Thanks Bill!

Another ugly symmetrical triangle in the indexes, just like the ones in December that led to the January free fall. Maybe buyers will step up at the January 22, 23rd lows if we get down there but it doesn’t look pretty in my humble opinion.

Breadth overall was about breakeven in the markets. I am seeing some extreme strength in various Oil and Energy related sectors with a reactionary weakness in Transportation issues. Also, across the major indexes it is clear that the Big caps outperformed the small caps on a breadth basis..

Good Trading,
Ralph
http://successfulonlinetrading.com/blogs/

ALOHA !!

Bill ... I agree as you know!

I think the HB&B conflict of interest issue is a direct result of the 1913 merger of private banks with the US Treasury and enhanced in 1999 by the repeal of Glass-Steigel Act. There clearly needs to be a TOP DOWN change and an amendment to the US Constitution to get GOLDMAN SACHS out of the US DOLLAR! We need a seperation of BANK AND STATE like the existing seperation of CHURCH AND STATE ... As long as bankers control money supply there will be no trickle down! What's more powerful than owning the printing presses? Greenspan was repeatedly grilled by RON PAUL regarding derivatives regulation and Greenspan repeatedly said it was not needed ... problem is Greenspan and the cowards at the FED and US Treasury know they are immune from prosecution. Accountability is out the window!!!

GOVERNMENT IS ONLY AS HONEST AS ITS MONEY ...

Get rid of the US Federal Reserve Bank! Only the US Mint should issue money in America!

ALOHA !!

The only honest man compiling US government data has left the BUILDING!

A repost from yesterday ...

I find this very troubling ... To me this is the equivalent of Skilling leaving Enron! We know what happened to Enron not too long after that!

This is very positive for GOLD and SILVER ... the monetary metals. Yet on the same hand this is what is WRONG with America ... This is why OBAMA and any other future President other than RON PAUL is a LAME DUCK!!

READ ON:
Cassandra of U.S. fiscal issues, Walker leaving Government Accountability Office

Government Accountability Chief Resigns

By Elizabeth Williamson
Washington Post

Saturday, February 16, 2008

One of government's chief internal watchdogs resigned yesterday as Comptroller General David M. Walker, an outspoken gadfly and frequent witness on Capitol Hill, announced his plans to lead a new foundation focused on U.S. fiscal responsibility.

Walker has led the Government Accountability Office, Congress's investigative agency, for a decade.

Walker was an outspoken critic of the costs of the wars in Iraq and Afghanistan, Social Security, Medicaid, and Medicare spending -- issues on which the Democratic-led Congress, and Republicans before it, have had trouble building consensus.

In September the administration and the military took issue with a bleak GAO assessment of progress in Iraq; the top military command in Baghdad described the assessment as flawed and "factually incorrect." Despite last-minute changes to address the criticism, the final report cast serious doubt on U.S. efforts to build a functioning democracy in Iraq.

At the time, Walker told the Senate Foreign Relations Committee: "Given the fact that significant progress has not been made in improving the living conditions of the Iraqis on a day-to-day basis with regard to things that all citizens care about -- safe streets, clean water, reliable electricity, a variety of other basic things ... I think you'd have to say it's dysfunctional -- the government is dysfunctional."

Most of Walker's tenure was spent with Republicans in control of both the White House and Congress, and he has frequently irritated both bodies with his dire warnings on reining in spending.

During that time, "I would give Walker high marks for trying to stand up for GAO priorities even though he had a Congress that was trying to block him and that didn't want to know what the White House was up to," said Scott Lilly, senior fellow at the liberal-leaning Center for American Progress.

"He handled it as forcefully as he could, given that the Congress that was funding him was discouraging him."

The Walker-era GAO filed, but then declined to appeal, legal action to force Vice President Cheney to provide notes and information about meetings he held with energy companies while developing U.S. energy policy. A related suit wound up before the Supreme Court, which upheld the vice president's refusal to make the information public.

Walker's resignation takes effect March 12. He will lead the Peter G. Peterson Foundation, a new think tank whose mission, according to its Web site, is "to enhance public understanding of the nature and urgency of selected key sustainability challenges that threaten America's future," including "unsustainable" growth in entitlement spending, and energy consumption.

The GAO's chief operating officer, Gene Dodaro, will serve as acting comptroller general until a successor for Walker is found.

"The one thing that bothers me the most, given this president's record on nominations: It's not likely we're going to get a new comptroller before next year," Lilly said.

"That's a very sad thing, given how much institutional leadership means toward improving oversight over government."END

Goodbye US Dollar ...

Good afternoon!

Coincidently, these last few days the website of the comptroller was down...(remember my post?).

Re POG / ToG: here is some gold TA:

IMHO POG is forming a symmetrical triangle (continnuation).

According to chart school (www.stockcharts.com):

The symmetrical triangle, (...), usually forms during a trend as a continuation pattern.

The pattern contains at least two lower highs and two higher lows. When these points are connected, the lines converge as they are extended and the symmetrical triangle takes shape (true).

The ideal breakout point occurs 1/2 to 3/4 of the way through the pattern's development or time-span.

The time-span of the pattern can be measured from the apex (convergence of upper and lower lines) back to the beginning of the lower trend line (base).

The future direction of the breakout can only be determined after the break has occurred.

Edwards and Magee suggest that roughly 75% of symmetrical triangles are continuation patterns and the rest mark reversals.

Price target: There are two methods to estimate the extent of the move after the breakout.

- First, the widest distance of the symmetrical triangle can be measured and applied to the breakout point.

- Second, a trend line can be drawn parallel to the pattern's trend line that slopes (up or down) in the direction of the break. The extension of this line will mark a potential breakout target.

MY comments:

- We are now about one week away from the apex, and reaching 3/4 of the time span, and therefore a breakout must be imminent.

- Other Technical indicators for POG remain bullish

- Technical indicators are becoming more and more oversold, paving the way for a nice runup.

- The recent period has certainly sucked in some shorts, to be squeezed in due course.

Finally, the most reliable technical indicator:

:-)

My gut feeling says we will see an apward breakout with serious short squeezing in due course.

Enjoy your oversized weekend, while here in Europe we go to work on Monday...

Cheers!

Bill,
I have posted an interesting chart of CPI vs. S&P-500 performance.

It clearly shows a negative correlation.

Recently there has been a re-acceleration of inflation. No wonder the market is not happy.

Another blogger talking about generational bull market in bonds that may be ending.

http://stephenvita.typepad.com/

I've got a large position short 30 yr bonds.

Dave

As an illustration of investor sentiment, a small Platinum PGE/nickel exploration company in Ontario has a very volatile chart:

Stockcharts.com

http://tinyurl.com/2ad2wx

I began following this company while into uranium. Shares at the time were traded at 6¢. When people believed that May 06 was "the big kahuna" there was a rush into the stock, but since then, trading has been very volatile. Even so, platinum is at a record this week, and the shares have thoroughly underperformed.

The inverted gold/silver ratio is in the background, as well as the platinum price. My hypothesis is that silver will make gains against gold at this point, and with the advance in the silver/gold ratio, speculative money will be returning to the sector.

Part of the peformance of this stock is based on newsletter writers promoting it.

http://www.northern-shield.com/corporateintro.html

If I may say so, Barrick would not be shorting this stock in order to hold the price down.

Hey Bill

Thanks for including Trane (TT) in the Cara 100. Just now saw it.

As a Trane employee, I am proud of what we have acomplished, and we optimisticly (but clear-eyed) look forward to future acomplishments.

Thanks for recognizing our hard work.

ALOHA !!

This takes the cake ... I just opened some mail here and the University Of Hawaii Manoa sent me a notice about ADJUSTED GROSS REVENUE-LITE(AGR-Lite)insurance. This is yet another US Taxpayer funded scheme to boost revenues for US insurance companies. In one word "WELFARE"! Big Daddy government will take care of us all. Yet another reason the US FED printing presses will be running overtime!!!

Here's how it works ... I as a farmer essentially hedge my poor production or poor management by buying AGR-Lite insurance. I am insured against natural disasters or market fluctuations. One of the selling features of this insurance is that 48% up to 59% of the premiums are paid by ... (drum roll please)guess who? The US TAXPAYER !!! In the brochure they state the "government" ... anytime you see "government" you must in your mind substitute "US TAXPAYER"! The US government qualifies as a "non-profit" organization. The University of Hawaii(taxpayer funded)is putting on a "free" workshop for AGR-Lites.

