The Market is a Yo-Yo; Don't Get Strung Out

There are only two directions in which the prices of assets can move: up or down. In it's current state, US stock indices are doing both, a condition which cannot persist for long before the establishment of a definite direction becomes apparent and dominant.

Thus far in the month of February - which has a mere six trading days remaining - there have been eight days of gains and five sessions ending with losses, each swing in either direction being rather magnanimous compared to the prior regime of low volatility and complacency.

On Tuesday, the Dow Jones Industrial Average arrived at the midpoint between the highs and lows for the month. On the 8th, the low reading was a cumulative loss of 2288 points. On Tuesday, the 20th, it closed with a loss of 1184 for the month, roughly a 50% retracing off the lows, ending a string of six straight winning session.

Tumultuous times cry out for straightforward thinking and diligent observation. Direction will soon be determined, and such direction can be employed as a springboard for trading over the upcoming six to 18 months.

At the present, nothing has been determined, but it is clear that stocks are finding a rough road back to all-time highs acquired late in January. Not that all gains are without drawbacks and whipsaws, but the measure will likely be in the breadth of gains and losses in individual stocks.

Tuesday's losses on the Dow were led by Wal-Mart (WMT) which fell by more than 10%, but it was by no means alone. Of the 30 blue chip components, only five gained on the day, and only one - Intel (INTC) - gained more than one percent.

One by one, as fourth quarter 2018 and full year earnings are announced, the Dow stocks are being sold off. Whether this emerges as a buying opportunity or a precursor to more asset shredding is a function of both market sentiment and the continuing narration of the Trump economy.

If the general economy is on the mend, then this episode of doom and gloom will be brushed off as a mere anomaly. On the flip side, should the darlings of Wall Street continue to underperform, more losses lay dead ahead.

Dow Jones Industrial Average February Scorecard:

Date	Close	Gain/Loss	Cum. G/L
2/1/18	26,186.71	+37.32	+37.32
2/2/18	25,520.96	-665.75	-628.43
2/5/18	24,345.75	-1,175.21	-1,803.64
2/6/18	24,912.77	+567.02	-1,236.62
2/7/18	24,893.35	-19.42	-1,256.04
2/8/18	23,860.46	-1,032.89	-2288.93
2/9/18	24,190.90	+330.44	-1958.49
2/12/18	24,601.27	+410.37	-1548.12
2/13/18	24,640.45	+39.18	-1508.94
2/14/18	24,893.49	+253.04	-1255.90
2/15/18	25,200.37	+306.88	-949.02
2/16/18	25,219.38	+19.01	-930.01
2/20/18	24,964.75	-254.63	-1184.64

At the Close, Tuesday, February 20, 2018:
Dow Jones Industrial Average: 24,964.75, -254.63 (-1.01%)
NASDAQ: 7,234.31, -5.16 (-0.07%)
S&P 500: 2,716.26, -15.96 (-0.58%)
NYSE Composite: 12,763.34, -111.02 (-0.86%)

Note: Just heard that Reverend Billy Graham has passed away at the age of 99. A good man has gone to meet his maker.

Dow Hangs Onto Friday Gains Amid Late-Session Selloff

It was options expiration Friday and the volatility showed up late in the day, as the Dow shed more than 200 points off a morning rally, closing marginally ahead. The S&P gained a point and change, but the NASDAQ slipped into the red for the day.

The entire trading day came to matter little in the larger scheme, especially for the NASDAQ, which led all indices with a gain of more than five percent for the week.

With markets closed for President's Day on Monday, February 19, investors will take the time off to evaluate foreign markets and prepare for the seven remaining trading days of the month.

Stocks have clawed back more than half of the losses incurred earlier in the month, setting up for a continuation of the short-term rally well in advance of expected rate hikes at the next FOMC meeting on March 20-21.

This leaves stock indices with strong support at their respective 200-day moving averages, bottoms which look less likely to be revisited any time soon.

After some tumult earlier in February, it appears that nothing of import has changed - besides the value of the dollar and rates on treasury bonds - supportive of the proposition that central banks are still in charge and complete control.

Should investors be worried?

Always. But, presently, they are not.

Dow Jones Industrial Average February Scorecard:

Date	Close	Gain/Loss	Cum. G/L
2/1/18	26,186.71	+37.32	+37.32
2/2/18	25,520.96	-665.75	-628.43
2/5/18	24,345.75	-1,175.21	-1,803.64
2/6/18	24,912.77	+567.02	-1,236.62
2/7/18	24,893.35	-19.42	-1,256.04
2/8/18	23,860.46	-1,032.89	-2288.93
2/9/18	24,190.90	+330.44	-1958.49
2/12/18	24,601.27	+410.37	-1548.12
2/13/18	24,640.45	+39.18	-1508.94
2/14/18	24,893.49	+253.04	-1255.90
2/15/18	25,200.37	+306.88	-949.02
2/16/18	25,219.38	+19.01	-930.01

At the Close, Friday, February 16, 2018:
Dow Jones Industrial Average: 25,219.38, +19.01 (+0.08%)
NASDAQ: 7,239.47, -16.96 (-0.23%)
S&P 500: 2,732.22, +1.02 (+0.04%)
NYSE Composite: 12,874.36, +17.49 (+0.14%)

For the Week:
Dow Jones Industrial Average: +1028.48 (+4.25%)
NASDAQ: +364.97 (+5.31%)
S&P 500: +112.67 (+4.30%)
NYSE Composite: +468.54 (+3.78%)

Rally On! Dow Regains More Than Half of February Losses

With the Dow Industrials posting the fifth straight positive session, he blue chip average has regained more than half of the losses incurred during the first six trading sessions of February.

Standing just above 25,200, the Dow has been an impressive performer following the instant, interest rate sensitive melt-down earlier in the month.

The Dow is up more than 1000 points this week, with Friday's session important as stock options reach expiration.

Last week's scare has morphed into this week's buying opportunity, as investors have scrambled back into stocks after equity funds experienced record outflows just a week prior.

Those who sold at the interim bottom may be experiencing some seller's remorse presently, though the stock market has still has some distance to travel back to all-time highs.

Has anything changed besides sentiment, which is now returning to bullishness after a spat of fear entered the minds of speculators?

Certainly, rising interest rates are a concern, with the 10-year-note reaching four-year highs. The value of the US dollar, as reflected in currency FX pairs and the Dollar Index, is another new feature of the cycle-weary market. The dollar has weakened considerably over the past 12 months and does not appear to have four support.

Higher interest rates on treasuries usually causes strengthening in the dollar, but not this time, befuddling the normally-smug bond and currency analysts. If bond yields continue to rise and the dollar does not recover substantially, then all manner of economic theory can be tossed out the proverbial window.

Whatever the case may be - not discounting the effect of accelerating volatility during the recent downturn - there remains considerable uncertainty which must somehow be resolved, either by a permanent change in market direction from bull to bear, or a continuation of the long rally off the GFC lows of 2009.

Dow Jones Industrial Average February Scorecard:

Date	Close	Gain/Loss	Cum. G/L
2/1/18	26,186.71	+37.32	+37.32
2/2/18	25,520.96	-665.75	-628.43
2/5/18	24,345.75	-1,175.21	-1,803.64
2/6/18	24,912.77	+567.02	-1,236.62
2/7/18	24,893.35	-19.42	-1,256.04
2/8/18	23,860.46	-1,032.89	-2288.93
2/9/18	24,190.90	+330.44	-1958.49
2/12/18	24,601.27	+410.37	-1548.12
2/13/18	24,640.45	+39.18	-1508.94
2/14/18	24,893.49	+253.04	-1255.90
2/15/18	25,200.37	+306.88	-949.02

At the Close, Thursday, February 15, 2018:
Dow Jones Industrial Average: 25,200.37, +306.88 (+1.23%)
NASDAQ: 7,256.43, +112.81 (+1.58%)
S&P 500: 2,731.20, +32.57 (+1.21%)
NYSE Composite: 12,856.87, +110.15 (+0.86%)

Despite Relatively Hot CPI, Stocks Rip Higher

What's that old saying?

It's something like... "don't wish too hard, you may get what you want."

Well, it applies to the Fed, ECB, BoJ and other central banks, which have been screaming for higher inflation ever since the Great Financial Crisis of 2008-09.

On Wednesday, they got some of the "good" news. The CPI for January came in with a gain of 0.54 month-over-month, the biggest increase since January of 2017. Being that both January of this and last year were the high points for CPI, it might be a statistical anomaly, though that thought seemingly hasn't crossed the minds of any economic reporters.

Higher consumer prices in January, however, didn’t substantially alter the overall picture on inflation. The increase in the CPI over the past 12 months remained unchanged at 2.1%.

After stripping out volatile gas and food, the more closely followed core rate of inflation rose 0.3% last month. The 12-month rate of core inflation was also flat at 1.8%.

So, once stock players digested the news, which was released an hour prior to the opening bell, futures nosedived, stocks opened deep in the red, but, within an hour, it was off to the races, despite interest rates - especially the 10-year-note - rising sharply.

