There are no shortage of developments and perspectives on this rapidly evolving Washington story, but it behooves traders to continue to focus on what is crucially important to them, which are market price direction and personal portfolio management strategies and tactics.

Try, if you can, to put your other concerns on the side burner for now. Admittedly, if Dutch bank Fortis goes under, that may be difficult to do.

In fact, just reading this week’s WIR may be a challenge. With all my ISP and computer problems this weekend, I am afraid my report will be rather incoherent. Call it a work-in-frustration.

Setting aside the credit market blow-up for the moment, there is a serious piece of business being played out in the market today that does affect Mom & Pop’s wealth, which must be addressed. As you know, I have constantly harangued the so-called ‘professional managers’ of Other People’s Money, where Mom & Pop have zero control, such as in their pension plans for instance, where their life savings are being destroyed by the ‘system’. The situation has gotten worse.

Because of the nature of the explicit trust relationship involved with managing pensions, the pension fund managers are obligated to practice the Prudent Man Rule. It is a bloody shame, then, that the SEC has looked the other way as literally trillions of dollars have been stolen from people who are being treated as chattels of the system.

Any child who can read would know that Bear Stearns, Lehman, Fannie, Freddie, IndyMac and WaMu were collapsing this year under the burden of holding dubious quality investments. But even on the day these companies finally declared insolvency or bankruptcy, which wiped out all or most of their investment value, there were pension plans of Mom & Pop just stuffed to the gills with these worthless stocks and bonds.

That isn’t fair; in fact I think it is criminal. I am not talking financial abuse through mere incompetence; I mean flat-out theft. Pension managers, who ought to know better, maintained client positions in the above noted companies right to the end. These so-called professionals would not have dared to invest their own family’s capital that way. They did so for blatant conflict of interest reasons, to protect their precious financial system.

For their lack of oversight in the pension area, the SEC also ought to be censured. Just like the Fund managers, the SEC was also caught up in conflict of interest issues, which is completely unacceptable for a regulator.

Federal and state prosecutors must investigate these pension managers and lay charges as soon as possible. When the public sees what’s gone on here, they’re going to be mad as hell, and not ready to make nice.

Forgive, sounds good
Forget, I'm not sure I could
They say time heals everything
But I'm still waiting

I'm through with doubt
There's nothing left for me to figure out
I've paid a price
And I'll keep paying

I'm not ready to make nice
I'm not ready to back down
I'm still mad as hell and
I don't have time to go round and round and round
It's too late to make it right
I probably wouldn't if I could
'Cause I'm mad as hell
Can't bring myself to do what it is you think I should

The Dixie Chicks sang that little ditty after their run-in with George Bush. I can hear the chorus now.

For the past two years, I have discussed Paulson’s Folly, essentially blaming his actions -- starting on Wall Street early this decade and in the White House since July 2006 – for the credit bubble and subsequent deleveraging dilemma that is hurting us all today.

While I detest the Plan he brought to Congress, I now believe that a new Deal will likely put the man under tight control. Apparently, he knelt to kiss the ring of Speaker Pelosi in a meeting this weekend.

Now I am going to switch horses and say that, if he can be trusted to do the right thing (yes, I’m nervous!), I think he’s probably the best person to do a work-out on behalf of the people. This man is anything but incompetent; he is also a leader. But, in saying this, I have already noted the tight control pre-condition, and have already opined that there should be an independent Resolution Trust Company 2 put in place under William Seidman to resolve these issues. Putting liars and criminals in charge of fixing the mess they created is not my idea of a solution, but at this point action must be taken or the credit ring between banks will have been broken, and many banks will fail within days.

That’s the reason the regulators have been working day and night in seeking to adopt a Plan they think might possibly get them re-elected in November.

Years after his departure from the White House, historians will have written books on this mess, and Paulson’s role in it. I’ll leave it at that.

Today, I will address why I think the 2007-2008 Bear has ended and why prices will now start to work through a series of higher highs and higher lows, which is the definition of a Bull market. I know that most people will disagree with my perspective, not because of analysis, but due to their manifest anger at politicians, government and regulators who allowed the situation to become such a crisis and to apparently decide to have the very perpetrators fix the problem and, worse, financially benefit for their misdeeds.

People ought to be upset. But they also need to maintain a level head and go about their business. The rest is out of their control.

Many of you watched the first US Presidential Debate of the Party candidates. Depending on your personal bias, you happened to see it much the way you expected. Republican-biased Fox Network viewers responded to a poll of who won the debate, 82% voting in favor of the Republican candidate John McCain. I don’t think the national audience saw it that way.

Personally, I am not going to get into this other than to make a couple observations.

This debate was properly initiated by the moderator, pointing the candidates to the urgent financial crisis facing the nation. However, for these two key people one of whom will soon be the elected leader of the most economically powerful nation in the world and who have said they are intimately involved in negotiations of “the Deal”, they seemed to know little to nothing. They had sufficient time to prepare, and knew the question would the first one asked. Both men stumbled and came out flat. Disappointing to say the least.

I was also immediately struck by Sen. McCain’s refusal to look in the eye the person he was debating in front of maybe 100 million people. It was bizarre to me that he looked away from his opponent, which was shockingly impersonal. I think Sen. Obama picked up on that right off and started to call his opponent by his first name, John. I thought that was clever.

I also thought it was an error on the part of Sen. McCain to have Rudy Giuliani and not his running mate, Gov. Palin, speak on his behalf in the wrap-up, as did Sen. Obama with Sen. Biden. Attracting voters is such a confidence game, and I think McCain stumbled on this as well.

The polls of independent voters, which is the demographic that will decide the outcome of this election, went apparently 39% for Obama, 24% for McCain and the rest undecided. As I say, many of you disagree because of your bias.

There will be a lot of water under the bridge in the next five weeks, so I think we need to take it all in, including the decision in Washington, before speaking out. I will try to stay out of the noise-making as best I can.

What most of you want to know from me is why I switched from Bear to Bull. Just like those Fox Network viewers are always going to overwhelmingly support McCain, I will not convince a goodly number of you, and I won’t try. I’m not selling anything, and I’m not running for office. What I will do is show you how I think about these important matters, with one proviso: I may know how to trade very well, but nobody’s perfect. I may be wrong. Clearly, if there is no Plan set in place today, in Washington, Brussels, London and Tokyo, the carnage in the market this week will be ugly.

First off, I am a strong believer in the Relative Strength Index technical indicator, particularly in certain types of market environments. If prices move in what we call fast markets, like mid-October 1987 as an extreme example, I switch to the more sensitive (but similarly constructed) Stochastic technical indicator. As today’s markets have been grinding through the Bear for about 14 months, this is not a fast market setting, so I tend to rely mostly on RSI.

As you know, my experience has taught me to use all technical indicators with a combination of Monthly-Weekly-Daily price series data, relying on the longer data series for telling me how long-term cycles are evolving. This momentum analysis is telling me that the long-term cycle is bottoming.

Without my usual systems at hand, I’ll have to forego the charts that show this.

Next I look at history because, as I often say, the market is us.

Yes, increasingly trading decisions are being decided by computer-based algorithms, but except for the fact that these programs have been lowering volatility in average market conditions (ie, where, over time, the VIX measurement continues to fall), the algorithms have still been developed by us, and approved, implemented and tweaked by us. Because of the nature and crucial importance of wealth management, people are still involved; the system is not yet on auto-pilot.

History, then, tells us that there is such a thing as a stock cycle, which happens to be a period of about 4 to 5 years on average where prices start very low, then build, reach a peak, then sell back down to a low. Boiled to its essence, this cycle is natural law, something that is well described in The Book of Ecclesiastes, Chapter 3, which starts, “There is a time…To every season there is a time for every purpose under the heaven; A time to be born and a time to die; a time to plant and a time to pluck up that which is planted; A time to kill and a time to heal; and a time to break down and a time to build up…”

Just like people don’t run with clocklike precision, there is no fixed time to the stock cycle; but if you look at a very long history chart of the DJIA index for instance, you will see the stock complete bull-bear cycle repeats every 4 to 5 years on average going back more than a hundred years. The bottom of the last Bear was 4Q02 and this one is bottoming in 3Q08. I believe that the Bear was about to start in 3Q06 when Paulson was hired to puff it back up. His actions extended the bullish phase of this cycle an extra year, probably in hopes the Financials could use the time to work through the real-estate market collapse from its peak in 3Q05. Then there were related credit market issues I am sure the bankers and broker-dealers knew existed in 2H06 and 1H07, before the public started seeing the credit market fall-out in July 2007.

Regardless of time extension to a particular cycle, there will be a limit because there always has been. Always. What often happens, however, is that when a new Bull starts before the economic backdrop is ready, or a Bear starts without fundamental causes, there is subsequently what is called a magnitude failure.

Following the 1973-74 Bear, the 1974-77 Bull suffered such a fate, and the one after that from 1978-81 did the same. Then the inflation of the 1970’s was brought under control and the Bull that started in the summer of 1982 reverted to its typical, if not extended, magnitude, resulting in a severe, but short, Bear in October, 1987. This history explains my thinking as to why this next Bull will be muted and also range bound between DJIA=10500 and, say, 15000 or less.

With the goings-on in Washington, and the election campaigning coming to an end in five weeks, and the near total anger by voters, I believe there has been a major change in thinking by all politicians who will seek election on November 2, which happens to be the majority of them in the legislature and the White House. Voters are issuing marching orders this weekend; clean up this mess or else it’s the end of your political career is what they are saying. I think there will be significant legislative changes made in the next Congress as a result.

I suspect the people, while fearful and skeptical, are starting to come around to this notion. Bear markets end when there is a purging of emotion, replaced by a new attitude. Traders of big money sense this and start to change their strategies, which I think is happening presently.

This week, for example, the winners were DJIA big hitters: Microsoft, JPMorgan, Wal-Mart, Exxon, and Merck, while the biggest losers were among the smallest capitalized companies in the DJIA index: General Motors, DuPont, Alcoa and United Technologies.

Concurrently, financial sophisticates like Warren Buffett (Berkshire Hathaway), Jamie Dimon (JP Morgan), John Mack (Morgan Stanley), and the others in their league, have started to call in their chips. The out-going President, Treasury Secretary, Fed Chairman and SEC Chairman are under huge pressure to give these players a break now because it may be a long time before Congress again yields such immense power as held until now by Wall Street’s titans.

What these people are trying to accomplish, I believe, is the construction of a few mammoth banks – maybe five of them – and they will become the new power brokers for America.

I call them banks, but I have always seen their plan, which is why I refer to them as Humungous Bank & Broker, only now it should be Humungous Lending Bank-Agency Broker-Product Creator, Syndicator and Dealer-Insurer-Wealth Manager-Government, Corporate and Personal Advisor-Hedge Fund Manager-Venture Capitalist-etc.

At the end of the day, these banks will own the Fed, and the bad joke of it all is that they will continue to be self-regulated by the Fed. These are the chips being played, I think.

If it were up to me, the Fed would be regulated by a restructured, independent SEC.

As much as I see the inevitability of this evolution to mega-HB&B, and how bad it will be for Mom & Pop, and independent traders like me and most of you, it would take a super-leader to be elected President of the US and a very strong Congress to derail the Wall Street train. However, I believe both Presidential candidates and most of the others have already been bought-and-paid-for by HB&B, so I’m not going to fight it other than to continue to speak out and later have people recognize the truth. To fight the system is a job for the American people and their politicians.

Some of you will argue that such powerful banks are what America needs to fight its enemies, real and imaginary. I say it’s the worst thing; size and scope to this level doesn’t solve anything. It puts too much power into too few hands. Absolute power corrupts absolutely, as we all know. What we need in its place is exactly the opposite; laws that support the sovereignty of the people and free markets, so that individuals can truly make their own decisions in life.

For now, most of the people, including traders, will mistakenly take heart that a newly fortified Fed and HB&B network will protect us, will stabilize the $USD, and so forth, and that’s enough to float a new Bull market. They will believe that even when they won’t understand the Plan.

I acknowledge that this Plan may be a good one to solve the immediate credit market crisis, but my bigger fear is that politicians are being pushed by HB&B to take steps that will solidify the power of the Fed and HB&B well into the future.

This weekend Treasury Secretary Paulson, the ex-CEO at Goldman Sachs, brought into the White House a former high level banker to help him do that. Of course, the man came from Goldman Sachs. All I wanted, to set us on a path for social equity, was to have an independent Resolution Trust Company 2 under somebody like 87-year old William Seidman. But, no, Congress and the Administration have added to the Goldman Sachs team.

That situation being what it is, all I can do is to re-focus on market prices.

As you know, every new Bull needs firepower. Usually that comes in the form of credit from HB&B, but it may also come from cash that has been saved by prudent corporations and individual traders. Through the Bear, these people have been awaiting the day when, for example, they can spend $5 billion to take a piece of a Cara 100 company like Goldman Sachs. Did you get your piece? Yes? Did you get Warren’s price?

You have probably noted over the years that Warren Buffett likes to buy value, and so do I. If you have the cash, there are values out there.

