Stock Market July 2009

[jjj000]

Whenever the dollar starts going up the markets tank.

Whenever we go into earnings the markets tank.

Whenever earnings beat estimates the markets go UP.  I have a feeling that earnings estimates are low enough across the board, to send the markets back up to the 950 range by the end of July.

Right there with you as far as dollar and estimates.  I haven't found a good resource yet to see how analyst estimates have been tweaked heading into Q2 reporting though.  I guess you'd only need to go through the first week or two of big names in financials and tech and see what the consensus is versus Q1.  any ideas?

[jjj000]

speaking of... looks like Alcoa just beat estimates:
http://finance.yahoo.com/news/Alcoa-posts-2Q-loss-of-454M-apf-4150542646.html?x=0&sec=topStories&pos=main&asset=&ccode=

up about 6% aftermarket

[Bottomfeeder]

No ideas 3j....I do believe that SnP concensus estimates were for a YoY decrease of like 35%.

Alot of work trying to put together all those estimates on ur own.....guess we gotta trust something.

I did see some buying come in late on the U's at EOD, and Alcoa beating was pretty big for the entire asset class I believe.

[davidslane]

Haven't written much in a while.
Still focusing on long term and not short term anymore.


Still, why not throw out another prediction.


We bottom over the next week (maybe even today) and then turn up into Labor Day making new highs for the year for the markets, oil and gold.

This will be driven by better than expected Q2 earnings.


By September, we'll head back down again and come close to retesting the March lows when worries that we are years, not months away from a recovery hit everyone dead on with Q3 warnings.

I expect a lot more Treasury and Govt spending in the 3Q to counter the falling markets which will send gold up towards $1,200 or higher.


As for everyone's favorite uranium, those stocks will follow other commodities, bottoming soon (they often hit their highs in May and then lows in July). And rallying into Labor Day. They'll fall with the rest and then rally on inflation fears with gold come November and onwards.


Let's see if I'm right.

[sidewinder]

The issue is always the same: the government or the market. There is no third solution. - Ludwig von Mises

So David you did so well on the predictions you decide to "hang it out again"  I admire that shoot, I did not even participate but doubt I would have come as close as you did.

So you keep us unwashed informed with anything you hear from your buddy in Washington you hear.

[Bottomfeeder]

DSL...I am with you on the first part, not sure about the 2nd downturn though, too early to tell.

I am still watching the bond market as a major barometer for equities and the bond market looks like to me it is pricing in a recovery.  When you also look at ISM it is also positive.   The question to be answered in my mind is whether or not, it is "just restocking the shelves" or will it be sustained.  Noone has the answer to that one yet, as the consumer is still deleveraging paying down debt, but also beginning to consume.

If we start to see the prices fall on the long term notes and the yields rise, then we are in trouble, but so far so good I think.

I think today was the bottom at least short term on commodities, Alcoa gave enough I think and the oil correction looks reasonable, with Snp support also holding.

David kick me in the head next time or do something to get my attention about keeping my promises on selling would ya?

GLTA

[MetalMeister]

Thanks 3j,

Not rocket science here just been around a while, that's all.  A combination of what goes up must come down and what falls down must rise up (previously).  Oil fell to the bottom in Feb and I knew it had to be there because a lot of the world supply would start shrinking so it was not really possible to fall any further considering the CAPEX of producing the black stuff.

So how does the world respond?  By inflating the hell out of things from DOW 6500 to DOW 8700 on NO good news.

Shell game unmasked.

What I really laugh about is all the huff and puff to pass that big stimulus bill that was Obama's first great piece of fake pork and they have only actually moved 10% of the fake dollars.

They can put off the inevitable for a while with fake money but the bubble just gets bigger till it pops.  Somebody, somewhere has to pay the piper sometime...

Look at this headline: 

http://money.cnn.com/2009/07/08/news/companies/ppip/index.htm?postversion=2009070819

Then take a look at the 3 year charts at some of these 9 companies:

http://money.cnn.com/quote/quote.html?symb=BLK&time=3yr

This is nothing but good ole bubble mania in those charts!