The 10-year-note popped over 2.9% yield, while gold and silver - traditional inflation hedges - soared throughout the day.

Seems nobody really knows what will happen, though many profess to have deep inner knowledge of how economics actually works.

Maybe we're all just being played for fools.

Pull my finger...

Dow Jones Industrial Average February Scorecard:

Date	Close	Gain/Loss	Cum. G/L
2/1/18	26,186.71	+37.32	+37.32
2/2/18	25,520.96	-665.75	-628.43
2/5/18	24,345.75	-1,175.21	-1,803.64
2/6/18	24,912.77	+567.02	-1,236.62
2/7/18	24,893.35	-19.42	-1,256.04
2/8/18	23,860.46	-1,032.89	-2288.93
2/9/18	24,190.90	+330.44	-1958.49
2/12/18	24,601.27	+410.37	-1548.12
2/13/18	24,640.45	+39.18	-1508.94
2/14/18	24,893.49	+253.04	-1255.90

At the Close, Wednesday, February 14, 2018:
Dow Jones Industrial Average: 24,893.49, +253.04 (+1.03%)
NASDAQ: 7,143.62, +130.10 (+1.86%)
S&P 500: 2,698.63, +35.69 (+1.34%)
NYSE Composite: 12,746.72, +172.35 (+1.37%)

Stocks Struggle to Small Gains Through Listless Session

Like Chinese water torture, the slow drip... drip... drip... of the stock market's dips and ascents had Wall Street hoping for better on Tuesday, but, after an early rally erased opening losses, stocks lost momentum into the close, finishing with insignificant gains.

While January was kind to investors of all stripes, February has been rude, sending stocks briefly into correction territory and still hovering just above recent lows.

Dow Jones Industrial Average February Scoreboard:

Date	Close	Gain/Loss	Cum. G/L
2/1/18	26,186.71	+37.32	+37.32
2/2/18	25,520.96	-665.75	-628.43
2/5/18	24,345.75	-1,175.21	-1,803.64
2/6/18	24,912.77	+567.02	-1,236.62
2/7/18	24,893.35	-19.42	-1,256.04
2/8/18	23,860.46	-1,032.89	-2288.93
2/9/18	24,190.90	+330.44	-1958.49
2/12/18	24,601.27	+410.37	-1548.12
2/13/18	24,640.45	+39.18	-1508.94

At the Close, Tuesday, February 13, 2018:
Dow Jones Industrial Average: 24,640.45, +39.18 (+0.16%)
NASDAQ: 7,013.51, +31.55 (+0.45%)
S&P 500: 2,662.94, +6.94 (+0.26%)
NYSE Composite: 12,574.37, +14.25 (+0.11%)

How Long Before Stocks Regain Previous Highs?

The question before Wall Street's punters, planners and prognosticators is measuring the length of time it will take for the main indices to regain their prior all-time-high levels.

Just in case the recent downturn isn't of the long-term variety (a 50-50 proposition), the guesses and estimates range from a few weeks to a matter of months. However, if circumstance prevail to keep stocks lower - higher interest rates, bouncy economic data, unexpected geopolitical events - regaining the high ground could take years.

A couple of recent retreats and rises may prove instructive.

After the NASDAQ shattered the 5000 mark in 2000 (5,048.62, March 10, 2000), it subsequently crashed and burned, shedding roughly 75% of its value by March 9, 2009 (1,268.64). It didn't get all the way back to the previous top until April 25, 2015, when it closed at 5,056.06.

Even more recent, when the Dow Jones Industrial Average topped out at 14,164.53 on October 9, 2007, less than 18 months later it had fallen by more than 50%, to 6,547.05, bottoming out on March 9, 2009. Fueled by central bank largesse in the form of ZIRP and QE, the Dow rocketed back to prior highs until March 5, 2013, closing at 14,253.77 that day, a period - from top to top - of a mere five-and-a-half years.

From this recent data, it appears the tops and bottoms are generally features of Spring and Fall, so the most recent January highs may not signal the market's last hurrah but portend another quick rise back beyond and then a fall.

Whatever the case may be, it does appear that the second-longest bull market in history is nearing an end, and may, in fact, be done. How long it takes to get back, after the eventual crash, is an open question, and one that should be correctly assessed in terms of years, and probably more than a decade.

For the record, the Dow regained some of what it lost over the past two weeks, but it still has a fair a distance to travel back toward the all-time highs, a touch more than 1500 points.

Next week? Why not?

Dow Jones Industrial Average February Scoreboard:

Date	Close	Gain/Loss	Cum. G/L
2/1/18	26,186.71	+37.32	+37.32
2/2/18	25,520.96	-665.75	-628.43
2/5/18	24,345.75	-1,175.21	-1,803.64
2/6/18	24,912.77	+567.02	-1,236.62
2/7/18	24,893.35	-19.42	-1,256.04
2/8/18	23,860.46	-1,032.89	-2288.93
2/9/18	24,190.90	+330.44	-1958.49
2/12/18	24,601.27	+410.37	-1548.12

At the Close, Monday, February 12, 2018:
Dow Jones Industrial Average: 24,601.27, +410.37 (+1.70%)
NASDAQ: 6,981.96, +107.47 (+1.56%)
S&P 500: 2,656.00, +36.45 (+1.39%)
NYSE Composite: 12,560.12, +154.30 (+1.24%)

Stocks Continue Downward Spiral Second Straight Week

With stocks rallying on Friday, the disastrous second straight week of declines came to a relieving finish for equity longs, but not without significant teeth-gnashing through the tortuous five trading days.

The Dow and S&P 500 each entered correction territory on Thursday, as the blue chip index posted its second-largest single-day point decline. With the focus on the 10% down mark, Friday's gains may serve only as a temporary salve to many frayed nerves.

With the Dow Industrials still down nearly 2000 points in just the first seven trading days of February it's going to take quite an effort to regain all-time highs. The major indices peaked simultaneously in late January, but it's been all downhill since then, and the probable causes for such a shakeout are still in effect, if not even more exacerbated in the case of bond yields.

Globally, outflows from equity funds set a record, as investors pulled $30.6 billion out in the week through Wednesday, according to global fund tracker EPFR.

Breaking down those flows, the U.S. dominated with a record $33 billion in equity redemptions, while Europe saw $3.3 billion exit, the largest in 79 weeks. Japan saw the strongest equity inflows in 65 weeks at $2.4 billion, while $2.4 billion flowed into emerging markets, according to Bank of America Merrill Lynch.

Weekly declines in US markets were uniform, as the four major indices were all lower by at least five percent, led by the Dow, at 5.21%.

The 10-year-note closed out the week at 2.83%, a level seen promoting a massive shift from stocks to bonds and risk to relative safety. Crude oil slipped to its lowest level of the year, finishing off Friday at $59.05. Though not directly related to the equity selloff, crude prices have been elevated for the past two months until they were devastated by a massive increase in supply, reported this week.

Precious metals prices were muted, falling along with stocks, bonds and nearly every other asset class.

Trickling out from the corners of mouths were murmurings of getting long art, transportation, real estate and anything tangible.

Obviously, the correction is not over, having barely dipped a toe into the -10% water. It would not be unusual to see stocks bounce early next week and possibly beyond, though a retest of the prior lows is all but inevitable.

While caution had been thrown to the wind all of last year and through January of this year, consensus sentiment has changed dramatically and markets are likely to remain unstable until volatility subsides. That may not happen for some time, since the past nine years of bank-and-buyback-induced stock profits have been characterized by extremely low levels of volatility.

The past two weeks have been witness to a fundamental change in many regards. Extreme greed turned to a healthy level of fear in just a few days.

Rising rates and the prospect of profligate spending at the federal level point to further declines in the equity complex.

Dow Jones Industrial Average February Scorecard:

Date	Close	Gain/Loss	Cum. G/L
2/1/18	26,186.71	+37.32	+37.32
2/2/18	25,520.96	-665.75	-628.43
2/5/18	24,345.75	-1,175.21	-1,803.64
2/6/18	24,912.77	+567.02	-1,236.62
2/7/18	24,893.35	-19.42	-1,256.04
2/8/18	23,860.46	-1,032.89	-2288.93
2/9/18	24,190.90	+330.44	-1958.49

At the Close, Friday, February 9, 2018:
Dow Jones Industrial Average: 24,190.90, +330.44 (+1.38%)
NASDAQ: 6,874.49, +97.33 (+1.44%)
S&P 500: 2,619.55, +38.55 (+1.49%)
NYSE Composite: 12,405.82, +135.17 (+1.10%)

For the Week:
Dow: -1330.06 (-5.21%)
NASDAQ: -366.46 (-5.06%)
S&P 500: -142.58 (-5.16%)
NYSE Composite: -679.53 (-5.19%)

The Gartman File (It's about time this fraud was exposed)

Well, after publicly calling out Dennis Gartman, celebrity investment advisor and frequent guest on CNBC, and trying to sign up for his newsletter (thegartmanletter.com), Money Daily editor Fearless Rick has received no response.

