On Friday, 12/20/13,
the BOJ concludes
a 2-day meeting and continues to remain accommodative. The dollar/yen
moves higher to 104.42. NIKK is flat so traders expected the easy money
news for several days already sending
the dollar/yen and Japan and U.S. stocks higher. China’s central bank injects liquidity into the banking system.
China’s banking operations are occurring
under the radar lately since they do not want to call attention to the
troubling situation. The SSEC dumps
-2% overnight on top of the -1% the day before. The Shanghai Index is down 9 consecutive days from 2260 to 2125, -6%,
losing -0.5% per day. The wealthy Chinese money is chasing investments in
the U.S., Australia and other places rather than their own country. S&P reduces
EU’s AAA rating due to the ongoing
weakness in Europe. Sweden is
concerned over a housing bubble caused by the global easy money. European and U.S.
futures markets are flat to slightly higher. BBRY releases horrible
earnings but announces a 5-year partnership with Foxconn (the major
manufacturing arm for AAPL products). The new CEO is likely cleaning house so
his numbers can appear much better next year. BBRY is
halted from trading for the news and then drops
to 5.75, -8%, pre-market, when opened, but recovers above 6 quickly. The 2-year
yield is at 0.40% and 10-year yield
at 2.95% moving higher. The 5-year
yield moves towards 1.70% so the Fed is likely becoming worried that they are losing
control of the short end (2’s
and 10’s). Third-quarter (Q3) final GDP is 4.1%, a 4-handle, printing above the preliminary 3.6% estimate. Q2 GDP was 2.5%. The dollar/yen is pumped
higher to 104.60 so a weaker yen sends the S&P futures to +4. The GDP is happy news but most economists continue to call for a 2% or lower number for Q4. Much of the GDP increase is due to
inventory stocking so moving forward the consumers must purchase the goods
produced to keep the party going. Crude
oil moves higher on the higher GDP news. HAL +2%.
Today is OpEx Quadruple Witching and
both the S&P and Nasdaq are
rebalancing. This will create a huge volume day
especially at the open and close. Equities float higher after the opening bell.
BBRY +4% despite the dire news. NKE -1%. The SPX and Dow print new all-time highs. Senate Leader Harry
Reid is hospitalized. PolitiFact
announces President Obama’s lie “if you like your health care plan, you can
keep your plan” as the 2013 Lie of the Year. The Whitehouse changes the Obamacare law rules again instituting ‘hardship
exemptions’ allowing folks to miss the deadline but keep their insurance creating more confusion with insurers and
consumers. The Obamacare web site goes down for 3 hours embarrassing the president
before he speaks at 2 PM ahead of taking a Hawaiian vacation. A poll shows nearly
80% of the uninsured folks do not want
Obamacare. Shockingly, 50% of the
uninsured have not even looked at the Obmacare web site or information
concerning the new AHA program and nearly 60% say they probably cannot afford health insurance anyway. The Obamacare debacle continues.
The president
says 2014 will be a breakthrough year for the economy and calls it a ‘year of
action’. BBRY +11%. BA pops
+1.3% on a $7 billion plane order. Europe indexes print a stellar week gaining +3.5%.
The SPX
tags 1820 at 11:30 AM EST, however, the dollar/yen, drops to 104. NAV drops -4% after reporting weak sales. AMZN launches
over 400 at new all-time highs and
appears unstoppable. Amazon’s market cap hits $185 billion only exceeded
in the retail sector by WMT’s cap at $250 billion. The financial newsletter writers are the most
bullish and least bearish in years. The market rally creates a festive, care-free
and party atmosphere. Traders high-five one another and expect equities to stay lofty forever. TXT +8%. ZUMZ +8% on an upgrade. The Dow takes
out the inflation-adjusted high from 2007 above 16200. Markets move strongly higher all day
long. The Nasdaq
is above 4100 lifted by strong Apple
sales. AAPL +1%. Interestingly, the VIX recovers off the lows and
actually floats higher as the day progresses. Financials lag as the short-end yields climb and the long end
yields leak lower flattening the yield
curve. FAST, a great bellwether for the
manufacturing industries, drops -5%. Money is chasing into the high-flying and biotech stocks. TSLA +2%. GOOG is up
+1.3% now above 1100. Volume is
large today as expected. At the closing bell, the SPX is up 9 points, +0.5%, to a new
all-time closing high at 1818.32 and new all-time intraday high at 1823.75.