As for getting a loan from HB&B, presently that is an issue; the banks are financially strapped. A package of some $700 billion plus the $400 billion guarantee of Money Market Funds as well as the several hundred billion already put out for Fannie, Freddie, Bear Stearns, Lehman, IndyMac, WaMu, AIG and others, is going to be a $2 trillion rescue. I gather that’s about 200 times the cost of monthly expenditures of the military program in Iraq, which most people find mind-boggling. So that’s 200 times mind-boggling.

I have always said, never fight the Treasury and Fed when they start reflating via printing presses. In other words, $2 trillion is an expensive Bull market. Mind you, a new Bull will lead to more paper wealth and more taxes, and might even lead to a recovery of much of that $2 trillion, so it’s going to happen. As I say, if it costs even more, say 3 or 4 trillion dollars, it will happen. Don’t fight it.

When paper money is issued by government, its value depreciates. Real property prices will hold here and start to increase again; oil and precious metal prices will increase as these commodities and storehouses of value are limited in amount, while paper is in endless supply. So what we need to do is look at the attractiveness of shares of companies that produce, administer, sell, and/or deliver these commodities, which will continue to be in demand.

Now some of you fear deep recession and even economic depression, but the Washington Plan will halt the slide in foreclosures and lay-offs, and the economic slowdown is already knocking inflation down. Of course people are consuming less, bank credit may take some time to revert to normal, and oil prices are likely not going to sink much further (maybe 85 is the lowest we’ll see, which is still very high), so Consumer Discretionary stocks are not going to enjoy their usual popularity among traders. And HB&B will continue to lie to one another about the quality of their assets in hopes of getting a better deal from the Washington Recue team, and the other banks who come round seeking cheap assets. Without a true market being made for these syndicated loan assets being held by financial intermediaries, traders will continue to distrust them, and bid low for their shares (longer term). P-E multiples will fall. Traders will favor those financial companies that have the balance sheet strength and cash flow to be able to pay higher dividends and actually buy back shares without handing over the keys to the bank.

So these are two sectors to avoid, and they are important ones. A roaring Bull market, of course, needs to be hitting on all ten sectors, not six, seven or eight. Yes, healthcare could be another misfiring sector. Who knows what a Democrat Administration will do to mess that up. Even Consumer staples will suffer. In fact, a lot of once discretionary items became staples in recent decades, like coffee shops (Starbucks) and natural foods (Whole Foods), for instance. Can you imagine a line-up at cash registers in Starbucks and Whole Foods during the Great Depression? People were too busy scrounging coal from railroad tracks!

The excesses of the past 25 or 30 years must be worked off, so I look at things like automakers and airlines to suffer. There are only going to be x number of cars and airplane seats needed, and the largest, most successful companies will grab market share. Detroit is likely to end up with only one auto manufacturer, for instance, albeit a big and healthy one. Same with fewer national and regional air carriers.

Local and regional banks will be hampered by new branch offices of Mega-Bank. Yes, the Wal-Mart Effect will see Bank of America, JP Morgan, Citi, etc, and their ATM’s coming to your neighborhood, putting many of the small financial services companies out of business. So I’d avoid the smaller banks.

People will always need Energy; so, even if the oil companies are forced to expand into alternatives, the best managed, financially strongest ones that control their resources will be in demand. At this point in the Bear, the big oil companies like Exxon (XOM) and others can be purchased for 6 to 7 times cash flow. The higher risk juniors of Western Canada are available for just 1.5 to 3 or 4 times cash flow. When compared to prices over the past 50 or more years, these are strong values, similar to what happens as Bear markets come to an end.

Without getting into specifics today – the ISP modem and/or my PC network card failed this weekend, so I’m way behind – I will look for some good values for you. Already I mentioned a couple. DELL was one.

The point I’d like to make is that I usually can tell a peak when I see the RSI-7 for the Monthly-Weekly-Daily at very high levels. That’s when, when I analyze a particular stock, I know I cannot legitimately seek annual +26% Total Returns (dividend and capital growth). At the peak, that happens a lot. Now I’m seeing the reverse. So, I know we are close to the bottom. Since I also know nobody can pick absolute tops or bottoms without luck, I choose to apply my experience and skill to acquire values, which I know will be at cycle lows. I never chase stocks on break-outs unless the Bull is just starting. Most of the time, that’s a mug’s game, ending in losses unless you are the person running the promotion and are doing an illegal pump and dump.

Yes, I stick to value within the shares of quality companies only, based on my analysis of high Return on Equity, high operating margins, high revenue momentum, high dividend growth, strong balance sheets and management that has a good all-round track record. If I see also a reasonable Price Target that could return me at least +26% or more, with a high degree of confidence, knowing life is a risk, I’ll commit to adding bullish positions. If I see many of them following a Bear market, I’ll start thinking of the next Bull. That’s where I am in my thinking today.

The favored list would be the shares of the highest quality companies in the following sector ETF’s: XLE (senior and junior producers, plus drillers and oil services), XLB (chemicals, papers, miners, and precious metals (senior and junior if the latter is well funded), XLI (industrials, conglomerates and transports), and XLK (hardware, software, networks, internet… how about ORCL and RIMM?). I also like the gas and nuclear utilities in XLU. In the Staples, there are some solid dividend payers trading at low prices that I like). I don’t really want to give many specific recommendations because this blog is not a tout sheet.

If you noticed that the sector ETFs identified above were mostly comprised of US-based companies; that was deliberate on my part. I think the US market is the most stable, and most ready for a new Bull. The BRIC markets may have the most magnitude to the upside at the start, but the risks are also greater, and I don’t think the Bull there will be as strong as most traders think.

The monetary authorities of England, Europe, and Asia are going to have to go through their own work-out issues, including credit market, inflation and high interest rate problems. This weekend, for example, big Dutch bank Fortis appears in trouble, if the collapsing share price on Friday is used as a tell, as it was with all the US banks that failed. So, America is not alone in this mess.

In the past, much US capital was invested abroad. That led to much inflation in those countries, especially the rapidly growing ones, which was imported into the US, but it also led to exporting of jobs from the US. The Washington Plan will sooner or later address that because the marching orders being sent by the voters to Washington include the message, “Burden those capital exporters, and save our jobs and way of life.” I think the message gets through this time around. Besides, as rates increase in the US, which they will after this Plan locks down the present risk to credit markets, there will be less incentive by US capital managers to seek higher interest returns offshore. In the more stable markets of Japan, UK and Western Europe, I don’t see any great need for Americans to go searching for higher quality companies in those markets. There are some, but for the population size, not nearly as many.

As much as Americans have been scared and angered by the present crisis, I think the majority of people are far too pessimistic. It was the shareholders of the big banks, broker-dealers, insurance companies and telcos that are hurting the most today, and into the future until the Plan starts paying off. Hopefully most of you avoided that train wreck and have a clear head for thinking ahead. Most of the other sectors and industries in the market are where your future action should be.

Moreover, while we may disregard Financial sector ratings from HB&B, I believe there will be (self-preserving) rating increases in the other sectors, plus encouragement from the Financial services industry for capital managers and Mom & Pop to jump back into the market.

Another observation is that throughout the latter stages of the Bear the daily trading volumes were light. Some of that has to do with tight emotions, but there is now a pent-up demand by those who have been building cash, including the Funds that continue to take in monthly deposits as the economy cranks along. This cash must be put to work. As it is, the risk-free instruments are earning less than the inflation rate. I believe most Bull markets show a booming daily volume as prices surge to the upside and this market will be the same.

I can just envision the screaming to come on the CNBC Squawk Box show, and from Kudlow and Cramer, and the rest of them as money flows back into the market. These media personalities have a lot at stake in the GE stock price, so that will be a stock I think will be given a strong boost.

It took less than two months for Crude Oil to plunge from $145 to under $100. That’s the Bear. Ian Notley used to say; turn that chart upside down – that’s the Bull. It will be amazing how quickly people will change their attitude when prices start higher, and the wealth effect kicks into gear. Two months for an oil market crash; think about that. These things don’t take long.

Don’t miss it.

Mind you, if you tried to read these rambling notes, you might sleep through it.

---

Global Economics Review

Weekly International Economic Report .

I encourage everybody to read these reports and discuss them in the Discourse, but check the publishing date if you are looking for the latest data. This one is current.

Here are the key US economic reports and the Econoday analysis from last week.

US Economic Calendar.

US Existing Home Sales for August. Econoday reported, “The descent of the housing sector may be slowing, at least in August before September's crunch hit. Existing home sales did fall 2.2 percent in August to a 4.910 million unit rate, but a rate still in line with this year's trend. Condo sales, at -8.2 percent, showed an unusually steep drop in the month with single-family sales down a less alarming but still sizable -1.4 percent. Differences in regions were narrow with the Northeast and West showing mid single digit percentage declines and the Midwest and South both showing fractional gains… The year-on-year rate, helped by ever easier comparisons, is less frightening, at -10.7 percent in August for the least severe dip since July last year. Existing home sales began their uninterrupted run of year-on-year decreases in December 2005 -- a numbing, nearly three-year stretch that has ended up gutting the financial markets… The year-on-year decline of 9.5 percent is the most severe yet for the median price, now at $203,100. The month-on-month drop, at 3.4 percent, is the steepest of the year. Prices are being pressed down by a tide of distressed properties, sales of which the report said make up 35 to 40 percent of total sales. Prices have been in nearly uninterrupted decline for two years, hit by swelling supply which is at 10.4 months. But supply, at 4.255 million units, has at least been edging back the last couple of months… This report is mixed at the very best, with slowing rates of decline in sales offset by rising rates of decline in sale prices, the latter factor one that is certain to add further pressure to the credit markets. Markets, focused on bail-out talks in Washington, showed no reaction to the report.”

US New Home Sales for August. Econoday reported: “The worst for the housing sector appears to be still ahead. New home sales plunged 11.5 percent in August to a 460,000 annual unit rate, a rate comparable to downturns in the early 90s and early 80s (times of a smaller housing base). Sales were especially weak in the West and Northeast. The year-on-year decline stands at 34.5 percent… Supply on the market did fall back in total units to 408,000 from July's 427,000, but the slower sales rate means homes are sitting on the market longer. Supply at the current sales rate rose from 10.3 months in July to 10.9 months -- one of the very highest readings in nearly 50 years of data… Prices fell a very steep 5.5 percent on the month to a median $221,900. The year-on-year decline of 6.2 percent has been steeper during the ongoing downturn but is still one of the very steepest on record… Yesterday's existing home sales report showed less steep sales declines but similar price declines. Falling prices reflect distressed sales and point ahead to yet greater distress in the credit and housing sectors. There was no reaction to the report as the financial markets await bailout developments in Washington where results of August's housing data are a certain topic.”

US Durable Goods Orders for August. Econoday reported: “Durable goods orders in August dropped sharply, pointing to possible contraction in manufacturing. Durable goods orders fell 4.5 percent in August, following a 0.8 percent boost in July. Excluding the transportation component, new orders declined 3.0 percent, following a 0.1 percent gain in July. Weakness was led by aircraft and motor vehicles…
Weakness in August was seen in transportation, down 8.9 percent; primary metals, down 9.3 percent; machinery, down 6.2 percent; fabricated metals, down 0.6 percent; and electrical equipment, down 2.2 percent… The only major category showing strength was computers & electronics, up 1.9 percent… Within transportation, motor vehicles dropped 8.1 percent, nondefense aircraft fell 38.1 percent, and defense aircraft, declined 12.5 percent… Year-on-year, new orders for durable goods improved slightly to down 4.7 percent in August from down 4.8 percent the prior month… Today's report shows widespread weakness in durables orders and does not bode well for manufacturing. Also showing weakness this morning was a jump in initial job claims. Both reports are negative news for equities and are favorable toward bonds. But the big news is reported progress in Congress on the Treasury's rescue plan and this may outweigh other news for equities.”

US GDP estimate that is final for 2Q08. Econoday stated: “Second quarter GDP surprisingly was revised down significantly. But the number will still look quite good compared to the likely figures in coming quarters. The Commerce Department's second revision to second quarter GDP was revised down to 2.8 percent from the prior estimate of 3.3 percent. The revised estimate for second quarter GDP fell short of the market forecast for an unrevised 3.3 percent increase. On the inflation front, the GDP price index was revised to an annualized 1.1 percent - compared to the previous estimate of 1.2 percent. The market forecasted no revision. Headline PCE inflation was revised to 4.3 percent - up slightly from the prior estimate of 4.2 percent. Core PCE inflation came in at 2.2 percent, compared to the earlier estimate of 2.1 percent for the second quarter.”

How is next week’s calendar looking?

US Economic Calendar.

US Personal Income and Outlays for August. After the July report, Econoday reported, “Personal income in July fell 0.7 percent, following a 0.1 percent rise in June. But weakness was related to a drop off in income tax rebates. Within personal income, the wages and salaries component posted a moderate 0.3 percent gain, following a 0.2 percent rise in June. Spending was moderated by a sharp dip in motor vehicle purchases. Personal consumption expenditures in July slowed to a 0.2 percent rise, after jumping 0.6 percent in June. Turning to inflation, the headline PCE price index remained quite hot with a 0.6 percent jump -- only slightly down from June's red hot 0.7 percent surge. The core PCE price index held steady but at a pace unacceptable to the Fed, rising 0.3 percent in both July and June. Looking ahead, the wages and salaries component may be sluggish but still positive as average hourly earnings were moderately strong in August even as the average workweek was flat and payroll jobs edged down. On inflation, a 0.1 percent decline in the headline CPI in August and a 0.2 percent rise in the core CPI suggest similar changes in the PCE price indexes.”

