Good News?

After an exciting start to the day that had everyone hopping, the day would up quite uneventful from 11:00 to the close as SPX and other indexes sat on support and would not budge. For the bears the good news was the dip was not bought up with any fury (yet). for the bulls, there was no good news other than a strong support level. Does anyone recall that the unemployment report was this am? (LOL- what an afterthought that has become).

Other than GS's blow out, the big news to me was the O's speech basically attacking the banksters. As Denninger puts it - To President Obama: FOLLOW THROUGH NOW! The O has been a man of many unfulfilled promises and I'm quite surprised the market did not laugh off his (what should be idle) threat. I have no reason to trust the man. For once, I fully agree with the O. We saved their asses and they should be eternally grateful. It will be interesting to see1) how aggressively they push back and 2) who is actually running the show up there. Will they hold us hostage again? What leverage (financial blackmail) will they use to sway congress from even getting to a vote on this. This begs the question; was it all just rhetoric for the masses? If anything I will consider it a nice gesture and possibly the first brick laid in the foundation of an actual recovery. Naked cap also has“President Obama: It’s Not Just the Words!” Krugman is on this page as well. Washington's Blog - I'll Believe It When I See It (In the Fine Print) (this is getting rather humerous now - boy our president must have a ton of credibility!)

Another positive development is the delaying of Helicopter Ben;s confirmation. This is quite possibly the second brick in the foundation of recovery (of course a full audit of the Fed would be nice and abolishing the Fed would complete a whole wing of our ficticious recover hose we are attempting to build here). I think this is a must read from Zero Hedge. Scandal: Albert Edwards Alleges Central Banks Were Complicit In Robbing The Middle Classes As I am speculating the rhetoric and finger pointing for the blame is going to get very heated in this election year and the blame game hot potatoe will a fun one to keep track of. 


With Brown winning Massachusetts, this has been the best news week since like 2007. I'll report the good stuff to. I'll actually shout it from the roof if and when it happens. That may be three bricks in the foundation! (we got a long way to go.)


Back to reality.....


We got a lot of problems. One that gets little focus is the pension issue. In Escalating Pension Crisis Will Bankrupt San Diego Mish brings to life an enormous issue. You see underfunded pension obligations was a big issue before the crash and is now even worse after the crash and CDS debacles. If you thought unemployment was bad, wait till you get a bunch of retirees that can't afford shit cause corporations and governments neglected their fiduciary duties to get the pension pot right (uh - they had TWO bubble scenarios to get this done). "The core issue is unsustainable pension benefits. The system is broke. Toying around with little cuts here and there will not help. And as bad as things look now, they will look even worse after another stock market plunge. Unions in general are attempting to hold the status quo as the day of reckoning rapidly approaches. The realization phase for unions will be brutal." Now there is another crime, the unions misleading their members that all is well. It ain't and how sad it is that the members don;t get it yet after two years of this crap.


Calculated Risk is one of the few blogs that actually took the time to mention the (un)employment report this am. Weekly Initial Unemployment Claims Increase - Zero Hedge hit home the most important fact (as always) in Initial Claims Misses Estimate By 42K, Emergency Compensation Explodes By 652K Over Last Week "The combination of initial, continuing claims and EUC for the most recent period is a record 10,701,794 Seasonally Adjusted  or a whopping 12,021,880 Non-Seasonally Adjusted. The double dip is here, and unfortunately for Obama, he is all out of stimulus bullets." The way the administration is attacking this problem you have to ask, does employment really matter?


The most shocking story I read was last night  - Democrats To Seek Stunning $1.9 Trillion Increase In Debt Ceiling To $14.3 Trillion  That would be the icing on the cake now wouldn't it!


And for you market timers Deutsche Bank On China: "First Rate Hike Coming In The Second Half Of March"  I've been pointing to March for some time as the end of P2 (nope, I have somehow not called a top yet). I'm not a hopium addict. I just think they have another trick or two up their sleeves (remember they do control everything). All the signs are there and even price now. Maybe reality will slap me in the face and I will wake up. When China raises rates (I suspected they would first) we either must follow or get out of the way. When rates go up the market will implode.


In case you did not already know this - Ron Paul: After ‘CIA coup,’ agency ‘runs military’


Have a good one and GL!


"Based on the lower low, the futures and the daily indicators I have to vote for further weakness. 1118 to 1115 would be a good spot to look for." - who said dat this am? SPX low 1115.08.