Lets review. The US government and the University Of Hawaii and State of Hawaii(all US and Hawaii taxpayer funded)have teamed up with private insurance companies to boost the insurance company revenues on the back of US TAXPAYERS. Read my lips ... ITS THE FIAT STUPID!

GOVERNMENT IS ONLY AS HONEST AS ITS MONEY ...

yet again!!

maromatics, thanks for the info on the symmetrical triangle. Also only a few Canadian provinces, as far as I know, will have a holiday on Feb 18th leading to the "oversize" weekend: Alberta, Saskatchewan, Manitoba and Ontario.

Cheers all

Thx for the David Walker update. It may be interesting to see what he does with the Peterson group. Pete Peterson has written a host of great books regarding demographics and the financial implications for many westernized countries.

kaimu re: algae biofuel

Quite a while ago someone on these pages mentioned "vertigro" technology. That took me to look at Valcent Technologies www.valcent.net(VCTPF: OTCBB). It has developed a closed system for producing algae to turn into biodiesel. Because algae uses vast amounts of carbon dioxide to grow, carbon credits will be a major source of income. Interesting that kaimu mentions algae yesterday and Bill mentions carbon credits today. Coincidence?

Have position in Valcent.

David - Thanks. I had not noticed Trane in the Cara100, but on looking into it, I found that Ingersoll-Rand will soon be the new owner of Trane. Not sure what the mid to long term impact of this transaction will be, but --- Good Luck to ya!

http://tinyurl.com/2hff46

Birch Mountain, BMD.to

Remember some of you were following this one a while back, I currently have no position but have been watching it. Weekly chart still ugly, but daily chart starting to show some promise.

Divergence on RSI, MACD and Stoch in the coiled mode. Close short term support below, MA's converging at current price. Some overhead resistance but could be nice for a little move here.

Weekly / daily chart
http://tinyurl.com/yrtkc2

Bespoke has posted a bullish outlook for Nat Gas...
http://tinyurl.com/yvcuqn

I'm a little bit short due to the short-term over-bought condition...

All right ladies and gentlemen.... for those of you interested in emerging sciences, I'll refer you to the following links:

http://tinyurl.com/2alanp
http://tinyurl.com/2yonoh

These techniques offer a novel way of treating disease and infection. They do not require intensive drug research or invasive and prolonged treatment procedures. THey can easily be fine tuned in a physics or electorphysiology lab environment. And these technologies have a pedigree of success... they represent the direct descendency of a technology exstensively beta tested early in the last century by Dr. Royal Rife.

As an electrophysiologist, I have been following public disclosure of this technology for A LONG TIME. It was originally black-balled by the medical and governmental establishment under the auspices of being crackery. Royal Rife was proffessionally ruined and imprisoned for not playing along with their proclamations.

Once taken off the streets, the technology went black. That is to say it was swallowed up completely by the military industrial complex for further research and development away from the prying eyes of the masses. The technology has been exploited particularly in the development and deployment of beam weaponry as currently being beta-tested in the Middle East by US forces in Irag, and recently by Israeli forces during the conflict in Lebannon... It is no coincidence that the group selectively irradiating cancer cells (as described in the above link ) hails from an Israeli company. I would put very big money on this company having direct connections to the Israeli Defense Force....there is a long and well-documented history of this stuff but this IS NOT MY POINT, so I leave you to do any further research on your own.

My point is that this technology represents the future of medical practice in much the same manner that the jet engine represented the future of aviation when it was initially developed and deployed. Among other things, it represents a Star Trekian reality where subtle electromagnetic energies are utilized to both diagnose and selectively target treatment for disease and infection. If this technology is finally being leaked to the masses or green-lighted for commercial appllication, as I suspect based on the above links, you would do well both as investors and trend-watchers, to keep track of any future developments and related patents... When this technology finally emerges, its impact will be huge for all of mankind.

Have a great President's day weekend.

Hi maromatics!

I've been waiting for someone to bring up the new symmetrical triangle in gold. Maybe we can call this symmetrical triangle lesson #2 :-)

Also, watch bollinger bands for narrowing (naturally) and a future straddle position may be called for. I doubt that this symmetrical triangle will be as easy a long trade as the last one. I wouldn't be surprised if the formation breakout fails with either a breakout below or, hopefully a breakout above finding resistance with the new longs caught, only to have to sell at a loss as the upward breakout fails, then after a decline, we can catch shorts (and the last longs being burned won't be so easily going long again) leaning the wrong way for a big upside move. Big moves follow failed formations.

Note that the 23.6% retracement is roughly the January 22 low. That may be the next high probability buying op.

Hope that makes sense.

Bottom line: maromatics, I do like your analysis, but because it worked so easily before, I don't think profits will so easily had this time.

It may be getting time to fleece the sheeple again...profitable trading is not about being nice.

China Money Supply is surging!
http://piaohaoreport.sampasite.com/blog/January-new-lending-and-new-mone.htm

Does it mean that we will see a little more 'strength' at the stock exchange? Maybe yes...

Here is what John Mauldin wrote in his news letter on Friday:

"On January 18, 2007 S&P estimated that as-reported earnings for 2007 would be $89.10 per share. The index was at 1426, which gave a forward P/E (price to earnings) of 16.

And the real number for 2007? It was $71.56, so down about 20% from the estimates at the beginning of the year, and down 12% from 2006. Not a good year, as it turned out.

Now, S&P came out with an estimate for 2008 on March 30 of last year. They projected earnings of $92.30 for this year. By the end of the year that was down to $83.98, which would give a forward P/E of 17.48, which is starting to be pricey.

And what are they currently projecting for 2008? $71.20, which is roughly what the earnings were for 2007. That also puts us into a rather sporty P/E at current levels of 19.2 on a forward basis.

But wait. It gets worse. They project that for the four quarters ending in June the earnings will be down to $65.15, which yields a very high P/E of 21 at today's prices. Do you think the stock market could be at risk if we get into a full-blown recession and P/E ratios are at the top of historical valuations, except for the 2000 bubble valuations?

Further, earnings typically soften during a recession, so it is likely that actual earnings will go down from here. S&P estimates that earnings for the S&P 500 will rise 20% in the 3rd and 4th quarters of 2008, from 2007. That is a rather robust recovery in their projections. And one that is looking increasingly unlikely.

As I have written before, the research shows that the reason bear markets stretch out over time is that it takes several earnings disappointments to truly put the majority of investors in a bearish mood. Of course, the opposite is true, in that several earnings surprises in a row will make investors much more bullish.

My bet is that earnings for the S&P 500 are going to be revised down again and again as the year goes on. A 10% drop in earnings will mean that the market has a P/E of 22, if the market stays where it is. That is hard to imagine."
****

If the earnings are going to be continually revised downwards, then we are very likely to see the scenario I quoted in my posting on Feb 13 at 1:29pm, describing the feeling of a long bear market puncutated by counter-rallies of up to 15%. So those who are still playing only on the long side in this market may want to open some shorts on market indices as a hedge against their favorite long positions, or better yet vary your short position over time, increasing it when the market becomes more and more overbought (but still keeping it smaller than half or even 1/3 of your long position, so as to not run into trouble with it when the next bull market finally starts) and decreasing it (i.e., take profits on your shorts) when the market becomes more and more oversold. Similarly, you can sell some parts of your long position when the market rises and buy it back when the market falls, which should clearly outperform the strategy that does nothing in the face of all the volatility we are observing. This is the strategy I have been following since November, and it is working out very well so far. My trading is, of course, not as profitable as for those who are using technical analysis matched to the latest news in the market, but I am still making money with this simple strategy, which is better than doing nothing and just waiting for the next bull market to start.

ALOHA !!

More challenges to the US Dollar monopoly on oil. How long before these idiots figure out that the Ruble is just as bad as any other piece of paper in terms of devaluation and purchasing power? The Arab world has long valued the gold Dinar and I suspect some day the producers will quit trading their future for worthless paper of any Nation. In the meantime, this becomes more a matter of politics than monetary sanity where "baskets" of currencies will be traded. Either way you look at it the less US Dollars are used in global trade of anything , especially oil and gas, the less value the USDX has. That would mean our many billions of pieces of IOU paper now on holiday in foreign lands would then come home to where they were first printed.

