Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Gold Stocks Still Correcting - 27th Oct 20
Gold and Crypto: Is This How Charts Look Before A Monetary Collapse? - 27th Oct 20
Silver's Coming Double Trigger Shotgun Price Explosion - 27th Oct 20
The $126 Billion Gold Opportunity in Australia - 27th Oct 20
Tips to Breeze through Your Spanish Classes Online - 27th Oct 20
Try The “Compounding Capital Gains” Strategy Today - 26th Oct 20
UK Coronavirus Broken Test and Trace System, 5 Days for Covid-19 Results! - 26th Oct 20
How the Coronavirus is Exacerbating Global Inequality, Hunger - 26th Oct 20
The Top Gold Stock for 2021 - 26th Oct 20
Corporate Earnings Season: Here's What Stock Investors Need to Know - 25th Oct 20
�� Halloween 2020 TESCO Supermarkes Shoppers Covid Panic Buying! �� - 25th Oct 20
Three Unstoppable Forces Set to Drive Silver Prices - 25th Oct 20
Car Insurance And Insurance Claims and Options - 25th Oct 20
Best Pressure Washer Review - Karcher K7 Full Control Unboxing - 25th Oct 20
Further Gold Price Pressure as the USDX Is About to Rally - 23rd Oct 20
Nasdaq Retests 11,735 Support - 23rd Oct 20
America’s Political and Financial Institutions Are Broken - 23rd Oct 20
Sayonara U.S.A. - 23rd Oct 20
Economic Contractions Overshadow ASEAN-6 Recovery - 23rd Oct 20
Doji Clusters Show Clear Support Ranges for Stock Market S&P500 Index - 23rd Oct 20
Silver Market - 22nd Oct 20
Goldman Sachs Likes Silver; Trump Wants Even More Stimulus - 22nd Oct 20
Hacking Wall Street to Close the Wealth Gap - 22nd Oct 20
Natural Gas/UNG Stepping GAP Patterns Suggest Pending Upside Breakout - 22nd Oct 20 -
NVIDIA CANCELS RTX 3070 16b RTX 3080 20gb GPU's Due to GDDR6X Memory Supply Issues - 22nd Oct 20
Zafira B Leaking Water Under Car - 22nd Oct 20
The Copper/Gold Ratio Would Change the Macro - 21st Oct 20
Are We Entering Stagflation That Will Boost Gold Price - 21st Oct 20
Crude Oil Price Stalls In Resistance Zone - 21st Oct 20
High-Profile Billionaire Gives Urgent Message to Stock Investors - 21st Oct 20
What's it Like to be a Budgie - Unique in a Cage 4K VR 360 - 21st Oct 20
Auto Trading: A Beginner Guide to Automation in Forex - 21st Oct 20
Gold Price Trend Forecast into 2021, Is Intel Dying?, Can Trump Win 2020? - 20th Oct 20
Gold Asks Where Is The Inflation - 20th Oct 20
Last Chance for this FREE Online Trading Course Worth $129 value - 20th Oct 20
More Short-term Stock Market Weakness Ahead - 20th Oct 20
Dell S3220DGF 32 Inch Curved Gaming Monitor Unboxing and Stand Assembly and Range of Movement - 20th Oct 20
Best Retail POS Software In Australia - 20th Oct 20
From Recession to an Ever-Deeper One - 19th Oct 20
Wales Closes Border With England, Stranded Motorists on Severn Bridge? Covid-19 Police Road Blocks - 19th Oct 20
Commodity Bull Market Cycle Starts with Euro and Dollar Trend Changes - 19th Oct 20
Stock Market Melt-Up Triggered a Short Squeeze In The NASDAQ and a Utilities Breakout - 19th Oct 20
Silver is Like Gold on Steroids - 19th Oct 20
Countdown to Election Mediocrity: Why Gold and Silver Can Protect Your Wealth - 19th Oct 20
“Hypergrowth” Is Spilling Into the Stock Market Like Never Before - 19th Oct 20
Is Oculus Quest 2 Good Upgrade for Samsung Gear VR Users? - 19th Oct 20
Low US Dollar Risky for Gold - 17th Oct 20
US 2020 Election: Are American's ready for Trump 2nd Term Twilight Zone Presidency? - 17th Oct 20
Custom Ryzen 5950x, 5900x, 5800x , RTX 3080, 3070 64gb DDR4 Gaming PC System Build Specs - 17th Oct 20
Gold Jumps above $1,900 Again - 16th Oct 20
US Economic Recovery Is in Need of Some Rescue - 16th Oct 20
Why You Should Focus on Growth Stocks Today - 16th Oct 20
Why Now is BEST Time to Upgrade Your PC System for Years - Ryzen 5000 CPUs, Nvidia RTX 3000 GPU's - 16th Oct 20
Beware of Trump’s October (November?) Election Surprise - 15th Oct 20
Stock Market SPY Retesting Critical Resistance From Fibonacci Price Amplitude Arc - 15th Oct 20
Fed Chairman Begs Congress to Stimulate Beleaguered US Economy - 15th Oct 20
Is Gold Market Going Back Into the 1970s? - 15th Oct 20
Things you Should know before Trade Cryptos - 15th Oct 20
Gold and Silver Price Ready For Another Rally Attempt - 14th Oct 20
Do Low Interest Rates Mean Higher Stocks? Not so Fast… - 14th Oct 20
US Debt Is Going Up but Leaving GDP Behind - 14th Oct 20
Dell S3220DGF 31.5 Inch VA Gaming Monitor Amazon Prime Day Bargain Price! But WIll it Get Delivered? - 14th Oct 20
Karcher K7 Pressure Washer Amazon Prime Day Bargain 51% Discount! - 14th Oct 20
Top Strategies Day Traders Adopt - 14th Oct 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

