Monday, November 12, 2007

Oops, They Did It Again

Broken record. Drop. Skip. Drop. Skip. Drop. Skip.

If you haven't bailed out of your long - and likely losing - positions by now, there's still time to limit your losses. The stock markets continue to fall, day by day, lower and lower. It's plain that there are problems with the economy, with stocks, with investments, and you don't want to be stuck holding the bag.

Dow 12,987.30 -55.44; NASDAQ 2,584.13 -43.81; S&P 500 1,439.18 -14.52; NYSE Composite 9,570.04 Down 163.30

The Dow careened through the 13,000 mark late today. Apparently, the PPT has given up attempting to fly the market higher into the close. They now prefer mid-day propping instead, as the Dow was at one point 100 points to the good, but it could not hold gains.

To illustrate the depth and breadth of the selling, declining issues overwhelmed advancers by 3894-1377. New lows trampled new highs, XX-XX. The NYSE Composite, the broadest measure of mainstream stocks and one of the least-watched, has lost 740 points since October 31, a span of just 8 sessions.

What's almost a certainty at this juncture is that the Dow will retest the August lows of 12,800, possibly as early as this week. Tomorrow, pending home sales for September will be released at 10:00 am, and the numbers are not likely to be encouraging. As the week rolls on, PPI, CPI, Industrial Production and Capacity Utilization reports flow into the market. With earnings season pretty much behind this market, though Home Depot (HD) and Wal-Mart (WMT) report Tuesday prior to the open, economic reports will be market-movers.

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Oil slipped $1.70 to close at $94.62. Apparently, there was another round of debts being called or heavy profit-taking as gold dropped an enormous $27.00, ending the day at $807.70. Silver also declined 78 cents to $14.76. I say there was a credit crunch because this is precisely what happened one day in August, when everybody rushed to raised cash - they sold gold. Panic selling of assets is endemic to this environment.

Panic selling of stocks might actually be a virtuous undertaking here since there are better places for money - like in a sock or tucked under a mattress - than sending them down the black hole on Wall Street.

I close today with a tribute to all veterans, and one very special one, my father, Nick Gagliano, who served in the Army in WWII and fought in the Battle of the Bulge. I salute you all and thank you for your service. God Bless America.

NYSE Volume 3,749,867,750
NASDAQ Volume 2,732,693,250

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