The Dow
is up 42 points, well off the highs, +0.3%, to a new all-time closing high at
16221.14 and new all-time intraday high at 16287.84. The Nasdaq is up
47 points, +1.2%, to 4105, a new 13-year high. The RUT gains 21
points, +1.9%, to 1146, to a new all-time closing high at 1146.47 and new
all-time intraday high at 1147.12, only 12 pennies above the
all-time high printed on 11/29/13. For the week, the SPX gains +2.4%, Dow +3.0%, Nasdaq +2.6%
and the RUT is up a huge +3.6%. SOX,
semiconductors, jump +3.3%, and TRAN, trannies, leap +2.8%. TMUS is up a
huge +12% this week. Interestingly, the short-end Treasury yields are climbing with
the 2-year yield towards 0.40% and 5-year towards 1.70% while the 10-year and
30-year yields are flat to lower, flattening, rather than steepening, the yield
curve. Watch the yield on the 2’s
and 5’s since if they continue to climb higher and higher, that signals that
the Fed is losing control of the markets. The first lawsuit is filed
against TGT concerning the security breach debacle and may develop into a
class action. Customers are complaining that they cannot contact Target by
Internet or telephone and swear they will never shop there again. With only a few days remaining in the holiday retail
season, and the biggest shopping weekend of the year on tap, TGT panics and
advertises 10% off everything to regain customer trust. The retailers
continue to cut each other’s throats to move merchandise which will hurt
company margins. Business television personality James Cramer says the current bull market may be an epic bull like the
1990’s. Cramer says several ongoing catalysts,
such as increasing company profits and an encouraging job market, will drive
the markets higher and higher. Pundits
and analysts continue to preach uber optimism and bullishness encouraging folks
to buy stocks while berating anyone bearish or negative on the markets. The
VIX recovers today and ends at 13.79. The volatility
remains low overall signaling traders completely relaxed and without worry about
the elevated stock market. Further, the uber low CPC and CPCE put/call ratio’s continue
to signal rampant complacency and lack of fear which always occurs at market tops.
On Saturday,
12/21/13, Federal housing regulators
reach a $1.9 billion agreement with DB to settle mortgage-backed securities
litigation against the bank involving Fannie Mae and Freddie Mac. The Detroit bankruptcy reorganization is ruled
to continue without expediting the appeals process which is a blow to the
employee unions and pension funds. Today is typically the busiest shopping day of the year; the last Saturday before
Christmas. ANN, M, ARO, JCP and PLCE are
slashing prices from 50% to 80%. The retailers are starting to give the
stuff away. Internet shopping is a
bright spot this year; however, the malls are not busy. Mall traffic will recover strongly today
with Christmas only 4 days away. The Chinese wealthy continue to buy art, collectibles, real
estate, vineyards, etc.., trying to hide their money from any chance of
confiscation by the China government.
Unfortunately, one unlucky Chinese billionaire dies in a helicopter crash as he
viewed his new France vineyard from the air. The all-cash home sales hit a record 42% of total sales. The wealthy are wealthier than ever because of
the Fed’s policies so they buy real estate with cash money pumping house prices
higher and further out of reach for the common family. This is why bank lending remains paltry. Folks are not seeking a loan for a house they
cannot afford especially in this new structurally-unemployment society. Japan says GDP
for next year will be 1.4% below the current 2.6% growth rate. The BOJ is
destroying the yen daily to create paltry growth. A U.S. journalist and
Internet activist living in Berlin, Jacob Appelbaum, who has access to Edward
Snowden’s documents, says his apartment has been broken into and he is under
surveillance. He suspects the German and US authorities are
behind the harassment. The subversive
behavior by authorities is reminiscent of the former Communist East Germany.
The Orwellian society grows. Violence in
South Sudan increases. An American
helicopter is fired upon as it attempts to evacuate people from Bor. 4 Navy Seals
are wounded. The South Sudan situation
is deteriorating.
----------------------------------------------------------
On Sunday, 12/22/13, automatic robo calls in Oregon are telling folks that if you
have not received confirmation that you have health insurance by tomorrow
assume that you do not have any insurance.