Perhaps the monetary powers-that-be in Washington DC and NYC will see that a military solution like Iraq will not be viable with Russia in the way. At this rate they could head them off at the pass and re-weight the USDX. That would stun the Dollar bears, but at the same time it would show the under belly of FIAT. There are many tricks in the FIAT BAG-O-TRIX !! Re-weighting only buys time and to be honest thats all the FIAT MASTERS have any more is "time"! I mean the game is up when an Iranian ambassador uses phrases like ... "rid the World of the US Dollar's slavery ..." I mean talk about the Emperor has no clothes!! Oh and hey, look at that pink elephant over there!!

READ ON:
Iranian envoy suggests pricing Iranian oil in rubles

From Islamic Republic News Agency, Tehran
Friday, February 15, 2008

MOSCOW -- Iran's ambassador to Russia said here Friday that Iran and Russia, as major energy suppliers, can rid the world of the U.S. dollar's slavery by promoting oil and gas deals using other currencies.

In an interview with Echo Moscow Radio, the ambassador, Gholam-Reza Ansari, further emphasized, "We have been trying to launch an oil market in Iran and trying to find substitute currencies for Iran's oil sales. That can be Russia's ruble."

He said he appreciated Friday's remarks by the Russian prime minister's first deputy, Dimitri Medoviv, on Russia's intention to sell its oil in rubles, saying, "That was a brave move."

Focusing on the world's large gas producers, the Iranian ambassador said, "We need to establish an organization as soon as possible to regulate the market and monitor the proper use of this product."

Elsewhere in his interview, Ansari rejected the position of Western countries against Iran's achievements in peaceful nuclear technology and aerospace engineering, saying, "By sending a satellite to earth orbit, Iran intends to decrease the hazards of natural disasters, such as floods and earthquakes."

He added, "Such moves are totally within the framework of international laws and conventions, pursuing absolutely no military objectives."

Ansari added, "On the other hand, as a free and independent nation, we cannot ask for the permission of the United States and the West for taking any step to safeguard our nation's interests, just as Russia does not do so for its scientific and other national activities."

The ambassador also elaborated on Iran's achievements in the 29 years since the glorious victory of the Islamic revolution of Iran.END

Interesting report from Financial Stability Forum (a group of leading central bankers)

http://www.fsforum.org/publications/FSFWGG7Interimreport5Febfinal.pdf

ALOHA !!

I have been mentioning price points in Australia. As an example a greek pasta salad at a restaurant is $20AUD. Food prices have increased 43% in Australia since 2005. Please-e-e ... a $20 salad! I kid you not!!!

ON M3B
Here is the latest M3b just updated yesterday, Feb 15th 2008 where it shows M3 at 18.3%. The steep rise over the past few months from 15% in December 2007 is parabolic! Money supply has moved 3% in a month's time. Wow ... I wonder why? Look at the chart and notice the steep rise since August 2007 when the derivatives time bomb was first exposed to the World. Remember Northern Rock and CountryWide? That was last August. Prior to August 2007 money supply contracted to 10% or $11trilUSD. Over the next seven months M3 has risen to 18.3% or 1.2% monthly to $13.3trilUSD adding $2.3trilUSD in seven months or $328bilUSD monthly. WOW! Last year the Bush FY2007 Budget had $450bil to pay just the interest on the $9trilUSD debt. You and I pay interest on our loans to a bank. Where does that bank get the funds to lend? What bank gets the $450bilUSD USA interest payment each year that's in Bush's budget? Don't ask the US GAO Comptroller ... he quit! The two party aristocracy beat him to a pulp! More CHANGE please!!!

Is it any wonder the POG went up? At this point $915USD is still cheap ...

Look at this chart ... ever higher lows and higher highs ... Its not a stairway to heaven thats for sure!! The patient is dying ... Get some monetary insurance! I am not talking about GLD or US Treasury Bonds ...

Link: http://tinyurl.com/yq4ome

Seems to be weekly stories on food inflation, global grain pressures, shortages, ban on food exports, etc. As opined before, some countries look at this as homeland security issue.

This week: Asia facing growing rice crisis

MUMBAI - An Indian government ban of rice exports has plunged neighboring Bangladesh into crisis, in a grim preview of growing global grain shortages. Leading rice-exporting nations such as India and Vietnam are reducing sales overseas to check domestic price rises. Previously healthy buffer stocks in the world's largest rice exporter, Thailand, are shrinking.

http://tinyurl.com/2dxbt4

Re: Conflict Of Interest

"It doesn’t take a rocket scientist to see that where there is extreme conflict of interest in matters of money, there will be cases of extreme deceit. Regulation and notarized filings are one small step to having our back covered. We also desperately need to recognize that the system is broke, and do something about it."

I find it altogether very odd that most of the capital at risk in any of the CDO deals are mostly tied to pensions, municipal bonds, homes, bank reserves, and that CDS's are a put option on the failure of companies - in short - other people's money. But notice that THE market in ficticious capital, imaginary prices, and huge leverage, essentially gambling in the futures market goes literally unscathed.

ALOHA !!

Speaking of M3 and "transparency" ... The following data will soon disappear! Does hiding data really solve anything?

From Rob Kirby ...

READ ON:
The Latest Data Scheduled to Disappear Behind the Iron Curtain:

Due to budgetary constraints, the Economic Indicators service (http://www.economicindicators.gov) will be discontinued effective March 1, 2008.

Advance Monthly Sales for Retail and Food Services

Advance Report on Durable Goods

Construction Put in Place

Gross Domestic Product

Manufacturers' Shipments, Inventories, and Orders

Manufacturing and Trade: Inventories and Sales

Monthly Wholesale Trade

New Residential Construction

New Residential Sales

Personal Income and Outlays

Quarterly Financial Report

Quarterly Services

Retail E-Commerce Sales

U.S. International Trade in Goods and Services

U.S. International Transactions

Poooof!!

SPRD
Spreadtrum Communications, Inc. NASDAQ-GM



SPRD New buyers Q ending 12/3107

Institutions own 5.9%

Company Shares Value

GRANAHAN INVESTMENT ... 1,199,800 $10,558
ARDSLEY ADVISORY PAR... 375,000 $3,300
PRICE T ROWE ASSOCIA... 152,060 $1,338
NEUBERGER BERMAN LLC 150,962 $1,328
INVESCO LTD. 126,609 $1,114
GENERAL MOTORS INVES... 109,374 $962
MARK MORRIS ET AL 103,674 $912
GRUBER & MCBAINE CAP... 86,300 $759
J P MORGAN CHASE & C... 71,094 $626
CREDIT SUISSE/ 43,061 $379
RENAISSANCE TECHNOLO... 41,600 $366
UBS AG 41,209 $363
OBERWEIS ASSET MANAG... 33,030 $291

Boone Pickens also purchased CLNE (Clean Energy Fuels Corp.

Yesterday (6 Feb)we had a conversation with David Silver of Wall Street Strategies, to ask his professional opinion on Spreadtrum Communications Inc. (SPRD) . We have included our a summary of the conversation below, but do suggest that investors looking to receive research on SPRD sign up for free to BellwetherReport.com for more information as it becomes available. Also members looking to receive a free custom stock review on any company they currently hold in their portfolio are welcome to sign up and submit their query in the members section of www.bellwetherreport.com under the tab "request a stock review".

This conversation was conducted on February 6th 2008.

Q: What is your professional opinion of Spreadtrum Communications' recent earnings report?

A: Spreadtrum Communications reported earnings that surpassed the Street's expectations after the bell on Monday, but its guidance is what caused the stock to fall. Management indicated it expects revenues to be approximately $39-$40 million during the first quarter compared to the Street's $40 million estimate.

Q: So, how do you see the company fairing in the near future?

A: The Company is likely to be pressured from the sever snow storms that have afflicted most of China, and coupled with a slowing economic environment, management has an uncertain future about the Company's first quarter. We expect the Company to continue to improve operations; we would like to see the Company surpassed its 4% to 5% gross margin target for the first quarter. The second half of the year should be strong following the Olympic Games.

Q: Technically speaking, what would you tell investors looking to position themselves in this stock?

A: The stock has been stuck in a down channel, and the first resistance level is at $10.40, and then the top of the channel at $12.80, and then a technical breakout to $15.20. On the downside, $8.00 and $7.20 are support points.