Chicago Business Survey for September. Econoday reported: “The NAPM-Chicago purchasing managers' index jumped to 57.9 from 50.8 in July. The gain reflected large jumps in new orders - to 60.2 from 53.5 -- and production - to 63.4 from 49.2. Input prices remained elevated but a little less severely at 80.6 for a 10.1 point drop from July… NAPM-Chicago Consensus Forecast for September is 53.0.”

US Conference Board Consumer confidence Index for sept. Prior to the report, Econoday advises: “The Conference Board's consumer confidence index popped solidly higher in August, reflecting declining gas prices but not improvement in current labor conditions. The Conference Board's index climbed to 56.9 in August from 51.9 in July and posted its largest one-month gain since July last year. Nonetheless, the level remains quite low… Consumer confidence Consensus Forecast for September is 55.0.”

US Construction Spending for August. Last month, Econoday stated: “Construction spending fell 0.6 percent in July, following a rise of 0.3 percent in June. The July decrease was led by private residential outlays which fell 2.3 percent. Private nonresidential outlays also declined -- by 0.7 percent -- while public expenditures rose 1.4 percent. Given recent weakness in starts, another slip in the residential component is likely in August. Also, weakening revenues for state and local governments could lead to soft government construction. Construction spending Consensus Forecast for August is -0.5 percent”

US ISM Manufacturing Index for Sept. Last month, Econoday stated: “The Institute for Supply Management's manufacturing index was little changed in August, coming in at 49.9 versus 50.0 in July. Growth in production slowed slightly but remained in positive territory with a reading of 52.1. However, employment dipped fractionally to 49.7 from 51.9 in July. New orders and backlogs remained below 50 for the latest month. Prices paid continues to show severe pressure but did ease more than 11 points from July's astronomical reading of 88.5. ISM manufacturing index Consensus Forecast for September is 49.5”

US Factory Orders for August. Last month, Econoday stated: “Factory orders rose 1.3 percent in July, following a 2.1 percent jump in June. New orders for durable goods were up 1.3 percent while new orders for nondurable goods rose 1.2 percent. More recently, in the advance report for durables in August, new durables orders dropped a sharp 4.5 percent, largely on declining aircraft orders. Lower oil prices likely will weaken the nondurables component for August… Factory orders Consensus Forecast for August is -2.5 percent.”

US Employment Report for Sept. Last month, Econoday stated: “Nonfarm payroll employment in August fell 84,000, following a decline of 60,000 in July and a decrease of 100,000 in June. The latest decrease was widespread. Manufacturing and construction jobs fell by 61,000 and 8,000, respectively. Service-providing jobs declined 27,000 after falling 12,000 in July. On the inflation front, average hourly earnings posted a 0.4 percent gain in August. Average weekly hours were unchanged at 33.7 hours in August. The civilian unemployment rate jumped to 6.1 percent from 5.7 percent in July. The August number was the highest since the 6.1 percent seen for September 2003. The September jobs report will carry huge significance as it is the last employment report before the November 4 presidential election… Nonfarm payrolls Consensus Forecast for September is -100,000”

US ISM Non-Manufacturing Survey for Sept. Last month, Econoday stated: “The composite index from the ISM non-manufacturing survey strengthened in August into positive territory, rising to 50.6 from 49.5 the prior month. Similarly, the business activity index, equivalent to a production index, rose more than 2 points to 50.6. Price pressures eased somewhat as the prices paid index declined to 72.9 from 80.8 in July… Composite index Consensus Forecast for September is 50.0.”

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US Equity Markets Review

DJIA ino.com chart

DJIA stockcharts.com chart

The DJIA dropped from 11388 to 11143. All the damage was done at the open on Monday. The rest of the week was actually up. From the degree of pessimism floating about, one would think the equity markets had crashed.

For the full week, however, there were only 7 Dow components that were up and 23 down. The trading was mostly done on very light volume as traders were looking to Washington for the so-called National Rescue Plan.

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NASDAQ Composite ino.com chart

NASDAQ Composite stockcharts.com chart

The NASDAQ Composite dropped from 1255 to 1213. There have been many worse weeks this year.

Here is the list of the ten highest-weighted non-financial stocks in the NASDAQ Composite. Put them in a watchlist (see Google Finance Portfolio) and watch them like a hawk. If you want, add a couple like SNDK and ADBE:
AAPL MSFT GOOG QCOM RIMM CSCO INTC ORCL GILD EBAY

Daily RSI-7 for the Nasdaq 100 Big-10

Weekly RSI-7 for the Nasdaq 100 Big-10

Monthly RSI-7 for the Nasdaq 100 Big-10

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Sector ETF Summary for the US equity market

This week, there was one flat sector (Consumer Staples) and 9 down.

Here’s the SPY Monthly, Weekly and Daily data charts:

SPY Monthly data:

SPY Weekly data:

SPY Daily data:

The tables I now show are for eleven GICS Sector Index Funds (ETF’s), including two for Technology (XLK and SMH), for a total of ten GICS sectors. They cover the full spectrum of the US equity market.

Table 1: Cara ETF List is sorted by price performance Week over Week (W/W), i.e. 1W%N.

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
XLP	27.70	-0.09	-0.32%	0.00%	-4.97%	-2.57%	-2.43%	3.55%	-0.75%	-0.32%
XLK	20.80	0.25	1.22%	-0.24%	-3.75%	-10.61%	-20.37%	-9.88%	-8.73%	-23.22%
IYH	63.70	0.16	0.25%	-1.10%	-3.03%	-5.16%	-9.13%	4.70%	0.66%	-10.24%
XLU	34.53	0.01	0.03%	-1.34%	-5.35%	-10.03%	-17.96%	-13.83%	-8.16%	-15.20%
SMH	25.85	0.45	1.77%	-2.45%	0.39%	-11.35%	-17.57%	-13.83%	-12.10%	-32.29%
SPY	120.85	0.06	0.05%	-2.63%	-4.16%	-7.17%	-16.61%	-5.76%	-9.27%	-20.59%
XLY	29.25	0.30	1.04%	-3.15%	-6.10%	-5.09%	-9.16%	1.88%	-7.05%	-20.58%
IYZ	21.24	-0.02	-0.09%	-4.07%	-7.81%	-11.79%	-27.19%	-11.17%	-9.15%	-37.69%
XLF	21.39	0.69	3.33%	-4.42%	0.94%	0.19%	-24.58%	2.64%	-16.31%	-37.20%
XLI	31.57	-0.13	-0.41%	-4.65%	-7.45%	-11.47%	-18.02%	-6.93%	-15.57%	-22.39%
XLE	67.70	-1.64	-2.37%	-4.98%	-1.66%	-9.89%	-14.84%	-21.73%	-8.67%	-9.16%
XLB	35.24	-0.67	-1.87%	-7.94%	-7.82%	-11.97%	-14.67%	-15.23%	-13.37%	-16.10%

You can do this table yourself by entering the following string into the Summary window at Billcara2.com and then clicking on the link for Performance. SPY XLE XLB XLI XLY XLP IYH XLF XLK SMH IYZ XLU . You can also add more ETF’s – up to 30 in total.

For a list of components to many ETFs, go to the AMEX.com web site, and click on ETF’s.

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10 (energy: XLE)

15 (basic materials: XLB)

20 (industrial: XLI)

25 (consumer discretionary: XLY)

30 (consumer staples: XLP)

35 (healthcare: IYH)

40 (financial: XLF)

45 (technology, semiconductor: SMH)

50 (telecom: IYZ)

55 (utilities: XLU)

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Individual Sector ETF Review

Sector 10 (energy: XLE, IYE, VDE, OIH, PBW and IXC)

Here’s the XLE Monthly, Weekly and Daily data charts:

XLE Monthly data:

XLE Weekly data:

XLE Daily data:

Table 2: Senior oil & gas equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
XOM	80.65	-0.02	-0.02%	1.31%	4.06%	-0.65%	-13.75%	-6.67%	-6.50%	-12.69%
PTR	111.49	-2.03	-1.79%	0.97%	-0.95%	-14.67%	-35.80%	-13.55%	-10.15%	-37.48%
IMO	44.90	-0.24	-0.53%	-0.36%	1.81%	-13.54%	-18.24%	-17.36%	-15.09%	-7.56%
CVX	86.95	-0.52	-0.59%	-0.97%	3.22%	-0.26%	-6.97%	-10.74%	2.34%	-6.01%
TOT	64.61	-0.72	-1.10%	-1.37%	-0.29%	-10.57%	-22.42%	-20.86%	-12.89%	-20.43%
PBR	46.56	-1.76	-3.64%	-1.61%	1.88%	-12.25%	-60.81%	-31.85%	-55.57%	-38.28%
RIG	121.83	-5.19	-4.09%	-2.85%	-0.70%	-5.93%	-16.53%	-19.47%	-9.90%	9.24%
CEO	125.31	-4.93	-3.79%	-2.93%	1.76%	-18.94%	-25.15%	-25.27%	-11.44%	-21.52%
ECA	69.30	-2.92	-4.04%	-3.36%	2.64%	-7.22%	-0.45%	-22.06%	-8.33%	13.92%
SLB	86.03	-1.99	-2.26%	-5.16%	-2.99%	-11.02%	-14.47%	-18.07%	-0.57%	-16.48%
STO	25.14	-1.15	-4.37%	-5.17%	-1.80%	-18.30%	-19.53%	-29.87%	-15.50%	-24.96%
SU	45.37	-1.82	-3.86%	-5.68%	-3.96%	-20.53%	-17.70%	-24.00%	-7.77%	-2.74%

Crude Oil ($WTIC closed the week up +$4.14 +4.03% this week to 106.89.

That’s two solid weeks of gains, showing what happens as the $USD gets devalued. One of the costs of the new Deal is definitely going to be higher costs of fuel and higher interest rates. That will hold the new Bull to a what I described as basically a range-bound market that will be seen later as a magnitude failure.

A week ago I wrote, “Many of the oil-heavy hedge funds are on the ropes. Not even two hurricanes in succession could help. The bigger story was the Interventionist’s need to see the commodities in order to try to protect the total collapse of the banks.” I think I had it wrong. The credit tightening of the banks was choking the hedge funds who were selling oil positions. Now I think that higher oil prices will save some of these Funds from collapse.

“It could be that $100 holds here as it is a psychological level, and these days the most important factor in the market is psychology.” Yes, I think I had that right. I now see a new floor at $100, rather than 80-85, where I thought demand destruction in the recession would take it. I’m now taking the Bull perspective, which will mean I also don’t see the recession lasting long. Too much reflation – at least two thousand billions actually – and this has never been done before. Sure there is a lot of bank deleveraging problems that reflation will clean up, and the new money may have just staved a massive deflation, but I also don’t think it will lead to that much inflation because I don’t think oil is going back to 150 for a while. The banks may save the hedge funds, but I don’t think they’ll give them enough rope to hang themselves again.

The Energy ETF (XLE) lost -4.98% this week, closing at 67.70. But the important point is that in the prior six sessions, XLE had gained +6.50%.

Exxon (XOM) was up +1.3% this week on top of a gain of +2.5% a week ago. It may be that the cycle low was put in a couple weeks ago.

I have stated that I do like the higher risk profile junior oil and gas group. Two weeks ago I wrote, “A week ago Friday, BNN TV interviewed the doyen of Calgary O&G analysts, the young Ms Joanne Hruska. Her top picks (high risk; high potential reward) were: Nuvista Energy (TSX:NVA); Orleans Energy (TSX:OEX); and Breaker Energy (TSX:WAV)… These tiny companies are light years removed from Big Oil, but they are also trading at 2x and 3x cash flow (vs 6x and 7x for CVX and XOM), and they have harder working, hungrier management as well as fairly strong finances. No is the time to study them. A year from now will be too late… I recommend you watch the Sept 12 taped Hruska interview if you have any interest in junior oils at all. Then on June 23 she made picks that were up almost +14% in less than 3 months. Back on April 14, she made picks that went up +36%... There will be a lot of wealth grown in these oils in the next two to three years, I believe.”

The stocks were down, but nothing this past two weeks changed that opinion.