The Obamacare debacle continues and may
reach a chaos level in January with law suits likely occurring next. All
this could have been avoided by simply
delaying the new law for a year. The Whitehouse
changes the law ever few days to where the situation is confusing and
unclear. On top of that, the ‘pajama boy’ ads are the laughing stock of the
Internet. GS says emerging
markets will continue to disappoint investors and to keep trimming decreasing exposure. Democratic
Senator Joe Manchin of West Virginia
says Obamacare may suffer a meltdown if the problems are not resolved
quickly. IMF’s
Lagarde says the US economic growth forecast will be raised for next year since growth
is picking up and unemployment is
falling. S&P futures pop a few
handles. TIF
cuts its outlook after a Dutch court
rules in favor of Swatch Group awarding it $450 million in damages. AAPL and CHL sign
the long awaited multi-year deal to offer the Model 5s and 5c iPhones. S&P futures
are +7. JPM limits debit cards to a $100 withdraw and $300 purchase due
to the TGT security breach and debacle. These types of problems are why you
need to keep cash around and regularly
set aside cash each month. Banks can
limit the amount of your money that you withdraw at any time from your account,
especially in a banking crisis. Concerns over the ongoing
China banking cash-crunch continues. China 7-day REPO rate jumps from 3.86% to
8.21% in 4 days, a 6-month high, despite the liquidity injections. Social unrest grows in Turkey with Erdogan promising to
clamp down on any trouble.
On Monday, 12/23/13,
the dollar/yen
is sticky at the 104 level. Japan
markets are closed for a holiday. Asia trades marginally higher with the Shanghai finally logging an up day after 9
consecutive down days. The Thailand
demonstrations intensify with over 60K protestors in Bangkok calling for PM
Yingluck to step down. The
anti-government protestors plan to boycott the 1/2/14 snap elections. Thailand
stocks tumble lower and the baht is at a 3-year low. Violence erupts
in Istanbul, Turkey, as police use tear gas against thousands of
opposition-government protestors. Israel PM Netanyahu demands an explanation of
why the U.S. and NSA have been targeting Israel’s communications (more fallout from Snowden’s documents). Europe is trading modestly higher on thin holiday volume. ARMH trading over
+2% higher since it supplies chips for iPhones. The S&P futures remain joyous +9
after the IMF happy news last evening. Fed’s Lacker says the $10 billion Fed taper should
continue on course moving forward. Equities bounce strongly at the opening
bell printing new all-time highs once again. Oddly, the RUT Russell
2000 Small Cap Index explodes higher with a flash spike move of near +7%. 7%
for a major index in seconds!!!! RUT HOD is 1213.49!!! Then price
collapses in a flash crash dropping more than -6%. RUT then moves
sideways up +0.5% on the day. Traders
are not concerned and treat this wild and alarming behavior as regular
market action nowadays. The news
wires do not explain the troubling RUT behavior. Consumer Sentiment is 85.2 at 5-month highs. This
is encouraging news for the retailers since
a happy consumer spends more money. High-flyer and long trade favorite MU drops -4% in the up tape. KORS, the retail long
darling, drops -4.1%. Equities remain buoyant into the afternoon. The SPX prints new
all-time highs 400 points above the 1426 print at the start of the year, the
first time the SPX has ever printed 400 points in
one year. President Obama signs up for Obamacare but since he will always
receive better health care, the move is labeled as a ‘token of support’ for the
troubled AHA law. The Whitehouse changes the rules again now
saying folks can sign up through tomorrow for coverage at the start of the
year. Most folks are completely confused at this point. The 10-year
yield climbs to 2.93%. The 5-year
yield moves to 1.71%. FB is +4.4% at
another new high above 58 on its first day of trading as part of the S&P
500. TWTR jumps +7.7% now above 64. The
high-flyer and momo stocks continue to receive a strong bid. TRAN prints a new
high so the trannies and Dow industrials confirm as per Dow Theory. Everything
is going the bull’s way. The day ends with the SPX up 10 points, +0.5%, to a new
all-time closing high at 1827.99 and new all-time intraday high at 1829.75.
