Friday Brings Out Just a Few Bottom Fishers in Flat Market

There was a bit of moderation on Friday, at the end of a week which saw the major averages give up plenty of downside.

With a dearth of data and corporate news, there were probably more than a few active traders taking the early train out of town during the lackluster session. Some bottom fishing did occur - though not much - as belied by the A-D line, which favored advancing issues, for a change and very low volume.

For the week, the Dow lost 264.84 points (1.65%); the S&P gave up 29.77 (1.65%); the NASDAQ fell 61,54 points (1.51%); and, the NYSE Composite declined by 176.38 (1.74%).

A telling sign of overall weakness is represented by the broadest index (NYSE Comp.) being the worst performer for the week in percentage terms. Notably, the composite average broke through its 50-day moving average yesterday and stabilized below it today. Each of the other indices have room to spare above their respective 50-day lines.

New lows continued their dominance over new highs for the third straight session, 147-114. While that is by no means a trend, experience suggests that it could be marking a market top if new lows exceed the number of new highs for an extended period of eight or more consecutive sessions. More likely would be a back-and-forth between the daily highs and lows in a sideways trading pattern as a precedent to the market direction being decided.

The week was the worst for stocks since October, but by no means indicative of anything other than some late-year selling, fears of Fed tapering and the usual yin and yang between buyers and sellers.

More time and data need to be collected before calling for a change in direction, though the measured belief is that it is overdue, at least in the medium term. Strong support was tested and bounced off of at the lows of the day on the Dow, around 15,723.

DOW 15,755.36, +15.93 (+0.10%)
NASDAQ 4,000.98, +2.57 (+0.06%)
S&P 1,775.32, -0.18 (-0.01%)
10-Yr Note 99.02 +0.75 (+0.77%)
NASDAQ Volume 1.49 Bil
NYSE Volume 3.05 Bil
Combined NYSE & NASDAQ Advance - Decline: 3257-2361
Combined NYSE & NASDAQ New highs - New lows: 114-147
WTI crude oil: 96.60, -0.90
Gold: 1,234.60, +9.70
Silver: 19.60, +0.151
Corn: 425.50, -8.75

Stocks Pounded Lower Again; December a Month of Not-so-Happy Holidays

Declines in equity prices are beginning to get a little bit serious, with the Dow Jones Industrials taking another 100+ point hit on Thursday after retail sales for November came in strong, but were unable to inspire confidence in the consumer sector, and unemployment claims shot up beyond expectations, to 368,000, not the kind of number expected during what is supposed to be the "busy" holiday shopping season.

Since the peak of 16,097.33, reached the day before Thanksgiving (November 27), the Dow is off 357 points, putting in a new interim low today. Still, that's a loss of just over two percent, not anything to get excited over, but the trend since Black Friday has been pronounced, with just two up days in the past 10 sessions.

Worse, new lows have taken a huge edge over new highs as of today, portending further losses should the trend extend.

The selling spilled over into precious metals, with gold and silver reversing gains made yesterday. Selling off of the metals may be a precursor of more asset depreciation, or, it could be just more of the constant discrediting of gold and silver as stores of value. It's a preposterous argument, made manifest by the fact that precious metal prices are derived from paper trading, which has nothing whatsoever to do with the intrinsic value proposition which only physical objects hold.

Overall, it's just getting a little too ugly for speculators with the year-end arriving in just 12 trading days.

DOW 15,739.43, -104.10 (-0.66%)
NASDAQ 3,998.40, -5.41 (-0.14%)
S&P 1,775.50, -6.72 (-0.38%)
10-Yr Note 98.86 -0.15 (-0.15%) Yield: 2.88%
NASDAQ Volume 1.75 Bil
NYSE Volume 3.28 Bil
Combined NYSE & NASDAQ Advance - Decline: 2513-3135
Combined NYSE & NASDAQ New highs - New lows: 66-314
WTI crude oil: 97.50, +0.06
Gold: 1,224.90, -32.30
Silver: 19.45, -0.903
Corn: 434.25, -5.00

Stocks Suffer Heavy Losses in Biggest Two-Day Selloff in Two Months

Not since the uncertainty surrounding the government shutdown in October have stocks suffered through a two-day period such as the one ended Wednesday afternoon.

Stocks were lower at the open and never gained positive ground for the entirety of the session.

Besides the usual fears of Federal Reserve tapering in December (or soon thereafter, as everybody knows it's coming), the latest buzz comes from the far East, where talk of China's overcapacity in an enormous number of industries is fueling speculation of a slowdown in the growth rate of the world's most populous nation.

Another way of expressing overcapacity concerns is slack demand in consumer countries from the USA to the various Eurozone nations and Great Britain. All taken together, a slowdown could be coming at exactly the wrong time for the resident intellectuals at the Fed, who may see their hand forced to curtail - at least to some extent - their bond purchases.

The three-headed monster of slowing industrial growth, slack consumer demand and a pullback of stimulus appears ready to launch an attack on wary equity investors who have been mostly riding a liquidity gravy train for nearly the past five years.

While the two-day selling event may portend even more selling heading through December - usually one of the strongest months for stocks - the fact that the major averages have been down seven of the last nine sessions, belies the false move presented last Friday on November's blowout non-farm jobs data when the Dow was up nearly 200 points. Monday's five-point gain on the Dow was nothing more than a rounding error. Today and yesterday's losses have nearly given all of last Friday's gains back. The Dow is just 22 points above last Thursday's close, setting up this Thursday (tomorrow) as a potential mini-correction if the Dow closes below 15,821.51.

Technical damage has been done recently, both to blue chips and more speculative issues. The NASDAQ suffered the brunt of the selling today, losing nearly 1 1/2 percent on the day. Declining issues outnumbered advancers by more than a four to one margin.

Another concern is volume, which picked up in today's downside trading. Making matters even more bearish were the new lows, which completely subsumed today's new highs, 208-104, a key indicator for direction, and, if it holds, a sure signal for a market correction or outright bear market, something which is probably long overdue.

Happy Holidays? Depends upon which side of the trade you're on.

DOW 15,843.53, -129.60 (-0.81%)
NASDAQ 4,003.81, -56.68, (-1.40%)
S&P 1,782.22, -20.40 (-1.13%)
10-Yr Note 99.46 +0.30 (+0.30%) Yield 2.84%
NASDAQ Volume 1.78 Bil
NYSE Volume 3.46 Bil
Combined NYSE & NASDAQ Advance - Decline: 1096-4603
Combined NYSE & NASDAQ New highs - New lows: 104-208
WTI crude oil: 97.44, -1.07
Gold: 1,257.20, -3.90
Silver: 20.36, +0.041
Corn: 439.25, +3.25

Another Dismal Day in the Dumps for Stock Owners

Certainly, nobody is going to feel sorry for the Wall Street lemmings, vultures and whales for another losing day on stocks. After all, the major averages are up more than 25% on the year and a good number of individual issues are up much more than that, many having doubled in price over the past 48 weeks.

So, excuse us if we cry crocodile tears for well-heeled investors and speculators.

There is, however, a little bit of a problem in the markets, and it is completely and everlastingly tied to the Federal reserve and their Zero Interest Rate Policy (ZIRP) and continuing quantitative easing (QE), about which there is much debate, constrnation and confusion.

The final meeting of the year for the FOMC is slated for next Tuesday and Wednesday, and, while nobody in their right mind expects this august body to announce any rate policy changes, there is the small matter of decreasing the amount of securities the Fed is buying every month (QE) from the current $85 billion to something less than that, otherwise known as "tapering."

CNBCs Steve Liesman, who has a pipeline directly to and from the Fed, announced today that tapering would be announced at the December meeting. That news, and the final acceptance and future implementation of the Volker Rule, sent stocks backpedaling from the outset. The Volker Rule, in essence, disallows banks from engaging in speculative trading with depositors' money, something the various agencies feel was responsible for at least a part of the financial crisis of the past five years.

The rule puts severe restrictions on what banks can and can't do in terms of proprietary trading (i.e., speculating), but it is dense, long, deep, and riddled with potential loopholes for crafty lawyers and bankers to slither all kinds of nefarious doings through. The Volker Rule document - three years and 585 pages in the making - is, in reality, nothing more than a full-employment bill for litigation attorneys. Bully for them.

QE, and, more specifically, the tapering of QE, is another animal altogether. The Fed has been jawboning about the possibility of scaling back their bond purchases - $45 billion in treasuries and $40 billion in MBS - since May, with varying degrees of success. Wall Street banks, being the main beneficiaries of the program, would like the policy to extend to infinity and beyond, though they know in their dark heart of hearts that it must come to some kind of conclusion. The US economy cannot be force-fed money by the central bank forever.

Besides the program being excessively beneficial to banks and somewhat harmful to small businesses, consumers and emerging market nations, there is another problem that the Fed may never have considered. Due to their monopolizing of the MBS and treasury markets, the available bond issuance is dwindling, so much so, that the Fed may have no choice but to wind down such programs.

The other side of the equation is such that the Fed has so far crowded out potential bidders that there may not be many who actually want to participate. Thus, many in the bond world see even a slight decrease of buying by the Fed as a potential for higher interest rates, including interest on government debt itself, which is already a large portion of the Federal budget but could grow into a behemoth should the federal government have to begin paying back interest at higher and higher rates.

These are the unforeseen, though somewhat predictable, ramifications of the Fed's actions, actions that forestalled an implosion of the financial system and the insolvency of many of the world's largest financial institutions, dating back to the halcyon days of 2008 and $800 billion in TARP money and then-Fed Chairman Hank Paulson holding a gun to the economy's head.

So, Liesman may be bluffing at the behest of the Fed, or he could have just issued the warning shot to the markets that the plundering of assets with free money is about to come to an end.

The signs that the policy has run its course are profligate: record art and collectible car auctions, record high-end real estate prices, record stock prices.

Enough is enough. The party is about to come to a crashing, cataclysmic conclusion, and as cataclysms usually are, this one is not likely to be pretty.

Technically speaking, the advance-decline line deteriorated again today, the gap between new highs and new lows continues to show signs of shrinking and potentially flipping, and outside of Friday's massive vapor-rise, stocks have fallen every day since Thanksgiving.

The good news (for some) is that commodity prices took a lift today, with silver and gold leading the way.

DOW 15,973.13, -52.40 (-0.33%)
NASDAQ 4,060.49, -8.26 (-0.20%)
S&P 1,802.62, -5.75, (-0.32%)
10-Yr Note 99.43, +0.37 (+0.37%), Yield: 2.80%
NASDAQ Volume 1.71 Bil
NYSE Volume 3.07 Bil
Combined NYSE & NASDAQ Advance - Decline: 2115-3553
Combined NYSE & NASDAQ New highs - New lows: 206-113
WTI crude oil: 98.51, +1.17
Gold: 1,261.10, +26.90
Silver: 20.32, +0.614
Corn: 436.00, -2.00

No Follow-Through After Big Jobs Report Gains

We've seen this show before, and, it bears witness to the steady downtrend last week that was punctuated by a huge move to the upside on Friday. The non-momentum Monday is the hangover effect of a stock move that was entirely day-trading driven, run on fumes and now run out of gas.

It shows no commitment among traders to actually invest; rather, it solidifies the argument that Wall Street stocks are nothing but casino chips, their valuations unrealistic and devoid of fundamental value, or, at least, fundamentals that would support such stocks at lower prices.

Thanks to Uncle Ben at the Fed we have a completely distorted market that is fueled by creap money and speculation. It was nice knowing Mr. Bernanke, who could step down as early as this week if the Senate confirms Janet Yellen, though she, as replacement, seems even more out-of-touch and reluctant to do anything other than continue printing.

Stocks will keep going up, until they don't, which could be any day now, considering the predictably ugly numbers retailers are set to report this week and throughout the holiday season.

Basically, if one spent today watching the tape, one would have likely fallen asleep.

DOW 16,025.53, +5.33 (+0.03%)
NASDAQ 4,068.75, +6.23 (+0.15%)
S&P 1,808.37 +3.28 (+0.18%)
10-Yr Note 99.20 +0.18 (+0.18%)
NASDAQ Volume 1.54 Bil
NYSE Volume 3.09 Bil
Combined NYSE & NASDAQ Advance - Decline: 2599-3043
Combined NYSE & NASDAQ New highs - New lows: 305-96
WTI crude oil: 97.34, -0.31
Gold: 1,234.20, +5.20
Silver: 19.70, +0.178
Corn: 438.00, +3.75

November Jobs: 203,000; So, Now Good News Is Good News?

Highly anticipated all week, the November Non-farm payroll report from the BLS showed 203,000 jobs created during the month. The official unemployment rate fell to 7.0%, which, for all intents and purposes, is pretty close to not just the Fed's 6.5% target for raising interest rates, but not too distant from what is regarded as full employment at five percent unemployed.

Initially thought to be a negative if the number came in anywhere above official estimates of 185,000, index futures got ramped higher and stocks were off to the races, opening with a huge gap higher and maintaining price levels throughout the final session of the first week of December.

For the week, the Dow was down just 66.21 points; the S&P missed closing positive by a mere 0.72; and, the NASDAQ actually closed in the green for the week by 2.63 points.

Opinions varied widely about what the movement in stocks meant, based upon the potential for tapering of the bond buying program by the Fed. In general terms, the Fed now has Wall Street's tacit approval to begin winding down the $85 billion a month program as early as this month. either that, or today's trading, and all the supposed "fearful profit taking" of the first four days of the week were simply short-term momentum trades, rooted in absolutely nothing.

In any case, those who were short the market for the better part of the first four days of the week and then went long at the close on Thursday (cue insider bankster types) were big winners. Anybody who waited for the number to be released prior to the opening on Friday, ate dust.

And that, my friends, is how the game is played. Good news may very well be perceived as bad news, until the size players decide that good news is good news, after all. Pure thievery at a high level is probably the most apt description of how this week played out. A telltale sign was the absurdly low volume, especially coming in anticipation, and, on the heels of a critically "important" number.

Thank goodness, Christmas is less than three weeks away and the retailers haven't had much to say, but that card will be turned shortly, and it could be a wild one.

DOW 16,020.20, +198.69 (+1.26%)
NASDAQ 4,062.52, +29.36 (+0.73%)
S&P 1,805.09, +20.06 (+1.12%)
10-Yr Note 99.03, +0.74 (+0.76%)
NASDAQ Volume 1.49 Bil
NYSE Volume 2.74 Bil
Combined NYSE & NASDAQ Advance - Decline: 3965-1711
Combined NYSE & NASDAQ New highs - New lows: 310-112
WTI crude oil: 97.65, +0.27
Gold: 1,229.00, -2.90
Silver: 19.52, -0.047
Corn: 434.25, +0.75

Dow, S&P Post Fifth Straight Losing Session; Fed Tapering Fears to Blame

Stcks took another turn lower on Thursday after the government reported its second estimate of GDP for the third quarter grew at a rate of 3.6%, far ahed of even the most bullish estimates and a dramatic revision from the first estimate of 2.8% growth.

Inside the numbers, more than half of the GDP push was due to inventory builds, the consumer spending portion of the calculation lower than previous quarters. Additionally, the govenment changed the way it calculates GD per the second quarter, so the adjusted figures include intangible assets (normally treated as liabilities on any corporate balance sheet, but as growth assets according to the infamous trick economists the government employs). All estimates of GDP from the second quarter of 2013 onward, and especially during the initial quarters through the second quarter of 2014, should be viewed as more mark-to-fantasy accounting by the government, designed to make the economy look better than it actually is.

The new calculus of GDP is a double-edged sword going forward, as higher GDP emotes thoughts of Fed tapering of bond purchases, currently the lifeblood of the stock markets. While it looks good on the surface, the net effect in stocks is negative, for now.

In some glorious, imagined future world, higher GDP, based on various faulty assumptions, will produce a happiness effect or contentment, which, along with the Fed's highly-dubious but nonetheless heavily-touted "wealth effect" will be hailed as the outcome of successful Fed policies or some other rubbish, and, which the lazy, out-of-touch politicians in congress and the White House can somehow claim credit.

Sadly, or perhaps happily, in this good-news-is-bad-news regime, the headline-munching algos controlling the stock market can't read between the lines and are programmed to sell on economic improvement, whether the data is flawed or pristine. The Wall Street herd (and it is nothing other than herd mentality dictating direction) is equally deficient by buying into flawed data, but those are the cards issued by the underhanded Fed bottom-card-dealing Fed. The choice to raise, hold or fold is entirely up to the traders, though at this juncture, they're collecting their profits and running from the gaming tables in advance of november non-farm payrolls, due out Friday at 8:30 am ET.

The other number issued today was courtesy of the BLS in weekly initial jobless claims, coming in at 298,000, a six-year low, the good news just adding more melancholy to traders who have brought the Dow and S&P indices lower for the fifth straight session.

Those paying attention to internals will note that the advance-decline line continues to erode, and that new lows finally overtook new highs today, for the first time since early October. Those two indicators will be supplying signals beyond the November non-farm payroll data tomorrow and should be viewed as the least-abused and most reliable signs for market direction.

Precius metals were hammered lower once again, though nary a gold or silver bug can be heard complaining, considering the lowered prices to be akin to a pre-Christmas sale on the metals.

DOW 15,821.51, -68.26 (-0.43%)
NASDAQ 4,033.16, -4.84 (-0.12%)
S&P 1,785.03, -7.78 (-0.43%)
10-Yr Note 99.08 0.00 (0.00%)
NASDAQ Volume 1.79 Bil
NYSE Volume 3.30 Bil
Combined NYSE & NASDAQ Advance - Decline: 2217-3433
Combined NYSE & NASDAQ New highs - New lows: 127-164
WTI crude oil: 97.38, -0.18
Gold: 1,231.90, -15.30
Silver: 19.57, -0.26
Corn: 433.50, -3.00

Stocks Plunge, Recover, End Flat on Fed's Beige Book, Data

A raft of economic news hit the street on Wednesday, but, for the most part, all it did was add to the confusion surrounding the Fed's bond-buying scheme and Friday's non-farm payroll release for November.

Leading off the hit parade - prior to the open - was ADP's November private payroll number, gushing at a robust 215,000 new jobs created during the month, which turned futures sour and set a negative tone for the session (remember, good news is bad because the Fed would likely diminish the free money carry trade known as QE).

Then came data on the US trade deficit, which narrowed to $40.6 billion, more good news. New home sales surged 25%, though the median price declined slightly, another positive for the economy.

The mood changed with ISM Services data, showing a slowing from 55.4 in October to 53.9 in November. Overall, the mood on Wall Street turned to fear of an improving economy (sad, but true how twisted the logic is), sending stocks to their lows of the session around midday.

With the Dow off 125 points and the other major indices following suit, the Fed's beige book was released at 2:00 pm ET, and, apparently, enough investors and traders found enough evidence to believe that the Fed was nowhere close to tapering their bond purchases, igniting a rally that sent the Dow into positive territory briefly in the final half hour of trading.

While this is a plausible explanation of the day's roller coaster activity, some did not get the memo or read the tea leaves of the Fed clearly enough, as the rally sizzled, then fizzled into the close, leaving the Dow and S&P modestly lower, the NASDAQ up a couple of points.

At the end of the day, it was a big, fat, nothing=burger, though some adroit day-traders certainly cashed in on the movement and momentum.

With the Dow down for the third time in three December days, it marks the first time that's happened to start a month since September, 2011.

The BLS monthly non-farm payroll report will be released Friday morning, leaving Thursday as a kind of limbo trade. Based on the smashing results of the ADP report, expectations are for a boffo government report, producing, alas, another downdraft on stocks. such is the madness that moves markets in the age of QEternity and ZIRP until the end of time.

Thursday, therefore, would be a good day to relax, take some time off and buy some gold or silver, both of which saw heavy buying after weeks and weeks of relentless selling. A bottom may have been put in on the precious metals, or not. In any case, they're very cheap compared to prices over the past three years. Besides, they're shiny and guaranteed not to rust.

Bonds sold off, with the 10-year note hitting 2.84% yield at the end of the day, a watershed mark and the highest yield since October.

Volume was relatively strong, the advance-decline line continued to post a negative number, and the gap between new highs and new lows narrowed to its lowest point since the government shutdown in October, a key number on which to train one's investment eyes.

DOW 15,889.77, -24.85 (-0.16%)
NASDAQ 4,038.00, +0.80 (+0.02%)
S&P 1,792.81, -2.34 (-0.13%)
10-Yr Note 99.18, -0.03 (-0.03%)
NASDAQ Volume 1.81 Bil
NYSE Volume 3.59 Bil
Combined NYSE & NASDAQ Advance - Decline: 2236-3418
Combined NYSE & NASDAQ New highs - New lows: 150-111
WTI crude oil: 97.20, +1.16
Gold: 1,247.20, +26.40
Silver: 19.83, +0.765
Corn: 436.50, +5.25

Desptie Fed PMO of $3.7 Billion, Stocks Swoon

Something is definitely amiss in US equity markets.

While that may be the most understated understatement of the year - or the past five - even an injection of $3.7 billion from the Fed's Permanent Open Market Operations (POMO) couldn't get stocks to attain escape velocity.

And that's the problem. Velocity. There simply isn't any, in the stock markets (for now, though that will likely change) and especially in the outside economy where every extra dollar is being spent consolidating debt, paying down debt or going into a rainy day fund, because people, humans, have this uncanny knack for knowing when trouble is on the horizon.

Call it a Spidey-sense tingling, or intuition, or maybe people can simply see what's going on: politicians lie and don't deliver; economics are skewed toward corporations, not individuals; the government protects banks and ignores the plight of the people; Wall Street continues to enrich itself at the expense of the American people; Obamacare; eroding rights; call it what you will, but it's a fact that more than two thirds of the people in the United States believe the country is going in the wrong direction.

There are less people now who have a positive view of congress than there were supporting the king of England on the advent of the American revolution. People are afraid, so they don't spend, and, since consumer spending is the fuel of the economy, i.e., velocity, the velocity of money has been slowing and is nearing stall speed. The money the Federal Reserve pumps via their POMOs and bond-buying-binge ($85 billion a month) is not going into the general economy. It goes largely into excess reserves which the banks borrow from for speculation, mostly into stocks, but even this is not providing the lift.

The major indices spilled into the red for the second straight day during December. A large part of that spillage may be profit-taking, but there's also a valuation angle that must be addressed. Some stocks are at nosebleed levels. Others are backed by businesses which may or may not be very well-managed. Future-looking analysts paint a rosy picture for 2014, but the reality is that many corporations are seeing margins being squeezed, stock buybacks at all-time highs and labor cutbacks that are straining their collective workforces.

Then, there's Obamacare, which has had the unique ability to cut workers' hours to under 30 per week, limiting productivity and job security, while adding costs - and uncertainty - to the bottom line of many businesses, large and small.

It's a shipwreck, a train wreck, a slow motion un-natural disaster and it's being played out in real time on Wall Street. It's been said here and elsewhere ad nauseum that the greed, lying, cheating and stealing by Wall Street and Washington will eventually have to be paid back in an inglorious reversal of fortune. Could that reversal be taking place, right now?

Maybe, but probably not. These things, like the destruction of the entire economic system of a nation with the reserve currency, take time. It's not going to happen overnight, though the past five years have evidenced dislocations and distoritions to markets and price discovery mechanisms unlike any other time in recorded history.

The abomination has arrived... in 2008. We're only just now beginning to deal with the nasty side-effects of trying to deal with it without causing pain.

Now comes the pain. Detroit is first up for the beatings.

DOW 15,914.62, -94.15 (-0.59%)
NASDAQ 4,037.20, -8.06 (-0.20%)
S&P 1,795.15, -5.75 (-0.32%)
10-Yr Note 99.88, +0.70 (+0.71%)
NASDAQ Volume 1.72 Bil
NYSE Volume 3.36 Bil
Combined NYSE & NASDAQ Advance - Decline: 2168-3505
Combined NYSE & NASDAQ New highs - New lows: 142-113
WTI crude oil: 96.04, +2.22
Gold: 1,220.80, -1.10
Silver: 19.06, -0.224
Corn: 431.25, +6.75

On Cyber Monday, Black Friday Left Wall Street Red-Faced

So, everybody was shopping online today, this being Cyber Monday, the busiest online shopping day of the year, right?

Well, maybe, but there were a lot of people shopping online last week, instead of fighting the mobs at the malls and big box stores; so many, in fact, that Black Friday didn't really live up to the hype. It was kind of a bust, as the voting, via stock trades on Monday, clearly demonstrated.

Stocks took a nosedive at the end of the day, as they've done the past three sessions, led by the two strongest consumer sectors. Consumer discretionary was the loss leader of the day, with names like Aeropostale (ARO, -5.5%), Urban Outfitters (URBN, -3.5%) and Sears (SHLD, -5.2%) leading the way down.

That's not a good sign for the holiday season, which, according to now-skeptical analysts, expect to be the worst since 2009.

Retailers were not completely to blame for Monday's selloff, which was led by the Dow Industrials. Rather, the selling, which accelerated into the close, as has been the recent motif, was probably tied more to profit-taking. After all, stocks have had a stellar run in 2013, with the Dow up 26%, the NASDAQ ahead by nearly 30% and the S&P sporting a 28% rise on the year.

It's been a grand year to buy and hold stocks; one certainly can't blame anyone for partaking of some fat holiday profits, but the overall trend of trading has been puzzling to the perma-bull crowd, with the current bull market closing in on 57 months.

The trend may remain intact for a while longer, though, because there's nearly zero chance of the Federal Reserve announcing any kind of tapering of their bond purchase program at the December meeting of the FOMC (Dec. 17 & 18), risking market displeasure and a downturn which would cast quite a negative pallor on an otherwise outstanding year for speculators, risk-takers and even cautious investors.

That's why it would be unwise to read too much into one day's trading, or even the recent pattern of late-session selling at this juncture.

The likelihood is that profit-taking will be pushed forward into the first few weeks of December, saving the upside for the wise guys who know, above all, that the Fed isn't going to make any substantive end-of-year changes. If anything, investors should stand pat until the 30th, because the Fed will ensure a Merry Christmas and a Happy New Year for all.

On the flip side, gold and silver were absolutely smashed lower. Whether the continued selling is part and parcel of the recent distaste for anything not fiat-related or more of an exacerbated "sell the losers" mentality is an open question not soon to be answered.

Dow 16,008.77, -77.64 (-0.48%)
NASDAQ 4,045.26, -14.63 (-0.36%)
S&P 1,800.90, -4.91 (-0.27%)
10-Yr Note 99.58 -0.42 (-0.42%)
NASDAQ Volume 1.61 Bil
NYSE Volume 3.08 Bil
Combined NYSE & NASDAQ Advance - Decline: 1620-4074
Combined NYSE & NASDAQ New highs - New lows: 316-90
WTI crude oil: 93.82, +1.10
Gold: 1,221.90, -28.50
Silver: 19.29, -0.744
Corn: 424.50, 0.00

Disturbing Late Sell-Off Trend Undermined Stock Gains This Week

For the third time in the past four sessions, the major indices exhibited what can only be described as a disturbing trend: a late-day sell-off sending the averages back down to, or below, their opening levels.

This similar pattern - of stocks rising in the morning, leveling off and then dropping like stones off a mountain, has been identified this past Monday and Tuesday, and was exceptionally profound in the short session, Friday.

In general terms, no news accompanied the rise or falls, so, it should be regarded as an algorithm-trading-based function, as it's unlikely that humans would react in such herd-like behavior (well, maybe) as stocks have shown this week.

Friday's decline on the Dow and S&P (the NASDAQ managed to finish positive) might be viewed by those more occupied with Black Friday shopping than stocks as a minor issue - only 10 points on the Dow - though taken with the perspective of the whole 3 1/2-hour trading day, the dump was off a level that had the Dow at all-time highs, up 78 points on the day in early trading, finally losing all bids in the final twenty minutes.

Delving deeper into the phenomenon, Friday's decline could be the result of channel checks or car counting at selected retail locations that some organizations were conducting over the course of what is widely believed to be the biggest retail shopping day of the year. If, for instance, some of the trading firms were being fed less-enthusiastic figures from the field, it's not outside the realm of speculation that some adroit stock jocks could have been taking profits late in the day, and that would bode ill for a shopping season that's already six days shorter than last year's and, according to some analysis, may be the worst holiday season since 2009.

In that case, stocks should be expected to not just fail at the close, but moreso at the open, in coming days. Traders will have the weekend to figure this out, so, looking forward to Monday, a quiet open and negative finish might just confirm the retail fears. Saturday and Sunday shopping will be recorded by the compilers of such data and disseminated to market participants well ahead of Monday's opening bell.

With November jobs data due out Friday, the first week of December may be a watershed event for traders. Stocks are up significantly over the course of the year, by some measures, exceedingly so, and there hasn't been a sizable pullback in stocks since the government shutdown in November.

Additionally, the ACA website is supposed to be up and running at 80% capacity come Saturday, and more issues with the entire ObamaCare program might just give speculators enough reason to put on the brakes.

Of course, money has to go somewhere, so there's likely an equal chance that there will be a "Santa Claus" rally on top of this year's already-substantial gains, and the recent trend of late-day selling disregarded as nothing more than an algorithmic anomaly.

Whatever the case, next week bears close scrutiny, no matter which way one is playing the market. The larger picture, with stocks being buoyed by the Fed's incessant money-creation, remains decidedly bullish.

DOW 16,086.41, -10.92 (-0.07%)
NASDAQ 4,059.89, +15.14 (+0.37%)
S&P 1,805.81, -1.42 (-0.08%)
10-Yr Note 99.96, -0.07 (-0.07%)
NASDAQ Volume 823.70 Mil
NYSE Volume 1.59 Bil
Combined NYSE & NASDAQ Advance - Decline: 3173-2307
Combined NYSE & NASDAQ New highs - New lows: 528-27
WTI crude oil: 93.25, +0.95
Gold: 1,250.60, +12.80
Silver: 19.98, +0.348
Corn: 424.50, -2.00

Stocks Post More Gains Prior to Thanksgiving Holiday

The S&P and Dow set new all-time closing marks on Wednesday and the NASDAQ is approaching levels not seen since the dotcom boom (and bust), but, according to just about anyone who appears on CNBC or Bloomberg, there is no bubble in equities.

And, the Fed buying up $85 billion in bonds every month is normal. Gold stuck around $1250 is normal.

The p/e of Facebook (FB) is 77. Nope, no bubble there. Carry on.

Happy Thanksgiving.

The markets are open until 1:00 pm ET on Black Friday, which is usually a big ramp-up day on low volume, so sharpen up your day-trading skills and make some easy moolah while everyone else is out shopping.

Better get bitcoin. If you don't know what bitcoin is, you'd be doing yourself a favor to find out.

DOW 16,097.33, +24.53 (+0.15%)
NASDAQ 4,044.75, +27.00 (+0.67%)
S&P 1,807.23, +4.48 (+0.25%)
10-Yr Note 99.90, -0.20 (-0.20%)
NASDAQ Volume 1.33 Bil
NYSE Volume 2.36 Bil
Combined NYSE & NASDAQ Advance - Decline: 3691-1937
Combined NYSE & NASDAQ New highs - New lows: 469-55
WTI crude oil: 92.30, -1.38
Gold: 1,237.80, -3.60
Silver: 19.63, -0.215
Corn: 426.50, 1.75

Why There's No Inflation and No Growth... (and why that's good for some)

Stocks were up modestly on Tuesday, as is the usual practice during the week of Black Friday Thanksgiving. There's a general feeling of well-being about, and, even though the gains this year have been the best since something like 1997, buyers of stocks know how to do nothing else, so they keep on buying. Actually, the turn-about in the inal half hour erased most of the day's gains on the Dow and S&P, especially. The NASDAQ finished above 4000, for the first time since 2000, when it crossed that threshold from the other side.

Stocks, bought with ridiculously cheap money via the Fed, are, and have been, producing fatastic returns for many investors and holders of pensions, 401ks, IRAs, etc., but the nagging suspicion that it can't really be this easy continues to gnaw at the fringes of consciousness.

For now, it really is this easy. There's no compelling reason to do anything but buy more stocks, not sell and keep watching them go higher. It's a very powerful positive feedback loop. The Fed's continuous debt-purchasing and zero-bound interest rates fuel the stock market, have contributed greatly to the rebound in real estate prices, but, stubbornly, unemployment simply won't go down appreciably, and that's an issue, though most of the barons of the financial world can't, or don't, really care about the ordinary citizens struggling to eke out a living.

Also troubling is the idea that all this debt-binge-buying by the Fed hasn't produced inflation, which, according to all Keynesian estimates on the topic, should be raging by now.

But, something un-funny happened on Ben Bernanke's way to the printing press. While the Federal Reserve and the behemoth banks have been busy leveraging up, the average American (and European) has been leveraging down, using the limited free money that comes their way to pay down debt, stop spending frivolously and horror of horrors, save.

Official statistics will deny that Americans are saving anything at all. Many, for certain, are not. In fact, HELOC loans are once again on the rise. But others, quietly, off-the-radar, have been squirreling away small amounts, mostly in cash, though some in gold, silver, bulk foods, and saving in other ways like repairing an aging vehicle instead of buying a new one, shopping at discount stores, buying online, bartering and other creative ways that are having an unseen impact because they are individually so small as to be unnoticeable, but collectively, they become huge.

Imagine, for a minute, the impact of 10,000 people individually not buying one Starbucks coffee per week. On the individual basis, it's three or four dollars. Collectively, however, it's $30-40,000. Then start adding up the other ways people are saving. Driving less or coordinating their driving to do many tasks on one trip. A couple of dollars a week. Home gardens that can shave $10 to $40 off a family's food bill in season is another hidden savings the statisticians can't capture with their computers. There are many, many more practical methods people are using today to save on everything from food to fuel to... well, you name it. Cut your own hair, heat with firewood partially, buy clothes at thrift stores, eat out less (or not at all), don't go to movies, and on and on and on.

The Fed doesn't get it. Wall Street doesn't get it. Most public employees don't get it. They're conditioned to be like their co-workers. Buy a new car, or lease one. Eat out for lunch. See the latest movies. Buy new clothes. They, and the 47 million on food stamps, are keeping the economy just clinging to life. But, despite the added liquidity by the Fed, it's not working so well. Corporations aren't beating their revenue figures. Bottom lines are good, but much of it is due to shrinking the number of shares outstanding via stock repurchase programs, which also add to the stock market boom.

But, there's a horde of people out there who are getting out of the system, cutting their cable bills, credit cards, magazine subscriptions, and, soon, because of the nightmare that is ObamaCare, their monthly health insurance bill.

Some, like economists at the Fed or analysts on Wall Street, might call these types an underclass. In reality, they are the new freedom class, untying the knot of debt, freeing their minds from the day-to-day toil and keeping up with the Joneses mentality that feeds the corporate machine.

The signs of frugality and savings - despite the overblown hype of Black Friday being bellowed by the big merchants - are everywhere. Gold, silver, bitcoin, eBay, Craigslist, barter exchanges, healthy, home-grown foods instead of corporate fast-food mulch, economy cars, hybrids and public transportation are all taking the bluster out of the Wall Street boom.

When the dust settles, when the Fed stops printing to infinity and the economy begins to normalize, there's an old adage used by printers, manufacturers and writers of software that will be apropos: "Garbage In, Garbage Out."

The garbage in is the cheap money the Fed has been printing nilly-willy. The garbage out will be a steady, possibly spectacular, stock market decline. It may not be a crash, happening all of a sudden, but there will be a bear market, eventually. After all, this bull run began in March 2009. It's now a 57-month old bull, which, by most measures, is a little long in the tooth. The signs are everywhere. Corporate profits are of exceedingly poor quality (garbage out).

When this era of cheap money comes to an end - and end it will - many who made money all along will be left holding stocks worth much less than what they paid for them. Many of the companies represented by these stocks will have upside-down balance sheets because of all the stock they bought back at nose-bleed prices. And that's going to be a real problem, causing more layoffs, consolidations, and bankruptcies (yes, we still have them). JC Penny will be the first to go. They're overdue and probably will file within months after the holiday season, which, for them, will be a disaster. They will be followed by Sears, and then after the retailers get moving in the wrong direction, the filings will snowball.

Garbage in, garbage out. Those who've been saving, rejecting the debt-slave system and prepping will be much less affected, already living well within their means and enjoying it.

Happy Thanksgiving!

DOW 16,072.80, +0.26 (+0.00%)
NASDAQ 4,017.75, +23.18 (+0.58%)
S&P 1,802.75, +0.27 (+0.02%)
10-Yr Note 100.36, +0.31 (+0.31%)
NASDAQ Volume 1.79 Bil
NYSE Volume 3.40 Bil
Combined NYSE & NASDAQ Advance - Decline: 3292-2338
Combined NYSE & NASDAQ New highs - New lows: 431-93
WTI crude oil: 93.68, -0.41
Gold: 1,241.40, +0.20
Silver: 19.85, -0.034
Corn: 424.75, -6.50

Stocks Rise, Then Fall, End Flat; Dow Up 16X in 31 Years Though Not the Same

Stocks flew at the open, making the highs of the session, then backtracked, recovered and finally flat-lined until 3:00 pm ET, when selling commenced, taking the indices back to break-even for the day.

It was mostly a senseless trade, kicking off a holiday-shortened week which will feature lower volume than usual (if that's possible) and giddiness surrounding the holiday shopping season, which almost always produces an up session on the short Friday after Thanksgiving.

A few friends were commenting on the wisdom of a buy and hold strategy for the long haul as the Dow Jones Industrials crossed the 16,000 threshold this past Friday. One idea was that holding an index fund of Dow stocks from late 1982 to the present would have resulted in a 16X return on your money, or $10,000 invested in the Dow in 1982 - the last time the Dow crossed the 1000 mark and did not fall below it - would be worth $160,000 today.

It's an interesting concept, but, in case somebody wanted to just buy all the individual stocks in the Dow 30 blue chips, it would have probably been a more profitable, albeit time-consuming endeavor. Of the 30 stocks in the Dow today, only 10 of them were part of the index back in late 1982.

Those ten are AT&T, American Express, IBM, duPont, 3M, Proctor & Gamble, GE, United Technologies, Merck and Exxon (merged with Mobil to form ExxonMobil).

In those 31 years, the composition of the Dow changed 13 times, including eight times since 2003. Not to say that the stocks in the Dow are all magnificent winners, but how one gets a 16X return is by taking out under-performers and replacing them with stocks which have a better chance of appreciation, kind of a shell game, though one could have done well just holding any fund indexed to the famous average.

By way of comparison, the S&P 500 rose from about 140 to the current level just above 1800 in the same time period, a gain of just over 13X. Of course, the S&P has even more movement in and out of the index, and weightings are changed periodically. Overall, it gets re-jiggered more often than the Dow.

It's how Wall Street produces outsize profits for investors; they change the game constantly or as conditions warrant. It begs the question of the wisdom of individual issues and fast money trading.

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." --Henry Ford

DOW 16,072.54, +7.77 (+0.05%)
NASDAQ 3,994.57, +2.92 (+0.07%)
S&P 1,802.48, -2.28 (-0.13%)
10-Yr Note 100.10 +0.09 (+0.09%)
NASDAQ Volume 1.74 Bil
NYSE Volume 2.99 Bil
Combined NYSE & NASDAQ Advance - Decline: 2701-2954
Combined NYSE & NASDAQ New highs - New lows: 532-96
WTI crude oil: 94.09, -0.75
Gold: 1,241.20, -2.90
Silver: 19.88, +0.02
Corn: 431.25, +2.00

50 Years Ago and We Still Don't Know Why Kennedy Was Killed

Please, no matter what you may believe, instead of reading articles or watching videos, just contemplate the Kennedy assassination for a few moments.

Food for thought, presented without comment.

DOW 16,064.77, +54.78 (+0.34%)
NASDAQ 3,991.65, +22.49 (+0.57%)
S&P 1,804.76, +8.91 (+0.50%)
10-Yr Note 99.94, +0.72 (+0.73%)
Combined NYSE & NASDAQ Advance - Decline: 3500-2147
NASDAQ Volume 1.65 Bil
NYSE Volume 2.96 Bil
Combined NYSE & NASDAQ New highs - New lows: 461-76
WTI crude oil: 94.84, -0.60
Gold: 1,244.10, +0.50
Silver: 19.86, -0.072
Corn: 429.25, -0.25

Stocks Pop on Bad News from Philly Fed

Well, bad news for the economy is apparently good news for Wall Street once again.

The Philadelphia Fed's Index of business activity in the Mid-Atlantic region slowed significantly, according to the report issued today, which showed the index falling from 19.8 in October, to 6.5 in November, a drop that exceeded even the most pessimistic estimates.

The consensus was for the index to come in with a reading of 15.0, but the number was well below that. The convoluted thinking dominating the financial world today must have seen this as yet another sign of slowing economic activity, making it next to impossible for the Federal Reserve to begin slowing its monthly bond purchases from their current $85 billion per month.

Stocks, which were already showing healthy gains before the 10:00 am ET release, chopped their way higher throughout the session, with the Dow Jones Industrials ending the day at an all-time closing high.

With an eroding base economy and billions of created-out-of-thin-air dollars flooding the coffers of the primary dealers via the Fed, the market pricing mechanism is as broken as it has ever been in the history of economics.

Fantasy accounting, assets marked to nothing or anything, and all the other central bank meddling and criminality undertaken by Wall Street and global banking interests will eventually find its way back into the real world. The result may not be to the liking of anybody.

DOW 16,009.99, +109.17 (+0.69%)
NASDAQ 3,969.15, +47.88 (+1.22%)
S&P 1,795.85, +14.48 (+0.81%)
10-Yr Note 99.65, +0.48 (+0.49%)
NASDAQ Volume 1.64 Bil.
NYSE Volume 3.25 Bil.
Combined NYSE & NASDAQ Advance - Decline: 4246-1420
Combined NYSE & NASDAQ New highs - New lows: 327-102
WTI crude oil: 95.44, +1.59
Gold: 1,243.60, -14.40
Silver: 19.93, -0.124
Corn: 429.50, +4.25

Stocks Fall After October Fed Minutes Released; Deflation Commences

Just in case anyone forgot that the only thing that matters in this market is Federal Reserve policy, the message was forcefully driven home precisely at 2:00 pm ET, when the minutes from the last FOMC meeting were released.

Within those arcane discussions of all things monetary were warnings from more than a few members that tapering bond purchases by the Fed might begin sooner rather than later. Accepted thinking had been that the Fed would not taper until March, though after today, analysts are suggesting that December - just two weeks away - might mark the beginning of the end of the Fed's bond-buying spree.

While the cutback in bond purchases monthly may only be a decrease of $10 to $15 billion of the current $85 billion, Wall Street money-grubbers were spooked as usual at the suggestion that money would be anything other than nearly free to borrow.

Today's action in stocks shows just how fragile the 4 1/2-year-plus market rally is and how quickly paper profits may vanish if the Fed doesn't keep the money-printing machine going pedal to the metal.

It's a ridiculous market made up of ridiculous valuations and propositions, that, without Herculean-like support from the central bank, could fall apart in days or weeks.

The Fed will no doubt taper, the only remaining questions are when and by how much. Whatever the decision shall be, markets will not like it one bit, and the general economy may suffer even more than it already has as Wall Street will no doubt throw a massive hissy fit.

When it's all done with, when the Fed stops buying bonds altogether (when will that be, 2065?), either stocks or the US dollar (and maybe both) will be worth a lot less than they are today.

Lunatic policies by the Fed will be followed in time by equally hilarious conclusions to those misguided policies. The results will be a catastrophe financial markets have never seen before.

What is either amusing or distressing is the reaction in precious metal markets, which fell in concert with stocks and bonds. If the markets are correct, Fed tapering will be a deflationary event with magnificent outcomes ahead.

In the long term, the Fed cannot taper back on bond purchases because they have succeeded in crowding out the few remaining participants over the past four years. Deflations and defaults will be the most likely results, though emerging markets will feel the pain much sooner and to a much greater degree than established economies, though no nation will be spared the death spiral of deflation.

Dow 15,900.82, -66.21 (0.41%)
Nasdaq 3,921.27, -10.28 (0.26%)
S&P 500 1,781.37, -6.50 (0.36%)
10-Yr Bond 2.79%, +0.08
NYSE Volume 3,094,246,250
Nasdaq Volume 1,686,541,875
Combined NYSE & NASDAQ Advance - Decline: 2180-3428
Combined NYSE & NASDAQ New highs - New lows: 162-98
WTI crude oil: 93.33, -0.01
Gold: 1,258.00, -15.50
Silver: 20.06, 0.276
Corn: 425.25, -1.00

Another Dead Day on Wall Street

Stocks simply don't seem to have any momentum, such as earnings season is pretty much over and the gala holiday shopping season is still more than a week away.

There's no catalyst in either direction, though there's the continuing, nagging questions surrounding Fed tapering and the impact of Obamacare on business and markets, both of which seem to be supplying an anchor for equities.

Few voices are calling for a correction, but even fewer are banging the table about a generalized rally in stocks, as they are perceived to be just about fairly priced or over-priced.

This is an odd circumstance, as November is usually one of the better months for investors, though one could argue that gains in stocks this year have already beaten even the most optimistic targets.

Dow 15,967.03, -8.99 (0.06%)
Nasdaq 3,931.55, -17.51 (0.44%)
S&P 500 1,787.87, -3.66 (0.20%)
10-Yr Bond 2.71%, +0.03
NYSE Volume 3,199,620,250
Nasdaq Volume 1,714,876,375
Combined NYSE & NASDAQ Advance - Decline: 1903-3715
Combined NYSE & NASDAQ New highs - New lows: 162-78
WTI crude oil: 93.34, +0.31
Gold: 1,273.50, +1.20
Silver: 20.33, +0.023
Corn: 426.25, +5.25

Stocks Drop on Carl Icahn Comments?

So, is Carl Icahn the modern-day version of legendary investor J.P. Morgan, upon whose words - as legend has it - hung the fate of stocks and the economy?

Doubtful. Icahn may have a high opinion of himself, but he's probably not as influential as the TV-commercial version of E.F. Hutton, the company which used the tag line, "When E.F. Hutton talks, people listen."

Whatever the case, after Icahn made remarks at an investment conference today, saying he was "very cautious," stocks took an immediate nosedive, sending the Dow into negative territory after gaining as many as 68 points earlier in the session.

More likely, Icahn was the scapegoat du jour, giving cover to a well-planned exit by heavy holders in kay equities.

Markets don't need excuses to move one way or the other, or even to do nothing, but, in the age of instant communications, instant causation is expected, though it is almost never on the mark.

Icahn is no financial genius. Anyone with two eyes can see that stocks are priced nearly to perfection and ripe for a correction, though guessing ahead on that assumption, as has been well-learned over the past five years, can be a costly maneuver.

Stocks, as J.P. Morgan once said when pressed for direction, "will fluctuate."

And that's exactly what they did today.

Dow 15,976.02, +14.32 (0.09%)
Nasdaq 3,949.07, -36.90 (0.93%)
S&P 500 1,791.53, -6.65 (0.37%)
10-Yr Bond 2.68%, -0.03
NYSE Volume 3,152,413,250
Nasdaq Volume 1,793,143,750
Combined NYSE & NASDAQ Advance - Decline: 2127-3522
Combined NYSE & NASDAQ New highs - New lows: 496-45
WTI crude oil: 93.03, -0.81
Gold: 1,272.30, -15.10
Silver: 20.36, -0.41
Corn: 421.00, -9.50 (new low)

New Record Highs for Dow, S&P on Yellen Lovve-Fest Hearings

Wall Street has shown its liking for incoming Fed Chairman Yellen, so the congress better damn well approve him.

Dow 15,876.22, +54.59 (0.35%)
S&P 500 1,790.62, +8.62 (0.48%)
Nasdaq, 3,972.74, +7.16 (0.18%)
10-Year Note 2.70, -0.02
Combined NYSE & NASDAQ Advance - Decline: 3205-2398
Combined NYSE & NASDAQ New highs - New lows: 423-63
WTI crude oil: 93.76, -0.12
Gold: 1,286.30, +17.90
Silver: 20.72, +0.28
Corn: 426.50, -3.25

Stocks Rock; Yellen Ready to Kiss Up to Congress

Nice gains for the Dow and S&P, which both set new all-time high closes. The party won't stop, according to sources close to Mr. Yellen, who is expected to convince congress that the Fed needs to continue manipulating markets and driving the purchasing power of the dollar into oblivion with even more intervention and easy money policies.

Life , for working Americans, could be wonderful if the Fed can figure out how to induce any kind of wage inflation.

We are a hopeful nation.

Dow 15,821.63, +70.96 (0.45%)
S&P 1,782.00, +14.31 (0.81%)
Nasdaq 3,965.58, +45.66 (1.16%
10-Year Note: 2.68%, -0.05 (-1.83%)
NYSE Volume: 3,320,000
NASDAQ Volume: 1,769,363,821
Combined NYSE & NASDAQ Advance - Decline: 3777-1858
Combined NYSE & NASDAQ New highs - New lows: 323-93
WTI crude oil: 93.88, +0.84
Gold: 1,268.40, -2.80, -0.336
Silver: 429.75, -2.50

Stocks Little Changed on Veteran's Day

With bond markets closed and many traders enjoying a three-day weekend by virtue of the Veteran's Day holiday, there was little to get excited about in equity markets or elsewhere.

The day's smallish gains were led by Consumer Cyclicals, Healthcare and Technology, counterbalanced by downside moves in Basic Materials and Telecoms, which lagged the market.

Volume was noticeably in short supply as was volatility, reverting back to levels seen this past summer. Despite the lack of interest, the Dow Jones Industrial Average closed at a new all-time high, with the NASDAQ and S&P sporting smaller gains.

New highs continued to outnumber new lows, though not as substantially as in recent weeks. The advance-decline line was nearly static, with winners beating losers by less than a hundred issues.

Commodities were largely flat-lining, though corn got a bit of a bid off recent 52-week lows.

Unless there's some earth-shaking development on Tuesday, tomorrow could be just as listless, as there are no meaningful economic data releases until Wednesday, and even then, those are hardly impacting.

Dow 15,783.10, +21.32 (0.14%)
Nasdaq 3,919.79, +1.67 (0.04%)
S&P 500 1,771.89, +1.28 (0.07%)
10-Yr Bond 2.75% 0.00
NYSE Volume 2,507,799,000
Nasdaq Volume 1,538,911,625
Combined NYSE & NASDAQ Advance - Decline: 2840-2754
Combined NYSE & NASDAQ New highs - New lows: 238-56
WTI crude oil: 95.14, +0.54
Gold: 1,281.10, -3.50
Silver: 21.28, -0.035
Corn: 434.75, +8.00

Green Arrows for Stocks as Non-Farm Payrolls Surprise

As the work-week ended, everything was up, except, of course, gold and silver, because we just can't have those ancient relics of real money ruining the fiat-fest currently underway.

After the government reported October non-farm payrolls up a shocking 204,000 in October and revised August and September reports upward as well, futures slid, in sympathy with the idea that the Fed would - due to the "strong" jobs figure - reconsider its $85 billion-a-month bond-buying binge and begin to taper such efforts.

However, once the markets opened, good news was once again good news, and stocks staged a massive rally, erasing all of the prior day's losses on the major indices, sending the Dow Industrials to another record close.

Mortgage rates rocketed higher on the news, as did treasuries, the 10-year note ripping upward by 13 bips.

The logic may be a bit twisted - then again, what, concerning Wall Street and our current "crisis management" economy isn't? - but here's the take: Sure, the effects of the government shutdown the first two weeks of October were minimized, and the economy was creating jobs, but the unemployment rate actually rose - from 7.2 to 7.3% - due to a decline in the labor force participation rate, which has steadily trended downward for the past decade, making what looked, on the surface, as good news, actually bad news for the economy, which is good news for stocks because the Fed will just keep buying up treasuries and MBS, sloshing even more cheap money into the already liquidity-bloated system.

As usual, bankers and their kindred traders, hedgies and speculators were the main beneficiaries, after selling yesterday on a move that suggests the payroll data was privately leaked, were able to buy on the cheap Friday morning.

That's about the only analysis that makes any sense, though rational, logical arguments aren't always adequate predictors of market economics and trading patterns.

The guys with the inside scoop always do better than Mr. and Mrs. Average Joe and Jane. And they do it every day, whether the market is up or down, because they own the data.

Dow 15,761.78, +167.80 (1.08%)
Nasdaq 3,919.23, +61.90 (1.60%)
S&P 500 1,770.61, +23.46 (1.34%)
10-Yr Bond 2.75%, +0.13
NYSE Volume 3,770,251,500
Nasdaq Volume 1,934,757,875
Combined NYSE & NASDAQ Advance - Decline: 3706-1971
Combined NYSE & NASDAQ New highs - New lows: 231-99
WTI crude oil: 94.60, +0.40
Gold: 1,284.60, -23.90
Silver: 21.32, -0.34
Corn: 426.75, +6.25

Wall Street Pouts Despite Twitter IPO; Jobs Data on Deck

Busy day today for the gods of greed, buyers of bluster, falcons of fraud, purveyors of prevarication.

Wall Street was all a-twitter over the IPO of Twitter (TWTR), the latest Web 2.0 mega-fad company gone public, which opened today on the NYSE with a bang. The stock was issued at 26, but opened at 44, quickly ramped up above 50 per share and closed at 44.90, good for a 78% gain. The company - based on "tweets" of 140 characters - is valued at about 29 times sales, pretty rich, especially for a enterprise that's still losing money. Well, at least the founders are now billionaires... on paper.

Prior to the opening bell, there was a flurry of activity from across the Atlantic pond, as Europe's Mario Draghi, ECB president extraordinaire, announced key rate cuts of 25 basis points, leaving the base rate at .25 and the key lending rate at .50. Observers in America wondered what took the Euros so long, though one must consider that they have been in the business of wrecking their own economies and fleecing the public a lot longer than their American counterparts, so they can kick the old can-can a lot longer and down an even shorter road without causing much of a stir.

The response from traders across the continent and in the UK was resoundingly mixed, with the German DAX higher, Britain's FTSE lower and the French CAC-40 barely changed. Don't these people understand the concept of cheap money? Pikers, the lot of them, except, of course, for the stodgy, stingy, and oh-so-proper Germans.

At 8:30 am ET, the US blasted off a couple of economic indicators, releasing the first reading on third quarter GDP at a robust 2.8%, a ribald lie if ever there was one, but enough to scare the few remaining hairs off the head of Lloyd Blankfien and others of his balding ilk. Good news is once again bad news, it appears, and any growth approaching three percent in the US sends shivers up the spineless bankers' backs, because they believe their buddies, Mr. Bernanke and the incoming Mr. Yellen, may cease the easy money programs that has catapulted every dishonest banker into ever-higher tax brackets.

The most recent initial unemployment claims - which were down 9,000 from the previous week, at 336,000, remained stubbornly high, though apparently not quite high enough for the barons of buyouts. These dopes saw this as another sign of a strengthening US economy, so, shortly after the opening bell, stocks did an abrupt about-face and trended lower throughout the session, with little respite.

In other news, Goldman Sachs is under investigation for rigging foreign exchange (FOREX) trading and just about everything else they do, and, yesterday, the Blackstone Group began pitching its rent-backed securities.

Really. They did. And some people actually bought them.

The advance-decline line cratered, with losers leading gainers by a 7:2 ratio, and new lows continue to close the gap on daily new highs, a trend metric that may just flip over if today's losses are indeed presaging something un-funny about tomorrow's delayed October non-farm jobs data, due out an hour before the opening bell. The way to read this is that the government is likely to report that something in the range of 120-150,000 new jobs were created during the month, which would be more proof of economic improvement, exactly what the market doesn't want. Either that, or it's going to be a real stink-bomb, because the forecast is only for 100,000.

Business as usual, my friends. Monkey business, that is.

Dow 15,593.98, -152.90 (0.97%)
Nasdaq 3,857.33, -74.61 (1.90%)
S&P 500 1,747.15, -23.34 (1.32%)
10-Yr Bond 2.61%, -0.03
NYSE Volume 4,092,416,000
Nasdaq Volume 2,196,542,750
Combined NYSE & NASDAQ Advance - Decline: 1276-4371
Combined NYSE & NASDAQ New highs - New lows: 197-101
WTI crude oil: 94.20, -0.60
Gold: 1,308.50, -9.30
Silver: 21.66, -0.111
Corn: 420.50, -0.75

Wall Street Weirdness as Dow Makes New Record, NASDAQ Falls

Maybe it's the weather, but investor taste for speculation may be turning, just a day before the hoopla over the Twitter IPO is set to take place. The 142-character internet darling will open tomorrow at a very overpriced $27-30 per share. It could be that some big players in the tech investing (gambling) space just freed up money to get into the hottest IPO since... um, Facebook, though the memory of that magnificent failure is still fresh.

Still, winners just barely edged losers on the day, while the place to be in Dow stocks was in Chevron (CVX), IBM (IBM) and Microsoft (MSFT), an odd grouping there.

The MBA Mortgage Index slumped sadly prior to the open, with weekly applications off seven percent, even as 30-year rates fell to 4.32%.

Crude inventories showed only a modest uptick, which helped oil stage a rally off of five-month lows.

With bond yields settling lower, gold and silver up moderately, it was very tough to get a read on the overall market. Corn made fresh 52-week lows, which is bearish for beef, but bullish for carnivores in general, with beef prices stable and possibly set to decline. Overall, however, falling corn prices is about as good a deflation indicator as one can find, especially priced in silver.

Steady as she goes, though, especially on those safety plays in the Dow, which should consider to out-perform in a flight to dividend comfort.

Tweet that.

Dow 15,746.88, +128.66 (0.82%)
Nasdaq 3,931.95, -7.92 (0.20%)
S&P 500 1,770.49, +7.52 (0.43%)
10-Yr Bond 2.64%, -0.02
NYSE Volume 3,298,818,000
Nasdaq Volume 1,989,898,000
Combined NYSE & NASDAQ Advance - Decline: 2851-2753
Combined NYSE & NASDAQ New highs - New lows: 317-79
WTI crude oil: 94.80, +1.43
Gold: 1,317.80, +9.70
Silver: 21.77, +0.132
Corn: 421.25, -3.75

Stocks Split in Sloppy Session; Bond Yields Rising, Oil Sliding

Stocks slid at the opening bell, with the Dow down by as many as 117 points in the first half hour of trading, but quickly reversed direction at 10:00 am EST and continued a slow but steady gain the rest of the day.

Apparently, what turned stocks around was the October ISM Services reading, which came in at a solid 55.4, a full pint better than last month's data and a huge beat to the expected 54.0.

While questions concerning the veracity of these kinds of reports after the unusually-strong Chicago PMI data a week ago continue to swirl around, the beat on services - which is now the main production engine of the US, since we've hollowed out our manufacturing core and mostly export inflation - was enough for the Wall Street crowd to lift stocks off their lows.

That they were able to keep buying interest maintained for the remainder of the session was likely due to the usual POMO injection by the Fed, allowing for rampant speculation and unusually-high leverage.

While stocks were seeing the light of day - though the NASDAQ never quite made it into positive territory, bonds were getting slammed, up six bips in yield by the end of the day, as the gains following the end of the government shutdown are gradually being eroded. The closing level of 2.66% on the 10-year note was the highest in two-and-a-half weeks.

The big story happens to be in oil, which continues its retreat from $110/barrel highs just two months ago. Another $5.00 drop in the price of WTI will put oil into a bear market, a condition nobody has considered. While low oil prices relate positively to gas at the pump and is a boost for the economy, releasing more purchasing power, the underlying causes may be more nefarious and significant.

There is, at last, a supply-demand condition that is positive for the US, as more and more oil is being produced in North America, at the same time that demand is dwindling, or rather, has been dwindling for the past three to four years. Americans have tightened their collective belts and are much more careful about their driving habits these days, as lowered incomes have left less for transportation expenses. High unemployment also pays a part, as fewer people are driving to work five or six days a week.

So, while a period of lower gas prices is cause for celebration, the party may not be of the epic variety, with fewer participants and an overhang of disappointing economic circumstances.

Key numbers to watch tomorrow will be the MBA Mortgage Index (7:00 am), September Leading Indicators (10:00 am) and crude inventories (10:30 am).

Dow 15,618.22, -20.90 (0.13%)
Nasdaq 3,939.86, +3.27 (0.08%)
S&P 500 1,762.97, -4.96 (0.28%)
10-Yr Bond 2.66%, +0.06
NYSE Volume 3,485,473,500
Nasdaq Volume 1,899,388,750
Combined NYSE & NASDAQ Advance - Decline: 2064-3571
Combined NYSE & NASDAQ New highs - New lows: 248-74
WTI crude oil: 93.37, -1.25
Gold: 1,308.10, -6.60
Silver: 21.64, 0.064
Corn: 425.00, -1.25

Stocks Advance in Dull Session

Really, really dull session.

Dow 15,639.12, +23.57 (0.15%)
Nasdaq 3,936.59, +14.55 (0.37%)
S&P 500 1,767.93, +6.29 (0.36%)
10-Yr Bond 2.60%, -0.02
NYSE Volume 3,188,967,750
Nasdaq Volume 1,777,975,875
Combined NYSE & NASDAQ Advance - Decline: 3720-1864
Combined NYSE & NASDAQ New highs - New lows: 245-50
WTI crude oil: 94.62, +0.01
Gold: 1,314.70, +1.50
Silver: 21.70, -0.137
Corn: 426.25, -1.00

Stocks Up, Commodities Down; Oil Crashing

Stocks, bonds, up. Oil, gold, silver, corn, down.

WTI crude is at its lowest level since June, down $15/barrel since early September, technically in a correction. Another 6% decline in crude (about $5.60) will put crude into a bear market, which will be great for consumers.

Economy still incredibly weak, despite close to all-time highs on major indices.

Dow 15,615.55, +69.80 (0.45%)
Nasdaq 3,922.04, +2.34 (0.06%)
S&P 500 1,761.64, +5.10 (0.29%)
10-Yr Bond 2.62%, +0.08
NYSE Volume 3,703,160,500
Nasdaq Volume 1,917,590,125
Combined NYSE & NASDAQ Advance - Decline: 2439-3166
Combined NYSE & NASDAQ New highs - New lows: 178-65 (gap closing)
WTI crude oil: 94.61, -1.77
Gold: 1,313.20, -10.50
Silver: 21.84, -0.03
Corn: 427.25, -1.00

Stocks, Gold Silver Beaten Mercilessly; Boo!

Pretty ugly day all around. In addition to stocks taking a hit, gold and silver were beaten down, as per usual whenever the elitist scum feels threatened.

Not much else to report except a ridiculous - to the upside - Chicago PMI report, which surged at the fastest rate in over 30 years.

Dow 15,545.75, -73.01 (0.47%)
Nasdaq 3,919.71, -10.91 (0.28%)
S&P 500 1,756.54, -6.77 (0.38%)
10-Yr Bond 2.54%, +0.02
NYSE Volume 3,825,998,000
Nasdaq Volume 2,187,464,000
Combined NYSE & NASDAQ Advance - Decline: 2193-3400
Combined NYSE & NASDAQ New highs - New lows: 240-69
WTI crude oil: 96.38, -0.39
Gold: 1,323.70, -25.60
Silver: 21.87, -1.116
Corn: 428.25, -2.00

Fed Keeps QE at Full Throttle, Stocks, Markets Still Unhappy; ADP Misses

In September, when everybody thought the Fed was going to announce a scaling-back of their $85 billion-a-month bond buying bonanza, stocks rallied when they did nothing.

Today, when the Fed did exactly what the market expected, keeping the bond buying going full force with no mention of "tapering," stocks sold off, extending a decline that started in slow motion shortly after the opening bell.

It's probably asking too much to try and comprehend exactly what the algos or stock pickers were reading in the FOMC tea leaves, because a commitment by the Fed to continue easy money policies is exactly the best reason for equities to rise. Chalk it up to profit-taking by the slickest of the slick, on an old, "buy the rumor, sell the news" scenario.

As we've stated recently, stocks should continue to rise through the end of the year and beyond, being that there are now some unwritten rules in the market that say stocks can't decline during the Christmas season, there must be a "Santa Claus Rally" and a "New Year Rally."

So, despite this little blip of a disturbance in the force, investors should be good to go unless something really awful happens, like the economy suddenly shows unequivocal signs of strengthening.

OK, OK, stop the laughter. we all know that the economy is stuck in neutral since the Fed programs of QE and ZIRP are only beneficial to the top 1% of earners, those people you and I will never get to know personally, and that the government is going to do everything in its powers to see to it that the economy stumbles along at about 1.5-2.0% GDP growth, just enough to keep the recession dogs off the porch.

Investors and markets will digest today's losses and decide, around midnight tonight, that tomorrow morning would be a great time to add to their positions or open new ones in some of the more speculative, momentum stocks. That's really the mantra and it doesn't get any simpler.

In case nobody noticed, the October ADP jobs report showed that employment continued its gradual slowdown, adding just 130,000 net new private sector jobs - and revised September's 166,000 gain down to 145,000 - all blamed conveniently on the 16-day government shutdown earlier this month. Never mind that these are PRIVATE sector jobs and government is in the PUBLIC sector. Whatever scapegoat is available, that's the one that gets the blame.

As this missive is being prepared for publication, the president is pleading with less-than-enthusiastic supporters that the Affordable Care Act (ACA, or, ObamaCare) is going to work and actually good for America, despite all indications to the contrary.

You have officially entered the bizarro-zone and there is no escape if you keep watching the teevee.

Buy stocks. Can't miss.

Dow 15,618.76, -61.59 (0.39%)
Nasdaq 3,930.62, -21.72 (0.55%)
S&P 500 1,763.31, -8.64 (0.49%)
10-Yr Bond 2.53%, +0.02
NYSE Volume 3,486,428,250
Nasdaq Volume 1,795,014,125
Combined NYSE & NASDAQ Advance - Decline: 1596-4053
Combined NYSE & NASDAQ New highs - New lows: 487-42
WTI crude oil: 96.77, -1.43
Gold: 1,349.30, +3.80
Silver: 22.98, +0.491
Corn: 430.25, -1.75 (new 52-week low)

Ho-Hum, Another Record Close for the S&P, Dow

Well, since last Tuesday (October 22) when we issued our missive that one should be prepared for 100-point gains on the Dow for no reason, we at last have our first winner, and just five trading days hence. To boot, it propelled the Dow Industrials to a new all-time closing high (though we had to check because we didn't hear Maria Bartiroma hooting and hollering about it).

Today's close topped the September 18 close of 15,676.94, at the time, the all-time high. Something else interesting about our call from a week ago, which was implicitly a bullish "BUY STOCKS" advisory: the Dow is up about 213 points since then and has closed down on two days, up three, though the down days amounted only to a total of 55 points, while the gains were 268, or an order of magnitude of roughly five times better for the bulls.

If this isn't a sign of an imminent breakout, then nothing is. Since the debt ceiling and government shutdown masqueraded over all the internal financial problems facing the government and kept QE at a solid $85 billion a month without any slowdown even considered for another six months, there could be no more bullish news.

While the tone here at Money Daily is often flip and at times mistaken for an inherent pessimism, we are in the end nothing other than realists, now having come, somewhat reluctantly and late, to the sad realization that nothing in the equity market matters besides the official narrative from sources like the Wall Street Journal, CNBC, Forbes and Bloomberg and the continued loose money policies of the Fed, the latter, naturally, the most important.

Government debt and massive annual deficits ceased to have any meaning with Obama's first term, at the depths of the financial collapse, have since continued to grow, and will continue until they don't. What earth-shattering event it will take to upend the global liquidity spooning through the banks that is happening worldwide is as yet unknown, and the globe may be further from it now than it was just five years ago, the level of rampant money creation having gone from stimulus to necessity in the interim.

In the short term, this means that ordinary things like work, income, taxes and debt have little to no meaning and that getting onto the Federal Reserve's gravy train via the smorgasbord of handouts and/or entitlement programs is a sure path to immediate gratification, though not necessarily riches (though bankers with huge bonuses may beg to differ).

As with all gambling or investing, it's all about knowing who the other players are and what they're holding that is the key to success. With the Fed intent on creating more and more and more debt, ad infinitum (because they truly have no plan for tapering or unwinding their enormous balance sheet), one can either hunker down with real assets like gold or land, or play the paper chase with stocks, bonds, derivatives, options, and the rest.

The paper game has won for the past five years, and, as long as the economy keeps shrinking instead of growing, people, governments and businesses will continue borrowing, spending and defaulting, keeping the Fed busily creating more money in a vicious, non-virtuous cycle.

At some point, the debts will become so large as to be unpayable, and maybe we've already reached that point, so that the Ponzi scheme of unlimited money creation will have to continue and grow, a la Zimbabwe or Weimar Germany.

Fiat currencies have a perfect record, having failed 100% of the time, though this time the fiat is a global phenomenon. There is no currency in the world that is backed by anything but faith, and faith can be shattered any time the central bankers of the world deem necessary.

That, in the end, is the point. They control. We are but slaves on the global plantation, devoid of rights or wealth, with the means to exploit the system in whatever ways we find convenient. It surely won't last forever, and many are absolutely amazed it has lasted this long. Since we are five years into this global liquidity experiment without adequate capital, inflating assets willy-nilly all along the way, the only measures are the forex measures of currencies against the US dollar. When the dollar erodes to a point at which it is no longer maintaining itself as the reserve currency of the planet, the game is up.

Until then, party like its 2013.

Dow 15,680.35, +111.42 (0.72%)
Nasdaq 3,952.34, +12.21 (0.31%)
S&P 500 1,771.95, +9.84 (0.56%)
10-Yr Bond 2.51%, -0.01
NYSE Volume 3,335,803,750
Nasdaq Volume 1,840,704,750
Combined NYSE & NASDAQ Advance - Decline: 3376-2221
Combined NYSE & NASDAQ New highs - New lows: 427-25
WTI crude oil: 98.20, -0.48
Gold: 1,345.50, -6.70
Silver: 22.49, -0.046
Corn: 432.00, +1.25

ObamaCare a Complete Failure, May Prove to Bring About Peoples' Salvation from Over-reaching Government

Let's face it, ObamaCare, the health insurance mandate that all Americans MUST purchase, is an unmitigated disaster which, thankfully, threatens to bring down the entire government health care apparatus, and hopefully, the rest of the government with it.

The hits just keep coming for ObamaCare.

On Sunday, a major data hub failed, once again making the website, HeathCare.gov, inoperable.

Maybe the worst design flaw of ObamaCare is not the website, which hasn't worked since its rollout, October 1, but the soaring deductibles under the Affordable Care Act.

Experts are also questioning the security of the government's health care site, wherein customer data, including social security numbers, bank accounts and credit card information, can be easily hacked and stolen.

More lawmakers, including a swath of Democrats are now beginning to call for extensions to the "mandatory" filing deadlines, while others still are calling for the resignation of Health & Human Services (HHS) Secretary Kathleen Sebelius.

Members of the House Oversight Committee have sent letters to 11 of the companies involved with design and implementation of HealthCare.gov, threatening subpoenas if the companies don't supply the information promptly.

With any luck, the administration, in its abject refusal to release data about the botched rollout of the President's signature social program, may trigger a constitutional crisis, which would play right into the hands of both sides, who do nothing and prefer to shut down the government rather than deal with issues of importance to the American people.

How long it will take for people in America to stop complying with demands from an out-of-control, opaque, oppressive government that continues to operate outside the rigors of the constitution is unknown, but one thing is for sure: Obamacare is pushing the limits of people's patience.

On the other hand, the American public has so far tolerated rigged elections, countless government lies, being spied upon by the NSA, the closure of national parks and monuments, $17 trillion in debt, trillions more in unfunded liabilities, so maybe nothing will change until cities are drone-struck and people hauled off to FEMA camps.

In unrelated news, the artificially-life-supported stock indices continue to display symptoms of atrophy at or close to all-time highs. Volume remains at distressed levels, but that's what you get when the same computer algos trade the same stocks, day-in and day-out, ad nauseum, forever. Crash is an optimistic outcome.

Another Tesla exploded into flames a week ago (unreported), and Lou Reed is dead.

Disgust? It's what's for breakfast, lunch, and dinner, these days.

Dow 15,569.06, -1.22 (0.01%)
Nasdaq 3,940.13, -3.23 (0.08%)
S&P 500 1,762.12, +2.35 (0.13%)
10-Yr Bond 2.51%, +0.01
NYSE Volume 3,098,436,250
Nasdaq Volume 1,715,927,500
Combined NYSE & NASDAQ Advance - Decline: 2633-3071
Combined NYSE & NASDAQ New highs - New lows: 357-27
WTI crude oil: 98.68, +0.83
Gold: 1,352.20, -0.30
Silver: 22.54, -0.101
Corn: 430.75, -9.25

Sluggish Session Sends S&P to All-Time Highs in Final Half-Hour

The headline tells almost the whole story. Stocks languished in a narrow trading range all day until doubling gains in the final half hour. There was absolutely nothing newsworthy by which to move stocks in any particular direction.

All hail day-traders and Mr. Janet Yellen. Oh, and Twitter, the money-losing company with an estimated IPO value of $16 billion.

Cheers.

Dow 15,570.28, +61.07 (0.39%)
Nasdaq 3,943.36, +14.40 (0.37%)
S&P 500 1,759.77, +7.70 (0.44%)
10-Yr Bond 2.50%, -0.02
NYSE Volume 3,102,796,500
Nasdaq Volume 2,119,699,000
Combined NYSE & NASDAQ Advance - Decline: 2948-2668 (breadth, anyone?)
Combined NYSE & NASDAQ New highs - New lows: 472-29 (mark-to-fantasy)
WTI crude oil: 97.85, +0.74
Gold: 1,352.50, +2.20
Silver: 22.64, -0.183
Corn: 440.00, -0.25

What We Said Tuesday Was Right; Corn Near 1-Year Lows

On Tuesday, Money Daily opined that there would be 100-point daily gains on the Dow for no apparent reason on a regular basis for the foreseeable future.

Today, no news, no rationale, BINGO, a 95-point gain. We'll take it.

Just keep buying, take gains as they come and don't get caught in the wake when the tidal wave of defaults comes, which eventually must occur, as the dollar declines.

Turn your paper profits into hard assets - things you can use or that have lasting function and/or value: land, gold, silver, machinery, fuel, transportation, guns, ammo, food, not necessarily in that order.

Dow 15,509.21, +95.88 (0.62%)
Nasdaq 3,928.96, +21.89 (0.56%)
S&P 500 1,752.07, +5.69 (0.33%)
10-Yr Bond 2.52%, +0.04
NYSE Volume 3,564,373,500
Nasdaq Volume 1,928,785,500
Combined NYSE & NASDAQ Advance - Decline: 3327-2278
Combined NYSE & NASDAQ New highs - New lows: 440-25 (THIS is NOT normal)
WTI crude oil: 97.11, +0.25
Gold: 1,350.30, +16.30
Silver: 22.82, +0.205
Corn: 440.25, -2.50

Whoops. That's Why We Don't Offer Specific Investment Advice

What happened?

We thought the government was giving Wall Street the "all clear" signal to send the stock market upward and onward to all-time highs. That's why we - somewhat tongue-in-cheek - suggested buying stocks all the way through Christmas. Maybe we were getting a little ahead of ourselves.

Well, a few, not-so-funny things happened on the way to laughing all the way to the bank.

Momentum stocks are beginning to take on water as high-profile investors like Carl Icahn start cashing out of investments like Netflix. Speculative stocks like Chipolte Mexican Grill, Tesla, Facebook, LinkedIn and others have soared by more than 100% in the past year. Many came under heavy selling pressure yesterday and today.

China's largest banks tripled their debt write-offs, bracing for a full-blown implosion of their over-leveraged, over-inflated real estate market, much like the housing crash in the US from 2007 onward.

JP Morgan is close to settling another lawsuit over bad home loans (really? who cudda guessed?), this one for a mere $6 billion.

Late in the day, Bank of America was found liable for fraud on claims related to defective mortgages sold by its Countrywide unit.

Soooooooo, the major averages finished in the red. Of course, this is only one day, and it will take many more down days and confirmation of a failed rally for Money Daily to proclaim a bear market which will precipitate a crash, eventually. Timing is everything, and the final, fatal blow to the abhorrent US stock markets may not come for months or years, though 2014 is beginning to look pretty ugly.

One thing which is a positive, yet unexplained, is the collapse in the price of crude oil, which has dropped more than $10 in the past two months and about $7 in the past 10 days. With lower oil prices come - naturally - lower gas prices. It could be seasonal, though we're hoping the decline is more of a permanent one. Lord knows, car owners need a break at the pump.

Also, bonds have been rallying hard since the government got back to work, sending yields on the ten-year note down 25 bips in just the past week.

With Halloween rapidly approaching, it might be a good idea to begin getting scared in advance, thus, the frightful future of the US economy, according to John Williams of shadowstats.com in this revealing, startling interview by Greg Hunter:



BTW: We're still screwed.

Dow 15,413.33, -54.33 (0.35%)
Nasdaq 3,907.07, -22.49 (0.57%)
S&P 500 1,746.38, -8.29 (0.47%)
10-Yr Bond 2.49% 0.03
NYSE Volume 3,695,265,000
Nasdaq Volume 1,866,661,875
Combined NYSE & NASDAQ Advance - Decline: 2382-3210
Combined NYSE & NASDAQ New highs - New lows: 300-32
WTI crude oil: 96.86, -1.44
Gold: 1,334.00, -8.60
Silver: 22.62, -0.173
Corn: 442.75, +4.50

Get Used to 100-Point Gains on the Dow for No Reason

Let's just make sure everybody's on the same page, OK?

The Fed will continue to continue buying treasuries and MBS to the tune of $85 billion a month, with no end in sight. Thoughts of tapering those purchases has been pushed back until March, 2014, at the earliest, that is, if they taper at all. CHECK

The federal government has suspended the debt ceiling, so the federal government can spend whatever it wants without any kind of cost-containment mechanism whatsoever. CHECK

Most government statistics are fabrications, designed to keep the facade of "recovery" (isn't it time we got past recovery, toward a normal economy?) intact. CHECK

Ergo, stocks will continue to rise despite economic conditions or fundamentals like real earnings (those not caused by stock buybacks or forced layoffs or restructuring) and revenue expansion. CHECK

Good. Now go buy some stocks. Nothing will change unless the people at the top (the legendary one percenters) want it to change.

This is the environment we are subjected to by massive frauds and a derelict society led by psychopaths, but, it really can't get any more accommodative for risky speculation. Might as well go right ahead and buy call options. Everybody is going to be rich.

That's it. Meanwhile...

How bad is the experience on the healthcare.gov website?

The National Review estimates that five million lines of code need to be rewritten.

In human terms, if a line of code is rewritten (fixed) every minute, it will only take about ten years to fix the entire site, rendering those who sign up for health care soon a moot point since most of them will be sick or dead by then.

Dow 15,467.66, +75.46 (0.49%)
Nasdaq 3,929.57, +9.52 (0.24%)
S&P 500 1,754.67, +10.01 (0.57%)
10-Yr Bond 2.51%, -0.10
NYSE Volume 3,766,323,750
Nasdaq Volume 1,780,039,250
Combined NYSE & NASDAQ Advance - Decline: 3653-1983
Combined NYSE & NASDAQ New highs - New lows: 717-31 (yes, this is normal)
WTI crude oil: 97.80, -1.42
Gold: 1,342.60, +26.80
Silver: 22.79, +0.512
Corn: 438.25, -5.75