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Integrated Oil & Gas - Canada

Oil & Gas Exploration & Production -Canada

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Sector 15 (basic materials: IYM, XLB, IGE and VAW)

Here’s the XLB Monthly, Weekly and Daily data charts:

XLB Monthly data:

XLB Weekly data:

XLB Daily data:

Table 3: Senior Basic Materials:

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
PKX	101.28	-2.16	-2.09%	-4.54%	0.99%	-6.87%	-30.85%	-18.90%	-16.56%	-45.06%
BHP	58.86	-3.41	-5.48%	-6.20%	-4.29%	-18.25%	-16.40%	-27.43%	-9.67%	-22.26%
DOW	33.97	-1.16	-3.30%	-9.56%	-6.29%	-1.93%	-12.34%	-3.22%	-10.16%	-22.67%
TCK	32.43	-1.05	-3.14%	-9.82%	-11.66%	-21.09%	-10.51%	-31.44%	-21.19%	-31.18%
GGB	12.53	-0.69	-5.22%	-11.88%	-13.05%	-32.78%	-56.34%	-45.85%	-60.41%	-51.51%
RIO	20.89	-1.37	-6.15%	-12.08%	-13.89%	-22.34%	-36.14%	-41.20%	-39.76%	-36.66%
AA	23.54	-1.38	-5.54%	-12.13%	-17.89%	-27.35%	-34.85%	-33.31%	-34.67%	-38.81%
MT	56.89	-2.86	-4.79%	-12.48%	-13.09%	-27.05%	-25.54%	-42.18%	-29.24%	-27.19%
NUE	44.36	-1.65	-3.59%	-13.29%	-10.18%	-16.00%	-23.48%	-39.95%	-37.91%	-26.19%
TS	42.00	-1.90	-4.33%	-13.58%	-11.88%	-23.82%	-5.38%	-39.16%	-14.82%	-20.21%
RTP	271.00	-22.00	-7.51%	-13.94%	-16.72%	-30.18%	-35.43%	-40.27%	-33.20%	-17.96%
VCP	16.98	-2.21	-11.52%	-17.81%	-17.93%	-19.91%	-42.83%	-36.36%	-42.15%	-38.43%

Basic Materials (XLB -7.94% to 35.24) was hammered. Goldminer stocks were up, but there were significant losses taken in the steel, metal and paper stocks.

South Korea’s PKX was least hit, down only! -4.5%, while VCP -17.8%, RTP -13.9%, TS -13.6%, NUE -13.3%, MT -12.5% and AA -12.1% were major losers.

Just the storm before the fair weather I think. To put a point on it; just the pro traders hammering the price down against the long call and short put options which will serve them well for the next couple weeks.

Just watch!

It’s called the New Deal.

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Sector 20 (industrial: IYJ, XLI, VIS, and IYT)

Here’s the XLI Monthly, Weekly and Daily data charts:

XLI Monthly data:

XLI Weekly data:

XLI Daily data:

Table 4: Senior capital goods makers and transportation:

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
BA	58.32	0.90	1.57%	-2.41%	-7.87%	-12.09%	-32.67%	-14.50%	-23.56%	-44.16%
HON	44.17	0.82	1.89%	-2.54%	-7.11%	-12.22%	-26.26%	-10.11%	-20.60%	-25.51%
CAT	64.13	2.17	3.50%	-3.55%	-2.03%	-10.53%	-9.20%	-13.66%	-17.10%	-16.34%
MMM	69.45	-0.28	-0.40%	-4.44%	-1.00%	-4.21%	-16.03%	-1.15%	-11.71%	-24.95%
UPS	64.39	0.62	0.97%	-4.89%	-6.14%	-0.48%	-6.90%	7.53%	-11.47%	-13.96%
GE	25.25	-0.43	-1.67%	-5.15%	-5.61%	-12.42%	-31.31%	-4.82%	-32.00%	-38.82%
UTX	60.86	1.69	2.86%	-5.35%	-5.58%	-8.78%	-19.08%	-3.07%	-12.57%	-24.11%
ERJ	28.94	-2.02	-6.52%	-7.66%	-6.62%	-14.20%	-35.87%	3.69%	-28.06%	-35.59%
ABB	20.16	-0.47	-2.28%	-8.24%	-5.49%	-17.75%	-29.61%	-28.54%	-23.64%	-22.28%
FDX	81.56	-0.32	-0.39%	-9.46%	-10.22%	-2.82%	-5.34%	4.44%	-10.62%	-22.12%
TXT	32.49	-1.03	-3.07%	-9.65%	-16.52%	-20.95%	-51.37%	-31.93%	-41.64%	-48.53%
FLR	55.51	-1.22	-2.15%	-13.41%	-14.61%	-31.38%	-23.12%	-39.49%	-21.99%	-22.52%

The Industrials (XLI -4.65% W/W) closed at 31.57.

There were some big losers, FLR (-13.4%) among them. A bright spot was Boeing (BA), down just -2.5% when the S&P 500 was down -3.33% and XLI down -4.65%.

I like BA here at 58 (56 would have been better). I didn’t like it at 100+.

The plunging Industrial Production data hasn’t helped the XLI or FEDEX and UPS.

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Sector 25 (consumer discretionary: XLY, IYC and VCR)

Here’s the XLY Monthly, Weekly and Daily data charts:

XLY Monthly data:

XLY Weekly data:

XLY Daily data:

Table 5: Senior consumer discretionary equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
NKE	67.79	2.78	4.28%	6.42%	9.48%	10.73%	7.13%	13.93%	2.29%	16.10%
TM	90.76	0.28	0.31%	-0.65%	-0.18%	2.32%	-14.75%	-3.96%	-12.91%	-21.00%
BBBY	32.24	0.05	0.16%	-1.59%	0.56%	4.44%	13.68%	8.22%	2.94%	-4.70%
EBAY	22.57	0.21	0.94%	-2.59%	0.09%	-11.14%	-30.53%	-18.19%	-23.41%	-42.39%
TGT	51.47	1.25	2.49%	-3.47%	-10.11%	-4.47%	3.96%	8.04%	-1.83%	-17.66%
DIS	32.75	0.28	0.86%	-4.77%	-1.53%	0.49%	2.86%	3.87%	3.12%	-5.13%
BDK	62.89	0.38	0.61%	-6.54%	-7.04%	0.88%	-10.07%	7.07%	-6.55%	-23.37%
WHR	84.36	1.41	1.70%	-6.77%	-3.65%	3.52%	5.61%	27.34%	-2.19%	-2.70%
BC	14.06	0.32	2.33%	-6.83%	3.23%	2.18%	-16.90%	21.63%	-16.76%	-37.95%
JCP	35.50	-0.40	-1.11%	-6.85%	-14.31%	-9.07%	-14.77%	-1.33%	-14.83%	-45.00%
CCL	35.50	-0.76	-2.10%	-10.71%	-13.63%	-6.03%	-18.69%	6.07%	-13.83%	-27.36%
TTM	8.400	-0.210	-2.44%	-14.37%	-9.19%	-14.20%	-56.81%	-21.20%	-48.08%	-55.03%

Consumer Discretionary (XLY -3.15% W/W) closed at 29.25. But Friday saw a gain of +1.04%, due to the positive turn in their bankers (Financials +3.33% on Friday). More to come with the New Deal I think.

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Sector 30 (consumer staples: XLP, VDC, RTH and IYK)

Here's the XLP Monthly, Weekly and Daily data charts:

XLP Monthly data:

XLP Weekly data:

XLP Daily data:

Table 6: Senior consumer staples equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
KR	27.85	0.97	3.61%	3.00%	-0.14%	-0.18%	8.49%	-2.66%	10.65%	-1.10%
WMT	60.71	0.59	0.98%	1.69%	-2.72%	1.39%	29.45%	6.83%	14.76%	40.21%
KO	52.48	1.02	1.98%	-0.46%	-3.71%	-1.20%	-14.09%	-1.39%	-14.18%	-8.49%
WAG	32.73	0.60	1.87%	-0.70%	-9.26%	-10.38%	-12.35%	-0.46%	-13.78%	-31.40%
WFMI	20.64	0.34	1.67%	-0.72%	11.99%	13.10%	-48.09%	-17.77%	-37.45%	-56.97%
BUD	66.02	-0.69	-1.03%	-1.68%	-3.14%	-2.91%	27.87%	7.61%	36.80%	30.50%
PEP	71.71	0.41	0.58%	-2.02%	-1.97%	3.64%	-4.75%	10.71%	0.77%	-0.72%
PG	68.84	0.33	0.48%	-2.16%	-5.89%	-3.06%	-4.80%	10.59%	-1.15%	-2.37%
DEO	73.11	-1.05	-1.42%	-3.24%	-2.96%	-0.91%	-14.05%	-0.95%	-13.02%	-16.75%
ABV	56.16	-2.01	-3.46%	-3.60%	-5.22%	-10.59%	-22.52%	-12.06%	-29.84%	-20.69%
SBUX	14.96	0.03	0.20%	-7.31%	-2.41%	-6.38%	-22.53%	-8.11%	-15.29%	-45.97%
PDA	39.25	-3.17	-7.47%	-15.06%	-16.77%	-20.00%	-18.45%	-26.79%	-23.17%	-11.90%

Consumer Staples (XLP) closed flat at 27.70. It was down -4.97% a week ago.

KR was up +3.0% W/W, but the gain on Friday was +3.6%. PDA plunged -15.1%. Latin Americans sure like to sell their stocks hard. You remember VCP, which dropped -17.8%. Luckily that’s just a week, not a year. The losers who were long now have the rest of the year to make that back.

Kraft (KFT) going into the DJIA to replace AIG will put a more defensive face on the so-called blue chip index.

Sector 35 (healthcare: IYH, XLV, VHT, IXJ, and IBB)

Here’s the IYH Monthly, Weekly and Daily data charts:

IYH Monthly data:

IYH Weekly data:

IYH Daily data:

Table 7: Senior healthcare equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
NVO	55.64	1.02	1.87%	3.73%	5.82%	-4.45%	-12.79%	-18.00%	-17.35%	-53.31%
NVS	54.89	-0.39	-0.71%	3.33%	0.38%	-2.02%	0.59%	2.50%	10.02%	-0.34%
AMGN	60.67	0.74	1.23%	1.17%	-3.50%	-5.32%	30.19%	30.87%	44.45%	8.18%
GSK	44.93	0.49	1.10%	0.92%	1.58%	-4.59%	-10.44%	1.42%	7.05%	-15.59%
PFE	18.66	0.02	0.11%	0.59%	0.21%	-3.17%	-18.55%	8.68%	-9.81%	-24.08%
AET	38.49	1.16	3.11%	-0.26%	-9.48%	-10.84%	-32.04%	-2.78%	-12.44%	-27.72%
JNJ	69.40	0.04	0.06%	-0.84%	-1.69%	-2.81%	5.30%	8.00%	7.26%	6.13%
BMY	20.82	0.15	0.73%	-0.86%	-6.38%	-3.79%	-20.32%	5.85%	-1.79%	-27.93%
DNA	91.19	-0.56	-0.61%	-1.17%	-5.56%	-7.37%	35.30%	25.88%	11.19%	15.15%
MDT	51.13	-0.75	-1.45%	-2.55%	-5.24%	-7.39%	3.29%	0.10%	5.86%	-10.20%
WLP	46.69	-0.67	-1.41%	-2.77%	-8.70%	-12.01%	-46.33%	-2.28%	2.48%	-41.31%
UNH	25.81	0.31	1.22%	-3.66%	-12.83%	-14.14%	-54.46%	-0.62%	-24.31%	-47.66%

The Healthcare sector (IYH) lost -1.10% to close at 63.70, but it hasn’t moved much in three weeks.

Again there was no big winner but NVO did gain +3.7% after gaining +2.0% the prior week. NVS was up +3.3% and UNH dropped -3.7%.

Who knows what a Democrat Administration will do to a company like UNH? Maybe give them more clients! (which is probably a bad joke.)

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Sector 40 (financial: IYG, IYF, XLF, VFH, IXG, VNQ, RWR, IYR, and ICF)

Here’s the XLF Monthly, Weekly and Daily data charts:

XLF Monthly data:

XLF Weekly data:

XLF Daily data:

Table 8: Senior financial company equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
GS	137.99	2.49	1.84%	6.31%	-10.52%	-14.73%	-33.53%	-21.71%	-21.36%	-35.70%
CS	52.15	0.22	0.42%	3.95%	12.42%	11.67%	-12.62%	15.25%	2.48%	-20.42%
JPM	48.24	4.78	11.00%	2.53%	17.17%	24.07%	14.39%	32.82%	9.36%	4.57%
HBC	81.50	-0.09	-0.11%	-0.31%	3.39%	3.58%	-1.14%	4.57%	0.11%	-11.83%
DB	82.56	0.35	0.43%	-2.01%	0.05%	-4.00%	-36.03%	-6.94%	-27.78%	-34.68%
C	20.15	0.74	3.81%	-2.42%	12.19%	5.61%	-30.33%	14.04%	-8.62%	-56.71%
BBD	16.15	-0.51	-3.06%	-3.35%	-4.78%	-12.89%	-46.93%	-22.13%	-44.16%	-43.69%
UBS	20.10	-0.04	-0.20%	-6.29%	-2.66%	-9.30%	-56.10%	-8.84%	-31.07%	-61.87%
MER	27.36	1.25	4.79%	-7.25%	60.47%	-0.58%	-48.14%	-17.22%	-38.41%	-61.87%
MS	24.75	-2.35	-8.67%	-9.04%	-33.52%	-39.04%	-51.42%	-32.80%	-48.21%	-60.70%
IBN	24.94	-2.50	-9.11%	-10.90%	-16.45%	-19.03%	-59.87%	-19.52%	-38.71%	-52.18%
LEH	0.1300	-0.1700	-56.67%	-98.21%	-99.23%	-99.01%	-99.79%	-99.47%	-99.69%	-99.80%

The Financials (XLF -4.42% +5to 21.39, which means they are up +1.2% over two weeks. This is after all the pre-Deal week, and Friday’s gain was +3.33%. More days like Friday next week. $700 billion, half now; half when you need it.