Price Performance
Price on 2/15/08 $8.80
52-Week High/Low $17.00 / 7.46
Volume on 2/15/08 77,254
10-Day Avg. Volume 148,364
Price 1 Month Ago $9.50
1 Month Price Performance -7.4%
Price 3 Months Ago $14.10
3 Month Price Performance -37.6%
Price 6 Months Ago $10.12
6 Month Price Performance -13.0%
Price 12 Months Ago $15.95
12 Month Price Performance -44.8%
Market Capitalization $364.7 Million
Beta NA
Key Statistics (Latest 4 Quarters)*
EPS Growth 34.3%
EPS Growth 3 Year, annualized NA
EPS Growth 5 Year, annualized 4.6%
Sales Growth 56.8%
Asset Turnover 0.9x
Inventory Turnover 4.9x
Receivables Turnover 25.7x
Effective Tax Rate 4.6%
Total Debt to Equity NA
Interest Coverage 370.6x
Quick Ratio 2.7x
Current Ratio 3.3x
Payout Ratio NA
Debt to Capital 0.0x
Business Description
Spreadtrum Communications, Inc., a fabless
semiconductor company, engages in the
design, development, and marketing of
baseband processor solutions for the wireless
communications market primarily in the
People's Republic of China.
Spreadtrum Communications Inc
Lane 2288, Zuchongzhi Road
Zhangjiang, Shanghai201203

above post is about SPRD.

Thinking about the TOG, the fog is clearing a bit. We are in a generational shift in the trend of long term raters - not so much because of inflation, but because of the higher risk of default. Rates go up, bonds issued at 5% drop in value a lot.

Here's some additional background:

Higher Interest Rates Reflect Default Risk as Credit Boom comes to an End
June 14, 2007
http://www.marketoracle.co.uk/Article1266.html

Weekly Webcasts:
http://www.cyclesman.com/Articles.htm

As an aside, the range of asset classes we are all having to learn about far exceeds anything I ever expected. I have had less then zero interest in bonds, yet it's becoming clear that this is an important part of the overall picture.

Like I said a few weeks ago, natural gas is the next commodity to see a big increase. The multiples are ther, even Pickens is liking natgas with his purchase of CLNE.

Nat gas historically trades about 1:9 to 1:10 on an mscf:bbl oil basis. It is still mocing up but right now it is around 1:12, so oil has to go down or gas has to go up.

I have a current play on DUG (oil at 94 is too high) but nat gas at %7.50-8.50 is too low.

Also take a look at AHR. It is nice cyclicle since the res mortgage MBS, CDO debacle. AHR is int CMBS's and says their divy is secure for two years out.

Hi Go34!

Interesting perspective...

It seems we agree on 3 things:

1- As the apex of the symmetrical triangle is getting closer, we will soon know the direction of the breakout. :-)

2- For traders not in yet, a straddle is the smart way to join the fun to be starting soon. Then, as the markets takes a definitive direction, the "losing" part of the straddle is taken out (but wait for confirmation before doing so).

3- This breakout may be more volatile than the previous one, regardless of direction, which only adds to the fun, I guess.

Now, re fibonacci retracement levels and buying opportunities at this time:

- If one counts the fibonacci retracement levels starting from the Nov 19th low to the Jan 30th high, then in this correction POG has already put in a 35% fibonacci correction of that movement on Feb 5th, not having reached the 38,2% level. IMHO, that is a very bullish signal, and may mean that the correction lows are in.

- As far as I remember from my TA studies and a little accumulated experience, in bull markets in general, 38,2% is usualy a good first level to start buying, but it is also the case that some times, the market only corrects 35%. This of course only happens in serious bull markets, as seems to be the case for gold.

If that is the case, then the train may have left the station already on the 35%, and will not reach the 38,2%.

The rationale for that is the following:

- For the time being gold is in a bull market (unquestionable), is now in undertaking a corrective period, and 35% or 38,2% retracement levels have not been challenged on the 2 lower swings last week, as 900 spot held.

- So far, the symmetrical triangle formation appears to be forming again.

- In other currencies, POG is in an even better technical shape.

In the real world:

- USD index is again showing weakness, after Ben's testimony last week.

But, much more serious than that:

- For a non US investor like me, looking at the US from the outside, the failure of over 100 bond sales of us INSTITUTIONS last week is a very serious news, which, signals that investors are starting to question the ability of US institutions (municipalities, universities, local government institutions) to meet their financial obligations.

- The US long bond is showing worrying signals that it may have peaked. If that is the case, then this is very very serious, as it would imply that investors have come to a point when they will not go on looking to invest in US debt.

- US money is, by defenition, US debt, so the USD index may return to its downard path.

So, all these things considered, I am leaning towards an upward breakout of that triangle, altough it may come more volatile conditions than the last one.

Finally, I would like to add that I am expecting a hudge fight to take place at around 970 / 990, as the psychologial level of 1.000 is approached. That will indeed be an interesting fight to watch and trade.

Keep cool as a cucumber!

Cheers,

cresy
Anyone follow Cresud the Argentina farm compnay, the monthly chart looks interesting D-W rsi went below 30 but the monthly hasn't yet. We are back to support. May be a good way for investors to buy farm land. Opinions?

Re: Inflation/Deflation

Further to the discussion whether we are experiencing inflation or deflation, there's been references to long wave theory. There is a strong assessment of various supercycle concepts and business cycle concepts, which confronts just why there can be inflation in the grains/metals and deflation in housing.

Bob Bronson's synthesis of the various long wave supercycle theories and observed business cycles:

http://www.financialsense.com/editorials/bronson/model.pdf

Various articles by Bob Bronson can be found here:

http://www.financialsense.com/editorials/bronson/main.html

I believe the answer is probably two-fold, that the reasons for assuming deflation, or K-winter since 1999 nasdaq peak are related to interest rate declines in the 10-year bond, declines in the 90-day yields and very firm foreign exchange values for floating currencies relative to the U.S.

Note that in 1929, the collapse of the wheat market in Chicago was apparently what touched off the stock market crash in NY. The housing bubble in Florida had collapsed prior to that. But the entry into K-winter this time around saw the nasdaq crash first, housing, metals and in all probability, the grains as of late.

Metals prices have already collapsed, with the exception of copper. I invite skeptics on metals prices declines to please refer to kitcometals.com 5-year historical charts on metals prices if there's a dispute to whether base metals prices have collapsed or no.

But I would add: wherever there's a futures market in prices, you'll see the effects of a deflationary boom and a run-up in prices regardless of the fundamentals.

Just an FYI:
Seamus, rice shortages and exports halted from several Asian countries two weeks or so back.
Not promising. When I push my monstrous Costco cart past the big bags of rice I'm reminded, grains store well if properly sealed and stored.
This fits Kaimu's overall plan.

Kaimu: Get busy if you want more farmland. My local Seattle news reported last week on Hawaiian real estate, specifically farmland.
The downside....prop up, taxes up.

Hi again,

The recent events in the US bond market last week make me think that this must have an impact in the US deficit at some stage.

That will make the USD fall further and bond yields rise.

The first signals are already here.

So now the only question is not IF, but only WHEN will it be the exact right moment to short bonds and go long gold, as the TOG shapes up?

Maybe the exact moment now only depends on how deep your pockets are...

Cheers!

Good point Craig. I may even have mentioned some of those shortages in past postings. Asia Times seems to summarize trends over a few weeks and I thought the article reflected conditions in Asia.

For more recent food shortage information, google food shortage on the google news page. Today results in articles on “food shortage” conditions in Kenya, (UN predicting acute food shortage in coming months) and Venezuela (where our friend Chavez has instituted price controls on food) among others.

This past year has also shown protests and demonstrations (even a riot or two) in various places about huge price increases including Italy (pasta) and Mexico (tortillas) among others. I would not be surprised to read reports of riots as conditions worsen in some third world countries.

I don’t think conditions will get better soon. Thus--going simply by memory here---I have RJA, JJG, JJA, DBA, MOO, VT (Canadian symbol), on my lists as well as the fertilizers and individual companies MON, SYT, SEED (speculative) etc., etc. Watching for pullbacks while realizing some grain spikes due to short squeezes. Discussion, not a recommendation, please dyodd.

Disclosure: positions on RJA as well as puts I sold on MON. Have been in and out of positions in some others mentioned.

