis and toward valuing it on an amortized original cost basis."

Amortizing losses ... what over 100 years ... maybe 1000 years! YEWWW! So much for credibility!

Ministry of Finance intervention-related activity. They talk as if that is normal fare for "free markets"!

Hummmm??? " ... would protect the appearance ..." These guys spend 25/8 discussing new ways to profit off the "appearances of free markets".

Even in 2003 the central banks were hiding reality. Is it any wonder the Ron Paul "Audit the Fed" Bill was gutted?

Then did you catch this part ... "we have member banks that are shareholders and I think that under the law the member bank capital is actually at risk under the Federal Reserve Act."

I wonder how many US FED shares Goldman Sachs owns ... The US FED is a private banking cartel that is a monopoly. What do you expect from a monopoly?

Bill

My daughter came down with H1N1 on Sunday. On Monday her doctor did a nasal swab and quick test.... it was H1N1 (actually it tested for type A and type B influenza. The test strip red line appeared.... positive for type A which the doctor said would be H1N1 as it is type A and the only flu in our area at this time. The doctor gave her a prescription for tamiflu. Today she feels almost completely better. It's amazing (knock on wood). I've heard others say they've had great results also. The CDC released all they had in their stockpile, but Roche says they have plenty left so I don't think there's a shortage issue.... could be local distribution shortages but not overall. Of course no one wants to take unnecessary medicine, but this stuff really seems to work. Note though that you need to take it within 48 hours (I think) for it to be effective. I hope she gets well quickly, either way.

ALOHA !!

VB posted - "buffet is buying railroads"

Do you think he is going to start up the old railroad monopoly again? HA!!

What is interesting about the railroads which you guys may not know is the amount of land they own. For instance the Santa Fe railroad still owns huge parcels of land which are leased and managed by mining companies like Newmont.

The railroads got sweetheart deals with the US government to pick up large parcels of land for a pittance under "eminent domain" laws.

One mining CEO that I deal with was telling me about some property in Arizona that he has to negotiate with Newmont for, which is titled to Santa Fe.

How much land and mineral rights is Buffet getting with this BNI deal? There is way more to railroads than just rails and trains!

The Atchison, Topeka and Santa Fe Railway officially ceased operations on December 31, 1996 when it merged with the Burlington Northern Railroad to form the Burlington Northern and Santa Fe Railway.

If it's fraud or some illegal activity they should go down for it. If their super computers or other gizmos are responsible for giving them "no risk" trading, then that should be stopped too. Otherwise it's equivalent to a license to steal.... and will ultimately damage the whole market. Either way it needs to be investigated.

ALOHA !!

Well Bill if you go back to the 1970s archives when Arthur Burns was Chairman of the US FED you will see two now infamous underlings by the name of Greenspan and Volcker.

It never matters "who" ... because I can quote you manipulations going on back in the 1970s with regards to the USDX and the Swiss Franc. If you recall the Swiss Franc was very strong against the USDX due to its perception of being as good as gold ... the best paper currency.

I see the Swiss Franc appreciate quite a bit over the past few months, but the Swiss banks and government of today is nothing compared to the 1970s. I just think old habits die hard. I mean look how low the SNB rates are now. Then the other factor is the Swiss banks have been decimated in terms of taxable revenues, which is for all to see on the SNB financials.

We are dealing with a money monopoly which is probably the most powerful monopoly of all. Go read one of the 2003 FOMC meeting transcripts that I linked to and it strikes you immediately that these ten or twelve clowns are sitting around in a room making long term decisions that will effect the entire World, for sure some 306 million Americans. What else strikes me is that they say "I don't know" a lot. Or they put things up for debate, but the debate never lasts long because they all kowtow to Greenspan and he squashes any dissenting voices that do not agree with his views. So in essence what we have is a monopoly within a monopoly directed by the King(Chairman). I mean are you going to bite the hand that feeds you? Its all self-serving and nothing more than a "good old boys club"! Only this club controls each of our financial futures.

We need to do what the US government did to the Standard Oil monopoly ...
No don't break it up ... just END IT!

There is a reason that no central banks are mentioned in the US Constitution. Is America a country of laws or lawlessness? So far it is the latter that has won out for some 96 years now.

GS might be whiz-bang proprietary traders with their own money but they are rank amateurs when it comes to managing OPM's. Take a gander at this sick mutual fund they attach their name to, here, in Canada:

http://tinyurl.com/yejqw3l

golong,
Welcome to my IGNORE list!!
KC

I too can't view it. U.S. markets sure looked ugly today but with the last few days action in Canada and Pacific, it looks to me, a bit, like it's "game back on" in the riskier markets - e.g. good rising volume on green candles in Canada today and yesterday.

Though I do not quite agree with Jim Roger's $2000 gold in the foreseeable future (short of some big black-swan kind of event or war) Roubini's opinions are definitely suspect. Almost contrary to what does happen!

Here is Roubini's track record. If you traded his calls on the market you would have been definitely bankrupt (many times)!
http://www.marketoracle.co.uk/index.php?name=News&...

loannetter -

Not sure what you mean by Risk Retention. So it seems Frank is just increasing reserves for tiny financial institutions with checking deposits under the $43m threshold (credit unions and real small community banks; S&Ls now operate as banks). I haven't read the bill. Sounds like he's doing the Fed's dirty work.