The Dow
prints the 48th record closing high this year, the best run since
1995 almost 20 years ago. The Dow is up 73 points, +0.5%, to a new all-time closing
high at 16294.61 and new all-time intraday high at 16318.11. The
Nasdaq is
up 44 points, +1.1%, for a new 13-year closing high at 4148.90 and new 13-year
intraday high at 4149.31. The RUT moves in a flat range all day long
after the flash spike and flash crash event in the first 15 minute of trading, finishing at a new all-time closing high at 1157.22
and new all-time high at 1213.49. The day’s range on the RUT is from Friday’s close at 1146.47 to a high
at 1213.49, 68 points, a huge 6% range for a major market index!!! And
there is not a peep about it on the news
wires or in the media. TGT falls -1% on the debit and credit card fiasco and the
10% discount offering on the weekend did not help. More banks limit withdraws and purchases on cards affected causing
angst among consumers trying to finish their holiday shopping. There are now 50 law suits against TGT and growing
likely into a class action. Target is
now talking with State’s Attorneys General. Consumers
are avoiding TGT which will help WMT sales.
The ABA plans to file a lawsuit
concerning the Volcker Rule unless the CDO language is modified. Banks are
concerned about how quickly they would have to make changes to CDO’s and the
limitations on CDO’s in the future.
Collateralized debt obligations were a major cause of the Fall 2008
market crash. Of course the banksters want more leniencies so they can keep
making big money on shaky products and when it all fails again, the government
will bail them out again. No worries. Gasoline
rises 16 cents in the last few days so consumers will start to notice this
at the pump. Gold dances around 1200.
On Tuesday, 12/24/13,
Asia markets trade flat but the NIKK is up enough to print above 16K for
the first time since 2007.The PBOC
pumps $5 billion into their banking system to maintain liquidity. The interbank lending rate hit 9.8%. China’s new year is next month so further cash injections will be needed
in January. Europe is higher with the DAX up +1% heading into an early close. Italy approves a “Google Tax” trying to stop the shift of taxable
profits out of the country to safer havens. The action violates EU laws but Italy
appears desperate for cash income. GOOG has a bull’s eye on its backs now. A page on the MCD web site goes comically
viral since it highlights foods that are unhealthy and shows a picture of their
own food. Trading is thin in global markets helping the bulls float the indexes
higher. Retail
shopping traffic remains light on this last shopping day ahead of
Christmas. Last weekend, store traffic
is over 20% lower than last year; very shocking for what should be the most
robust shopping weekend of the entire year. Mortgage
Applications fall to a 13-year low; the conflicting housing sector signals continue. Durable Goods Orders are stronger than expected
suggesting real growth ahead. However, expiring
tax credits in R&D and depreciation helped boost the numbers simply pulling
next year’s orders forward into 2013. The
markets move higher at the opening bell. The
SPX
prints new all-time highs again now above 1830. TWTR jumps +4% towards 67. TSLA catapults +6% higher. VIX
drops under 13. New Home Sales fall -2.1% but
this is after last month’s numbers were revised higher. November home prices are up over 10%
compared to one year ago pumped higher by hedge funds and cash investors buying
real estate; not the young husband and wife family starting out with a
first home. Equities
remain elevated into the early close at 1 PM for Christmas Eve. The SPX gains 5
points, +0.3%, to a new all-time closing and intraday high at 1833.32.
The wine is flowing like water. The Dow is up 63 points, +0.4%, to a new all-time closing
high at 16357.55 (49th
record close this year) and new all-time
intraday high at 16360.60. The Nasdaq is up 7 points, +0.2%, to a new 13-year closing
high at 4155.42 and new 13-year intraday hight at 4155.62. The RUT is up 5
points, +0.4%, to a new all-time closing high at 1161.80 but not
a new all-time high. VIX drops to 12.48 so
the broad indexes pop. AAPL drops -0.4%. GOOG -0.3%.
The UN
authorizes 5500 more troops to help in South Sudan, in addition to the over
7000 there already, as atrocities and mass killings occur. The situation is
worsening with the death toll over
1000. U.S. Marines are on standby in the area to step into the hornet’s nest
if needed.
On Wednesday,
12/25/13, Japan’s NIKK is up +0.8% closing above
the 16K level for the first time since 2007, 6 years ago. BOJ’s Kuroda says
inflation will move above 1% next year. China’s 7-day repo rate is 5.2% well off
the nearly 10% high only one day ago. SSEC
is up +0.6% but gains are muffled since everyone knows more PBOC central bank intervention will be needed to keep the banks
and markets afloat. Markets are Closed in Observance of Christmas holiday.