Now, maybe it's because the people at The Gartman Letter are really, really busy, tracking stocks and currencies and ETFs and what not, though that's a serious doubt. It would make more sense to believe that Gartman is indeed lying - to his subscribers, primarily - about his year-to-date (as of March 10) performance of 12.3% and outperforming the S&P by 14%, especially after digging into Mr. Dennis Gartman's history.

On March 29, 2016Gartman "admits" that he's up 8.2%.

At one time, Gartman was pegged to manage an ETF for Horizons, a Canadian-based investment firm with various funds and ETFs under management. Specifically, the fund was known as the Horizons AlphaPro Gartman ETF, which was founded in March 2009 (perfect timing, being that was the market bottom), and went out of business four years later, on March 22, 2013.

Gartman, expert trader and analyst he claims to be, managed to lose money for the ETF and its clients while the S&P was up something on the order of 132% (from about 670 to roughly 1550).

Here's an article from the UK's Guardian (note: no mention of this on CNBC or any other US news media), published just before the AlphaPro Gartman ETF closed its doors at 7.90 per share, after opening four years earlier at $10.00.

But the Gartman ETF, named after advisor Dennis Gartman, ubiquitous author of the Gartman Letter, an investment advisory, couldn’t harness the benefits of its fortunate timing. The fund went public at $10 a share. Those same shares now fetch around $7.90.

More astonishing is that this closed-end fund actually saw the equivalent of massive redemptions. That’s unheard of in the closed-end world. With the asset base, and therefore fees, down sharply, it’s no surprise that Horizons Alphapro has decided to shut the fund down next month.

Here's an earlier article on Seeking Alpha, (June 23, 2011) that notes the fund had done OK for some time, but as of the article's writing, was down 7.7%.

Here is a rather humorous note from Peter Grandich, on Gartman's performance with a chart comparing his fund to the price of gold.

Nowhere to be found on any of Mr. Gartman's various postings and appearances are mention of his Hedge Fund, formed in August of 2009, as the River Crescent Fund (apparently named for the street on which he lives and likely does business from, in Suffolk, Virginia). At the time, Gartman was looking to raise the modest sum of $200 million from investors, and, according to his SEC filings, would accept a minimum of $5 million for starters.

Apparently, anybody with five million bucks didn't need Gartman's advice, because since its inception, there's been no news, no investments, no nothing, except for a lonely SEC filing. That's probably a good thing for most investors.

So, what does Gartman manage today, after failing miserably during one of the great bull markets of all time? According to sources, he manages his own retirement fund. And that's the one he claims is up 12.3% on the year, while the stock market was beaten down severely in January and early February, and gyrating in negative territory for the better part of the past month.

Essentially, from March 2009 through March 2013, Gartman should have had worn disclaimers every time he appeared on CNBC. whether he was or not is a question for the way-back machine. Certainly, there are clips from that time period and Money Daily will investigate further. Oddly enough, no mention is made of Gartman's failure with the AlphaPro Gartman EFT on his official CNBC biography.

Here's a particularly bad call, when Gartman said he was getting out of stocks in August of 2012, just prior to the Fed's launch of QE3, a mammoth stimulus, less than a month later.

Also, as far as can be discerned, Mr. Dennis Gartman is neither a registered equity trader, a member of FINRA, nor a futures trader (since 2005). Nor is Mr. Gartman a registered investment advisor.

The only conclusions one can reasonably assume is that Dennis Gartman, being well past his prime, is living off the $50 to $100 per day he makes appearing on CNBC and whatever meager earnings he derives from his newsletter.

Speaking of his newsletter - which I have never seen and doubt ever will as my request on his website has not elicited so much as a response - here are a few reviews. They're generally unflattering, again, begging the question as to why the clownish Gartman is even on CNBC at all.

Updating on April 21, 2016, Gartman says he likes Alcoa (AA) and Gold in Yen or Euro terms. Naturally, as soon as he had finished his on-air mouthings, gold fell $20... in US dollar terms, of course. As for the Alcoa call, it's a pretty safe one, since AA has been as high as 17.75 (November, 2014) and, recently, down to a multi-year low in January of 6.12 (intra-day). Calling it a buy around $10 a share isn't exactly rocket science. Gartman may actually have a winner here, but it won't be much of one.

UPDATE: Gartman has gone from bearish (in light of a face-ripping 200-point rally on the Dow, May 24) to bullish in 24 hours. This is the typical Gartman flip-flop and more evidence that he's a complete buffoon and plays with imaginary money.

What a clod!

Dude, Where's My Retirement Pension?

Stocks took another punch to the gut on Thursday, extending the February losses on all global indices.

The Dow Jones Industrial Average officially (-10%) entered correction phase.

The NASDAQ is within a hair of a 10% drop, from 7,505.77 to 6,777.16. 6755.19 is the magic number in this case.

On the S&P 500, the January 26 top of 2,872.87 is far away from the close into correction territory (at 2585.87), achieved in today's session with a triple-digit loss.

The Dow Jones Industrial Average Scoreboard looks like this:

Date	Close	Gain/Loss	Cum. G/L
2/1/18	26,186.71	+37.32	+37.32
2/2/18	25,520.96	-665.75	-628.43
2/5/18	24,345.75	-1,175.21	-1,803.64
2/6/18	24,912.77	+567.02	-1,236.62
2/7/18	24,893.35	-19.42	-1,256.04
2/8/18	23,860.46	-1,032.89	-2,288.93

That's in just six trading sessions, people. All the major averages are down for the year, but, hey, it's only February. Plenty of time to boost those profits.

This is only the beginning of a collapse that may be unprecedented. Considering the adherence to antiquated Keynesian economic theories spoon-fed to the masses, the unwinding will be a farce, fed by propagandists, though it's effects will be somewhat permanent on the financial status of almost everybody.

Precious metals were among the few gainers on the day.

At the Close, Thursday, February 8, 2018:
Dow Jones Industrial Average: 23,860.46, -1,032.89 (-4.15%)
NASDAQ: 6,777.16, -274.82 (-3.90%)
S&P 500: 2,581.00, -100.66 (-3.75%)
NYSE Composite: 12,270.65, -416.53 (-3.28%)

How is Your Money Doing? Here's the February Dow Scoreboard, Day 5

In the sports world, all manner of statistics and scenarios are routinely trotted out in attempts to reinforce how one team or player is better than another. All of this analysis is done every day on TV and radio talk shows, but the in the final analysis, as so perfectly expressed by the king of sports talk radio, Jim Rome, is "scoreboard," as in, who won the game, no matter the stats.

The same kind of metric can easily be applied to stocks and investments, as it no doubt should be. Thus, there's no need for analysis, no need for bald-headed, econo-speak commentators, no need for inverse correlations, causations, or extrapolations. All that matter can be found in the daily closing prices for individual stocks, or for individual stock indices, such as the Dow Jones Industrial Average, the measure by which everybody measures success.

Over the past four trading sessions, there's been more than sufficient ammunition for all kinds of wild speculation and analysis of what happened and why, and there may be a thousand reasons why the Dow and other indices were slaughtered last Friday and again this Monday. The more simplistic answers appear in the comeback sessions on Tuesday and Wednesday, which failed to recoup all of the losses. Thus, it's all in the scoreboard, i.e., the daily closes on the Dow. Nothing more, nothing less. No analysis necessary. You either won or you lost.

Let's just track the Dow through the month of February and see how well those precious stocks are doing.

Here are the only numbers that matter:

Dow Jones Industrial Average dates, closing prices, gains or losses:

Date	Close	Gain/Loss	Cum. G/L
2/1/18	26,186.71	+37.32	+37.32
2/2/18	25,520.96	-665.75	-628.43
2/5/18	24,345.75	-1,175.21	-1,803.64
2/6/18	24,912.77	+567.02	-1,236.62
2/7/18	24,893.35	-19.42	-1,256.04

So, as can clearly be seen, even adding in the smallish gain on Feb. 1, the Dow is down a massive amount. The contention here at Money Daily is that there has been a sea change in the market. Not only is a correction in the works (-10%), but a bear market (-20%) is quickly developing. We'll keep tracking so you at home can keep score on your "investments."

At the Close, Wednesday, February 7, 2018:
Dow Jones Industrial Average, 24,893.35, -19.42 (-0.08%)
NASDAQ: 7,051.98, -63.90 (-0.90%)
S&P 500: 2,681.65, -13.49 (-0.50%)
NYSE Composite: 12,714.83, -30.62 (-0.24%)

Dow's Dramatic Comeback 4th-Best in History

That was something to behold.

Not only did the Dow open down a whopping 500 points, but it battled back and forth across the unchanged line - as did the other major indices - until finally launching itself into a hyperbolic ascent in the final hour of the session.

While the Dow's rise was the 4th-biggest point gain in its long history, there's still work to be done. Just to get back what it lost last Friday and Monday of this week will take two more days of equal heavy lifting, something that is unlikely unless one lives on the planet Utopia, where unicorns spit skittles and money grows on trees.

Even more daunting may be the return to all-time highs (26,616.71), a mere 1,700+ points away. It could happen. It very well may happen. However, if it does, stocks will once again be more expensive than ever before (they are still).

The market action over the past week has been a warm-up, conditioning the masses for more carnage to commence and shaking out the weak - or wise - hands. Those who cannot allocate by themselves (like people with 401ks or government retirement plans) will be stuck with whatever the fund managers deem prudent. Call them bag-holders.

The swift and the wise are playing the ups-and-downs, though that was quite the challenge in today's session. Volatility has returned and it should be pointed out that some of the greatest one-day gains (in fact, the two largest occurred in the fall of 2008) happened in bear markets.

The fun has just begun.

At the Close, Tuesday, January 6, 2018:
Dow Jones Industrial Average: 24,912.77, +567.02 (+2.33%)
NASDAQ: 7,115.88, +148.36 (+2.13%)
S&P 500: 2,695.14, +46.20 (+1.74%)
NYSE Composite: 12,745.45, +172.53 (+1.37%)

Dow Sheds Record 1,175 Points, Global Markets in Panic Mode

Anybody already not convinced that stocks have been relentlessly pumped by buybacks and central bank interventions over the past nine years may have had a rude awakening over the past few days and especially on Monday as the Dow Jones Industrial Average lost a record 1,175 points in the week-opening session.

While the percentage loss was nowhere near record-setting, it still managed to crack the top 20 of all-time percentage losses for a single trading day. Combined with Friday's collapse, the Dow is down over seven percent in just the past two sessions, wiping out all the gains from an over-exuberant January.

What happened?

Interest rates exploded. That was the first salvo from massively intertwined markets. The ten-year note, which has been comfortably below 2.5% for most of the last nine years of "recovery" following the Great Financial Crisis (GFC) from 2008-09, smashed through 2.80% on Friday and continued its ascent Monday before some odd force pushed US treasury rates lower across the curve. The 10-year note ended at 2.79, still higher than anybody expected, but not at a level that would cause a panic.

Other than the obvious villain in the bond pits, the other dynamic at play is the obvious overvaluation of stocks, and that is a global problem. By artificially keeping interest rates too low for too long (avoid the pain that should be measured across the board), boosting asset prices in stocks alone, the Fed, ECB, BOJ, PBOC and Swiss National Bank (SNB) created a market structure with one sure feature: failure.

Because borrowing money was such an easy proposition, many of the major corporations on the Dow, NASDAQ and S&P took to buying back their own shares, enriching only major shareholders and especially top executives with cushy compensation plans. That gambit appears to be over, and it's troubling, because when companies buy their own stock at inflated prices, they own it at those prices. Selling it back into the market at reduced prices causes a loss, which in turn causes earning to collapse. That is the expected conclusion, already evident in some recent quarterly filings. More carnage - much more - is to come.

It has been reported that 84% of all wealth created in 2017 went to the top one percent globally. That's an unsustainable level of wealth inequality largely gone unreported by the news-speakers, analysts and squawkers on Wall Street and the economists in the government. The one percent at the top of the wealth ladder will only be marginally affected by losses, largely because they have more money than they need and probably have been doing most of the trimming over recent days. Who will be harmed? Pension funds, which are already massively underfunded and cannot maintain any measure of credibility in a market crash currently gaining momentum.

Those who have been derided for warning about just this kind of occurrence are now being proven to have seen the most obvious overvaluation and manipulation of markets early. Being early and being wrong are two different animals, but anybody who isn't invested at the moment is - at long last - looking fairly smart.

The global economy has been sputtering and stuttering ever since the crash of 2008. Nothing that caused the problems then has been fixed. In fact, credit has been extended even further than the levels seen prior to that singular solvency event.

Claims (especially those by President Trump, who has unfortunately embraced the massive gains and now will bear the brunt of blame for the losses) that the economy is strong and growing are largely a smoke screen hiding mountains of debt and poor financial management in government. The US Treasury is more than $20 trillion in the hole. Other major governments, especially Japan, are over-leveraged and broke.

The continuing narrative that the economy is strong - which will be heard repeatedly as the market correction (or slow motion crash) extends - is complete garbage, shoveled to an unsuspecting public that desperately wants to hear only good news. The federal government is broke. State governments are broke. Pension plans cannot deliver on the promises made to employees and retirees. Households are deeply in debt and businesses have enriched only their shareholders in recent years. The recipe for collapse has been ripe and the meal is now on the table.

As Wall Street prepares for another onslaught of selling, markets in the East have already taken the low road. In Japan, the NIKKEI was down over 1,000 points. The Hang Song dropped 1,600, or five percent.

This is not over by a long shot. Instead of an end of the bull market, this should be characterized as the beginning of the end for globally-induced monetary madness and an epochal message to believers in what were once known as "free" markets.

Nothing is safe.

At the Close, Monday, February 5, 2018:
Dow Jones Industrial Average: 24,345.75, -1,175.21 (-4.60%)
NASDAQ: 6,967.53, -273.42 (-3.78%)
S&P 500: 2,648.94, -113.19 (-4.10%)
NYSE Composite: 12,572.93, -512.42 (-3.92%)

Markets Turn Ugly As Bond Yields Soar in Ground Hog Day Massacre

Even as January's non-farm payroll report painted a rosy employment picture, adding 200,000 jobs for the month, the 10-year note crested over the 2.80% level on Friday, sending stocks into as vicious tailspin in a mid-winter crash.

The nearly 666-point decline on the Dow was the sixth largest one-day point drop in market history, though in percentage terms was the mildest of the top ten, all of which have occurred in the 21st century.

The fact that all of the major point losses happened since 2000 is made obvious by the enormity of the index, still standing at more then 25,000, an epochal figure in market terms. Notably, the Dow Jones Industrial Average first passed the 10,000 mark in 1999, amid the notorious dotcom boom, prior to the dotcom bust, which took a full three-and-a-half years to fully play out.

Friday's drop was the largest since a 634.76-point loss on August 8, 2011 which sent the blue chips down 5.55%, to 10,809.85. Noting the relative percentage puniness of the Ground Hog Day Massacre, it may be wise to expect larger point and percentage losses in the near to mid-range future (three months to one year).

While it may be simplistic to point to the gaudy valuations placed on equities in the current market dynamic, it is nonetheless a significant factor in the current shaky environment and as good a reason to sell out of stocks as any, though the other major catalyst - rising bond yields - provides a more granular perspective.

The long end of the Treasury yield curve was extended on Friday as the 30-year bond smashed through the psychological 3.00% barrier, signaling to long-term investors that the aging bull market in stocks (and bonds) may be coming to a quick conclusion.

Bull and bear markets do not begin nor end in vacuums, which is why this most recent pullback should be regarded as a change of tone in market functioning. Nothing gos on forever, and empirical data suggests that while stocks have enjoyed salad days for years, the general economy and the welfare of millions of Americans has been less than a full meal.

It's easy to look at macro data and conclude that all is well and central banks have the markets and global economies under control, but sometimes one needs to look around and actually see the mountains of debt, stock buybacks, and central bank meddling which have fueled the gigantic recovery and historic stock gains.

Money is undoubtably becoming tighter and the labor market - according to government figures - is straining at full employment, but wages gains have not nearly kept pace with either inflation or taxes for at least the past 15 years. A breaking point is coming, wherein multi-national corporate behemoths are going to have to sacrifice the massive salaries bestowed upon top executives in exchange for pay increases for Mr. and Mrs. America.

With the Federal Reserve ready to hike the federal funds rate another 25 basis points at their upcoming March FOMC rate policy meeting, the world's central bank seeks to create a buffer against an almost certain recession, one which they, by their own reckless actions, will have caused.

If stock declines continue through February, expect the Fed to pause on their quest to raise rates and unload debt at the same time. The outward absurdity of their position is dangerous to the welfare of not only business entities, but individuals and governments as well.

What may have been the most telling circumstance from Friday's demolition of all asset classes, gold and silver also took precipitous drops, action which harkens back to the tumultuous days of the fall of 2008, when precious metals were slammed along with stocks. Notably, it was the metals which recovered first, but under the current conditions of mad money mindlessness, the shiny stuff may be suppressed even further, simply because central banks don't appreciate competition for their various fake currencies by real money.

The era of easy money is ending.

Real assets will endure.

At the Close, Friday, February 2, 2018:
Dow: 25,520.96, -665.75 (-2.54%)
NASDAQ: 7,240.95, -144.92 (-1.96%)
S&P 500: 2,762.13, -59.85 (-2.12%)
NYSE Composite: 13,085.35, -296.62 (-2.22%)

For the Week:
Dow: -1095.75 (-4.12)
NASDAQ: -264.83 (-3.53%)
S&P 500: -110.74 (-3.85%)
NYSE Composite: -551.67 (-4.05%)

Stocks Struggle Against Higher Bond Yields

Stocks may have had a wondrous January, but February is shaping up to be a story of a different kind.

Not only have yields on all manner of bonds risen with alacrity over the past three weeks, they show no signs of slowing, especially since the Federal Reserve has sent a signal to markets that the federal funds rate is going to be upped at last three times this year, the first hike scheduled at the next FOMC meeting in March.

Higher bond yields make stocks look less attractive by comparison, being that they are virtually without risk, as opposed to stocks, which can rise or fall on whims, trends, poor performance of the underlying companies, or without cause, simply because a company or a sector is "out of favor."

As the 10-year note created above 2.70% earlier in the week, stocks suddenly became not so much of a bargain, especially since valuations have been egregiously stretched as the nine-year-long rally in equities has exceeded all reasonable valuation metrics.

Countering the argument are the voices from the Trump train touting the meteoric rise in stock prices over the past year, and, certainly, the economy is in better condition than it was 12 months ago.

But, a strengthening economy has headwinds, such as higher wages and costs due to inflation, and that's being caused by the endless printing of fiat and buying of securities outright by central banks, which has distorted the landscape of global economics.

The rush to safety has begun, and, once started, such a trend is not easily pushed back. Investors should prepare for a sea change which will wipe out gains that have been largely the result of central bank intervention and stock buybacks by inefficient corporate managers.

At the Close, Thursday, February 1, 2018:
Dow: 26,186.71, +37.32 (+0.14%)
NASDAQ: 7,385.86, -25.62 (-0.35%)
S&P 500: 2,821.98, -1.83 (-0.06%)
NYSE Composite: 13,381.97, +14.01 (+0.10%)

Stocks Rocked, Presdient Trump Stick-Saves with SOTU

There shouldn't be too much in the way of analysis seeking a rationale for Tuesday's smash-crash in global equity markets.

With treasury's 10-year-note rocking beyond 2.70%, bonds are coming back into favor as investments with little risk, as opposed to over-inflated stocks buoyed by buybacks.

Profit-taking being mostly a participant sport, sellers piled into the pits, sending previously-favored issues down for a second straight session. After the markets closed for the day, life returned to some semblance of normalcy, awaiting disruption, caused primarily by President Trump's stirring State of the Union speech (and the pouting Democrats lack of response).

Trump delivered for his base, as usual, leaving a feeble Joe Kennedy III drooling out the Democrat response, a vain, ineffective attempt to continue undermining the administration's attempts to bring America back to a place of dominance, reverence, and prosperity.

The shock-selling on Monday and Tuesday should likely fade as business continues gearing up, though the path will be made more difficult for the Fortune 500 types as interest rates ascend.

Perhaps investing will return from an overcrowded type of algo-chasing, bid-stuffing, front-running mosh pit to a semi-science based on math skills, management, and fundamental analysis.

Perhaps it will not, but, by all outward appearances, President Trump, at least has the right kind of ideas to move the country - and industry - forward.

At the Close, Tuesday, January 30, 2018:
Dow Jones Industrial Average: 26,076.89, -362.59 (-1.37%)
NASDAQ: 7,402.48, -64.02 (-0.86%)
S&P 500: 2,822.43, -31.10 (-1.09%)
NYSE Composite: 13,375.51, -149.14 (-1.10%)

Wall Street's Monday Blood-Letting Leads to Global Calamity in Equities

US equity markets were roiled Monday as the dollar jumped and bonds sold off, pushing yields higher, especially on the short end of the curve.

The two-year treasury finished the day at 2.09%, the five at 2.47%, and the benchmark ten-year note briefly touched 2.70% before dipping back to 2.68%. For perspective, consider that the five-year treasury was yielding 2.19% and the ten-year, 2.39, just a month ago. Those are significant moves and, apparently, the stock market has now taken notice as fixed investments begin offering yields competitive with stock dividends, at least.

For more perspective, the S&P and Dow averages suffered their worst one-day drops since early September. The percentage was just two-thirds of a percent on both indices. That shows just how decisive the rally since the election of Donald J. Trump as president has been. There has not been on single-day one percent decline on either in well over a year.

If a sea change in sentiment is occurring, Tuesday's trade could be a determinant day. Futures are pointing well lower and the VIX is cresting over 14 in the US, while global markets are a sea of red.

Japan's NIKKEI was down nearly 1.5%. The Hang Song was off over one percent. European bourses are uniformly lower at their midday.

As the nation prepares for President Trump's first State of the Union speech Tuesday night, more focus could be on internal DC politics, especially the readying for release of the troubling, explosive memo penned by the House Intelligence committee.

On Monday, the Intel committee voted along party lines to declassify the four-page missive. The president has five days to release the memo or keep it classified. Opinion and timing see Thursday as the likely eventual release.

With the FOMC set to keep rates unchanged on Wednesday (the meeting opens Tuesday), that may be the only thing that doesn't change this week.

At the Close, Monday, January 29, 2018:
Dow: 26,439.48, -177.23 (-0.67%)
NASDAQ: 7,466.51, -39.27 (-0.52%)
S&P 500: 2,853.53, -19.34 (-0.67%)
NYSE Composite: 13,524.65, -112.37 (-0.82%)

Stocks Soar Through January; Big Week Upcoming

Stocks staged their best cumulative effort of the new year, as January equity returns continued to explode through the final full week of trading in the United States.

Making the gains all the more impressive is the fact that the month has seen only 18 out of a possible 20 trading days, due to the New Year and MLK holidays falling on Mondays. Three more sessions to start the new week will conclude January trading.

Stocks have been the major story of the year thus far, along with the continued decline of the US dollar against other major currencies, especially the Yen, Euro and British Pound.

President Donald J. Trump returned from Davos over the weekend, preparing for his first State of the Unions address to congress on Tuesday night.

Also of note this week is the FOMC policy rate meeting of the Federal Reserve. While the Fed is not expected to raise key interest rates at this meeting, there's general impetus for a planned rate hike at the March meeting. The FOMC meets on Tuesday and Wednesday, January 30 and 31. The March meeting is March 20-21.

The week concludes with the January Non-farm Payroll release by the BLS on Friday, Feb. 2. The data release includes publication changes related to the annual sample review and the conversion to NAICS 2017.. Expectations will be high, given the explosive nature of the stock market and recent touting of strong economic growth by President Trump.

At the Close, Friday, January 26, 2018:
Dow: 26,616.71, +223.92 (+0.85%)
NASDAQ: 7,505.77, +94.61 (+1.28%)
S&P 500: 2,872.87, +33.62 (+1.18%)
NYSE Composite: 13,637.02, +124.36 (+0.92%)

For the Week:
Dow: +544.99 (+2.09%)
NASDAQ: +169.39 (+2.31%)
S&P 500: +62.57 (+2.23%)
NYSE Composite: +252.56 (+1.89%)

Dow Soars

Really?

At the Close, Thursday, January 25, 2018:
Dow: 26,392.79, +140.67 (+0.54%)
NASDAQ: 7,411.16, -3.89 (-0.05%)
S&P 500: 2,839.25, +1.71 (+0.06%)
NYSE Composite: 13,512.66, +5.00 (+0.04%)

Stocks a Little Shaky As Dollar Plummets, Silver, Gold Soar

Chalk this up to various theories of unintended consequences.

Even the brilliant thinkers at the Federal Reserve are unable to explain the strange divergence of bonds and the dollar over the past number of weeks because that's not the way it's supposed to go.

With the Fed becoming more hawkish as they attempt to unwind literally trillions of dollars worth of bonds on their vast balance sheet, interest rates have risen, but the value of the dollar in relation to other major currencies has taken a noticeable hit, not just in the past few weeks, but for the better part of the past year.

The mighty US dollar was beaten like a trailer park hooker, down nearly one percent on the day per the dollar index, which, in the forex universe, is a pretty severe move.

Other currencies were the beneficiaries of the dollar demise, with the British pound up 2.4%, Japan's yen up nearly one percent, and the Aussie dollar gaining 0.90%.

Fueled by Treasury Secretary Steven Mnuchin's comments at the World Economic Forum in Davos, Switzerland, that a weaker dollar was good for US trade, currency pairs were traded with one thing in mind: dollar dumping.

Bonds, however, failed to play along, with the 10-year benchmark unchanged at 2.65% and both long and short-dated maturities moving less than a basis point.

Besides the currencies of nations not the United States, commodities were bid large, with WTI oil futures making another in a series of three-year highs and precious metals continuing a rally that began in December but had recently stalled.

Not so today, as silver led the way with a gain of over three percent, topping out at 17.70, the highest since breaking briefly over $18 per ounce in early September of 2017. From a technical perspective, silver has ripped through a long, declining resistance line dating back to its peak in 2011. A clear breakout holding above $17.50 would be a significant development for the world's most unappreciated asset.

Gold was also well-taken, finishing in New York up $16.80 (1.50%), at $1358.70 the ounce.

Stocks meandered along the unchanged line, ending split, with the Dow higher while the NASDAQ and S&P fell.

With many pension funds chartered to rebalance by month's end, the rapid rise of equities in the early days of the new year may be coming to a quick conclusion. Estimates range from $12 to $120 billion of stocks which must be sold and converted to bonds in the next week. If that's the case, it will take a concerted effort from the central bank cartel (who also may be selling into the weakness) to keep the stock bubble adequately inflated.

If there's a downside other than stocks taking a much-needed shave, it's that any decline in the stock market will be blamed on President Trump and his administration's tough currency and trade policies.

The President is set to address the assemblage at Davos on Friday, concluding this year's fete of economic manipulators and would-be statist social constructionists.

The President is expected to deliver remarks touting America's re-emergence as the world's greatest economic force.

At the Close, Wednesday, January 24, 2018:
Dow: 26,252.12, +41.31 (0.16%)
S&P 500: 2,837.54, -1.59 (-0.06%)
NASDAQ: 7,415.06, -45.23 (-0.61%)

Revenge of the Gold (and Silver) Bugs As Dollar Crashes

Stocks may be hurtling towards infinity and beyond, but the long-suffering holders of gold and silver are about to be rewarded for their patience and prescience.

Overnight, the dollar index breached the 90 level to the downside extending the trend which saw the dollar lose the most value in 14 years in 2017.

As the dollar falls, gold and silver can do nothing but appreciate in dollar terms, and with Treasury Secretary Steven Mnuchin speaking out in favor of a weaker dollar, the trend seems set to accelerate.

Meanwhile, the US Postal Service continues to cater to the Amazons of the world by hiking postage rates (particularly to retail and the lowest tier of commercial rates, Commercial Base) and punish small business.

Likewise, cell carrier Verizon continues to throttle the speeds of users of its "unlimited" bandwidth service in spite of regulations and court rulings which forbid the practice.

The corrupt news media continues to taunt the public with stories that President Trump is about to be grilled by special prosecutor Robert Mueller in the "Russiagate" probe, while all along the true traitors are still employed by the FBI and Department of Justice.

It seems that the tree of liberty is ready to be to be quenched again.

At the Close, Tuesday, January 23, 2018:
Dow: 26,210.81, -3.79 (-0.01%)
NASDAQ: 7,460.29, +52.2568 (+0.7054%)
S&P 500: 2,839.13, +6.16 (+0.22%)
NYSE Composite: 13,474.11, +3.74 (+0.03%)

Trump and Republicans Carry the Day (and Water) for Wall Street

Just to be certain that the big government shutdown over the weekend was a big puff of smoke that left nothing other than a fog and stench, here is a comment made by a presumably knowledgeable person on how big business perceives the machinations and meanderings of the politicians in Washington, DC.

So far Wall Street is the dog that didn't bark in the night time. Indeed, all of Big Business is.

I work coordinating business meetings, mostly for Fortune 500 companies; the companies that spend enough on meetings to bother hiring professionals to handle them. I'm usually pretty busy during these meetings, but I keep an ear open for interesting tidbits when I can, and sometimes I have nothing to do but listen to every word.

Usually these companies do discuss politics, and how they plan to position themselves vis-a-vis the political climate. Not lately, they haven't been. Almost nary a peep. And that includes pharmaceutical companies, which usually are about as attuned politically as anyone.

The companies I work for, and you've heard of them, are ignoring:

- Attempts to change ACA (they know the entire healthcare finance system is already broken anyway, and they have to buy their employees health insurance no matter what happens so they don't care);

- Efforts to raise the US minimum wage to $15/hr. (they're already planning to raise pay because they can't hire people at the prevailing suppressed wages);

- The tax bill (they already pay corporate taxes at an effective rate so much lower than the headline rates it doesn't matter, and their top executives already mask most of their income from the tax system so effectively no legislation conceivable in the current political climate matters at all to them);

- Immigration (they simply don't care because they have no liability or consequences no matter what);

- Carbon-based fuels (they're all getting out of them anyway because they're too expensive and inefficient; if Trump wants to subsidize them while they're doing it they're fine with that);

- Government regulations (they pay their way out of them anyway, one way or the other, and write off the costs);

- Global trade agreements (all the methods they use to evade existing duties, tariffs and sanctions supersede such things anyway); etc.

- War and rumors of war (None of the wars involve or will involve anything they have an interest in. They have deep enough contacts to know there isn't going to be a nuclear war, and no other wars on the table pose more risk than profit opportunities to corporate interests);

- Ethics investigations, "RussiaGate," Uranium 1, PizzaGate, FISA-gate, or any of the popcorn nonsense dominating the partisan media (who invented ad campaigns in the first place?).

Indeed, most of the issues we concern ourselves with don't even interest the executives of the biggest corporations in America.

This is reflected in Wall Street. Where it matters, they know they've got the system dicked. It simply doesn't matter to them one way or the other, which faction of the Oligarchy has the upper hand today or tomorrow.

Here's the link to the comment (from a site on which the Money Daily staff has been banned twice for speaking truth to power).

Thus, stocks gained on the eve of the shutdown and also on the end of the shutdown. The shutdown was bad theater engineered by obstructionist Democrats who have nothing left in their quiver of attack arrows outside of assiduously assaulting the sitting president.

...and, apparently, it wasn't even close to being enough, as their gambit blew up in their collectivist faces, and especially so on the visage of one NY Senator Chuck Schumer, a sell-out to his constituents and to his party.

At the Close, Monday, January 22, 2018:
Dow: 26,214.60, +142.88 (+0.55%)
NASDAQ: 7,408.03, +71.65 (+0.98%)
S&P 500: 2,832.97, +22.67 (+0.81%)
NYSE Composite: 13,470.37, +85.91 (+0.64%)

Conceptually, Wall Street is Irrational and Stocks Are Poor (at best) Long-Term Investments

Follow the logic:

US federal government shuts down, stocks go up.

US Dollar collapse: stocks go higher (but inflation kills your purchasing power).

Nuclear war: stocks go ballistic (parabolic path, but the world is mostly ash).

TEOTWAWKI: Stocks take off towards infinity (no way to cash out, i.e, can't take it with you, though).

Ergo, bad news is good news, again.

And you thought investing was easy...

At the Close, Friday, January 19, 2018:
Dow: 26,071.72, +53.91 (+0.21%)
NASDAQ: 7,336.38, +40.33 (+0.55%)
S&P 500: 2,810.30, +12.27 (+0.44%)
NYSE Composite: 13,384.13, +68.55 (+0.51%)

For the Week:
Dow: +268.53 (+1.04%)
NASDAQ: +40.33 (+0.55%)
S&P 500: +24.06 (+0.86%)
NYSE Composite: +90.12 (+0.68%)

Does Wall Street Take a Government Shutdown Seriously?

Late Thursday afternoon, US stock indices took a decided turn to the downside as legislators in Washington DC failed to agree upon a plan to meep the US government operating past Friday night.

A favorite parlor game for the noise-makers in the nation's capitol, threatening to shut down the government because there's no budget or continuing resolution may have become passe´ to the general population, but Wall Street may take the issue a bit more seriously.

A partial shutdown of the federal government - because it doesn't really shut down critical operations or necessary functions - isn't taken seriously, though it could become a real issue, if it were, in fact, an absolute reality.

Considering the amounts of money the federal government handles on a regular basis, a complete shut-down would be devastating to the nation's economy. Imagine welfare, social security, and disability recipients not receiving their regular checks or direct deposits.

Imagine the nation's largest workforce going without paychecks for an extended period. Imagine the US Postal Service shut down, the entire military on leave, contractors idled, and an assortment of other regular activities closed, ceased, ended. The US treasury would cease operations, causing all US treasury bonds to become worthless.

Least of all, the bickering by members of congress would least be missed, since they are the supposedly responsible people.

An actual shutdown is a scary thought. Trying to scare the populace with a fake shutdown, caused solely by inter-party disagreements and politics, may be nothing now, but it could be seen as a conditioning effort for a true federal failure.

In such a case, the president would likely declare martial law, a necessary action to ensure civility, especially in cities. That's unlikely to happen at this juncture, but, the more the politicians play politics instead of enacting laws that do good for the American people, the closer the nations comes to a severe and lasting crisis.

Passing a two, three, or four-week resolution merely kicks the can down the road a little, making the government appear no better than that of a third-world banana republic.

If that's what's happening, all investors should take appropriate actions to safeguard not only their liquid assets invested in stocks and bonds, but also move to protect their friends and families.

The United States is headed for disaster if the congress and the news media continues on the destructive path of irresolution, political posturing, fear-mongering, and division.

Let's hope it doesn't begin to unravel further over the weekend.

At the Close, Thursday, January 18, 2018:
Dow: 26,017.81, -97.84 (-0.37%)
NASDAQ: 7,296.05, -2.23 (-0.03%)
S&P 500: 2,798.03, -4.53 (-0.16%)
NYSE Composite: 13,315.91, -36.48 (-0.27%)

Tail Wags Dog: Fed 'Beige Book' Provides Rationale for Dollar Buying

Wall Street professionals wiped off all the poop from yesterday's 300+ price collapse on the DJIA and set about to bidding up risky assets to even riskier levels, sending the Dow and other averages soaring to new all-time closing highs.

Making matters even more preposterous, sinister, or outlandish was the reading of the Fed's Beige Book at 2:00 pm ET, which sent the US Dollar index off three-year lows to near the highs of the day at 4:00 pm ET, the closing bell on Wall Street.

If there's a soul left on the planet that hasn't bowed to the power of the Federal Reserve and its host of central bank and commercial cronies, then that person is simply out-of-touch.

Silver and gold have wallowed near multi-year bottoms for four long years while stocks have gone absolutely ballistic. Paper promises are worth much, much more than solid gold or silver in today's phony funny money world.

It's almost enough to make one give up writing on the subject (pondered here nearly every damn day).

Today's gains on the Dow Industrials were the largest since the election of November 8, 2016.

At the Close, Wednesday, January 17, 2018:
Dow: 26,115.65, +322.79 (+1.25%)
NASDAQ: 7,298.28, +74.59 (+1.03%)
S&P 500: 2,802.56, +26.14 (+0.94%)
NYSE Composite: 13,352.39, +105.53 (+0.80%)

Turnaround Tuesday: Stocks Sink Into S---Hole

After soaring over 26,000 in the early going, the Dow Jones Industrial Average - and the rest of the main US indices - took an ugly turn to the negative, an elongated move which comprised nearly the entirety of the trading session.

The Dow, once as high as 26,086.12 fell to an intra-day low of 25,702.99, a 383-point decline. The blue chips gathered some momentum at the close, likely the work of short-covering, as sellers dominated the day's activity.

While the Dow finished with just a blemish, the NASDAQ was more badly injured, dropping nearly half a percentage point, though it too was soaring earlier in the session, as were the S&P and Composite.

There was little news upon which to hang the selling spree and it came as quite a surprise in the opening session following the MLK holiday. The energy and basic materials sectors took most of the downside, falling by 1.16% and 1.43%, respectively. Crude oil lost three-quarters of a percent, with WTI crude ending the day at 63.82 per barrel. The abrupt turnaround in the oil price could be the canary in the coal mine, but perhaps the biggest story of the day was the almighty US dollar, which fell to a three-year low, bottoming out at 90.28, the worst intra-day price since December, 2014.

Having the dollar and oil fall in unison is not the usual course of business. Such activity is the stuff that keeps the stomachs churning on Wall Street. No doubt, copious amounts of bismuth subsalicylate were consumed by belly-aching analysts.

If not apparent enough already, Tuesday's action prompted more than a few to reconsider portfolio allocations and question whether or not the Fed really does have the market's back.

Fear of sliding into some kind of hell hole or other equally unattractive place became paramount throughout the day.

Congress has three days in which to craft some kind of compromise budget, risking yet another blow to its already badly-damaged reputation.

At the Close, Tuesday, January 16,2018:
Dow: 25,792.86, -10.33 (-0.04%)
NASDAQ: 7,223.69, -37.38 (-0.51%)
S&P 500: 2,776.42, -9.82 (-0.35%)
NYSE Composite: 13,247.85, -46.49 (-0.35%)

Goldilocks Stock Market Is Becoming Idyllic Unicorn Utopia

Party hats and noise-makers for everyone!

The major US indices closed the second Friday in January at record levels. Huzzah, huzzah, huzzah!

The most recent stock market maneuverings are enough to make people consider quitting their jobs, as their money invested is making more.

How much more? Well, anybody with $100,000 invested in, say, a Dow index fund, on the last day of trading in 2017 (December 29), is ahead by $4386 as of the close Friday, January 12. That's like making over $2000 a week, or more than $100,000 a year.

Back in the 2006, the heyday of the sub-prime mortgage mania, people in places like San Diego were literally quitting their jobs, simply because their homes had risen in value by so much, sometimes as much as 150-200%. People in tony neighborhoods with $250,000 homes were being offered $500,000, $600,000 and more.

Well, we all know how that turned out, but the point of making money, either in real estate, or stocks, or anything else for that matter, relies largely upon one's entry and exit points.

To say that sometime in January would be a good time to at least trim some of one's stock holdings would not be considered bad advice. However, who would want to give up on a stock market that appears to be heading to the moon, orbiting it and then taking off toward outer space. After the great returns of 2017 - and the eight years prior to that - it's become apparent that "buy and hold" is the preferred strategy.

That makes sense, since the ongoing bull market is the second longest in market history and nudging along toward the longest ever, having begun in 2009, when the Dow bottomed out at 7,278.38 on March 20th. Having already tripled in value, another solid year could push the Dow (and the other averages) to quadrupling levels.

In other words, if you had $100,000 invested in March of 2009, you'd have over $350,000 today, on your way to $400,000. If you had $500,000 back then, you'd be close to $2 million, and if you haven't cashed out and retired already, you're a fool. (Seriously, anybody who can't make $2 million last 30 years is an idiot. It's $66,666 a year, or $1282 a week. That should be more than enough, even if you aren't keeping some of it in bonds at two percent).

So, stocks continue to ramp higher and probably aren't coming down any time soon. Plenty of people are what they call baby boomers and they're retiring in droves, many of them pulling money out of retirement funds. No matter how much these people remove from the market, it won't matter. There will be new buyers lining up to take their places, bid stocks higher, reap profits.

It's really amazing. Next, unicorns and money trees will be abundant.

At the Close, Friday, January 12, 2018:
Dow: 25,803.19, +228.46 (+0.89%)
NASDAQ: 7,261.06, +49.28 (+0.68%)
S&P 500: 2,786.24, +18.68 (+0.67%)
NYSE Composite: 13,294.34, +83.57 (+0.63%)

For the Week:
Dow: +507.32 (+2.01%)
NASDAQ: +124.50 (+1.74%)
S&P 500: +43.09 (1.57%)
NYSE Composite: +191.11 (+1.46%)

Central Banks Have Complete Control Over Global Economies, Governments

US stock indices had their best showing of the new year on Thursday, with all the averages reaching new all-time highs.

The Dow Jones Industrial Average is higher by 875 points in just the first eight sessions of 2018. That is extraordinary. It is so extraordinary that, at that pace - of a little more than 100 points per day - the Dow average would nearly double in value this year.

The gain would be over 20,000 points, putting the Dow Jones average somewhere in the range of 45,000 by year's end. In percentage terms, it would be up 80%. Anybody who has over 100,000 invested in stocks and is making less than $80,000 this year might as well take the year off. Why work when your money is doing so much of the heavy lifting?

Of course, that's a speculation. The Dow won't gain 80% this year, or will it?

Is the economy that good? Are US companies making that much money, that they are severely undervalued today?

Or, are central banks intervening in stock markets with money created out of thin air?

For answers, or, at least, hints, to the answers, see yesterday's post, or, any of the posts from the past eight or nine years which have tags or labels "central banks", "central bankers", or, "Federal Reserve."

At the Close, Thursday, January 11, 2018:
Dow: 25,574.73, +205.60 (+0.81%)
NASDAQ: 7,211.78, +58.21 (+0.81%)
S&P 500: 2,767.56, +19.33 (+0.70%)
NYSE Composite: 13,210.77, +104.17 (+0.79%)

First Red Day of 2018 is Laughable

Major US indices had their first negative day of the year on Wednesday, but the losses amounted to nothing more than rounding errors.

Stocks were off early in the day after reports that Japan and China were reducing their purchases of US treasury bonds, but the notion was simply shrugged off by the equity captains as buyers emerged to limit the losses.

Stocks have gain six of the first seven trading days of 2018, a trend that is likely to continue until central banks cease buying stocks outright. This story is getting rather stale, even though most Americans fail to realize that their pensions and 401k profits are being fueled by cash injections from the Bank of Japan, European Central Bank, Swiss National Bank, Bank of England, People's Bank of China, and, the US Federal Reserve.

To believe that the Fed, being the world's most influential central bank, is not engaged in the purchase of stocks - either outright through their trading desk at the NY Fed or through member banks such as Goldman Sachs, JP Morgan Chase, Bank of America and others - is to suspend reality.

Global markets have neither seen nor experienced anything like this unprecedented and outrageous activity by financial sources which create money at will, the ramifications of which are likely to result in a massive, destructive inflationary hyper-spiral.

Here in the US and across the pond in Europe, central bankers openly wring their hands and express concern that inflation is too low, when in fact the worldwide money supply - the lone reliable barometer of excess liquidity - has been increased by trillions of dollars during the post-crisis era which began in March of 2009.

Nearly nine years have passed since the great financial crisis and the excesses have only grown, reaching monstrous proportions. For what other reason would gold and silver be suppressed so virulently other than to eliminate their standing as real money? Why are governments so intent on clamping down on cryptocurrencies? Central banks do not want competition in currencies.

It is clear that the central banks of the world have pulled the global economy into a fully fiat regime, printing money backed by nothing at an unprecedented pace.

Future historians and economists - if there is indeed a future at the end of this madness - will look upon this era as one of rampant money creation by policy-makers whose only aim is to keep the failed economies of developed nations in endless debt.

The idea that the Federal Reserve wishes to "normalize" interest rates is a laughable concept. Doing so would only facilitate the ballooning of debt everywhere, to utterly unplayable levels.

Enjoy the ride.