I do know that higher reserves can significantly reduce money supply and therefore maintain the purchasing power of the almighty dollar. It's a key Fed tool along with increasing the rates to control inflation. Clawback time? Expect regional banks to get a 2% increase in checking reserves (M1) to 12% as the Fed perceives them to be anywhere near stablizing ...

Any bankers out there to back me up? Crickets chirping ....

Cheers.

Navid,

Most people don't need this vaccine (pneumococcus). Even though it is called Streptococcus pneumoniae it is not necessarily associated with pneumonia. It is one of 3 "encapsulated" bacteria that people who have their spleens removed are inoculated against to reduce the (very small) risk of overwhelming post-splenectomy sepsis (OPSS). For everyone else it's not a big player pathogen.

KC

Vad,

Discussion of Daily VaR and Daily revenues (not profit!) begins around page 121.

Everyday, on my way home from work, I read the front page of IBD to see what their assessment of the previous day's market action is - you know: the "confirmed uptrend", "market under pressure", etc.

Anyway, they often say, this year, like MANY commenters "market up, but in light volume, indicating a lack of institutional conviction".

I've brought this up before, and I'm starting to wonder if my observation is even relevant. Can one only compare volume strength with very recent action? Fact is, the last three day's candles have been green AND their volume has been higher than in all but 2 days during 2007. Comparing the last 3 day's volume with 2008, they are all even higher than the volumes of the vast majority of days in 2008. Of course, there were 4-5 patches of extremely higher trading volume that year.

In order to encourage rail developement in the 19th century, railroads were given fee simple every other section (sq. mile) of land that abutted the right of way. Back then land was cheap.

My wife's grandparents purchased their current property from the MKT in the early 1900's.

Railroads collect a lot of money from right of way leases to pipelines and the power distribution grid. They obviously also own the mineral rights.

Who knew?

Sprint started life as a division of Southern Pacific Rail; who knew the railroads also had their own internal phone system inside them using microwave towers and then later fiber laid along their right of ways.

http://en.wikipedia.org/wiki/Sprint_Nextel#GTE_Sprint

Bill, and all those interested in charts.

I've seen a few of the videos from Wordens and have been impressed with most of them, but not this one.
Although I agree with the basic conclusion of Peter Wordens video, I don't agree with his method for the following reasons.

1- The 10 month charts are in linear not log format, thus any trend line you draw represents a constant incremental rise, or in other terms a diminishing rate of return line. I agree the rate of this rally has been slowing for some time, even while it has been setting higher highs and higher lows. The trendline cross actually happened a little earlier if you plot the same line on log chart.

Actually this is quite normal for stocks in an uptrend to have varying rates of positive returns, we just have to decide when to ride the more powerful trends and look elsewhere during the long slow trends.

2- The trend line is established by two points, (Mar & July), not usually enough for a valid trend line. Then I'm sure I heard the statement at least twice that this trendline has not been violated since the beginning of the trend in March, until now. Well of course it hasn't, it was drawn between the only two low points on the line between then and now. We could have just as easily drawn the trend line from March to the Nov low and stated that we have just in the last few days successfully bounced of the long term trend line from Mar which has never been violated.

3- TSV volume on the SPY. I agree volume and price are important parameters, however I disagree on using any volume data on an index tracking product. The SPY is designed by Spiders to proportionally track the price of the S&P-500 index. I have never seen any tracking product which states it can also track the volume proportionally.

This volume issue has been a sore spot for some time as I see many chartists applying price and volume to these tracking products when they should be trading them but looking at the underlying chart for the TA analysis. IMO.

Attached please find a quick chart I put together of the $SPX and SPY, the price sections were scaled and overlayed and as you can see they are almost exact. Below I've shown the volume for the $SPX and then the SPY, with a 50 EMA added to both volume charts. As you can see the volume spikes above and below the 50EMA are quite different, also the long term trend in volume is quite different.

So in the end if the action of the SPY is driving the $SPX, then you should use its price volume for TA. But if the SPY is just a price tracking product then trade the SPY but use the $SPX for the TA analysis and signals.

Note some are having problems seeing the video, the link is in the top scrolling banner once the freestockcharts website starts. Also note that the site runs under Microsoft Silverlight software and if you don't have it installed I doubt you will be able to see the video.

Thanks to Fox1, for posting the following more direct link, although I think you will still have to have Silverlight installed.
http://www.freestockcharts.com/?WatchSP500Video

FD: (I like the Wordens Telecharts service but don't subscribe to it, I do subscribe to Stockcharts).

It just sticks in my craw. You don't need 100 traders to buy and sell paper to other banks electronically, let alone 400.

So *WHAT* are these 400 traders trading? And for what *PUBLIC* purpose?

Honestly, does it mean that the *ONLY* way we can make consistent money in these markets is to ride the invisible coattails of the Fed's traders?

And what gives them the *RIGHT* to be trading using MY money against me???

If Bill is correct about a sell off after a pop to the trend line approximately 1060, does the dollar have to go down?

I am into UUP. I was noticing it seems to be holding up well so far. I will not sell unless it breaks 22 at any rate...have hidden stop.

What do you guy/gals think about this security? I seems to be correlated with $trin positively. Does anyone have an opinion on the dollar and/or the $trin?

TIA

edit: Also, CNBC trader said after close that $ was sure to have a pop soon because of the crowded dollar short...did not trade off this, but disconcerting nontheless.