Merry Christmas. The Whitehouse says the deadline to sign up for
Obamacare is extended again if you were
affected by the malfunctioning web site. The confusion continues since the rules keep changing each day. South Sudan
situation continues to deteriorate and
all-out civil war is likely. Tens of thousands of refugees seek safety
in UN camps. Syria is spinning out of control. Asaad continues bombing
his own people turning the largest city of Aleppo into rubble. Radicals
from Libya, Iraq and Europe flood into the region. President
Obama is shown on television each day enjoying rounds of golf and sunning in
Hawaii. UBS and BAC are two creditors
that had reached settlements with Detroit before bankruptcy was declared this
past summer. As it turns out, these two too-big-to-fail banks receive a far
better deal than other creditors mired in the bankruptcy proceedings that will
end up with a few pennies on the dollar. The banksters always win. The USPS raises the cost of a first class stamp
to 49 cents effective 1/26/13. FDX and UPS are
operating at high capacities and are unable to deliver many packages in time
for Christmas. Both companies pledge that all packages should arrive by
Friday.
On Thursday, 12/26/13,
the dollar/yen
is elevated at 104.75 so U.S. futures
are positive +3. Copper is higher. Turkey’s PM Erdogan replaces cabinet
members on the heels of the corruption scandal destabilizing the government. Norway
receives 5 feet (1.5 meters) of snow. American consumers flock back to the stores for the biggest return
day of the year. The TGT saga deepens on reports that
consumer’s debit and credit card secret PIN numbers are stolen. BBRY drops pre-market on news the original owner is dumping
shares. The Florida orange crop
is at a 23-year low due to a bug infestation causing the fruit to stay
small and green. TMUS jumps higher on news
that Japan’s Softbank is in talks to buy the carrier. Softbank wants to combine
S and TMUS to provide a force against VZ and T. The 10-year yield is teasing the 3% level, however, today is the lowest
volume day for Treasuries of the entire year. U.S.
futures are +4 with traders remaining in a positive happy Santa Claus
rally mood. Jobless Claims drop by 42K as
seasonality adjustments continue to provide erratic data. Markets reopen for trading after the
Christmas holiday. The broad indexes move higher at the open printing new
all-time highs with the bullish euphoria continuing. TWTR launches to 73 in a wild frenzy with traders
tripping over each other to buy the high-flyer at any price. Gold is recovering at 1214. The euro is
1.3684. Pound 1.64. Volatility continues to
collapse falling through 12 creating bull market fuel. The 10-year yield prints the 3% level. The thinly-traded, light volume session
ends with the SPX up 9 points, +0.5%, to a new all-time closing high at 1842.02 and
new all-time intraday high at 1842.84. The Dow prints the 50th record
close up 122 points, +0.8%, to a new all-time closing high at 16479.88 and new
all-time intraday high at 16483.00. The Dow
is on a 6-day winning streak the longest in over one-half year. The Nasdaq is up
12 points, +0.3%, to a new 13-year closing high at 4167.18 and new 13-year high
intraday high at 6169.97. The RUT is up less than one point to a new
all-time closing high at 1162.65 but not a new all-time high. Trannies and semiconductors are higher. Jewelry stores such as ZLC and NILE are strongly higher
as well as 3D printing companies such as DDD up +7%.
Equities are
melting up in a parabolic move over the last couple weeks. Ben
Willis, a NYSE floor trader with Abert Fried, speaks optimistically on business
television looking for further highs in stocks in 2014 fueled by money market
funds. Money managers justify a higher stock market by saying ‘there is no
alternative’ (TINA) place to invest. The price action and bullish euphoria by every trader and analyst is
reminiscent of the dot-com bubble in 2000 and also the October 2007 market top.
Window dressing occurs with TWTR as
money managers buy at any price to show they own this latest market favorite.