High Frequency Trading Friday, The WSJ Finally Catches On!

Stock-Markets / Financial Markets 2010 Apr 16, 2010 - 09:05 AM GMT

By: PhilStockWorld

Stock-Markets

Best Financial Markets Analysis ArticleHas the World gone sane?

I was amazed this morning to see both the usual contrarian indicator of a bullish cover on Newsweek (mission accomplished market pumpers) and a good piece of reporting in the Journal on a topic ZeroHedge and I have been pounding the table on for a year.  Our readers will find nothing new in the article "This Market Has Its Freq On" but to see it finally summarized in the MSM (giving us no credit at all, of course) is at least a little bit satisfying. 


The Journal highlights the following facts (and they are now MSM FACTS, not "conspiracy theories" Tyler and I were making up): 

  1. The recent gains have come with only marginal support from traditional long investors. Wall Street trading desks and the relatively new breed of high-frequency traders have been fueling the rest.
  2. Investors pumped only $396 million into domestic stock funds in March. Since the start of the year, they’ve only added only $1.8 billion, according to the Investment Company Institute.  Compare those inflows with some other recent rallies. Between April and July 2009, investors poured $28.76 billion into U.S. stock funds and in the first three months of 2007 they moved $19.1 billion into such funds.
  3. Insiders are dumping stock at an alarming pace, $15 billion so far this year, more than six times the $2.5 billion they’ve bought, according to Trim Tabs. Moreover, they’ve been dumping their stock more in recent weeks. Insiders sold $6.9 billion in March and bought just $831 million.
  4. Six stocks represented 27.51% of the overall stock market volume: American International Group Inc., Ambac Financial Group Inc., Bank of America Corp., Popular Inc., Fannie Mae and Citigroup Inc. Since the start of the year they’ve represented 16.55% of the composite volume on the New York Stock Exchange, and more than 22% on each of this week’s first three trading days, reaching as high as 30.62% Tuesday..
  5. The rise in these stocks has mirrored, or perhaps driven, the recent broader gains. Through Wednesday, Bank of America was up 28.8%, Citigroup was up 48.9%, Ambac shares have doubled, Popular shares are up 74.3% since the start of the year.  AIG shares are up 32.5% for the year through Wednesday.
  6. Program trading represented 27.9% of NYSE volume for the week ended April 2. Morgan Stanley, Goldman Sachs Group Inc. and Deutsche Bank AG were the three biggest program traders, according to the Big Board.

Wow, if we can just get Uncle Rupert to start calling the trade-bot "Mr. Stick" it’s going to be hard to tell whether you’ve picked up the WSJ or PSW!  Not that any of this will matter to the markets for now - the article is buried but the fact that the Journal is reporting on it means they don’t want to be caught with their pants down when it all hits the fan so now they can point to this article and say: "See, we warned you about this way back on April 15th, before the market crashed - if only you had read the Journal!"

Barry Ritholtz had a great article on Tax Day about the "Top 400 Taxpayers," who earned $137.9Bn in 2007 (the last year for the data), which was 3 TIMES MORE than the top 400 made in the 1990s - that’s the old trickle up theory in action.  Thank goodness the Tea Party is rallying for these poor little guys, who’s minimum annual income is $138.8M.  Not surprisingly (to me, anyway) it turns out they don’t actually pay 35% taxes, in fact, they only paid $22.9Bn in Federal Income taxes or 16.6% of their income or, as Warren Buffett has pointed out - less than his secretary pays. 