Mr. Grinch (Non-Denominational)

He HADN'T stopped Christmas from coming!
IT CAME!
Somehow or other, it came just the same!
And the Grinch, with his grinch-feet ice-cold in the snow,
Stood puzzling and puzzling: "How could it be so?
It came without ribbons! It came without tags!
"It came without packages, boxes or bags!"
And he puzzled three hours, `till his puzzler was sore.
Then the Grinch thought of something he hadn't before!
"Maybe Christmas," he thought, "doesn't come from a store.
"Maybe Christmas...perhaps...means a little bit more!"
And what happened then...?
Well...in Who-ville they say
That the Grinch's small heart
Grew three sizes that day!
And the minute his heart didn't feel quite so tight,
He whizzed with his load through the bright morning light
And he brought back the toys! And the food for the feast!
And he...
...HE HIMSELF...!
The Grinch carved the roast beast!

You see, Christmas does not come from a store and, yes, it means a little bit more. Those that shop at the Fed's discount window found that Christmas can come early (or at any time they want it to). Those that shop at the Fed's discount window don't give a shit about your Christmas. The bonus laden will spend, spend spend and the debt and foreclosure laden will cry boo-hoo. They have left no crumbs for your mouses and that Who Hash, they smoked it! Friggin all of it! Bogarts.

Now Christmas is coming to CITI and Wells Fargo. They are getting bailed out for bonuses and the shareholders are getting diluted to Whoville and back. You’re a foul one Mr. Grinch. You’re a nasty wasty skunk. Your heart is full of unwashed socks, Your soul is full of gunk, Mr. Grinch. The 3 words that best describe you, are as follows, and I quote, "Stink, Stank, Stonk"


That's right, Christmas does not come from a store because their inventories are so low you won't be able to find what you want even though the shoppers are only out in limited numbers. For it was on that day they say the credit card issuers increased their interest rates 10 times plus two. They are not gonna come and steal your tree like the Grinch, they are gonna repo that sum bitch and still charge you interest (times two).


Was it really because the bankers hearts were two sizes two small? Not really they are to big to fail so they don't really have hearts or souls or even a spirit for that matter. Their religion is rooted in evil and greed and your well being is of no real concern to them. They have discovered a way to churn the markets without needing any of our assets and thus rendered us useless in this world. They got all they needed out of us. You nauseate me, Mr. Grinch. With a nauseous super naus, You’re a crooked jerky jockey and, you drive a crooked horse Mr. Grinch.

Don't expect Obama or Bernanke to come whizzing thru the night to bring you a load of jack shit. Their hearts are not feeling any lighter (nor are their wallets!). He's gone. He's checked out and did not leave a forwarding address. He left town with all your shit and is still charging you interest! That roast beast, that ain't roast beast I hate to tell ya.

I can't really decide amongst the candidates who should be the Grinch. Bernanke and his "superman of the year" award? Greenspan? Clinton/Bush/Obama? Timmuh? GS? Or pick almost any representative. It is a tough call, so you can make up your own Grinch.


OK, I have slightly berated one of the all time favorite Christmas stories, sorry. You see it is one of my favorites, and I believe the message is glaring to those that will listen. At the very end of the video the message is loud and clear.

Christmas day is in our grasp, So long as we have hands to clasp, 
Welcome all Who's Far and near, Christmas day will always be Just so long as we have we,
Welcome Christmas Bring your light, While we stand Heart to heart And hand in hand 


My kids have to recite that (and about 5 other Christmas classics), so I know they get it. You see if you remove the word Christmas and replaced it with, say, Saturday, read it again. Stripping away the commercial and religious aspects, we can all enjoy the season. What if We did not have We? What if We could not stand hand in hand with our friends and neighbors? It is about community and family coming together. We need We! Without We things would really suck, so this holiday season appreciate the We's you have.


Now stretch this We to our country or the world. We need We and We better start coming together or the Grinch is gonna get our tree, and he might want to stuff the tree up something other than your chimney. I have had enough of the Grinch and his TBTF party. So as you are spreading holiday cheer with the other Who's in Whoville, why don't you discuss the Grinch and his bad acts so others become aware of what is really happening. Then it will be the Whos turn to make some Noise, Noise, Noise. Then maybe the Who's can get their Constitution and government back! Now wouldn't that make a great holiday gift?

Happy holidays!


I'll post on a Christmas Carol soon. I'd hate to leave Scrooge out of one of my Xmas posts.

Also, I crossed the 300k hits milestone today! Thanks for all your views and support.

Wow, I'm Actually Making Money Now!

Good thing as I dropped off the property tax bill today. So what do we have newsworthy tonight that can add some fuel to this fire? Hmmm, should not be hard to find if you ask me. I think you'll get a good laugh somewhere in this post.