Twitter pops to 73 today, drops to 69, then up to
75, then down to 70, closing at 73.31, up +5% on the day, but price covers a total
range of about 30%. The National
Retail Federation (NRF) says retail sales should meet holiday expectations at
+3.9% despite the bad weather and short selling season. The news is all
positive and the future appears so bright each day you need shades. UPS, FDX and AMZN continue with damage
control for not delivering packages as promised for Christmas. Over 250K businesses and homes in the
northern States and Canada, especially Michigan and Maine, remain without
electric power due to severe ice and snow storms. Concern grows over shadow inventories in copper, aluminum, nickel and
zinc. The major commodity players
such as JPM and GS own shadow inventories and these holdings surpass LME
warehouse inventories. The lack of
transparency is worrisome since only
five companies control three-quarters of the LME’s warehouse inventories in
addition to their own shadow inventories.
The supplies appear robust moving
forward which should send metal prices lower. The shadow inventories can manipulate prices either way. Russia’s Putin pardons wrongly jailed people such
as the girl band Pussy Riot, the once-billionaire Khodorkovsky, Green Peace
activists and gay prisoners. Putin is trying to raise his stature ahead of the
Sochi Olympics in February but everyone sees through the charade. Russian and Chinese wealthy are fueling the
art, collectible, vintage car and real estate bubbles since placing their
money anywhere at any price is better than having it confiscated by the
government. Much of this money is also
pumping the U.S. stock market bubble higher.
On Friday, 12/27/13,
the dollar/yen
touches 105. Japan inflation is 1.2%, higher than forecast, working towards the
2% target. Analysts claim Abenomics is a
huge success citing the NIKK gains, stronger factory output and increased retail
sales. NIKK finishes flat
overnight but prints another new 6-year
high at 16179. The SSEC is up +1.4%.
The Turkish
lira hits a record low against the dollar at 2.1645. Turkey ISE 100 drops -4%. Investors are dumping Turkey’s bonds as
the unrest continues. Bombings in
Lebanon (the former Lebanon finance minister is murdered) and Egypt, and attacks against Christians, further destabilize the Middle East and Northern Africa regions. Crude oil hits 3-week highs due to
the violence. WTIC oil is near 100
and Brent oil is at 112. The 10-year yield is 3.0% and 2-year yield climbs to 0.42% which
provides an attractive 2-10 spread of 258 points and higher for the banks, if
it holds. The pound
prints another record high at 1.6486. The UK 10-year yield moves above 3%. The euro hits 1.38 the highest level since November 2011. European markets are up from +0.6% to
+0.9%. The France and Germany economies continue to diverge. France teeters
on recession while the DAX prints
another new all-time high above 9565. The 2014 predictions game continues on
Wall Street with universal agreement
among analysts and traders that stocks will continue higher in 2014. Investors Intelligent Sentiment shows bulls
at a euphoric near 60% level (59.6%) and bears at an uber low near 14% level
(14.1%). The bull-bear spread has
never been this wide since the 1980’s ahead of the 1987 market crash. Only
one-fourth of financial advisors expect a market correction. This data verifies the low VIX and CPC and CPCE
put/call ratios signaling trader complacency and a significant market top in
place. There are no bears remaining
in the markets. The bulls are selling stock to other bulls pushing markets
higher in thin volume. It is a fun party until the music stops. The prudent move is to cash out of all long
positions and to sit in cash for a month or three to see if a serious negative
market event occurs in the near future. S&P futures are flat. Copper is lower but experiences a strong positive +10% gain from 3.10 to 3.40 over the last
month. GM recalls over 1.5 million China automobiles due to a faulty
fuel pump bracket. DAL honors low fares to customers that took advantage of a
computer glitch. TXT, maker of Cessna airplanes, buys Beechcraft for $1.4
billion in cash. WTIC crude oil tops 100.
Equities
pop higher
at the opening bell. The 5-year yield is above 1.75%. WTIC crude oil is 100.58 and the higher oil sends
the airline stocks down -2% to -3% across the board. Trannies
(TRAN) are lower as well on higher oil. Equities
move flat into the lunch hour. A Federal judge rules that the NSA cell phone
metadata collection is legal contradicting the Federal judge from last week
that said these NSA spying was likely unconstitutional. In other words,
George Orwell’s 1984 world is here to
stay. Realize that all your communications
on any electronic device including cell phones, tablets, desktops and tablets
are monitored, recorded and archived forever. The mess is likely headed to the Supreme Court.