Another bad joke; but true.

Where do I start? This landscape is looking like Pork Chop Hill.

What is shaping up in a last man standing is winner scenario is a massive contraction of the industry into a relatively few mega-banks. Now, apparently, according to a Wall Street Journal story at least, Wachovia Bank (WB) is talking merger with Citigroup (C).

In the most basic accounting, however, one plus one does not equal three. Still, it might equal one still standing, like Bank of America et al, JPMorgan et al, Citi et al, Goldman et al, and Morgan Stanley et al.

Once you get past the et als, there won’t be much left of the XLF landscape, I feel. Just the way they always wanted it. Five guys at a NYC poker table playing with Mom & Pop’s money.

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Sector 45 (technology: IGM, IGV, IGW, XLK, VGT, IYW, IGN, IXN, MTK and SMH)

Here’s the SMH Monthly, Weekly and Daily data charts:

SMH Monthly data:

SMH Weekly data:

SMH Daily data:

Here’s the XLK Monthly, Weekly and Daily data charts:

XLK Monthly data:

XLK Weekly data:

XLK Daily data:

Table 9: Senior technology equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
ORCL	20.62	0.15	0.73%	2.74%	5.15%	-8.92%	-8.31%	-3.73%	-1.53%	-5.28%
INTC	19.20	0.63	3.39%	-0.16%	-4.76%	-18.61%	-24.26%	-11.07%	-12.17%	-25.90%
SAP	57.48	-0.10	-0.17%	-1.12%	8.07%	1.84%	13.31%	10.24%	10.69%	-1.07%
CSCO	23.82	0.34	1.45%	-1.93%	1.53%	-3.41%	-10.25%	0.00%	-3.87%	-27.80%
ADBE	39.99	0.16	0.40%	-2.32%	-1.19%	-9.75%	-4.12%	-2.06%	7.50%	-7.88%
GOOG	431.04	-8.56	-1.95%	-4.03%	-1.51%	-9.02%	-37.09%	-18.49%	-5.93%	-24.13%
SNDK	21.56	-0.06	-0.28%	-4.26%	37.41%	42.12%	-35.00%	8.18%	1.84%	-59.75%
QCOM	45.84	-0.70	-1.50%	-5.95%	-4.34%	-15.06%	19.41%	1.62%	13.21%	8.52%
CTSH	24.73	0.00	0.00%	-6.93%	-8.00%	-16.73%	-23.27%	-23.93%	-19.08%	-36.80%
AAPL	128.24	-3.69	-2.80%	-8.99%	-13.90%	-26.19%	-34.18%	-23.78%	-11.60%	-16.06%
INFY	33.61	-0.63	-1.84%	-12.70%	-9.75%	-18.82%	-24.35%	-21.12%	-9.24%	-28.94%
RIMM	70.76	-26.77	-27.45%	-31.59%	-33.04%	-44.13%	-37.77%	-42.69%	-40.11%	-28.53%

Tech (XLK -0.24% to 20.80, which is a loss of a nickel, which compared to $700 billion ain’t bad). Semi-conductors (SMH -2.45% to 25.85) lost what they made a week ago (+2.91%).

ORCL was a winner (+2.7%) while RIMM was crushed -31.6%, including -27.5% on Friday.

With a Daily and a Weekly RSI-7 at 17.2, you have to know the monthly (33.3) is going to soon drop below 30. Rather than wait, it’s time to buy it at 70.76. I don’t believe those stories on Friday about product delays, but even if they’re true, the revenues and earnings of this big hitter are still soaring. It was just 3 months ago when the stock hit a high of 148.13, and the 76 price will bring out the downgrades! Incredible these people have jobs.

Intel (INTC) was down -0.2% W/W, but up +3.4% on Friday. More days like Friday next week I think.

Oracle (ORCL +2.7% W/W) was up +2.4% a week ago.

I like INTC and ORCL here as well as RIMM. Add IBM, QCOM, CTSH and IBM.

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Sector 50 (telecom: IYZ, VOX and IXP)

Here’s the IYZ Monthly, Weekly and Daily data charts:

IYZ Monthly data:

IYZ Weekly data:

IYZ Daily data:

Telecom (IYZ -4.07% W/W) closed at 21.24. It was down -3.91% a week ago, and I wrote, “This sector has been very weak recently. Typically, it tracks Financials fairly closely.”

IYZ dropped only -0.09% on Friday. It’s due for a rally on Monday.

Verizon (VZ -3.4% W/W to 32.18) and AT&T (T -1.4% W/W to 30.00) seem pretty much have hit bottom here.

Same recommendation as a week ago: “If Financials go well here, so too should the telcos for a while anyway… But, as I stated a week ago, Like the most Financials, I think I’ll avoid the Telco sector when selecting companies whose stocks I want to buy for the next Bull market.”

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Sector 55 (utilities: IDU, XLU, and VPU)

Here’s the XLU Monthly, Weekly and Daily data charts:

XLU Monthly data:

XLU Weekly data:

XLU Daily data:

Utilities (XLU -1.34% to 34.53 W/W) was a relatively better performing sector this week.

I have just started running this table to help you with the higher income utilities.

Here is the list of North American Utilities that I will be following more closely:
AEP D DUK ED EXC FE FPL NGG PCG PEG SO TRP

For study purposes, there is a good mix of electric (AEP, D, DUK, FE, FPL and SO), gas (NGG, TRP) and diversified (ED, EXC, PCG, PEG) utilities.

Table 12: US Utilities

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Bonds & Yields Review

Table 10: US Treasury Yields

US Treasury Bonds

Maturity	Yield	Yesterday	Last Week	Last Month
3 Month	0.45	0.48	0.84	1.60
6 Month	1.21	1.24	1.41	1.86
2 Year	2.10	2.17	2.13	2.27
3 Year	1.90	1.98	2.03	2.13
5 Year	3.07	3.06	3.03	3.01
10 Year	3.86	3.87	3.80	3.76
30 Year	4.38	4.41	4.37	4.38

Municipal Bonds

Maturity	Yield	Yesterday	Last Week	Last Month
2yr AA	2.62	2.51	2.49	2.14
2yr AAA	2.40	2.39	2.33	2.08
2yr A	2.65	2.72	2.59	2.31
5yr AAA	3.08	3.08	3.10	2.66
5yr AA	3.15	3.06	3.09	2.76
5yr A	3.23	3.16	3.41	2.92
10yr AAA	3.94	3.98	3.76	3.54
10yr AA	3.97	3.97	3.83	3.51
10yr A	4.06	3.94	3.92	3.59
20yr AAA	4.97	5.13	4.89	4.55
20yr AA	5.06	5.22	4.99	4.61
20yr A	4.80	5.04	4.73	4.79

Corporate Bonds

Maturity	Yield	Yesterday	Last Week	Last Month
2yr AA	5.03	4.61	4.40	4.17
2yr A	10.50	8.85	8.10	5.01
5yr AAA	5.41	5.28	4.73	4.74
5yr AA	6.85	6.19	6.08	5.31
5yr A	7.97	6.65	5.72	5.89
10yr AAA	5.45	5.52	4.91	4.53
10yr AA	6.53	6.69	6.19	6.12
10yr A	6.72	6.71	6.30	6.11
20yr AAA	6.04	6.10	5.98	5.94
20yr AA	6.03	6.15	5.92	5.73
20yr A	6.61	6.60	6.45	6.19

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Bond prices were fairly quiet this week – like stocks and forex. Uncertainty over the failing banks and a deal to rescue them – excuse me; I mean rescue the people – kept volume very low.

Here is the $USB 30-year Treasury Bond chart.

Interest rates and bond yields.

Interactive Daily data charts:

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Interactive Chart of Interest rates and bond yields.

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US Bond Funds -- Interactive Monthly Data Charts

SHY Monthly data series chart:

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IEF Monthly data series chart:

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TLT Monthly data series chart:

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AGG Monthly data series chart:

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LQD Monthly data series chart:

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TIP Monthly data series chart:

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US Bond Funds -- Interactive Weekly Data Charts

SHY Weekly data series chart:

IEF Weekly data series chart:

TLT Weekly data series chart:

AGG Weekly data series chart:

LQD Weekly data series chart:

TIP Weekly data series chart:

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US Bond Funds -- Interactive Daily Data Charts

SHY Daily data series chart:

IEF Daily data series chart:

TLT Daily data series chart:

AGG Daily data series chart:

LQD Daily data series chart:

TIP Daily data series chart:

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Table 11: Interest-sensitive securities

Sorted by 1-Week Price Performance.

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
FRE	2.0000	0.1400	7.53%	263.64%	334.78%	-62.12%	-93.89%	-89.21%	-92.78%	-96.64%
FNM	1.8300	-0.1100	-5.67%	165.22%	147.30%	-76.98%	-95.11%	-91.30%	-93.74%	-97.03%
TLT	94.50	0.68	0.72%	0.56%	-0.46%	0.25%	0.13%	3.57%	-0.87%	7.50%
SHY	83.41	0.00	0.00%	0.18%	0.30%	0.36%	1.30%	0.75%	-0.86%	2.72%
IEF	88.91	-0.06	-0.07%	-0.33%	-0.79%	-0.65%	1.46%	1.60%	-2.61%	6.38%
NLY	15.47	0.40	2.65%	-0.90%	-3.01%	2.31%	-14.53%	-0.51%	-3.73%	-4.21%
TIP	102.66	-0.22	-0.21%	-0.96%	-2.28%	-3.76%	-3.73%	-4.25%	-5.39%	1.29%
AGG	98.71	-0.50	-0.50%	-2.27%	-2.47%	-2.05%	-2.89%	-1.40%	-3.74%	-0.99%
EQR	45.51	1.66	3.79%	-4.25%	6.21%	5.96%	24.92%	18.58%	9.45%	5.37%
AVB	99.26	2.81	2.91%	-4.47%	-0.90%	-1.86%	8.66%	12.03%	-1.83%	-16.74%
DRE	25.64	0.52	2.07%	-4.83%	1.50%	1.38%	0.08%	14.57%	11.19%	-23.19%

TLT (20-year average duration Treasury bonds) actually gained +0.72% on Friday, stopping the ten-day fall. TLT closed up +0.56% W/W at 94.50.

A counter-trend rally aka a trap coming up, perhaps?

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Consumer Finance -USA -- Interactive Weekly Data Charts

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Consumer Finance -USA -- Interactive Daily Data Charts

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Commodities Review

After four straight losing weeks for $CRB, the Treasury Secretary announced his mega-billion (trillion?) bail-out plan for the banks a week ago Friday. The market then spoke, pushing $CRB up +2.44% that day. This week, $CRB jumped a further +1.39%.

More to come, I think. But that’s the price you pay for expensive help in the White House.

When I opined two weeks ago, “The longer the nonsense goes on in Washington, the more that people will want to hold commodities. Smart traders, however, will likely wait for the $USD strength to play out before jumping back to commodities,” what I meant was a crisis typically sees a strengthening of the USD and also higher commodity prices. Then reality of the costly solution sets in and the $USD falls, while commodity prices then start a major lift. To try to avoid a whip-saw, many traders will wait until the $USD falls before jumping into the commodities.

Maybe I should not have written this because we are getting into nuances, and price drivers are pushing and pulling prices up and down violently, which most people find frightening.

Maybe I should just have stopped for the weekend, like my pc.

For $CRB, the 50d MA is now 386.93, and the 200d MA is 400.61.

$CRB Index

Open Futures Contracts

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Interactive Chart of Weekly CRB Commodities Index:

Interactive Chart of Daily CRB Commodities Index:

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Oil Review

$WTIC (US Light Sweet Crude called West Texas Intermediate) gained +$4.14/bbl (+4.03%) to 106.89. Tacked onto the gain of +5.34% of the prior Friday – Paulson Friday it shall be decreed – that’s close to +10% in six sessions – something George and Dick can write home about.

Having given thought to this bail-out plan – call it what you will – I now see $100 as the floor for oil. And you didn’t think that this White house team was working hard? Gotcha.

For $WTIC, the 50d MA is now 113.60, and the 200d MA is 112.25.

Here is the e-miNY Dec-07 Crude Oil chart.

Interactive Chart of Weekly Crude Oil:

Interactive Chart of Daily Crude Oil:

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Gold & Precious Metals Review

$GOLD regained strength this week, going up +$23.80/oz (I mistakenly had bbl inserted a week ago, which would be kinda nice of you could buy gold for 864.70/bbl (now 885.50). The gain was +2.75% W/W.

For $GOLD, the 50d MA is now 855.56, and the 200d MA is 895.20.

As I pointed out a week ago, “This is (still) a negative technical picture, but I have opined that too much Fed money will lead to higher gold prices.” Ergo, $GOLD is up $37 in two weeks.