MtnGntx- reference your 2/16/08 558p post-

thank you for bringing these developments to our attention...in an era of multi-drug resistant tuberculosis, multi-drug resistant HIV, multi-drug resistant staphylococcus and enterococcus- not to mention viral diseases (such as Avian flu) with no treatment at all-->the use of light and sound waves is exactly the kind of new technology that might take things in a new direction entirely...

notice that Novocure is already in Phase III with a potential treatment (low intensity alternating electric fields) for a certain type of brain tumor...sites include several well-regarded teaching hospitals in the US:

http://tinyurl.com/2hgul5

would be great to return to the time when scientific and medical breakthroughs routinely made newspaper headlines (rather than violence and celebrities, or should i say violence and/or celebrities? LOL)

david- really enjoy your style of posting comments from well-known investors followed by your thoughts on how to integrate your take on them into your portfolio positioning...

i also am starting to establish a few long/longer-term positions +/- trading around those positions, yet still expecting a sharp sell-off in the broader market and therefore hedging with short ETFs when counter-trend rallies get out of hand...keep telling my wife that certain Cara 100 companies (INTC/CSCO/SNDK/GFI) could easily double from here in a year, and not to get caught with no position(s) when they (unexpectedly, of course) start to take off->on the other hand, when you get a 10% run in one of them in a few days..well, in the context of a bear market, common sense just tells me to take some profits, right...being long in a bear market really is a tough game, which makes picking the right stocks absolutely essential...

I rented a film this weekend, no, not Lebowski or Bukowski or anything contemporaneous like that. Although, come to think of it, Bukowski as a documentary is an excellent historical depiction, regardless of how the degeneracy might have come across.

Apparently, a film was made in the "film noir" style some decades ago, which dealt with the social aspect of a poor bricklayer's life in NY City and the affect on him and his family of his untimely death during the depression era. It was a film made after the novel "Christ In Concrete" by Pietro di Donato. The novel was not well represented by the film.

The film was made by director Edward Dymtryk titled: "Give Us This Day," starring a very young Sam Wanamaker.

If you can stand the music and the excessive emotional slice of salami,(it was all ACTING!! ACTING!!!) the film approximates an historical depiction. It was released in 1949, so it goes quiet a ways back. Some scenes of NY in 1949 during the opening credits.

Its funny, but all the arguments about earning a wage and risking house and home on vetures is probably still true. They sound awfully familiar.

The film was apparently suppressed by Hollywood, according to the DVD case, and few have ever seen it or remember it.

The imdb.com file is here:

http://imdb.com/title/tt0041416/

re ToG- reference 2/15/08 822a post by onlineaces->i have been hesitant to start a short bond position with the expectation that the Fed will at some point be forced to slash ST rates on a dime, dropping bond yields back to 2003 lows...since RYJUX and RRPIX (1.25x) return the inverse of long bond performance, and trading in the long bond may or may not reflect what will happen in with short-term rates, would encourage anyone interested in the trade to read all three links carefully...whoever started scaling into RRPIX the past two weeks may in fact have caught the bottom?

craig- just got around to reading your friday night post (all-day trip to the central valley and back yesterday)...thank you, and you're welcome! since it's sunday, and social equity is always up for discussion here, will indulge in more thoughts about karma...

neither hindu or buddhist myself, but every religion and culture (and sub-culture!) emphasizes the importance of giving (away) freely what one is given...which leads me to think that karma is built into the human psyche/condition and we resist positive actions to our detriment...the 'net' has really revolutionized human interaction and communication...it blows my mind to think that bill is able to positively influence hundreds of thousands of lives (directly or indirectly) on a daily basis, and in real-time...

[EMIPY, VIVEF, FR:012777] Rock stars' royalties may be extended by EC: reports
3:23 AM ET, Feb 17, 2008 - 8 hours ago
08. [EMIPY, VIVEF, FR:012777] Rock-star royalties may last 95 years vs 50 previously
3:23 AM ET, Feb 17, 2008 - 8 hours ago

can't wait to read the supporting arguments (LOL)

make that neither hindu 'nor' buddhist...(but with plenty of friends/acquaintances who are one or the other)...

will there still be rock stars in 95 years...

It is a very sad day now that David Walker has quit. He was one of the few honest men in Government. Did any of you ever read any of his reports to Congress? He never pulled a punch, telling them each time how their foolish spending would bankrupt the US.

And now with failed Muni Auctions and world Grain shortages, we need people like him more than ever.

Rob.

U.K. government to nationalize Northern Rock.

Re: DISAPPEARING DATA

From: ShadowGovernmentStatistics.com

Open Announcement
February 16th, 2008

Economic Indicators Continued by SGS. The Department of Commerce (DOC) has decided to discontinue its economic indicators service economicindicators.gov (effective March 1st) "due to budgetary constraints." Shadow Government Statistics is pleased to announce that it will provide — at no charge to the public — a continuation of the basic link service heretofore provided by the DOC’s Economics and Statistics Administration.

The existing government service provides links to the Web pages and recent releases of the Bureau of Economic Analysis and the U.S. Census Bureau. We eventually plan to extend the service to other government or quasi-government reporting agencies, including the Bureau of Labor Statistics, the U.S. Treasury and the Federal Reserve, as well as to provide links to other major economic data providers. We plan for the new service to be operational by Wednesday, February 20, 2008.

Re: Posted by: 2nd_ave at February 17, 2008 11:33 AM

2nd, I'm reposting my links to ToG ideas again here...

http://tinyurl.com/2crz4c
https://www.quickbase.com/db/8xxcx953?a=q&qid=25
https://www.quickbase.com/db/8xxcx953?a=q&qid=24
http://tinyurl.com/yw2e28

I am seconding (pun intended!) your suggestion to "encourage anyone interested in the trade to read all three links carefully" and also be sure to open all the embedded links in the last article.

Ok, so I will propose an economic outlook going forward.

We have seen the internet do its work, where narry a penny is exchanged in securities trade, just a jumble of numbers with no attachment to real existing currency, and no real attachment to industry.

What has resulted is a finely disseminated financial sector, with as wide an audience as possible. Everything that wasn't tied into active trade, such as bond markets, pensions, housing, commodities, have all been now fed to the futures market and lost.

At the retail end, we're still buying the story of the collapse of former communist regimes being conscripted to capital for our benefit. The cliche is how risk averse investors are placing their bets on growth, "anywhere but here."

In fact, anything and everything has been sacrificed to unregulated electronic trade, the tool of our trade has been the internet, that great imaginary representation of ultimate reality.

What has occurred overall since the nasdaq, is the commodification of every last aspect. The exception has been the junior sector in precious metals, because they bear no relation to any options/futures trade, they have underperformed the precious metals sector. Or, rather, they reflect some deflationary reality underneath the sick air pumping the large cap liquid soap into greater froth.

Anything and everything what formerly made a sound basis for an economy is now being fed to the futures market. Housing, Pensions, Municipalities, Massive transfer and loss of taxpayer dollars, Wage stagnation and pending deflation, Bank reserves(essentially people's cash savings held in a bank), everything formerly not tied into the once-marginalized futures trade(you can throw in options chains and CDO/CDS, asset-backed commercial paper) is now channeled into the avenue of electronic trade.

ALOHA !!

Fransix ... That's a lot of global finances concentrated on the internet. We all use the internet for all our trading and some banking and I use the internet for all my information and disinformation! A lot is riding on the security of the internet. Imagine if even one day is disrupted on a globally! YIKES ...

In essence the internet is another piece of paper ... a receipt for your wealth. Like the invention of paper money it was intended to be a convenient way to store wealth. The weak link to that paper invention has always been the human condition. You had to trust another human with your gold and you had to believe the bank was safe. The human condition has always been the greatest "risk" to one's future finances. It still is and the use of derivatives is a betrayal of that trust.

There is only one way to hold your own wealth without other humans in the loop. Gold in your pocket! Gold in your pocket is insurance against the human condition and the insecurity of the internet.

AOL clicks with Yahoo! to sideline Microsoft
By Mark Kleinman
Last Updated: 12:40am GMT 17/02/2008

AOL, the American internet company, is attempting to piece together a deal with Yahoo! designed to help the Silicon Valley-based search engine evade the clutches of Microsoft, the world's biggest software group.

http://tinyurl.com/2ph23a

Trade of the Generation:

The trade: Short long bonds, Buy gold.

Perhaps the timing for the two will be different, not necessarily at the same moment.

Just a thought...

Dave

Re: Paper Investments

In terms of actual paper, there is probably not enough actual printed currency to go around.

Look at the implications of a vast, encumbered paper market shackled to electronic trade.

Anything not closely monitored by regulators or individuals with some small authority to prevent the loss of security in long term investments is absent, thus anything and everything is plugged in, yoked to some Credit Derivative formula.

That means all of the savings, pensions, municipal bond debt, housing, solvency of large corporations have now all been surreptitiously encumbered with obligations not previously thought possible. In another time, it would have been referred to as larceny on a grand scale, much of it done in the name of advancing one's own interest over the public good.