Equities remain flat all day and end slightly negative. The SPX prints a new
all-time intraday high at 1844.89 but not a new all-time closing
high. The Dow
prints a new all-time intraday high at 16529.01 but not a new
all-time closing high. The Nasdaq leads lower losing -0.5%
but prints a new 13-year intraday high at 4175.36. TWTR collapses -13%. For
the week, the
SPX gains +1.3%, the Dow +1.6%, Nasdaq +1.3% and RUT +1.3%. Interestingly,
tech and small caps are not leading
higher and also the broad indexes are up about the same percentage across
the board hinting at steady programmed trading from the robots. On CNBC
business television, Josh Brown, The Reformed Broker, advises folks to go long
and “embrace stocks.” He says “the economy is doing better; embrace better
economic times.” He also recommends shorting gold and says BAC is the best bank
to own and should be over 20. Anthony Scaramucci, SkyBridge Capital, says buy
the broad market as well and FDX should be 175. Strategist David Darst, MS,
repeats Morgan Stanley’s call for a SPX target of 2014 in 2014. The rampant bullishness
continues in the markets. The CPC put/call ratio prints a 3-year low this week verifying
the complacency and complete lack of fear in the markets. Case-Shiller’s PE is
24 which is the level where significant market pull backs occur.
On Saturday,
12/28/13, extended unemployment
benefits end for 1.3 million Americans. Benefits return to their base
26-week period. Many of these folks will go on Welfare or disability. The loss
of benefits should hurt retail and food sales (WMT, DG, SVU, KR, etc…) since the checks immediately flow into the
economy to meet daily needs. Interestingly, the unemployment rate will
probably tick lower under 7%, towards the Fed’s 6.5% target, since these folks
will no longer be counted as seeking employment. Typically, these folks would
be prompted to look for work more diligently once benefits end, sending the unemployment
rate higher, however, the ongoing structural unemployment problem in the States
removes any hope of finding a job, so many folks will simply give up on life. The
Fed’s easy money policies make the rich
richer and the poor poorer and Congress now
throws the unemployed under the bus and then backs up over the veterans as well
with the budget bill, also approved by the president. Credit cards are
showing up on the Internet with stolen numbers from the TGT debacle. The banks
are buying up any suspect cards to minimize the ongoing damage from the huge
security breach. An advisor to the Saudi royals
says President Obama has lost credibility over Syria. Egypt violence increases as police clash with the Muslim Brotherhood. Hundreds
are arrested and five die in the riots. Ukraine and Turkey violence continues. President Obama continues vacationing in Hawaii golfing
each day.
------------------------------------------------------------
On Sunday, 12/29/13, Japan PMI.
On Monday, 12/30/13,
Pending Home Sales Index. Dallas Fed Mfg Survey. Farm Prices. A Bradley turn
window is open this week into 1/8/14 for a major market move to occur, up or
down.
On Tuesday, 12/31/13,
China PMI. EOM. EOQ4. EOY2013. S&P
Case-Shiller. Chicago PMI 9:45 AM will
create a market pivot. Consumer Confidence 10 AM
will create a market pivot point. Gold is down on the year for the
first time this century. The Dow prints the
best year since 1997.
----------------------------- 2014 ----------------------
On Wednesday, 1/1/14,
Markets are Closed in Observance of New Years
holiday. A major Bradley turn date occurs where a major market
directional move is expected in the 12/25/13 through 1/8/14 time frame. The
Bradley turn does not predict direction, only that a strong move will occur one
way of the other. Another Bradley turns in quick order so the beginning of the
year may be a wild ride for the stock market. A new moon occurs. Markets are
typically bearish moving through the new moon. Obamacare coverage begins for the new year. How long before a lawsuit is filed by someone who thought
they had coverage but they do not?
On Thursday, 1/2/14, Thailand snap elections. Europe
PMI’s. Markets Reopen for Trading.
Mortgage Applications. Jobless Claims. Construction
Spending and ISM Mfg Index 10 AM will create a market stutter step.
On Friday, 1/3/14,
Motor Vehicle Sales. Natty Gas Inventories (delayed). Oil Inventories (delayed).
A parade of Fed heads speak including Plosser,
Stein and Lacker, and Chairman Bernanke
speaks at 2:30 PM.
On Saturday, 1/4/14,
Asia and
Europe Services PMI.
-----------------------------------------------------------
On Sunday, 1/5/14,
On Monday 1/6/14,
Yellen is
confirmed as the new Fed Chair and will
replace Bernanke on 1/31/14.
