Friday, May 28, 2010

Nose-Diving into the Weekend

At least stocks didn't gap up or down radically at the open today. Instead, they automatically reversed course against Thursday's gains, sending the major averages into a week-ending tailspin under pressure from foreign as well as domestic turbulence.

Prior to the open, personal income was shown to have grown 0.4% in April, most of the gain due to increases in government payrolls. Just before 10:00 am, the markets were dealt another blow of reality when both the Chicago PMI and University of Michigan comsumer sentiment index came in below expectations. Added to the 460,000 initial unemployment claims and lowered GDP estimate for the first quarter (to 3.0% from 3.2%) from Thursday, stocks were indeed lucky to receive any bids as the month of May for 2010 went down in the record books as the worst for stocks since 1940 - 70 whole years!

Those who insist that the US is on the road to recovery, or, already well down that road, are either not telling the truth or just too damn stupid to see the all-too-obvious signs on the road to ruin, the one the US has actually embarked upon.

The current and future fate of these United States was summed up brilliantly by casino-operator and real estate mogul, Steve Wynn, who, along with other gems of insight invoked Alexis de Touqueville, who predicted in 1909 that "the American system of democracy will prevail until that moment when the politicians discover that they can bribe the electorate with their own money." More of Wynn's caustic, cutting remarks can be viewed in the video below.

Dow 10,136.63, -122.36 (1.19%)
NASDAQ 2,257.04, -20.64 (0.91%)
S&P 500 1,089.41, -13.65 (1.24%)
NYSE Composite 6,791.57, -101.72 (1.48%)

Decliners laid over advancers largely, 4332-2135, or better than 2:1. New highs edged new lows, 107-73, but the margin being so close that it favors a negative outlook short term. So too, Friday's volume, which partly could be blamed on complacency and early departures, though it has been heading lower all week long.

NYSE Volume 5,757,302,000.00
NASDAQ Volume 2,185,725,000.00

The commodity complex was little changed, perhaps offering a glimpse at a more sober understanding of supply-demand dynamics for the coming months. Crude fell 58 cents, to a goosed-up $73.97. Gold gained 40 cents, to $1,212.20. Silver fell a nickel, to $18.41.

Remember, this weekend, those who served to make America great and gave their lives in defense of liberty, especially when driving through a police check-point or being harassed by some pompous low-level government official who wants to ruin your outing with nonsensical regulations. Remember that liberty is gained, not given. Earned, not handed out.

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