The convenience of availing oneself of any pool of capital anywhere in the economy(even fixed income instruments) and subjecting it to opaque obligations with no hope of ever satisfying them probably describes what's going on. There's always a secondary lien CDS to walk away with 10¢ on the dollar should the whole thing fail.

But we require a much more professional, hard look at money and obligations in this scenario rather than more cliches on emerging markets, safe havens, and two-dimensional Descartian era ruminations of market control. That's where we have failed, because we bought the mortgage story hook line and sinker and managed to ignore the wider implications of systemic fraud.

DaveB- re the timing of the ToG (if/when it occurs)- i was thinking the same thing...what put Canadian savings bonds in that category was a) an (extraordinarily high) inflationary environment that investors gradually became acclimated to, and b) (maybe b/c of the acclimation) the fact that most of them completely missed an extraordinary trade that was right in front of them...we have some extraordinary conditions prevailing right now, and perhaps (in retrospect) it will become clear that we should have begun shorting bonds in late January...and who knows, maybe we should have begun accumulating gold at the same time...i suspect it won't be an 'easy' trade, either in terms of recognizing it when it presents itself, or in the way it plays out...

TOKYO (Nikkei)--Women tend to wear their hair long when the nation's economy is up and short when it is down, a survey conducted over the past two decades shows. As concern grows about a possible economic downturn, will this hairstyle trend repeat itself, or will something new happen?

http://tinyurl.com/yrm3b

i can think of at least a couple reasons for the correlation, including the possibility that women unable to afford to make (as many) personal statements via changes in clothing styles may opt for changes in hairstyles, or that fewer hours spent at work or traveling/partying/at the gym may translate into experimenting with changes in personal appearance...wondering if men tend to grow their hair longer during downturns for the same reasons?

I'm playing around with my charting skills to try and improve my technical skills and I figured I'd post a few here for some of the resident chart masters to critique.

I've mainly been trading SKF and FXP with a tiny bit of QID on the side. For FXP I look at both my FXP and my FXI charts. Here is the FXI chart:
http://tinyurl.com/2xohjt

As you can see FXI is below both it's 50 MA and it's 200 MA. The MACD ain't pretty either. It's bounced off support at 140 and I'm betting that it's previous support level at 165 will make for good resistance now. Also if you look below the 140 support level it's basically just air so it has plenty of room to fall should 140 fail. Now over to the FXP:
http://tinyurl.com/2rdlvt

One look at that FXP chart and you can see what a whipsawing SOB it is. Right now it's basically sitting on support at 86.50. If support doesn't hold here it's a long way down to it's next support level at 70. My thoughts are that if support holds here it will establish a new trading range between 86 and 115.

Not making any recommendations, just offering up my charts and analysis so the masters here can point out any errors I'm making. ;-)

Crap, the links aren't working. I'll try posting them directly
FXI:
http://stockcharts.com/c-sc/sc?s=FXI&p=D&b=3&g=0&i=p57821920815&a=130792256&r=385

FXP:
http://stockcharts.com/c-sc/sc?s=FXP&p=D&b=3&g=0&i=p57821920815&a=130791280&r=613

posting in case someone missed it.Seems everyone and their mother has the same idea????

Kass: Cut the Dead Weight
02/14/08 - 11:57 AM EST

This blog post originally appeared on RealMoney Silver on Feb. 14 at 7:36 a.m. EST.
On Monday morning, I turned more optimistic about the equity markets, thinking that a 3% to 5% rally (within a bear market) was imminent.
This week's orderly advance of nearly 3% has us very quickly in the shooting range of my expectation, and equities now stand about 8% above the SocGen market bottom.

I expect, as we move to the top of a trading range, renewed optimism (e.g., Jim "El Capitan" Cramer) to percolate a bit and for stocks to leave oversold levels as a larger percentage of investors and traders seem too often to worship at the altar of momentum. Some might even confidently predict a new bull market leg, an assertion I would oppose.

Having said that, this rally remains an excellent opportunity to cull the losing positions and raise cash levels after an abysmal several months.

The S&P 500 is now down by 6.8% year to date and my expectation of a 5% to 10% decline for 2008 remains intact. But, between here and year-end, it is still likely to be a roller-coaster ride, with many opportunities on both the long and short sides. Having above-average cash positions is a necessary reagent to capitalizing on continued volatility.

Overnight, there was more news on what I believe to be the next shoe to drop -- the auction rate preferred market:

• There were more credit writedowns and share price losses at UBS UBS;
• the largest rebound in Japan's market in six years (I highlighted the attraction of Japan in my surprise list for 2008);
• Ingram Micro IM guided down;
• growing evidence that the Fed is "pushing on a string"; and
• Credit Suisse suggests that the FHA help resolve the U.S. housing problem, something I previously recommended.

From my perch, the safest anti-implosion investment and best risk/reward trade remains being short bonds. I am playing this trade via the iShares Lehman 20+ Year Treasury Bond Fund TLT. Tactically, I plan to expand my short book into further strength.

Doug Kass is the author of The Edge, a blog on RealMoney Silver that features real-time shorting opportunities on the market.

http://tinyurl.com/39t3no

FranSix, Maromatics, and others thank you for the great posts today. It's been a real education. I was wondering if anyone knows of an inverse ETF to the long bond, or the best substitute for that. I would like to do the ToG, but I can only buy long in my IRA account--no shorting allowed. I assume others are in the same position.

By the way, I was reading Peter Shiff at the local Border's today and note that he does not like pink sheets. He says that you always get lousy executions. I can vouch for that. However, in my IRA account I can only buy Canadian stocks that way unless they are listed on American exchanges, such as SLW or WGW.

Perhaps I should move my IRA to another firm such as Fidelity, but I'm afraid I would have to unwind all my current positions first, and the amount of time the transfer would take would result in many lost opportunities.

aucourant- both RYJUX and RRPIX are positions you are permitted to own in an IRA...

Zenob

Yes there are some problems with charts and links directly between Bill's site and Stockcharts. I think most of the problem is due to hot linking from a blog thru TypeKey to Stockcharts with or without the TinyURL redirect. I get the "visit Stockcharts to view this chart" error with both your TinyURL links and the direct links. Funny thing is I can get to your charts with Firefox by just resending the URL a second time, not refreshing but resending it as a direct request from me not a redirect from Billcara.com. However in IE, "Mr Softies" stuff no matter what I do I get the same error code.

Now your second posting probably looked like it worked for you but usually you're logged into Stockcharts so have chart access or your browser is just picking them up from your cache. I've tried to look into this problem a couple of times without finding a clean direct solution and as Bill is currently moving to a new site software settup I've given up trying to solve it. So I continue to use the third party file storage like ImageShack. It takes and extra step but works fine for static charts. If you need to post live updating charts you could try saving them in your Public folder list.

Now my comments would be;..

I usually look at more than three months on the daily to get an idea of trend, support / resistance etc, six month min. I agree FXI is in a downtrend channel at the present time but could have a little bounce high back to the upper side of the channel, but doesn't look like much strength here at all. FXP agree also looking very sloppy and weak, maybe a bounce at current support but sure doesn't look like it will be in the cards, I would guess more likely to see it fall to 70 before finding support.

Anyway I put a copy of your charts over on ImageShack with a link to them below.

FXI chart
http://tinyurl.com/2s32yn

FXP Chart
http://tinyurl.com/2shlg7

Quasi,

Thanks for the technical info and the chart comments. I'll expand my chart range and go over my favorite list again. As for the linking issue, it seems to be a "referrer" issue. It looks like stock charts is checking the referrer tag and blocking the charts based on it. You can see it doing this if you click the link in the comments it gives you an error, but if you copy the direct link and then open a new tab in your browser and paste in the link it will work being as how there is no referrer in a new tab. If I had to guess I would say they did this to prevent people from sucking up too much bandwidth(which begs the question of why they include that feature if they don't want people using it).

Actually, instead of guessing I just tested it. In firefox you can disable the referrer tag(not a bad idea for privacy purposes anyways) and after doing this the links work fine. To do this in firefox type about:config in the address line and hit enter. Then scroll down till you see your network.http.sendreferrer settings. Change the first one to 0 and the second one to false and then the links work fine. Of course, this solution is dependent on the end user modifying their browser settings so it's not exactly ideal but at least now we know why it's doing it.

A NONPARTISAN JOKE THAT CAN BE ENJOYED BY EVERYONE!!!

While walking down the street one day a
U.S.senator is tragically hit by a truck and dies.

His soul arrives in heaven and is met by St. Peter
at the Golden Gate.