TD and Zero hedge will lead us off with Nic Lenoir's Is This The Beginning Of The End Of The Ponzi Scheme? How bout this little factoid that will bring a smile to the premabears faces, "I saved the best for last: the LQD ETF which is basically a proxy for investment grade bonds which has been on a straight ramp up since October 08 seems to have broken its trend. Tha comes on the back of some observations over the last few weeks of some divergence between the CDS market which has made attempts to move wider while equities kept grinding up. This is by far the most important development. If the price action in the next 2/3 days confirms this break, then really it means the carry trade as a whole is starting to break down." As Cartman would say, sveeeeet!

Karl Denninger does the best job at ripping the preshredded fodder left over from the capitol hill grindings. Today he rips on Helicopter Ben in To Bernanke: It's Time To Stop Lying. "Or shall we talk about the "off-balance sheet" games, such as Wachovia's practice of writing CDS against their own tranches of OptionARMs as inducement to get people to buy them - a toxic brew that has now landed on Wells Fargo and remains undisclosed as to the exposure it presents to Wells from possible (or even probable) defaults! Wells has some $2 trillion of this off-balance sheet exposure and they're hardly alone in the (ab)use of these "QSPEs" - indeed, those are the same sort of vehicles that a really great energy-related company called ENRON was (ab)using to hide mounting losses that ultimately blew them sky-high." Note to Karl, stay away from the 5hr Energy man. You will blow. I can feel the angst being transmitted from your keyboard into mine and I don't need any more angst in my life right now.

OK, I'm not sure if this headline is a joke or not, Greenspan Calls Market Top Buahahahahaha, ROF, puke out nose, shart in pants! Thank you Naked Capitalism for my best laugh of the day. You mean the man with the troop of 1,000 economists (some salaried and some contracted) that all monitor this shit daily and missed the top in the first place, and YOU, yes you all by your little self, pull this out of your ass? You got to be freaking kiddin me? Uh, Mr. Greenspan, and your credibility to call this top would be? Yes? It would be?

Mish brings a rosy report from Rosenberg in Rosenberg: “We are certainly in a deflationary state”. "“We are certainly in a deflationary state,” said David Rosenberg, chief economist and strategist with Gluskin Sheff and Associates in Toronto. “Of that, there's no doubt. I think people still have no clue as to just how weak the economy is,” Mr. Rosenberg said." Uh, ok, now that is not what I heard on CNBS or from the leading ML analyst that took your old job. David, have you not had your government mandated green shoot tea today? Please report to the infirmary at once.

The Pragmatic Capitalist comes thru with it's daily must read in MUST READ: THE REAL REASON BEHIND THE FED SECRECY Sveeeet! You all know I love this shit.

“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”

- Thomas Jefferson

(Note: support audit the Fed HERE.)

Bhuahahahaha, ROF, puke out nose, shart in pants again! Oooh, better go clean that up.

Have a great night. Bhuahahahaha. He called a top. OMG, that's funny as shit.

Shanghai Index And Why Is China Pulling Out Of Treasuries?

With so much discussion about China vs. US markets, I thought I would throw the $SSEC vs. the SPX on a chart and see what pops. What I got was sort of interesting. See notes in chart. $SSEC does not look healthy at all on a weekly chart. Just getting pummelled. As with the SPX, I would like to see divergences in the indexes before the big fall. This is a healthy impulsive start to a larger downturn for sure.

On a more sour note for the US debt funding machine the BBC reports that China reduces holdings in US debt. "China reduced its holdings of US government debt by the largest margin in nearly nine years in June, according to data from the US Treasury."

What makes sense is their argument for why. "In recent months the US government's budget deficit has widened thanks in part to the Obama administration's costly stimulus plan. Our correspondent in Shanghai says that China is worried about this, and fears the stimulus efforts will fuel inflation in the US, reducing the value of the dollar. This would then erode the value of the debt China holds in the US currency. In June, China cut its holdings of US securities by about $25bn, a fall of 3.1%." This goes against all thoughts of the dollar bottoming out.

Maybe they just want cash for stimulus. Maybe since they are in a position to directly effect our monetary value, they are in play trying to control the value of the dollar thru treasury withdrawals. Bottom line is they are going in reverse and this will significantly effect the reflation theme that Big Ben and Timmay are pushing. China's withdrawal from treasuries was always near the top of my list of P3 catalysts.

H/T to Barracuda and Master33 from Kenny's commentary for the ideas.

Your thoughts and comments are welcomed.

GL trading.