Thursday, April 21, 2011

Stocks at Highs on POMO Momo; Silver Even Better

The melt-up continues in equities as the dollar continues deteriorating, losing another 0.39% on the day, dipping to post-Lehman crash (fall 2008) level at 74.09 after briefly crossing below 74.

We're witnessing a rather non-virtuous cycle here which is roughly 200 Dow points for every percentage decline on the DXY, so, if what's intended is the Dow above 13,000, expect another 2.5% decline in the value of the good, old greenback. Also expect a similar rise in the cost of everything you need to buy from outside the US, i.e., imports, which would include almost everything, and especially everything sold in any Wal-Mart store, the nation's largest retailer.

So, good news on Wall Street translates into generally bad news for the public American, except that 5, 10, 20 or 30 years from now, that money you keep pumping into your 401k or retirement plan is just going to be a mountain of cash! Unfortunately, by that time - if the market hasn't already crashed or you haven't already kicked the bucket, everything will cost enormously more than it does today, except, of course, your home, which continues to fall in value.

Stocks got an able assist from both the declining dollar and Uncle Benji, who delivered another $1.5 billion in free cash flow for the Primary Dealers on Wednesday, so there might have been just a little overhang, since settlement was today.

Of course, the markets would normally have been lower considering the economic news. The weekly new unemployment claims came in at 403,000, well above estimates (bad!), and the Philadelphia Fed's monthly Business Outlook Survey took a tumble in April to 18.5, from 43.4 in March (very bad!)

Not to worry, the maestros of our destruction are taking Good Friday off to pray for all of us. HAHAHAHA!

Dow 12,505.99, +52.45 (0.42%)
NASDAQ 2,820.16, +17.65 (0.63%)
S&P 500 1,337.38, +7.02 (0.53%)
NYSE Composite 8,504.36, +46.71 (0.55%)

As expected, advancing issues outnumbered decliners, 4214-2301. NASDAQ new highs: 143; new lows: 20. NYSE new highs: 224; new lows: 10. Volume was an absolute embarrassment, making all other data virtually meaningless. The only traders are computers whirring at the big brokerages and a few hedge funds which are allowed to play. Individual investors have been permanently spooked out of the Ponzi-style, POMO-driven US stock market.

NASDAQ Volume 1,856,856,375
NYSE Volume 3,947,026,500

Crude oil futures gained 84 cents, to $112.29. Yes, if gas isn't $4.00 a gallon where you live, it soon will be, and $5.00 in California, New York, Chicago and Hawaii are soon to come.

Gold finally closed above $1500 on the COMEX, hitting $1,503.80, a gain on the day of $4.80. Silver was up more than 4.5%, gaining $1.60, to close at another 31-year high of $46.06. Unbelievable! Silver is up 145% in just the last year and is likely to double again within two years, if not sooner.

Happy Easter!

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