That unpaid $25Bn works out to an extra $10,000 in tax burden that is shifted down to the next 2.5M taxpayers but, of course, the next 4,000 don’t pay no 35% either as they can also afford fantastic accountants, so the next 5M people, the bottom 99% of the top 2% have $50Bn dropped on their laps.  The minimum income of the top 2% is $1.3M a year and guess what - they can afford good accountants too!  That shifts a whopping $200Bn of uncollected taxes down to the next 20M taxpayers at $10,000 each to the bottom 18% of the top 20%, our "upper middle class," who then go to Tea Party rallies and ask, not that the top 2% pay their fair share of taxes so we can pay off our debts, but that the government LOWER taxes further or eliminate them all together.  Well, what the hell - it’s not like we pay our bills anyway…

The Daily Show With Jon Stewart

Mon - Thurs 11p / 10c

Nationwide Tax Protests

www.thedailyshow.com

 

Daily Show Full Episodes

Political Humor

Tea Party

Of course we don’t want to end a pumped-up week without more FREE MONEY from our government and, of course, our elected representatives hate to disappoint 14M unemployed voters so the Senate voted 59-38 to extend jobless benefits through June 2nd at a cost of $18Bn as we sweep the problem of not creating any jobs under the rug for another 2 months.  The Fed redistributed the wealth to the wealthy as they pumped their balance sheet to a record $2.32Tn, up $32,000,000,000 since their March 31st cut-off date for buying up MBS’s.  Said Bernanke "Just $32Bn more and then I swear I’ll stop - really…"     

In the most amazing coincidence of the morning, notorious Gang of 12 Member BAC thought this morning would be a good time to raise their S&P forecast for the year to 1,350.  Well, imagine their surprise when it turned out today also happened to be the day they reported earnings, which means their analysts accidentally put a huge spin on the market just when they were announcing numbers that they hoped would push their stock over the $20 mark.  I’m sure some wrists are going to get slapped over that one - if by slapped we mean huge bonuses for the conflicted analyst, of course!

Google had good earnings, GE had good earnings, BAC had good earnings, ISRG had good earnings, AMD had good earnings, Mattel had good earnings…  So friggin’ what?  Did you read the top of this post?  The fundamentals don’t mean anything and (if they did) they do not indicate, at this point, anything that can sustain these pumped up fake rally valuations.  I’m particularly pissed this morning because the futures were a massive joke.  Check out the movement in this chart:

How can you say valuations aren’t a joke when they can shift that violently from hour to hour?  Note how low the volume is yet 50 Dow points represent $150Bn of market value up and down - your portfolios fate decided by just a handful of small transactions performed by shadow traders while the market is closed.  And they wonder why investors are shunning the markets?  You can run a shell game for a while and rake in some suckers but every good con man knows when it’s time to move on and head to another town once they’ve played all the suckers and word gets out about their scam.  The problem Wall Street has is they scammed the entire planet - which is why there is probably renewed interest in a mission to Mars - Goldman needs some fresh suckers!

I said to Members yesterday we have to consider the possibility that this ridiculous, pointless, baseless rally was nothing more than a desperate attempt by the Gang of 12 to bang out the technicals and finally draw some fresh money off the sidelines so they could get out of their positions now that the Fed is turning off the spigots and the carrying costs (rates) are starting to creep up.  As we can see from the WSJ FACTS above, so far, it hasn’t been working and if that sideline money doesn’t start coming in soon - what will our next catalyst be?

OK, enough complaining - time to be happy, happy bulls and celebrate (as Newsweek notes) "The Remarkable Tale of Our Economic Turnaround."  Hurry, hurry ladies and gentlemen - it’s the greatest show on Earth!

Have a great weekend,

By Phil

www.philstockworld.com

Philip R. Davis is a founder of Phil's Stock World (www.philstockworld.com), a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders. Mr. Davis is a serial entrepreneur, having founded software company Accu-Title, a real estate title insurance software solution, and is also the President of the Delphi Consulting Corp., an M&A consulting firm that helps large and small companies obtain funding and close deals. He was also the founder of Accu-Search, a property data corporation that was sold to DataTrace in 2004 and Personality Plus, a precursor to eHarmony.com. Phil was a former editor of a UMass/Amherst humor magazine and it shows in his writing -- which is filled with colorful commentary along with very specific ideas on stock option purchases (Phil rarely holds actual stocks). Visit: Phil's Stock World (www.philstockworld.com)

© 2010 Copyright  PhilStockWorld - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules