Here, courtesy of ZeroHedge, is a page of 1st issue of Wall Street Journal on July 8, 1889.
Colorful annotations draw shocking parallels between trials and tribulations of distant past and today's news. Like I mentioned before, nothing ever changes. Not in human affairs, nor in markets. Ever...
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Marc Faber, Schiff, and Gartman talk markets
Oy Vey Iz Mir, you know...
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John Williams of ShadowStats talks at length about gov statistics mambo-jumbo, and how distorted it is, comparing to old ways of dicing and slicing of economic data. For only 175/year, responsible Mr. Williams delivers reshuffled economic reports, based on 'right' methodology.... no, I will not be cursing here...
Still, interesting talk, worth a listen... minus f@%#ing statistics http://www.shadowstats.com/
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Robert Kessler of Kessler Investment Advisors shorted bonds while long term bullish. ... Because 'its reasonable to be careful'... Classic... But really, these are the guys who ALWAYS win, even when they losing... He-he
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Old School Charlie Munger in 2009, talks about idiot boom, false competitiveness, and Berkshire investment tricks.
Plain spoken, rare these days.
Over past few days I stopped out of almost all common stock holdings, except gold, silver, miners, pot (in LB account), utilities and couple of other things. I don't have any shorts on. System 9 is over 50% cash, account continuously pushing new equity highs. System11 had a streak of winning trades, even thou I trade it sporadically and missed most of good opportunities. System12 stalled (as it should in correction) with only 4 positions so far.
I am crazy busy at work, as my departure nears. Already started to train my replacement - she is very bright - hope she doesn't quit before I leave...lol
I will be cashing out most of marijuana stocks from Z account, in order to pay for Boichik trip to Italy next year. Only a few months ago it seemed absolutely impossible. This is a great news, and a major achievement for me - to make and withdraw a significant amount of money from the market!
I feel very proud. Remember Ibiza - The Impossible Dream... Will happen someday too...
I started to get ideas about how to use My A/D Indicator (MADI) about a year ago in this Internals Study (link). Since then I added and changed few things. First of all, I now mostly use NYSE Advace/Decline issues (NYAD), because it seems to produce cleaner signals, but still look to Nasdaq (NAAD) for confirmation. Sometimes they diverge - I don't know what it means.
This is what now are MADI Rules for Bull Market ( I suspect that bear market will produce different levels, but don't have data to test):
- When 20ema is under 0 - market is consolidating or falling. Bottom will be made before 20ema recovers above 0.
- When NYAD 20ema goes below -200, and doesn't recover quickly, - it will go lower and produce at-least a tradable bottom at much lower levels. Most common next level is -400 to -600. Note that August 2011 bottom was -900 on 20ema! This spike lower will get a retest most of the time.
- When NYAD 50ema goes to or below -200, then its a Just Buy The Fucking Dip (JBTFD). This seems to be the most reliable use of MADI. Buyable dip happens couple of times every year, usually followed by
second dip of indicator 2 weeks to 2 months after extreme reading of -200
(or less) on 50ema of Advance/Decline issues. Failure of this bottom may lead to mini-crash (this is what happened in 2011)
- In order for bottom to be complete 20ema has to rally fast and recover above 0.
- In a bull market, MADI will spend more time above 0, allowing to keep positions longer and add on dips.
- "Sell The Rip" is generally at NYAD 20ema +400, but can go to +600/+700. As it is, its not a good signal to short the market - several of these high readings where just run over in early 2013. I'd say - when indicator is that high, probably too late to buy.
MADI 2/2014
3 year study of MADI is here (link)
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T-Theory Volume Oscillator checked at -80, the reading usually associated with tradable bottom. It may be already double bottomed. Unfortunately it may have destroyed T12/2013 (from this post link). I will wait for a rally, to see if market really bottomed, and revisit T-Theory then.
Confidence Indicator dumped, treasuries are a place to be since the beginning of the year, investment grade corporate bonds are better than high yield junk (no shit).
Golden Indicator warning that shocks are weak, although S&P and developed markets are stronger than Emerging.
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Mark Faber warning again. Treasuries are the place to be for next 3-6 months. I already have VUSTX in System 1 account, not looking to add for now.
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Nadeem_Walayat see ..."No sign whatsoever that this bull market is anywhere near being over!" "THIS stocks stealth bull market is one of the GREATEST bull markets in HISTORY!" "The current stock market correction looks set to attempt to revisit 15,000. How close it gets to 15,000 I can't tell, perhaps half way, just that the correction is not done to the downside."
His favorite sector is Biotech, and has been forawhile. http://www.marketoracle.co.uk/Article44238.html
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Classic ZeroHedge. The world is ending...again...any day now...
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------------------------------ In The News ----------------------------
Solar activity is productive with M-class flares every day. "Solar activity is expected to be at moderate levels with a chance for high levels through 09 February", sais NOAA.
Now we have a new Fed Chairman(woman). Bermonkey is no more. Good riddance.
Emerging markets are submerging again. Turkey, Argentine, Brasil, South Africa, bunch in Asia, etc are in some kind of currency crisis. China got banking problems. I am looking to buy the blood.
Here is very smart India central bank Governor Raghuram Rajan talks about interest rates, fund outflows, the
rupee and global monetary policy coordination on Jan 30.
...2013 was a bad risk that happened to work out well, not unlike the gains earned near the end of a Ponzi scheme.
SPX 2013
No, it was not an easy trend to ride. As I noted before, the only way to be long in 2013 was to disregard stop loss (be it a break of previous low, 50 day MA, sentiment, Elliott Wave, internal divergences etc), non withstanding real deteriorating economic conditions (based on my observations), and stupidity and ignorance of our elected leaders and their cronies.
My biggest losses of 2013 came from trying to short the market indexes. So much so, that summer short/hedge wiped out all early-year gains. Back end, and especially October - December period, put me back in black. Important to note that I was shorting the indexes, while being long individual stocks and sectors (via ETF's). I also traded a lot of commodities, both long and short, with mixed results. Grain longs cost me some, softs where about break even, silver short was a big winner early in a year, oil worked very well both ways.
This infatuation with S&P 500 index is rather a drawback to my approach. I continue to come up with different ways to better trade SPX via Systems 10 (discontinued), System 11, and major adjustment to System 1 (too late to implement in this cycle). This research takes a lot of time, detrimental to my P&L, and pulls resources (and gains) from System 9. As I Spring to Action, I will be looking for more balance, will be able to expand Theme Investing - all with goal to reduce dependance on intermediate term forecasting of index trends.
As we enter year 2014 warning signals abound. Here are some
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12/20/2013
SKEW sell signal
Only 4th time in history of SKEW since 1990, it gives 'Above 140' sell signal.
Previous times:
06/21/1990 - S&L Crisis (Stocks dropped 18% in next 3 months and the US entered recession)
10/16/1998 - Russian Default and LTCM (Stocks soared 22% in the next 3 months and the dot-com bubble was born)
03/16/2006 - Housing Bubble peak (Stock dropped 6% in next 3 months and the 'great recession' started within a year)
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II most bullish sentiment on record (since 1990's). Implication being - if everybody bullish, who is left to buy? BTFATH...
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I take this guy
very seriously, as his investment time frame is equal-to-little-longer
then mine, and he is usually right on a money. His message - be careful http://fat-pitch.blogspot.com/2014/01/weekly-market-summary.html#more
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Various cycle works project turbulence ahead in 2014
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Then, there is John Hampson of http://solarcycles.net/, who does very detailed analysis of sun/moon cycles and their effect on markets and mass physiology. Although it is still considered unorthodox approach by many, I am all over it. Having observed Sun, geomagnetic activity and Moon phases in real time and their effect on my co-workers, friends and family, and market, I think its safe to extrapolate results onto Northern Hemisphere population as a whole.
Specifically, we are going right thru Solar Cycle Maximum, as Sun's poles flipped couple of weeks ago.
The following quote is from here:
Historically, solar maxima have correlated with earthquakes and peaks in
temperature oscillation. They have also correlated with
protest/war/revolution, inflation oscillation peaks and speculative
parabolic peaks (often secular bull peaks). With both magnetic poles now
having flipped for SC24 maximum...the solar max then gives way to economic recession...
Important to note, that although three prior Solar Cycle peaks where followed by economic recession, they didn't start right away, and where not necessary accompanied by catastrophic bear market everywhere, but correlation is undeniable. Causation? I got your hard data right here, mothafucka:
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David Collum - 2013 Year in Review
He comes in at 5min and again at 15min. He said everything I do, or is it the other way around? Also, all this has been wrong for at-least a year, and would not help to make money. Quite the opposite. Still... http://www.peakprosperity.com/blog/84101/2013-year-in-review
One my favorite 'Characters', Marc Faber :
"We are in a gigantic financial asset bubble," "everybody's bullish", "...this could burst any day. I think we are very stretched." bitcoin and more. He's been saying all this for a while, it doesn't make him wrong, just early
I’ve seen the future and there are lower stock prices in it. The
republicans have nothing to lose but the legacy and job approval rating
of their sitting President. We are going OVER the fiscal cliff, AND
MORE. You wait and see. It’s going to be a shit show. Not only that, the
elections are over and earnings season was for shit. The Fed is going
to ease up on the gas because Obama is already in. Why exert themselves,
now that their jobs are secure?
I want you to heed my final warning and understand that the government
is intent on inflicting damage to you. They will not avoid the fiscal
cliff–but purposely drop you off of it.
"Let me get this straight . . .
We're going to be "gifted" with a health care plan we are forced to
purchase and fined if we don't! Which purportedly covers at least ten
million more people without adding a single new doctor, but provides for
16,000 new IRS agents, written by a committee whose chairman says he
doesn't understand it, passed by a Congress that didn't read it but
exempted themselves from it, and signed by a Dumbo President who smokes,
with funding administered by a treasury chief who didn't pay his taxes,
for which we'll be taxed for four years before any benefits take
effect, by a government which has already bankrupted Social Security and
Medicare, all to be overseen by a surgeon general who is obese , and
financed by a country that's broke!!!!!
'What the hell could possibly go wrong?'" ~ Donald Trump
Marc Faber : “The federal government is sending each of us a
$600 rebate. If we spend that money at Wal-Mart, the money goes to
China. If we spend it on gasoline, it goes to the Arabs. If we buy a
computer, it will go to India. If we purchase fruit and vegetables, it
will go to Mexico, Honduras and Guatemala. If we purchase a good car, it
will go to Germany. If we purchase useless crap, it will go to Taiwan
and none of it will help the American economy. The only way to keep that
money here at home is to spend it on prostitutes and beer, since these
are the only products still produced in US.” - Marc Faber said in 2008
commenting on the US Stimulus package
Long interview with Marc Faber. Talks about everything
Jeremy Rifkin, 'The Third Industrial Revolution' "How lateral
power is transforming energy, the economy, and the world."
According to Rifkin, industrial revolutions occur when new energy regimes emerge
and new communications systems enable them to become operational. We are now
entering a third industrial revolution, one which combines renewable energy and
internet technology to transform the power grid.
China is different because with a small amount of capital, you can
survive for a long time. You give 20 companies a couple of million
dollars a piece, they are going to last for five or six years even if
those models haven't been successful. I'm not sure if that's the right
way to look at it. If failure means going bankrupt, not many companies
go bankrupt because you can last for a long time in creative ways in
China.
Marc Faber. As usually - equities, cash, PM, corp bonds, real estate.
FNN AU Marc Faber 'Optimistic Prediction 4 Central Bankers Fate