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Spot gold chart for the week

Interactive Chart of Weekly Gold EOD Continuous Contract Index:

Interactive Chart of Daily Gold EOD Continuous Contract Index:

Interactive chart of recent trading for the Gold Bullion index.

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Spot silver chart for the week

Interactive daily data

PM’s are in rally mode: $SILVER gained +8.24% this week and +15.56% a week earlier, closing Friday at 13.50/oz (not bbl).

For $SILVER, the 50d MA is now 14.31, and the 200d MA is 16.54, both down from a week ago, but now probably going to turn higher.

As I wrote in this space two weeks ago after the PM prices had plunged, “I think $SILVER will bottom here before $GOLD. The Silver Crazies sense things can change quickly. As tortured and depressed as they are, having failed to jump ship when I shouted SOS, they are still alive. In fact, if you read kaimu closely, there is no killing a Silver Crazy.”

No sooner said than done: $SILVER rocketed +24% in two weeks.

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Interactive Chart of Weekly Silver EOD Continuous Contract Index:

Interactive Chart of Daily Silver EOD Continuous Contract Index:

Interactive chart of the Silver Bullion index.

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$PLATINUM rallied +37.12/oz (+3.24%) to 1184.12.

$PLAT had rallied +4.72% a week ago Friday, so that’s a gain of +8% in six sessions.

The 50-day MA for $PLAT is 1470.38 and the 200-day MA is 1805.60.

Spot platinum chart for the week

Interactive Chart of Weekly Platinum EOD Continuous Contract Index:

Interactive Chart of Daily Platinum EOD Continuous Contract Index:

Interactive chart of the Platinum metal index.

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$PALLADIUM had reversed the goldbug action a week ago Friday, and for five sessions did rather well. But this Friday, the contracts lost -6.99%, taking $PALL to a weekly loss of -4.83%, closing at 225.50.

The 50-day MA is now 306.34 and the 200-day MA is 409.95.

I don’t have access to the charts I need, so I am writing blind. My crystal ball says that prices next week might be going…. Up.

Spot palladium chart for the week

Interactive Chart of Weekly Palladium EOD Continuous Contract Index:

Interactive Chart of Daily Palladium EOD Continuous Contract Index:

Interactive chart of the Palladium metal index.

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$COPPER contracts lost -10.20 (-3.21%) to 307.45. Still trying to hold the $300 level.

The 50-day MA for $COPPER is now 335.04 and the 200-day MA is 355.16.

Not having taken a Glencore refresher course in Zug, I still have no feel for the copper market.
http://en.wikipedia.org/wiki/Glencore

Now in addition to not seeing charts, I can’t do links. Man this is hard work. I feel like I’m working on the railroad in the Great Depression, not the information highway.

Btw, did you know that at Canada’s CP Rail, my grandfather, straight from Italy, was called the Oil Rail Man because he used to guard the bent rails that were sent back to the main yard in Toronto’s Junction. By coincidence, my Dad bought a property on Old Rail Road near Brighton Ontario many years later. My uncle Bill, who had become head livestock buyer for Canada Packers, headquartered in the Junction, shipped him a young bull and about eight head at then record low prices. It’s who you know I guess. Bill was in Forth Worth buying cattle from Mr. Johnson when President Kennedy was assassinated. The man came to visit us and I was amazed he looked so much like President Johnson.

Unlike Henry Paulson’s silver spoon feeding him from Palm Beach FL, I came from railroads, steel and cows – on the ground or grounded as some would say.

Interactive Chart of Weekly Copper EOD Continuous Contract Index:

Interactive Chart of Daily Copper EOD Continuous Contract Index:

Interactive chart of the Copper metal index.

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Table 12: Senior gold equities

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
GFI	9.470	0.050	0.53%	10.63%	15.91%	0.32%	-38.51%	-20.55%	-36.40%	-47.59%
HMY	10.15	-0.13	-1.26%	8.21%	32.33%	15.21%	-5.58%	-10.10%	-18.93%	-16.05%
ABX	37.00	0.50	1.37%	5.41%	25.13%	5.65%	-19.60%	-14.03%	-18.70%	-4.34%
GG	33.48	-1.04	-3.01%	4.04%	15.25%	-1.90%	-8.62%	-24.49%	-17.62%	13.76%
KGC	16.60	-0.02	-0.12%	0.36%	20.46%	-1.60%	-17.62%	-25.69%	-28.51%	13.62%
AEM	59.86	-2.03	-3.28%	-1.77%	13.59%	3.64%	5.91%	-15.68%	-15.81%	27.47%
EGO	6.767	-0.403	-5.62%	-1.79%	7.41%	-14.02%	9.15%	-15.73%	-0.34%	14.69%
AU	24.22	-0.21	-0.86%	-2.02%	0.46%	-11.12%	-47.19%	-24.50%	-26.38%	-47.05%
NEM	41.00	-0.56	-1.35%	-2.03%	3.38%	-9.35%	-21.74%	-21.43%	-13.58%	-8.69%
BVN	23.30	-0.29	-1.23%	-4.27%	30.97%	-0.47%	-23.46%	-24.57%	-35.95%	-1.89%
LIHR	23.14	0.47	2.07%	-5.09%	44.35%	11.30%	-30.24%	-23.98%	-34.04%	-30.80%
AUY	8.970	-0.690	-7.14%	-5.38%	4.67%	-18.08%	-35.33%	-42.54%	-45.07%	-22.14%

The Goldminer stocks went soft this week, losing -0.79% to 138.29 for the $XAU. The GDX gained +1.79% and the XGD gained +0.72%. Pretty close to nothing when you add it all up.

We continue to watch closely. But, as I said a week ago, these are volatile markets, which require minute to minute monitoring, so they are not for the typical trader.

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To watch the moves in precious metal miners, you will have to monitor the individual stock charts, preferably in real-time, as follows:

NEM ABX AU GFI GG HMY AUY KGC BVN
Interactive Daily data
Interactive Weekly data

MDG LIHRY AEM BGO IAG EGO RGLD GOLD CDE GRS
Interactive Daily data
Interactive Weekly data

SSRI SIL NG KRY UXG GRZ TSE_HRG TSE_GUY TSE_AGI
Interactive Daily data
Interactive Weekly data

NXG GSS MNG DROOY MFN RNO RANGY MRB CLG
Interactive Daily data
Interactive Weekly data

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Here are the key Silver miners and the SLV ETF:

SLV SIL CDE HL PAAS SSRI SLW MGN

Interactive Daily data
Interactive Weekly data

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Here are the Weekly and Daily Data charts of the indexes:

Weekly U.S. Goldminers Index:

Interactive Chart of Weekly U.S. Goldminers Index:

Interactive Chart of Daily U.S. Goldminers Index:

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The U.S. goldminer share trust ETF trades under the ticker symbol GDX.

Here are the U.S. Goldminer ETF (GDX) index Weekly and Daily data charts:

GDX Weekly data:

GDX Daily data:

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The Toronto Exchange-listed goldminer iUnits S&P/TSX Capped Gold Index ETF trades under the ticker symbol TSE:XGD. Yes, just like GDX on the AMEX, you can trade XGD on Toronto.

Here are the Weekly and Daily data charts for the TSX Goldshares (XGD) index:

Interactive Chart of XGD Weekly data:

Interactive Chart of XGD Daily data:

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Forex Review

The $USD dropped only -0.87% to 76.99, which is an impressive feat for the Fed after Treasury printed $700 billion this week and about the same really in the previous month.

The 50-day MA for the $USD is 76.23 and the 200-day MA is 74.46.

You cannot trade commodities that are priced in $USD without studying forex movement. The Forex market is a multi-trillion dollar marketplace every day, which dwarfs the size of the stock and bond markets. In this market, the Euro/USD is the highest volume trader. The $USD is a trade-weighted US Dollar index, we used to call the Morgan Dollar.

The current value of $USD is a mean value of rate fluctuations of six world currencies (Japanese yen, Euro, British pound, Canadian dollar, Swiss franc and Swedish krona) that each trade against the USD.

$USD=50.14348112 x (EUR)0.576 x (JPY)0.136 x (GBP)0.119 x (CAD)0.091 x (SEK)0.042 x (CHF)0.036

The Fed developed the $USD index based on a currency basket that coincides with free-floating (non-pegged) currencies of the countries that form the main US foreign trade turnover. The biggest part of US foreign trade falls to the Euro shares (57.6%), followed by Japan (13.6%), Great Britain (11.9%), Canada (9.1%), Sweden (4.2%) and Switzerland (3.6%). China and Hong Kong are excluded because the Yuan and HK Dollar are pegged to the USD.

In mathematical terms, the $USD index is calculated as the weighted geometrical mean fluctuation of these six currencies against the USD compared to 100.00, which is the price recorded in March 1973 when the floating rates system was introduced.

For example, today’s quotation of 76.99 means that USD value against the currency basket dropped by -23.01% compared to March 1973. During its history period, $USD reached the highest level of 165 and the lowest level of 70.70 in March of this year.

Following a July low of 71.31, the high this month has been 80.38, which shows the extreme volatility of the $USD.

Also, a strong economy leads to a healthy national balance sheet, which in turn leads to a strong currency. In relative terms, then, the US economy has been quite badly managed since 1973.

Including the previous Friday, the $USD plunged -4.1% in eleven sessions, which is a huge drop, but consistent with traders’ beliefs that the Treasury Secretary has embarked on a program of reflation.

Reflation is different from inflation, which refers to the increased cost of goods and services. Reflation is money printing.

The forex market is so much larger than the gold market that with these recent changes, I believe that traders will soon overwhelm the US Fed control over gold that exists presently as part of the newest reflation program of the US monetary authorities (Fed and Treasury). Now the other central banks and finance ministers will have to follow suit, and when traders realize that, then precious metals will soar.

Interactive Chart of Weekly U.S. Dollar Index:

Interactive Chart of Daily U.S. U.S. Dollar Index:

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The Euro ($XEU) lifted +0.97% W/W after gaining +1.79% a week ago to close at 1.4624. With the previous Friday’s gain of +1.85% two weeks ago, the Euro has now lifted +4.64% in eleven sessions, which is truly an awesome move.

This weekend, however, Europe was saddled with rumors of the demise of huge Fortis Bank. That cannot help the Euro.

The Euro 50day MA is 1.4882 and the 200day MA is 1.5189.

Interactive Chart of Weekly Euro Dollar Index, priced in USD:

Interactive Chart of Daily Euro Dollar Index, priced in USD:

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The Pound gained +0.56% W/W, closing at 1.8437, which is a huge gain over three weeks.

The 50-day MA and 200-day MA are at 1.8748 and 1.9526.

This weekend, the UK had to nationalize another major bank that is in the real estate lending industry. That cannot help the Pound.

Weekly British Pound Index:

Daily British Pound Index:

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Weekly Japanese Yen Index:

The Japanese Yen ($XJY) gained +1.15% this week, closing at 94.22.

As I wrote a week or two ago, “With the weakness ahead for the $USD next month, I think the Yen will continue to rally. A stronger Yen and weaker USD hurts the Japanese exporters, like Toyota, Honda, Nissan. Same for Mercedes and BMW in Germany. So, I am certain that watching Treasury Secretary Paulson do his thing this week, the boardrooms in these auto manufacturers were pretty much depressed.”

TM was down -0.7% this week, but cannot recall the others.

The Yen’s 50-day MA is 92.61 and the 200-day MA is 94.15.

Daily Japanese Yen Index:

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The Loonie (Cdn Dollar) gained +1.31% to 96.70. With the move on the previous Friday, the eleven-session gain in the Loonie has been +4.2%, which, again, is stunning.

As I say, a stronger Loonie “hurts tourism and exporters in Canada, but brings in more money to the miners and oilers, and speaking of oilers, to the NHL teams in Canada.”

The 50-day MA and 200-day MA is at 95.48 and 98.39 respectively.

Weekly Canadian Dollar Index:

Daily Canadian Dollar Index:

Here is the China Yuan (CNY) chart.

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International Equity Markets Review

There were softer prices again this week in the global equity markets. Most of these markets are sitting right on crucial technical support levels, possibly ready to tumble once more. In fact, had there not been a remarkable turnabout a week ago Sept 18, on Thursday afternoon at DJIA=10462 that was extended through the close that Friday at 11388.44, I would definitely be writing today about the last stumble in this 2007-2008 Bear market.

UK FTSE moved down from 5416.7 to 5311.3 to 5088.5 German DAX moved down from 6234.9 to 6189.5 to 6063.5

Aussie All-Ords moved up from 4840.7 to 4934.6

Shanghai Composite moved up from 2075.1 to 2293.8

HK Hang Seng moved down from 19352.9 to 19327.7 to 18682.1

India’s BSE 30 moved down from 14000.8 to 13327.7 to 13102.2

Japan’s Nikkei 225 moved down from 12214.8 to 11920.9 to 11893.2

As I say, traders can look at the glass as half full or half empty. That’s why there is a buyer and a seller. Presently, there is an overwhelming sense of emptiness, but at mid-day Thursday, I switched to the Bull camp. But it won’t take long to see if the traders in these international markets agree with me.

A week ago I wrote in this space, “As you know, I don’t mind flying my own plane if that’s what I feel is necessary. Call it intuition plus a healthy respect for the endless intervention that central banks and a banker-cum-Treasury Secretary can impact on capital markets. The expression used to be ‘Don’t fight the Fed’, but now it’s ‘Don’t fight the Fed-Treasury tag team’. I think these people have told the President that the $USD is going to fall from 80 to 70 because of this rescue package, but that McCain can ‘Blame it on Obama’. A 70-cent Dollar will boom the equity markets. Watch Russia. Watch Brazil. Watch India. Watch Australia. Watch Canada. Watch Gold. Watch Oil (should make George happy). Watch XLE. Watch XLB. Watch XLI. Watch XLK… We won’t have much of a Bull without the Financials and the Consumer Discretionaries, but like the end of the Bears in 1974 and 1978, which the last time the market encountered stagflation, we’ll muddle through it, probably hitting DJIA=15000 sometime in 2011… The biggest winners will (ultimately) be BRIC – Brazil, Russia, India and China, I think. So, watch the Cara 100 companies that are non-Financial and non-oil related Consumer Discretionary in those markets.”

But also watch the US-headquartered non-financial companies because these are going to surprise traders. There is too much cash sitting on the sidelines being eaten by inflation and low rates to be there for long. With the nervousness in the Financials, and uncertainty about their future landscape, it’s far too early yet to form opinions on those, however.

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There are 16 country index charts from StockCharts.com (with their formal approval btw) because I think it is important to be watching these markets move through a trend juncture together, and in relation to currency and commodity strength or weakness.

I also made some additions to the country-based ETF tables as I intend to focus more on ETF’s in 2008. In time, I will also set up tables and track the domestic market prices. This will come after we switch to the Drupal platform maybe next week.

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Here is the latest session data for the exchanges of the Americas.

Here is the latest chart for the Brazilian Bovespa stock exchange in Sao Paulo.

Brazilian Bovespa stockcharts.com chart

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Here is the latest session data for the Toronto Stock Exchange composite index.

Toronto 300 stockcharts.com chart

Toronto CDNX stockcharts.com chart

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Europe

Here is the latest session data for the bourses of Europe.

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Here is the latest session data for the London stock exchange FTSE.

FTSE 100 stockcharts.com chart

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Here is the latest session data for the German DAX.

DAX stockcharts.com chart

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Here is the latest session data for the French CAC 40.

CAC 40 stockcharts.com chart

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Here is the latest session data for the Milan Italy stock exchange MIBTEL.

Italian Milan Index stockcharts.com chart

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Here is the latest session data for the Swiss market index.

Swiss Market Index stockcharts.com chart

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Asia-Pacific

Here is the latest session data for the Asia-Pacific stock exchanges.

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Here is the latest chart for the Japanese Nikkei 225 index.

Tokyo Nikkei 225 Index stockcharts.com chart

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Here is the latest chart for the Singapore index .

Singapore Straits Times Index stockcharts.com chart

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Here is the latest chart for the Shanghai Composite index .

Shanghai Composite Index stockcharts.com chart

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Here is the latest chart for the Hong Kong Hang Seng index .

Hong Kong Hang Seng stockcharts.com chart

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Here is the latest chart for the India BSE 30 index .

Mumbai BSE 30 Sensex Index stockcharts.com chart

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Here is the latest chart for the Australian All Ordinaries index .

Sydney All Ordinaries Index stockcharts.com chart

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Russia (RTS) stockcharts.com chart

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Table 13: International equities via an ETF perspective (in $USD)

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
EWA	22.60	-0.43	-1.87%	1.39%	1.53%	-5.68%	-21.47%	-14.85%	-13.18%	-27.80%
EWJ	11.10	-0.06	-0.54%	-1.86%	0.36%	-2.63%	-16.10%	-10.34%	-10.84%	-20.88%
IFN	34.56	-0.34	-0.97%	-3.33%	-5.26%	-8.55%	-44.17%	-7.84%	-26.00%	-36.12%
EWQ	28.46	-0.24	-0.84%	-3.39%	-0.56%	-6.90%	-24.99%	-11.53%	-18.10%	-24.91%
EWG	25.57	-0.42	-1.62%	-3.47%	-0.43%	-7.19%	-27.75%	-13.61%	-18.18%	-25.12%
EWU	17.80	-0.27	-1.49%	-4.04%	-3.31%	-8.06%	-25.46%	-12.92%	-17.67%	-29.87%
EWC	27.77	-0.89	-3.11%	-4.27%	-2.25%	-9.66%	-14.29%	-16.10%	-8.95%	-14.21%
EWZ	60.28	-1.66	-2.68%	-4.77%	-5.47%	-18.88%	-25.53%	-31.84%	-23.92%	-17.08%
EWH	13.91	-0.21	-1.49%	-5.82%	-7.70%	-13.23%	-36.16%	-17.84%	-21.46%	-33.70%
RSX	31.25	-1.23	-3.79%	-7.38%	-7.27%	-19.42%	-40.54%	-41.18%	-32.48%	-30.88%
GXC	54.60	-1.11	-1.99%	-7.88%	-2.48%	-16.00%	-38.58%	-18.18%	-17.81%	-40.84%

Other than Australia (EWA), which had a gain of +1.39%, the rest were down between -2% and -8% W/W. It wasn’t a good week. Particularly badly hurt were China (GXC -7.9%) and Russia (RSX -7.4%).

Sharing the northern and western borders of the US, the most down on Friday were Canada (EWC -3.1% on the day), and Russia (“I can see Russia from my home!” says the VP candidate) (RSX -3.8%).

Not to pick on Gov. Palin (I mean a visiting head of state called her “gorgeous” which I guess shows the world where his head’s at), but do you recall my review of her convention speech as being something you’d hear from a high school valedictorian?

Now that she’s blown away Katie Couric in a warm-up, can’t we all just wait for her next debate with Sen. Biden? Biden actually has a tough job; he must soundly beat her to expose her weaknesses to avoid her becoming that heartbeat away from the Presidency, but if he is too tough, she could walk off with the sympathy vote.

Unlike Dick Cheney she probably has better aim and won’t shoot people in the foot, but honestly is she ready to be President of the United States Senate?

At least traders have to be pragmatic.

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Japanese equity market ETF: EWJ

Here is the Japanese (EWJ) equity market ETF Monthly, Weekly and Daily data charts:

Interactive EWJ Monthly data:

Interactive EWJ Weekly data:

Interactive EWJ Daily data:

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U.K. equity market ETF

Here is the United Kingdom (EWU) equity market ETF Monthly, Weekly and Daily data charts:

Interactive EWU Monthly data:

Interactive EWU Weekly data:

Interactive EWU Daily data:

EWU Daily data:

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Canada’s equity market

Here is the Canadian (EWC) equity market ETF Monthly, Weekly and Daily data charts:

Interactive EWC Monthly data:

Interactive EWC Weekly data:

Interactive EWC Daily data:

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US Equity Markets Review

The DJIA (-2.15%), S&P 500 (-3.33%), NASDAQ Composite (-3.98%), and the Russell 2000 small cap index (-6.49%) were very weak. A rally into the close on Friday lifted these indexes substantially.

A week ago I wrote in this space, “A failure to have a deal by 9:30am ET on Monday will likely have negative consequences, with both Wall Street and Main Street exercising their anger at Washington.” As I write this WIR, a Deal still has not been done, although much closer, and probably voted on tomorrow, but the public is much angrier.

The big movers in the DJIA this week were MSFT, JPM, WMT, XOM and MRK, all heavyweights. The losers were GM, DD, AA and UTX, much less weighty.

Also, the trading volume was remarkably weak, so just because US stocks were down say -3.5% on average this week, I’m not running scared.

Obviously the higher risk-taking traders who trade the NASDAQ (-4.0%) and the Russell 2000 small caps (-6.5%) were rattled. Do you see my point; I think it’s my experience that says ‘Don’t panic’.

Maybe it’s my Caribbean lifestyle? ‘Don’t worry mon, be happy’.

Anyway, I don’t think there are too many people here who work 100 hour weeks.

Kraft Foods (KFT) replaced AIG on Monday morning. The company is like the US economy; it’s a work in progress. Unfortunately, I think it will be a laggard.

Kraft Food [GICS 30, Dow 30]
(KFT: Google Finance file)
(KFT: Yahoo Finance file)
(KFT: StockChart chart)
(KFT: Billcara2 chart)
(KFT: ADVFN Financial Data)

A dozen NASDAQ stocks to watch.

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Here is the Monthly data chart of the Interactive Chart of Nasdaq Composite, S&P 500, Dow30, and Russell 2000 (small cap) indexes.

Here is the Weekly data chart of the Interactive Chart of Nasdaq Composite, S&P 500, Dow30, and Russell 2000 (small cap) indexes.

Here is the Daily data chart of the Interactive Chart of Nasdaq Composite, S&P 500, Dow30, and Russell 2000 (small cap) indexes.

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Table 14: Dow 30 List

Sorted by 1-Week Price Performance

Symbol	Close	1Day Change	1Day %Change	1W %Change	2W %Change	4W %Change	YTD %Change	3M %Change	6M %Change	12M %Change
MSFT	27.40	0.79	2.97%	8.90%	-0.80%	-1.93%	-22.20%	-1.26%	-4.06%	-7.12%
JPM	48.24	4.78	11.00%	2.53%	17.17%	24.07%	14.39%	32.82%	9.36%	4.57%
WMT	60.71	0.59	0.98%	1.69%	-2.72%	1.39%	29.45%	6.83%	14.76%	40.21%
XOM	80.65	-0.02	-0.02%	1.31%	4.06%	-0.65%	-13.75%	-6.67%	-6.50%	-12.69%
MRK	32.12	-0.25	-0.77%	0.88%	-5.03%	-11.76%	-44.01%	-11.27%	-28.14%	-38.94%
PFE	18.66	0.02	0.11%	0.59%	0.21%	-3.17%	-18.55%	8.68%	-9.81%	-24.08%
IBM	119.42	-0.69	-0.57%	0.48%	0.38%	-4.14%	14.07%	-1.41%	2.15%	1.81%
INTC	19.20	0.63	3.39%	-0.16%	-4.76%	-18.61%	-24.26%	-11.07%	-12.17%	-25.90%
KO	52.48	1.02	1.98%	-0.46%	-3.71%	-1.20%	-14.09%	-1.39%	-14.18%	-8.49%
JNJ	69.40	0.04	0.06%	-0.84%	-1.69%	-2.81%	5.30%	8.00%	7.26%	6.13%
HPQ	47.81	0.11	0.23%	-0.93%	1.79%	1.01%	-4.02%	7.03%	0.99%	-5.55%
CVX	86.95	-0.52	-0.59%	-0.97%	3.22%	-0.26%	-6.97%	-10.74%	2.34%	-6.01%
MCD	63.20	0.93	1.49%	-1.22%	-1.34%	0.49%	8.78%	11.96%	13.67%	15.33%
T	30.00	-0.07	-0.23%	-1.41%	-4.88%	-6.92%	-26.83%	-10.37%	-20.55%	-29.96%
BAC	36.70	2.33	6.78%	-2.08%	8.77%	16.77%	-9.52%	47.92%	-7.88%	-27.20%
PG	68.84	0.33	0.48%	-2.16%	-5.89%	-3.06%	-4.80%	10.59%	-1.15%	-2.37%
AXP	39.50	1.67	4.41%	-2.23%	1.41%	-2.20%	-22.61%	1.57%	-12.92%	-33.06%
BA	58.32	0.90	1.57%	-2.41%	-7.87%	-12.09%	-32.67%	-14.50%	-23.56%	-44.16%
C	20.15	0.74	3.81%	-2.42%	12.19%	5.61%	-30.33%	14.04%	-8.62%	-56.71%
HD	26.46	0.66	2.56%	-3.32%	-8.13%	-3.50%	1.34%	7.30%	-6.04%	-19.79%
VZ	32.18	0.13	0.41%	-3.36%	-6.70%	-9.28%	-25.53%	-6.21%	-10.96%	-27.65%
CAT	64.13	2.17	3.50%	-3.55%	-2.03%	-10.53%	-9.20%	-13.66%	-17.10%	-16.34%
MMM	69.45	-0.28	-0.40%	-4.44%	-1.00%	-4.21%	-16.03%	-1.15%	-11.71%	-24.95%
DIS	32.75	0.28	0.86%	-4.77%	-1.53%	0.49%	2.86%	3.87%	3.12%	-5.13%
GE	25.25	-0.43	-1.67%	-5.15%	-5.61%	-12.42%	-31.31%	-4.82%	-32.00%	-38.82%
UTX	60.86	1.69	2.86%	-5.35%	-5.58%	-8.78%	-19.08%	-3.07%	-12.57%	-24.11%
AA	23.54	-1.38	-5.54%	-12.13%	-17.89%	-27.35%	-34.85%	-33.31%	-34.67%	-38.81%
DD	41.99	-0.62	-1.46%	-12.59%	-9.48%	-7.25%	-4.00%	-1.94%	-10.34%	-15.78%
AIG	3.1500	0.1300	4.30%	-18.18%	-74.05%	-85.36%	-94.40%	-88.79%	-92.85%	-95.34%
GM	9.760	-0.270	-2.69%	-25.38%	-24.98%	-5.61%	-60.02%	-14.61%	-49.90%	-74.07%

You can do this table yourself by entering the following string into the Summaries window at www.billcara2.com and then clicking on the link for Performance.