Can't wait to see how this new 30 Billion dollar investment, we are paying for, to kick start this things sales of toxic assets is going to go.    I've got my buttered popcorn and M&M's at the ready for this thriller picture show!!

I can just hear Michael Jackson singing thriller (also know as "the pedophile hustle").

Lyrics are here: 

http://www.elyrics.net/read/m/michael-jackson-lyrics/thriller-lyrics.html

Have any of you actually ever read those lyrics?

I've been thinking about you guys since this post late May and was curious to see if any on you got out of DXO when I called the top of oil between $70-75 in the quote below...  Hope you guys can make another 100% on the way down!

Ya, definitely credit where credit is due on that on YC... no idea how you called that one too but you are definitely dialed in on the price targets for oil!!!

ERY has been the best play off the top for that so far - 3X Energy Bear...up about +60% or so.

I've only been sniping some front month puts on some of the high fliers coming back down to earth... just too damn scared to put any real money into the market right now.

I'm thinking this H&S reversal top for S&P might be a fakeout and we bounce off 875 or so.  Though oil is still getting hammered over night... perhaps on that story about regulating commodity speculation from the big houses...

Man that would really screw up a couple year's worth of pattern observations, wouldn't it...

[MetalMeister]

Ludwig would write it differently today if he saw what's going on here....

"The issue is always the same: it's the government or the government.  There is no other solution. - Ludwig von Mises, written from the grave... (circa 2009)

Damnable liberal...!

Milton Friedman considered Mises intolerant in his method and in personal behavior:

    The story I remember best happened at the initial Mont Pelerin meeting when he got up and said, "You're all a bunch of socialists." We were discussing the distribution of income, and whether you should have progressive income taxes. Some of the people there were expressing the view that there could be a justification for it. Another occasion which is equally telling: Fritz Machlup was a student of Mises's, one of his most faithful disciples. At one of the Mont Pelerin meetings, Fritz gave a talk in which I think he questioned the idea of a gold standard; he came out in favor of floating exchange rates. Mises was so mad he wouldn't speak to him for three years. Some people had to come around and bring them together again. It's hard to understand; you can get some understanding of it by taking into account how people like Mises were persecuted in their lives.[17]

In a 1957 review of his book, The Anti-Capitalistic Mentality, The Economist said of von Mises: "Profesor von Mises has a splendid analytical mind and an admirable passion for liberty; but as a student of human nature he is worse than null and as a debater he is of Hyde Park standard."[18]

In a 1978 interview Friedrich Hayek said of his book Socialism: "At first we all felt he was frightfully exaggerating and even offensive in tone. You see, he hurt all our deepest feelings, but gradually he won us around, although for a long time I had to -- I just learned he was usually right in his conclusions, but I was not completely satisfied with his argument." [19]

Sounds persuasive like Obama and neither right in his conclusions or his argument.

The issue is always the same: the government or the market. There is no third solution. - Ludwig von Mises

So David you did so well on the predictions you decide to "hang it out again"  I admire that shoot, I did not even participate but doubt I would have come as close as you did.

So you keep us unwashed informed with anything you hear from your buddy in Washington you hear.

[MetalMeister]

Who's paying down debt? 

Personal savings along with massive personal debt is the trend now.  Does that mean people are getting ready for the big crash?  Makes sense to me.  But with the credit while you can and save all the green that you make.  Then default when the world collapses...

Works!

DSL...I am with you on the first part, not sure about the 2nd downturn though, too early to tell.

I am still watching the bond market as a major barometer for equities and the bond market looks like to me it is pricing in a recovery.  When you also look at ISM it is also positive.   The question to be answered in my mind is whether or not, it is "just restocking the shelves" or will it be sustained.  Noone has the answer to that one yet, as the consumer is still deleveraging paying down debt, but also beginning to consume.