'Welcome to heaven,' says St. Peter. 'Before you
settle in, it seems there is a problem. We seldom
see a high official around these parts, you see,
so we're not sure what to do with you.'

'No problem, just let me in,'says the man.

'Well, I'd like to, but I have orders from higher
up. What we'll do is have you spend one day in
hell and one in heaven. Then you can choose where
to spend eternity.'

'Really, I've made up my mind. I want to be in
heaven,' says the senator.

'I'm sorry, but we have our rules.'

With that, St. Peter escorts him to the elevator
and he goes down, down, down to hell. The doors
open and he finds himself in the middle of a green
golf course. In the distance is a clubhouse and
standing in front of it are all his friends and
other politicians who had worked with him.

Everyone is very happy and in evening dress. They
run to greet him, shake his hand, and reminisce
about the good times they had while getting rich
at the expense of the people. They play a friendly
game of golf and then dine on lobster, caviar and
champagne.

Also present is the devil, who really is a very
friendly guy who has a good time dancing and
telling jokes. They are having such a good time
that before he realizes it, it is time to go.

Everyone gives him a hearty farewell and waves
while the elevator rises...

The elevator goes up, up, up and the door reopens
on heaven where St. Peter is waiting for him.

'Now it's time to visit heaven.'

So, 24 hours pass with the senator joining a group
of contented souls moving from cloud to cloud,
playing the harp and singing. They have a good
time and, before he realizes it, the 24 hours have
gone by and St. Peter returns.

'Well then, you've spent a day in hell and another
in heaven. Now choose your eternity.'

The senator reflects for a minute, then he
answers: 'Well, I would never have said it before,
I mean heaven has been delightful, but I think I
would be better off in hell.'

So St. Peter escorts him to the elevator and he
goes down, down, down to hell.

Now the doors of the elevator open and he's in the
middle of a barren land covered with waste and garbage.

He sees all his friends, dressed in rags, picking
up the trash and putting it in black bags as more
trash falls from above.

The devil comes over to him and puts his arm
around his shoulder.

'I don't understand,' stammers the senator.
'Yesterday I was here and there was a golf course
and clubhouse, and we ate lobster and caviar,
drank champagne, danced and had a great time. Now
there's just a wasteland full of garbage and my
friends look miserable. What happened?'

The devil looks at him, smiles and says,

'Yesterday we were campaigning...... Today you voted.'

It seems that more and more information about what actually happened with the mortgage and CDO mess is getting out. People are starting to spread the news and education about how the scheme was setup.

If you'll excuse the course language here is one example:
http://tinyurl.com/3yo77h

Wow!!! Get this. A hacker broken into a companies network, stole the earnings report just hours before it was released. Invested in put options because the report was below analysts estimates. Went to court. And he gets to keep his profits.

http://www.nytimes.com/2008/02/15/business/15norris.html?_r=1&oref=slogin

Good morning from a sunny Cape Town

Financial markets ended the past week on a subdued note as economic data, credit concerns and recession talk dominated investors’ mood.

Read all about this in my regular weekly blog post, highlighting some thought-provoking news items and quotes from market commentators during the past week, and briefly reviewing the week’s market action on the basis of economic statistics and a performance chart.

Here is the link to the "Words from the Wise": http://tinyurl.com/2t2avh

Enjoy the read (and your long weekend).

Looks like the British government is going to take over Northern Rock over the subprime lies.
I can only assume the French Gov will come to the aid of SocGen since I find it hard to believe subprime isn't the culprit with their finance troubles. Rogue trader is nothing but smoke and mirrors, and unfortunately people may be blinded in this case. And then you have Fannie Mae, Freddie Mac, and Country Wide. How can Bank of America bail out Country Wide and still have billions of dollars in write downs themselves?

NEW YORK TIMES

Government to Control Struggling British Bank

By JULIA WERDIGIER
Published: February 18, 2008
LONDON — The British government announced on Sunday that it would bring Northern Rock, the struggling mortgage lender, under its control. It was the first nationalization of a bank in more than a decade and a huge blow for the administration of Prime Minister Gordon Brown.
The government rejected two takeover proposals for the lender, which ran into trouble last year because of a money shortage that followed a subprime mortgage crisis in the United States. The government was forced to shore up the company with about £55 billion, or $107 billion, in loans and guarantees.
“The government has completed its review of the two detailed proposals received,” Alistair M. Darling, chancellor of the Exchequer, said at a news conference in London on Sunday. “But in current market conditions, we do not believe that they deliver sufficient value for money for the taxpayer. The government has therefore decided to bring forward legislation to take Northern Rock into a period of temporary public ownership.”
The Virgin Group under Richard Branson and the current management of Northern Rock had both submitted takeover proposals to the government’s adviser, Goldman Sachs, before a deadline earlier this year. Both suggested repaying the loans partly by issuing new shares. Mr. Darling said on Sunday that neither proposal had met all of the government’s objectives of securing financial stability, depositors’ money and taxpayers’ funds.
Under the government ownership plan, the taxpayers’ outstanding loans to Northern Rock will be repaid in full with interest, Mr. Darling said. The private sector alternatives did not meet this test, he said.
Northern Rock’s trouble began last September when the management revealed it had financing problems and thousands of depositors formed lines in front of its branches to retrieve their money. The government stepped in within days to guarantee deposits, but many lawmakers and analysts criticized the treasury for taking too long to act.
Mr. Darling defended the government’s intervention, saying that if it had “let this bank fail, there would be a chance that the problems would have spread into the wider British banking system.” But some shareholders have spoken out against nationalization, saying the government was unlikely to invest further in Northern Rock to pay for any expansion of the business, and may scale down its operations.
“I’m shocked and appalled; nationalization is not an option for this,” a Northern Rock shareholder, Robin Ashby, told the British Broadcasting Corporation. “This is a very bad day for Britain.”
Mr. Ashby said he could not rule out the possibility that some shareholders would take legal action against the government.
The ruling Labor Party had tried to avoid nationalization, which worsens a situation that is already embarrassing for Mr. Brown. Not only has he prided himself on his economic competence, but the move also recalled the 1970s, when such takeovers led to the decline of the economy and the end of Labor Party control.
Mr. Darling said on Sunday that Ron Sandler, a former chief executive of Lloyds of London, would take over as executive chairman of the bank. He said the bank should be returned to shareholder ownership as soon as possible. Mr. Sandler will travel to Northern Rock’s headquarters in Newcastle, in northeast England, on Monday to meet with staff members and unions.
Neither Mr. Sandler nor Mr. Darling commented on possible job cuts at the bank. Northern Rock is the largest employer and one of the biggest mortgage lenders in the region.
The chancellor plans to introduce legislation on Monday to bring the lender under government control. The bank will continue to operate normally, and deposits will continue to be secured.
Northern Rock shareholders are to receive some compensation for their investments, set by a government panel, but are likely to walk away with little as a result of nationalization, some analysts have said. Northern Rock shares lost 87 percent of their value over the last six months.
The government has been under pressure to resolve Northern Rock’s problems before a deadline later this year set by the European Union, which would have regarded the emergency loans as state aid. Mr. Brown and Mr. Darling have said that nationalization was their least preferred option.

I know many of you probably don't like Glenn Beck. But he is going to have David Walker on his CNN show tonight. I don't have cable or Satellite so I don't know what time it is on or which CNN channel.

If someone knows could they please post the info. I think it will be an enlightening interview about the future of our government. When an honest man like David Walker resigns it's time to worry.

We're going to a hotel tonight and flying out first thing in the morning so I plan on watching it if I can find it.

Rob.

Finger Lakes

Glenn Beck airs nightly on Headline News at 7, 9pm ET.

http://www.glennbeck.com/content/tv/

SHM is a SPDR etf for the Lehman Short-Term Municipal Bond (Index?). Actually, on first glance, the weekly chart looks fairly positive. The biggest clue that something is going on here is that the volume is huge for a doji (neutral) candlestick. Big distribution while the price was held up? If true, wonder how much of this activity is going on in other funds and Indices for Muni's?

Not a recommendation of any kind. Just some thoughts.

http://tinyurl.com/32nbz2

You can find television listings for any US area online at http://tvlistings.zap2it.com/tvlistings/ZCGrid.do

Just customize its settings for the viewing area.