On Tuesday, 1/7/14, …
On Wednesday, 1/8/14, …
On Thursday, 1/9/14, ECB Rate Decision 7:45 AM EST and Press Conference 8:30
AM. A Bradley turn date
occurs where a market directional move is expected in the 1/2/14 through 1/16/14
time frame. The Bradley turn does not predict direction, only that a strong
move will occur one way of the other.
On Friday, 1/10/14, Monthly Jobs Report—are wages increasing?
---------------------------------------------------------
On Wednesday, 1/15/14, ….
On Thursday, 1/16/14,
a full moon occurs. Markets are typically bullish moving through the full
moon.
---------------------------------------------------------
On Wednesday,
1/22/14, does
BOJ decide to implement additional stimulus? If so, the yen will weaken with the dollar/yen currency pair running
strongly higher to 105 and higher and the NIKK, DXJ and U.S. equity markets all
running higher. If not, the dollar/yen will drop
as well as Japan and U.S. stocks.
On Friday, 1/24/14,
Asia
and Europe Flash PMI’s. Europe must finalize all plans for the new banking union by
March.
---------------------------------------------------------
On Sunday, 1/26/14, the
cost of a US postage stamp is now 49 cents.
On Tuesday, 1/28/14, President Obama provides the State of the Union speech in
the evening.
On Wednesday,
1/29/14, Chairman Bernanke conducts his last
official two-day meeting (1/28 and 1/29)
as Chair of the FOMC.
On Friday, 1/31/14,
Japan PMI. China’s
New Year begins with the Year of the
Horse. Chairman Bernanke’s term ends at the Fed. New Chair Yellen
takes over.
On Saturday, 2/1/14, China PMI.
-----------------------------------------------------
On Friday, 2/7/14, Monthly Jobs Report—watch for any odd
affects to the rate due to the elimination of extended unemployment benefits. The
initial Debt
Ceiling Limit date is hit but Secretary Lew will take extraordinary measures to
extend the deadline until the end of the month. Congress must agree to a
solution quickly. Winter
Olympics begin in Sochi, Russia, through 2/23/14.
----------------------------------------------------
On Friday, 2/28/13,
the Final
Debt Ceiling Limit Deadline is hit where the U.S. will default on obligations
unless Congress reaches a solution today.
----------------------------------------------------
On Saturday, 3/15/14, the deadline for
the Obamacare sign up period ends. The Whitehouse
needs 7 million people (mainly healthy young people) to sign-up by today or the
program will be bleeding money profusely and require a taxpayer bailout.
----------------------------------------------------
On Wednesday, 3/19/14,
new Fed Chair Yellen talks at the conclusion of her
first FOMC meeting (3/18 and 3/19).
Perhaps Yellen will conduct press conferences and Q&A sessions for each Fed
meeting forward instead of only the quarterly meetings?
In February/March, Fed Chair Yellen testifies before Congress.
In February/March, Congress discusses and develops a privacy code agreement since face
recognition software is quickly gaining use across all levels of society, as
is other privacy-stripping technologies.
In February/March, the German High
Court must rule on the constitutionality of the OMT program. The decision is delayed from the Fall
2013. Many German citizens believe the OMT is simply a backdoor mechanism to
fund other countries.
In February/March and
forward, European
bank stress tests are ongoing and will take one year to complete (there are likely
10% of the 128 banks undercapitalized with no clear way on how to
recapitalize these troubled institutions). The one-year timeline is chosen to
keep stretching things out in the hope that the European economy recovers
before further bad news occurs.
In March, the ESM is
officially “fully operational.” The Euro banking union is in place after
delays from January 2013 to January 2014 and now to March 2014.
In April, MSFT no longer supports Windows XP.
In June, employer
mandate provisions begin for Obamacare with many workers likely forced into
part-time 30 hours per week or less employment.
On Tuesday, 11/4/14, mid-term elections.
The 2-year presidential race for 2016 begins.
On Saturday,
11/15/14, the enrollment period for Obamacare in 2015 begins pushed forward from
10/15/14 by the Whitehouse and democrats so voters will not experience the
sticker shock of higher insurance premiums before the elections. Premiums will rise since too few healthy
young people are signing up to support the program.
---------------------------
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Speculator. All Rights Reserved. 2012. 2013.
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