AA AXP BA BAC C CAT CVX DD DIS GE GM HD HPQ IBM INTC JNJ JPM KFT KO MCD MMM MRK MSFT PFE PG T UTX VZ WMT XOM

Here are the links to interactive Dow charts from Billcara2.com that I broke into groups of ten, which you can add technical indicators for as well. (list one) (list two) (list three)

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Value Line Report(s) this past Friday

This week, Value Line reported on two DJIA components, AT&T (T), and Verizon (VZ), neither of which is a Cara 100 company.

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AT&T [GICS 50, Dow 30]
(T: Google Finance file)
(T: Yahoo Finance file)
(T: StockChart chart)
(T: Billcara2 chart)
(T: ADVFN Financial Data)
(T: Value Line Report Sep. 26: next one is due Dec. 26)

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Verizon [GICS 50, Dow 30]
(VZ: Google Finance file)
(VZ: Yahoo Finance file)
(VZ: StockChart chart)
(VZ: Billcara2 chart)
(VZ: ADVFN Financial Data)
(VZ: Value Line Report Sep. 26: next one is due Dec. 26)

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At the top of the cycle for these two Telco stocks, I heard traders say they loved the high dividend, and I reminded them that Total Return, which is dividend plus price change, is the important concept, and that a large dividend can (and was) be overwhelmed by falling prices.

Unless interest rates have been at a cycle peak and ready to fall, which boosts the price of interest-sensitives like the Telcos, I have no interest I buying them. Moreover in tight credit markets and with consumers being squeezed and homeowners being foreclosed, this is not a time to be getting interested in the Telcos. There are too many other high reward:low risk opportunities.

As time is short, I will forego any more discussion of T and VZ. I suppose they will take a jump along with the Financials after the passing of the National Rescue Plan, but if you are a holder that’s the time to look to jettison the positions and switch into stocks that will give better total returns, if return is your main objective.

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The Dow 30 Company links in chronological order of next reports.

Procter & Gamble Co. [GICS 30, Dow 30, Cara 100]
(PG: Google Finance file)
(PG: Yahoo Finance file)
(PG: StockChart chart)
(PG: Billcara2 chart)
(PG: ADVFN Financial Data)
(PG: Value Line Report Jul. 4: next one is due Oct. 3)

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Home Depot [GICS 25, Dow 30]
(HD: Google Finance file)
(HD: Yahoo Finance file)
(HD: StockChart chart)
(HD: Billcara2 chart)
(HD: ADVFN Financial Data)
(HD: Value Line Report Jul. 4: next one is due Oct. 3)

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General Electric [GICS 20, Dow 30, Cara 100]
(GE: Google Finance file)
(GE: Yahoo Finance file)
(GE: StockChart chart)
(GE: Billcara2 chart)
(GE: ADVFN Financial Data)
(GE: Value Line Report Jul. 11: next one is due Oct. 10)

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Hewlett-Packard [GICS 45, Dow 30]
(HPQ: Google Finance file)
(HPQ: Yahoo Finance file)
(HPQ: StockChart chart)
(HPQ: Billcara2 chart)
(HPQ: ADVFN Financial Data)
(HPQ: Value Line Report Jul. 11: next one is due Oct. 10)

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IBM [GICS 45, Dow 30]
(IBM: Google Finance file)
(IBM: Yahoo Finance file)
(IBM: StockChart chart)
(IBM: Billcara2 chart)
(IBM: ADVFN Financial Data)
(IBM: Value Line Report Jul. 11: next one is due Oct. 10)

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Intel [GICS 45, Dow 30, Cara 100]
(INTC: Google Finance file)
(INTC: Yahoo Finance file)
(INTC: StockChart chart)
(INTC: Billcara2 chart)
(INTC: ADVFN Financial Data)
(INTC: Value Line Report Jul. 11: next one is due Oct. 10)

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Alcoa [GICS 15, Dow 30]
(AA: Google Finance file)
(AA: Yahoo Finance file)
(AA: StockChart chart)
(AA: Billcara2 chart)
(AA: ADVFN Financial Data)
(AA: Value Line Report Jul. 18: next one is due Oct. 17)

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Dupont [GICS 15, Dow 30]
(DD: Google Finance file)
(DD: Yahoo Finance file)
(DD: StockChart chart)
(DD: Billcara2 chart)
(DD: ADVFN Financial Data)
(DD: Value Line Report Jul. 18: next one is due Oct. 17)

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Merck [GICS 35, Dow 30]
(MRK: Google Finance file)
(MRK: Yahoo Finance file)
(MRK: StockChart chart)
(MRK: Billcara2 chart)
(MRK: ADVFN Financial Data)
(MRK: Value Line Report Jul. 18: next one is due Oct. 17)

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Pfizer [GICS 35, Dow 30]
(PFE: Google Finance file)
(PFE: Yahoo Finance file)
(PFE: StockChart chart)
(PFE: Billcara2 chart)
(PFE: ADVFN Financial Data)
(PFE: Value Line Report Jul. 18: next one is due Oct. 17)

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United Technologies [GICS 20, Dow 30, Cara 100]
(UTX: Google Finance file)
(UTX: Yahoo Finance file)
(UTX: StockChart chart)
(UTX: Billcara2 chart)
(UTX: ADVFN Financial Data)
(UTX: Value Line Report Jul. 25: next one is due Oct. 24)

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Caterpillar [GICS 20, Dow 30]
(CAT: Google Finance file)
(CAT: Yahoo Finance file)
(CAT: StockChart chart)
(CAT: Billcara2 chart)
(CAT: ADVFN Financial Data)
(CAT: Value Line Report Jul. 25: next one is due Oct. 24)

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Coca Cola [GICS 30, Dow 30]
(KO: Google Finance file)
(KO: Yahoo Finance file)
(KO: StockChart chart)
(KO: Billcara2 chart)
(KO: ADVFN Financial Data)
(KO: Value Line Report Aug 1: next one is due Oct. 31)

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Kraft Foods [GICS 30, Dow 30]
(KFT: Google Finance file)
(KFT: Yahoo Finance file)
(KFT: StockChart chart)
(KFT: Billcara2 chart)
(KFT: ADVFN Financial Data)
(KFT: Value Line Report Aug 1: next one is due Oct. 31)

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Wal-Mart [GICS 30, Dow 30, Cara 100]
(WMT: Google Finance file)
(WMT: Yahoo Finance file)
(WMT: StockChart chart)
(WMT: Billcara2 chart)
(WMT: ADVFN Financial Data)
(WMT: Value Line Report Aug. 8: next one is due Nov. 7)

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Disney [GICS 25, Dow 30, Cara 100]
(DIS: Google Finance file)
(DIS: Yahoo Finance file)
(DIS: StockChart chart)
(DIS: Billcara2 chart)
(DIS: ADVFN Financial Data)
(DIS: Value Line Report Aug. 15: next one is due Nov. 14)

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3M Company [GICS 20, Dow 30, Cara US 100 June 25-06]
(MMM: Google Finance file)
(MMM: Yahoo Finance file)
(MMM: StockChart chart)
(MMM: Billcara2 chart)
(MMM: ADVFN Financial Data)
(MMM: Value Line Report Aug. 15: next one is due Nov. 14)

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American International Group [GICS 40, Dow 30]
(AIG: Google Finance file)
(AIG: Yahoo Finance file)
(AIG: StockChart chart)
(AIG: Billcara2 chart)
(AIG: ADVFN Financial Data)
(AIG: Value Line Report Aug. 22: next one is due Nov. 21)

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American Express [GICS 40, Dow 30]
(AXP: Google Finance file)
(AXP: Yahoo Finance file)
(AXP: StockChart chart)
(AXP: Billcara2 chart)
(AXP: ADVFN Financial Data)
(AXP: Value Line Report Aug. 22: next one is due Nov. 21)

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Bank of America [GICS 40, Dow 30]
(BAC: Google Finance file)
(BAC: Yahoo Finance file)
(BAC: StockChart chart)
(BAC: Billcara2 chart)
(BAC: ADVFN Financial Data)
(BAC: Value Line Report Aug. 22: next one is due Nov. 21)

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Citigroup [GICS 40, Dow 30]
(C: Google Finance file)
(C: Yahoo Finance file)
(C: StockChart chart)
(C: Billcara2 chart)
(C: ADVFN Financial Data)
(C: Value Line Report Aug. 22: next one is due Nov. 21)

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JP Morgan [GICS 40, Dow 30]
(JPM: Google Finance file)
(JPM: Yahoo Finance file)
(JPM: StockChart chart)
(JPM: Billcara2 chart)
(JPM: ADVFN Financial Data)
(JPM: Value Line Report Aug. 22: next one is due Nov. 21)

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Microsoft [GICS 45, Dow 30]
(MSFT: Google Finance file)
(MSFT: Yahoo Finance file)
(MSFT: StockChart chart)
(MSFT: Billcara2 chart)
(MSFT: ADVFN Financial Data)
(MSFT: Value Line Report Aug. 22: next one is due Nov. 21)

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General Motors [GICS 25, Dow 30]
(GM: Google Finance file)
(GM: Yahoo Finance file)
(GM: StockChart chart)
(GM: Billcara2 chart)
(GM: ADVFN Financial Data)
(GM: Value Line Report Aug. 29: next one is due Nov. 28)

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Johnson & Johnson [GICS 35, Dow 30, Cara 100]
(JNJ: Google Finance file)
(JNJ: Yahoo Finance fle)
(JNJ: StockChart chart)
(JNJ: Billcara2 chart)
(JNJ: ADVFN Financial Data)
(JNJ: Value Line Report Aug. 29: next one is due Nov. 28)

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McDonalds [GICS 30, Dow 30, Cara 100]
(MCD: Google Finance file)
(MCD: Yahoo Finance file)
(MCD: StockChart chart)
(MCD: Billcara2 chart)
(MCD: ADVFN Financial Data)
(MCD: Value Line Report Sept. 5: next one is due Dec. 5)

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Chevron Corp [GICS 10, Dow 30]
(CVX: Google Finance file)
(CVX: Yahoo Finance file)
(CVX: StockChart chart)
(CVX: Billcara2 chart)
(CVX: ADVFN Financial Data)
(CVX: Value Line Report Sep. 13: next one is due Dec. 12)

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ExxonMobil [GICS 10, Dow 30, Cara 100]
(XOM: Google Finance file)
(XOM: Yahoo Finance file)
(XOM: StockChart chart)
(XOM: Billcara2 chart)
(XOM: ADVFN Financial Data)
(XOM: Value Line Report Sep. 13: next one is due Dec. 12)

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Boeing Co [GICS 20, Dow 30. Cara 100]
(BA: Google Finance file)
(BA: Yahoo Finance file)
(BA: StockChart chart)
(BA: Billcara2 chart)
(BA: ADVFN Financial Data)
(BA: Value Line Report Sep. 19: next one is due Dec. 19)

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AT&T [GICS 50, Dow 30]
(T: Google Finance file)
(T: Yahoo Finance file)
(T: StockChart chart)
(T: Billcara2 chart)
(T: ADVFN Financial Data)
(T: Value Line Report Sep. 26: next one is due Dec. 26)

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Verizon [GICS 50, Dow 30]
(VZ: Google Finance file)
(VZ: Yahoo Finance file)
(VZ: StockChart chart)
(VZ: Billcara2 chart)
(VZ: ADVFN Financial Data)
(VZ: Value Line Report Sep. 26: next one is due Dec. 26)

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Wrap-up:

I had a computer network card problem that started Thursday (or maybe it was a faulty modem, or a cable issue, causing me to be late for the Daily Reports on Thursday and Friday and which delayed this Report. I had planned to publish the WIR earlier so I could enjoy the weather, but mostly because I wanted you to have more time to think things over.

Then on Saturday morning, nothing worked.

Last weekend I told you I was fishing – we caught six snappers plus something else I didn’t recognize, probably a Jack. We were fishing at about 1000 feet with a power reel and multi-hook line baited with squid. I am known as the Bait Man, which next to the bartender is the lowest job on the boat. Given there were only three of us, and I also had to get the drinks and maneuver the boat, you know where I stand in the pecking order.

And with a passing offshore storm, there were white caps and some four-foot swells, so we were the only boat out there. At 48-feet, it’s big enough, but we did spill a few California cabs over the deck. BBQ a couple hours later – you can’t beat it.

With the pressures of the market and building a company, and all, I need relaxation breaks like that. This is my 14th day back and I figure I’ve already worked 200 hours. I live right on the ocean, right next to an upscale resort that I guess people are paying about $3,000 each a week for. Much of the time, they are swimming in my ocean. For 14 days, however, I’ve been in it once, for a total of five minutes.

Ah, but as the saying goes, at least I’m here, and last time I checked I’m still vertical.

Time to look up; things are going to get better. There will be a New Deal for the New Bull.

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