If we start to see the prices fall on the long term notes and the yields rise, then we are in trouble, but so far so good I think.

I think today was the bottom at least short term on commodities, Alcoa gave enough I think and the oil correction looks reasonable, with Snp support also holding.

David kick me in the head next time or do something to get my attention about keeping my promises on selling would ya?

GLTA

[Bottomfeeder]

YC....the numbers I saw today showed a contraction in consumer debt down sharply from May, even though May's numbers were revised up.  Who knows maybe Julys numbers will include upward revisions for June also.

On another political note I think you guys are being a bit harsh on Obama and the stimulus plan.  If we had not passed that stimulus we would have lost 4.5M jobs this year instead of just 2.5. Riggghhhhttttt!

Its getting pretty silly in Washington with the "misreading of the situation".  Probably should have just looked at the CBO numbers, can't say that they didn't know about those, right?

In the end, regardless of decades of government incompetance and continued wasteful spending we will come out of the recession, and "everyone" will praise Obama for getting us out of it.  That is what Obama knows also and as a result we will continue to have second rate politicians in the Executive and Legislative branches lead this country down to the day when it doesn't come back.

[MetalMeister]

BotF,

I saw this one today, is this what you are talking about?

http://money.cnn.com/2009/07/08/news/economy/consumer_credit/index.htm

Seems status quo to me...

Night all.   

[jjj000]

BF - so far the trend I'm seeing in Earnings Reports is "meeting expectations" and then "lower guidance"... which equals stocks down.

[Bottomfeeder]

not sure we have had enough info yet on guidance to have any consensus just yet.  Retailers sure down is expected.  Lets wait and see what happens with the banks.  That is what I believe the markets are waiting for.

Todays 30 Year auction wasn't great, which if I am understanding things correctly steepens the yield curve for the banks, which means big profits ahead.

Its going to take the banks and commodities to send this market higher, we can do just fine with a weak retail sector.  The dollar got whacked pretty good today also falling below its uptrend line which is also stock bullish and of course commodity bullish.

Its sketchy, but I think I am seeing things right.  I don't want to say that I am sure that the market will go up, but I am pretty confident that the banks are going to beat big as they re-inflate their balance sheets and the market will reach new recovery highs, as it did last quarter.

We just need to keep up above that 875 SnP number for a few more days I think.  This has been a light volume down move, which I think is important to keep in mind.  We don't have a bunch of big short money coming in the market just yet, because the bears are just as scared as the bulls are, even though the sentimment is very bearish IMO. 

Just my read obviously, maybe I am high as a kite, but the key is the bond market.  They telegraphed the bear market early and I think that is what that market provides, insight.

[Bottomfeeder]

Pretty stong UUU numbers out today:

http://www.miningweekly.com/article/uranium-one-reports-best-ever-quarterly-output-2009-07-09

Mega has some good stuff going on as well with a resource upgrade occuring at Lake Maitland, which is expected to go into production in the next 12-18 months looks like.  They also signed a deal with Aura of Austrailia for a potential 50% buy in for 3M in consideration on some more surface Uranium.  This project is also a government sponsored effort, which is quite interesting.  Those guys are getting hooked up and into postions of influence, like it.

http://www.proactiveinvestors.com/companies/news/1841/mega-uranium-announces-resource-increase-and-upgrade-at-lake-maitland-western-australia-1841.html

[pinetree]

Call me crazy but I was buying UUU in yesterday's selloff...    Those shares up 15% in one day!

Good news on Mega.  On schedule to go into production in 2011.  Only .10 from my 200sma target for initial accumulation.  I have to say if they ever turn out like Cameco (or other commodity producers of the 01-08 run) and go to $40 I'll be kicking myself for haggling over pennies at this level LOL...  But since I don't have a crystal ball what else can I do.  Still waiting to see how things shake out in the broad market... considering they're already showing their seasonal weakness *if* the S&P should go down to the 800 level I think these U's are really going to get whacked.