At the Close, Wednesday, January 10, 2018:
Dow: 25,369.13, -16.67 (-0.07%)
NASDAQ: 7,153.57, -10.01 (-0.14%)
S&P 500: 2,748.23, -3.06 (-0.11%)
NYSE Composite: 13,106.60, -14.24 (-0.11%)

Central Bank Resolve To Be Tested If China, Japan Break Ranks

In yesterday's post, reference was made to the backstopping of stock markets by the global cartel of central banks and how the aforementioned banks would not allow even the slightest decline on the main US indices.

True to form, Tuesday's trading was a textbook example of the central banking gambit, with the Dow Jones Industrial Average and S&P 500 making new all-time records, the NASDAQ and NYSE Composite tagging along.

About to be tested is central bank resolve and unity. Overnight, Japan has apparently decided to cut back on the purchase of long-dated treasury securities, and China has - according to unnamed sources (the preference of manipulators, provocateurs, and liars) - likewise decided to cut purchases of US treasuries by as much as five percent.

Being that Japan and China are he largest holders of US treasuries and at the same time partners in the global central bank ponzi scheme to keep fiat currency floating and stock brokers gloating, these developments - if found out to be the truth - could be inflammatory and possibly devastating to the value of stocks.

With the US markets set to open, futures are forecasting a negative open, though that alone will not ensure anything other than alerting the main buyers of equities - central banks - to be at the bid early and often.

At the Close, Tuesday, January 9, 2018:
Dow: 25,385.80, +102.80 (+0.41%)
NASDAQ: 7,163.58, +6.19 (+0.09%)
S&P 500: 2,751.29, +3.58 (+0.13%)
NYSE Composite: 13,120.84, +6.49 (+0.05%)

If 2017 Was Good, 2018 Should Be Better

Anybody who owns stocks or has a portfolio in a retirement fund, 401k or other equity-style investments is well aware of just how good 2017 was.

All indications are that 2018 will be just as good, and probably better.

There's a number of reasons for this prognosis.

First, it's more than apparent that global stock markets are now completely under the purview of the global elite central banks, and that this central banks are actively buying stocks, boosting the underlying asset prices in the process.

Second, after that, nothing really matters, since central banks can create money out of the ether, at will, any time, for any purpose. Economics has been flipped upon its head. Price discovery has been delegated to a function of the central banks, i.e, they set the prices. No fundamental analysis is needed, nor will it be valid.

Since the goal of central banks is to keep their money ponzi schemes intact via their various currencies - pound, dollar, euro, yen, yuan - and the stock markets are primary vehicles, there exists almost zero chance of stocks losing value over even the short term. A longer-term decline would be unthinkable as it would destroy the fiat money that central banks employ in their quest to continue their global finance monopoly.

Knowing all of that, there's no reason anybody should invest in anything other than stocks, or, for added assurance, an index fund which tracks the Dow, S&P, NASDAQ, or all three, weighted, or otherwise.

Stocks will never go down again, at least not for any extended period of time.

Just Buy The Dips.

At the Close, Monday, January 8, 2018:
Dow: 25,283.00, -12.87 (-0.05%)
NASDAQ: 7,157.39, +20.83 (+0.29%)
S&P 500: 2,747.71, +4.56 (+0.17%)
NYSE Composite: 13,114.35, +11.12 (+0.08%)

Huge Miss on December Non-Farm Payrolls Won't Trigger Sell the News Event

Stocks ripped higher on Thursday on pure hope and fumes, in anticipation of Friday's BLS release of December non-farm payroll data.

As mentioned in yesterday's post, the market has set itself up for a "sell the news" event, having already bought the rumor in the form of an incredible 250,000 December private jobs gain from ADP.

Being a case of which numbers should be trusted, investors will probably accept the BLS, being that it is the "official" number, despite the wild swings, methodology and revisions for which the data set is so famous.

On Friday morning, the BLS announced a gain of a mere 148,000 net new jobs in December, on expectations of 190,000, the lowest print since July 2017. [full release here]

The unemployment rate remained moored at 4.1%, a rather humorous figure, given that the BLS counts part-time jobs and working more than one day a week as a "job."

As of this writing, roughly 15 minutes prior to the market open, stock futures are higher, but well off the levels seen earlier this morning.

The expectation for stocks to sell off throughout the session, given that valuations have been stretched to unsustainable levels, will likely not materialize since prognosis is as much the stuff of smoke and mirrors as the algo-driven market itself.

At the Close, Thursday, January 4, 2018:
Dow: 25,075.13, +152.45 (+0.61%)
NASDAQ: 7,077.91, +12.38 (+0.18%)
S&P 500: 2,723.99, +10.93 (+0.40%)
NYSE Composite: 13,028.46, +71.18 (+0.55%)

Caution Thrown To (Bitter Cold) Wind, As Investors Ignore Tech and Weather Threats

Across the board gains were the order de jour on the second day of trading in the new year.

As on Tuesday, the NASDAQ outpaced the other major averages, continuing its meteoric rise beyond the 7,000 mark with tech stocks leading the way despite an admission from Intel (INTC) that their chips have a serious flaw, affecting nearly all chips made by the company over the past ten years.

The world's largest chipmaker was not immediately taken to the woodshed and whipped, though shares of the company were down more than three percent and are off another one-and-a-half percent in pre-market trading on Thursday.

Rival chipmaker, Advanced Micro Devices (AMD), was the main beneficiary of the Intel news, its stock advancing more than five percent on the day, though it appeared that AMD chips are also vulnerable, though not to the same extent nor by the same exploits as Intel chips.

While the immediate impact may be slim, the long-term repercussions of this revelation may be significant. The world's major chip manufacturers may be facing a black swan event once hackers devise attacks that could legitimately effect computers and servers worldwide, for years.

Traders were not on the defensive, however, as the lure of early gains overwhelmed any concerns for troubles ahead, such as the massive snowstorm and bitter cold that is expected to affect most of the Northeast in days ahead. The storm - being called a Bomb Cyclone - is primarily focused off the Eastern coast of mainland North America, though New York, New Jersey, and Massachusetts were making preparations for a major winter weather event which has already bettered Southern cities such as Charleston, SC, and Savannah, GA.

The apparent complacency of equity speculators is somewhat confounding, given the potential for severe disruptions from weather and technology in coming days.

On the other end of the asset spectrum, precious metals responded to a slight rise in the dollar index, blunting a strong run for gold and silver over the past three weeks, though the selling seemed to be transitory, with the metals recovering early on Thursday morning as the dollar fell to fresh lows (91.933).

On Thursday morning, prior to the opening bell on Wall Street, ADP private payroll data for December showed a massive 250,000 job gain for the final month of 2017. While the AMD numbers are preliminary and subject to revision, they are sending a strong signal in advance of Friday's BLS non-farm payroll dataset for December.

With caution being thrown largely to the (bitterly cold) wind, Friday and/or Monday could be a day of "selling the news," or, as has been the case for the past nine years, the stock market rally will not be impeded by facts nor insinuations of negativity.

At the Close, Wednesday, January 3, 2018:
Dow: 24,922.68, +98.67 (+0.40%)
NASDAQ: 7,065.53, +58.63 (+0.84%)
S&P 500: 2,713.06, +17.25 (+0.64%)
NYSE Composite: 12,957.28, +54.55 (+0.42%)

Stocks Advance to Start 2018; Gold, Silver Rallies Continue

Stocks ramped higher at the opening of the first trading session of 2018, continuing a trend that carried equity investments to major gains in 2017.

At the same time, gold and silver continued their impressive three-week-old rally. Silver has been the out-performer of the pair, rising from a low of 15.67 per ounce on December 13 to 17.15 as of the close of trading in New York on Tuesday. Gold crested above the sticky $1300 level, finishing the day at 1317.10. It also bottomed out on December 13, dropping below 1240.90 on that date.

While there's certainly nothing unusual about stock gains, the rally in precious metals is raising some eyebrows and prompting talk of future Fed rate hikes and incipient inflation, which has been a false flag for eight years running.

On Wednesday, investors may get some indication of the Fed's intentions. Minutes from the December meeting - at which the Fed raised the federal funds rate for the third time in 2017 - are to be released during the session. Of particular interest is the discussion over rate increases and any dissenting opinion.

The Fed has made it clear that they intend to continue raising rates this year, with four increases of 25 basis points the proposed path. At the same time, the Fed will continue to unwind its bloated balance sheet, shedding billions of dollars worth of treasury bonds and mortgage-backed securities (MBS) and increasing the rate of disposal as the year commences. By October, the Fed is supposed to be dumping as many as $60 billion worth of notes, bills and bonds.

The combination of a general tax cut for consumers, a large tax cut for corporations, rising rates, bond dumping, and an improving economy suggests a formula for inflation, which is generally understood to be good for gold and silver, though the rise in precious metal prices may have more to do with currency debasement than a knee-jerk response to the economic climate.

At the Close, Tuesday, January 2, 2018:
Dow: 24,824.01, +104.79 (+0.42%)
NASDAQ: 7,006.90, +103.51 (+1.50%)
S&P 500 2,695.81, +22.20 (+0.83%)
NYSE Composite: 12,902.72, +93.88 (+0.7329%)