Hang Seng closed down 1.6%

Subprime Primer

http://tinyurl.com/2kvosz

‘Dean of Oil Analysts’ Maxwell (Part 4 of 4): Oil Crisis Will Lead to 10-Year Financial & Political Crisis
Posted: February 7, 2008
A growing chorus of voices is screaming for the United States to undertake a Manhattan Project-type program to wean America off its oil dependency. But as Charles T. Maxwell, the “dean” of Wall Street’s energy analysts, looks into the future, he deeply fears that Washington won’t do anything to head off the oil crisis he sees rapidly developing starting in 2010. He says this will make the financial crisis he fears even worse. Also, because Washington will be seen by angry voters (who will be paying $12 to $15 for a gallon a gas) as the cause of their “Nightmare on Main Street,” Maxwell sees the American political system being shaken to its roots.
Princeton and Oxford-educated Maxwell believes that if the Democrats are in power, their core constituencies – farmers, workers and intellectuals – will be ranged against one another, resulting in an impasse. If the Republicans are in power, he expects whatever “solution” they come up with to be politically untenable because it will be premised on people with money continuing to consume as before, with the have-nots expected to do without.
Seeing no chance of a timely political response to America’s looming oil calamity, Maxwell, senior energy analyst at Weeden & Co., expects an oil-induced financial crisis to start somewhere in the 2010 to 2015 timeframe. He said that, unlike the recession the U.S. appears to be in today, “This will not be six months of hell and then we come out of it.” Rather, Maxwell expects this financial crisis to last at least 10 or 12 years, as the world goes through a prolonged period of price-induced rationing (eg, oil up to $300 a barrel and U.S. pump prices up to $15 a gallon), while waiting for new technologies that can wean nations off their oil dependency to take hold in the marketplace. (It will take time to change over the world’s one billion or so oil-consuming cars and trucks.)
As this combined oil and financial crisis worsens, Maxwell would not be surprised if the U.S. government started functioning the way it did in World War II, when the democratic dialogue was often put on hold so that unilateral decisions could be made by people given special powers. He described them as little tyrants who will be able to cut off debate, effectively weakening the democratic process. Not a pleasant prospect, Maxwell emphasized, but one that may be unavoidable in the oil-scarce world that’s coming

Looks like the people that went long FXP friday will be having a good day tomorrow.

craig- marooned by yet another US holiday...would we be selling CSCO/SNDK/INTC into NASD100 33+ futures? no doubt...

Maxwell parts 1-3 can be found here:

http://energytechstocks.com/

zenob/(vinod)- my play on FXP is simply based on trying to time the wild swings...trying to discern opening direction in the US based on what happens in Shanghai or HK has not worked well->i've done better placing bets on Banker/Player/Tie in baccarat (where betting against the crowd- naturally you need a crowded table- works 70% of the time)...although over a period of time (looking at 6 month charts), it seems to have achieved its stated goal of returning 2x the inverse of the FXI...

ALOHA !!

Telestar3d ... Maxwell says $15 gas and who will be buying this gas and what will wages be? How can $15 gas exist during a deep recession? Hummmmm???

If you would study money you would know why. It isn't the greedy oil companies fault either ... Even though Maxwell calls it "oil induced" it isn't. Oil prices are just a symptom of the greater evil ... money supply expansion. Who controls money supply? Here's a clue ... its not Exxon!

Damn, if only one of these HB&B sponsored "anal-ists" would put the blame where it really lies! Is their job really that important? There's so many ethical midgets out there!

Posting Hang down a 1+% is more important than FTSE up 2.75% rise led by financials? oops forgot where I am;)

Kaimu, Maxwell is looking at a time frame beyond 2010 and admits that the recession will slows things down a bit. This guy was an adviser to the Arab oil shieks in, I think, the 1970's.

He says: "Maxwell said it will take $12 to $15 a gallon to get Americans to let go of what he called the “precious freedom of mobility.” As much as Maxwell laments the loss, he sees no other way for the U.S. to impose enough conservation to deal with the growing imbalance between oil demand and supply that he sees developing around 2010 and getting worse in 2012 or 2013, as the world hits a “peak” in conventional oil production.
Because he expects Americans to hang on for dear life to their freedom of mobility, Maxwell says there will have to be a “stomping exercise” to “get them to let go.” Basically, Maxwell said, Americans’ freedom of mobility will have to be stomped on by allowing the supply-constrained price of oil to steadily rise starting in 2010, reaching $180 a barrel in 2015 and $300 a barrel in 2020."

However, it is just one person's view. Take as you will.

Kaimu welcome home, I hope the rains were not too hard on your farm and your orchids. Lovely flowers that they are.

speaking of analysts, exactly what role do their reports play in the capital markets? i think most of them are quite conscientious, but price targets and buy/sell ratings (ie, timing of entries/exits) are all over the place...why not concede that price and timing predictions are wild guesses and leave them out?

a great deal of useful information can be gleaned from most reports, but i suspect most people skip over them and head straight for the bottom line->which is, of course, entirely useless...

which leads to the conclusion that analysts include price targets and ratings for the simple reason that public recognition (let's face it, most people are not the 'toil in the background while someone else packages my research for public consumption' type) requires that they include them...

MichaelD- LOL->that's right, man...you're flashing the wrong signal in this 'hood...

Isaiah and Jojojo,

Thanks for the info. I'll be tuned into the 9PM show I would think.

Something tells me that when I get back in three weeks alot of crazy things will have happened in the financial world.

I will be able to check in periodically during that time when we're staying with my in-laws.

But I'm 100% in cash so the only way they can hurt me is if the dollar drops below 76 on the world scale, which is highly likely to set up the TOTG. I'll be in touch as much as possible between beaches and campsites.

Take care everyone and I hope you all make some serious money while I'm away.

Rob.

Bloomberg now reports threats of many years of endless litigation if the insurers are allowed to break apart and toss out the bad loans, rightly so in my opinion. Business cannot be allowed to walk away from their obligations like that.

And who is the next bond issuer who will its rates to up to 20%? (New Yersey Port Authority was part of the failed bond auction last week and now has to pay 20% rates instead of 4.3%). That has to make a little dent on their finances.

"Rates on $100 million of bonds sold by the Port Authority of New York and New Jersey, with bidding run by Goldman, soared to 20 percent yesterday from 4.3 percent a week ago, according to data compiled by Bloomberg. Presbyterian Healthcare in Albuquerque and New York state's Metropolitan Transportation Authority also experienced failures, officials said. "

20%? i'd be in for 20% on municipal bonds...

rob- enjoy your vacation...100% cash sounds great->it would be the only way i could enjoy 3 weeks off with limited market access...

MichaelD, my Hang Seng comment was only intended for those interested in FXP, given the recent buzz here regarding that fund.

I fully expect SKF holders to be severely disappointed tomorrow morning, and the QQQ euphoria will spill over into a bad morning for FXP as well.

Hey everyone, in the past day or two I've made some tweaks to the website to improve bandwidth usage. It is possible it could affect some RSS/Atom feed readers and also viewing graphs in the WIR/Daily Reports. If anyone has a problem, send me an email at jeff [at] billcara.com and I'll look into it.

There shouldn't be any problems, but I'm especially wary of assuming that all RSS/Atom feed readers know how to use the Internet properly.

** FTSE up 2.8% on Monday, led by banks.

** US index futures are up.

** I am using stockchart of 1998 as one of my guides.

** Foreign country ADR/ETF's are doing good for me so far.

I know 2nd. Big time!. Here's some more while I'm at it;).

Action in europe's banks in tune with late charge Friday by banks here. FTSE now looking to try resistance at 6000 this week

GS double bottom?

Fut's now just off last weeks highs in NDX SPX it looks like.

S&P 500 MAR08 1367.80 +1650
E-MINI MAR08 1368.00 +1675
E-MINI JUN08 1369.75 B +1600
NSDQ100 MAR08 1820.00 A +3350
E-NASDAQ MAR08 1819.75 +3325
RUSSELL MAR08 712.10 +1080
E-RUSSEL MAR08 711.90 +1060

century- would be careful construing the nationalization of northern rock as good news (i don't think it is)...consider selling into continued optimism in european shares...

ALOHA !!

Telestar3d ... 2010 is only two years away! I believe Americans will feel the pinch sooner than that because it will not only be the cost at the gas pump but all other commodities combined. You have to eat whether you can pay your mortgage or not. I just got back from a place where a salad is $19USD! One bottle of Coke was $3.00USD! A gallon of gas was $5.80USD! A vacant lot in my old neighborhood that I used to mow in 1975 is selling for $2.2milUSD! Yet the government is predicting 300,000 homeowners will default in 2008! That's in a country of 23 million!! But there is "free" medical ... I love how people actually think it is "free"!! Almost every A