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Looking for another sell off



December 27, 2009 – Comments (7)

 Caution lights are flashing again,we could be In for a correction In very short order. I have been tinkering with a Directional Movement Index{DMI} for a few months. The last time that I called for a correction using this Index,I hit It right on the nose.....   as you can see on (June 17th)  This time It's a little different. We headed down In June even as the {ADX} was rising,thus the downturn was relatively short lived,then actually reversed as the DMI+ crossed the DMI- to the upside with stocks In tow.... However,the new signal could be a sign of a larger and more sustained downturn....   DMI+ has crossed the DMI- to THE DOWNSIDE,AND THE ADX CONFIRMATION LINE HAS BEEN TRENDING DOWN FOR 5 MONTHS !!!  Toss In the fact that the {VIX} Is trading near 52 wek lows,and It starts to get a little scary If you are long the market....  Be careful fools.....  TS                              Were Heading Down

June 17, 2009 – Comments (3) | RELATED TICKERS: FAZ

  I have been using technical charting for over 30 years,and while that does not necessarily mean that what I do Is foolproof, there are certain things that have worked for me consistantly over the years. While I do not know how long this leg down will last,It's coming..... The first test should be 8,000 on the dow,If It slips from there,7800.... If It does not hold at this level,look out below. While I would be mildly surprised If the Index dropped below 7600,my charting and trends suggest a  5 to10% correction could happen In relatively short order. Good luck,and take cover...  I bought FAZ 3x yesterday and I will add to that position on any intraday market uptrends.  Good Luck, Jim 

7 Comments – Post Your Own

#1) On December 27, 2009 at 10:50 PM, topsecret09 (86.35) wrote:

Stocks higher? New bull market for the new year? Famed bond investor El-Erian of Pimco says don't bet on it
 By Bernard Condon, AP Business Writer , On Sunday December 27, 2009, 1:08 pm EST

NEW YORK (AP) -- Homes are selling at their fastest clip in nearly three years, the unemployment rate is falling and stocks are up 66 percent since their March lows -- the best performance since the 1930s.

What's not to like?

Plenty, according to Mohamed El-Erian, chief executive of giant bond manager Pimco. The investor says the recovery may be gaining steam but is no different than a kid who eats too much candy at one of the birthday parties his 6-year-old daughter attends.

"We're on a sugar high," El-Erian says. "It feels good for a while but is unsustainable     

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#2) On December 27, 2009 at 11:11 PM, Momentum21 (98.09) wrote:

Are you not interested in capitalizing this time around in your CAPs picks?

I don't have facts to refute your claim or methodology...I am just curious on how you are playing it TS. 

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#3) On December 27, 2009 at 11:33 PM, topsecret09 (86.35) wrote:

#2) On December 27, 2009 at 11:11 PM, Momentum21 (90.77) wrote:Are you not interested in capitalizing this time around in your CAPs picks?   I played my picks very badly... I had a huge run up with FAZ then held It Instead of closing It... I did VERY WELL In my REAL PORTFOLIO,and did not pay enough attention to my CAPS picks....  I made a large amount of money In a little company called STEREOTAXIS (STXS) and also ARIAD PHARMACEUTICALS (ARIA) another that I had In my REAL PORTFOLIO that I did well on was EASTMAN KODAK (EK)  I will be updating my blog with some useful Information that will Include the stocks I like or do not like,and they will Include REAL MONEY PICKS,and CAPS GAME picks....  Red Thumbs will be showing up more often In the near future In my CAPS PICKS.... There are several stocks that I LIKE,even through a downturn In my real portfolio,and I will use weakness In them to buy more...    Update to follow, good luck....  TS

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#4) On December 28, 2009 at 10:18 AM, topsecret09 (86.35) wrote:

John Maynard Keynes Who2 Biography: John Maynard Keynes, Economist Born: 5 June 1883 Birthplace: Cambridge, England Died: 21 April 1946 Best Known As: The British economist who created macroeconomics

John Maynard Keynes was a British economist whose advocacy of government-managed economies helped shape capitalism in the 20th century. The son of Cambridge economist and logician John Neville Keynes, Maynard spent his career among England's elite. He was part of Virginia Woolf's so-called Bloomsbury Group -- intellectual aesthetes who flouted philosophical and sexual conventions -- he taught at Cambridge, he wrote and edited economic journals, and he played important roles for the British Treasury in both world wars. He became famous after World War I with The Economic Consequences of Peace, his 1919 critique of the Versailles Peace Conference. (He thought the harsh reparations demanded of Germany would lead to economic instability -- and they did.) His 1936 book, General Theory of Employment, Interest and Money, made him the most famous and influential economist since Adam Smith. Keynes's notion that governments should intervene in times of market distress eclipsed Smith's laissez-faire capitalism and has influenced Western democracies since the 1930s. At the close of World War II Keynes was a key player in the formation of an international banking system. His general theories about managing free markets on a global scale are considered the foundation of macroeconomics.

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#5) On December 28, 2009 at 10:23 AM, topsecret09 (86.35) wrote:

John Maynard Keynes died in 1946, but his thinking continues to dominate world economic policy. Bushonomics, Obamanomics, and the policies of the U.S. Federal Reserve have all ultimately been derived from Keynes's book, The General Theory of Employment, Interest, and Money, usually referred to as Keynes's General Theory or The General Theory.

What does Keynesian economics tell us about the Crash of 2008? First that crashes are an inevitable part of Capitalism—they reflect what Keynes called the "animal spirits" of private markets. Second that the Crash creates a downward spiral that feeds on itself. If Keynesian remedies are not promptly applied, there may be no economic recovery. These remedies, the essence of Keynesianism, include the U.S. Federal Reserve printing money and lowering interest rates, bailouts, and economic stimulus through deficit spending.

Where Keynes Went Wrong demystifies Keynesian economics. It reveals what John Maynard Keynes really said. And it offers a startling and persuasive argument that Keynesianism is leading us down a path not to genuine economic recovery, but to inflation, bubbles, and crashes.

More about Where Keynes Went Wrong

When the world financial system failed in 2008, world governments intervened decisively. Guided by Keynesian economics teams with impeccable credentials, they intended not only to "stimulate" the economy, but to "jolt" it back to borrowing and spending as usual. All of these actions were taken from a playbook devised by British economist John Maynard Keynes, author of The General Theory of Employment, Interest, and Money and by far the most influential social thinker of the past century.

But . . . not all economists agree. Following the Crash of 2008, some critics of Keynesianism ask: Isn’t the root problem that Americans have borrowed too much? Will even more borrowing, this time government borrowing to support deficit spending, really help us out of the bind we are in?

Is it right to borrow to finance bank bailouts? Will economic stimulus—also financed by government deficits—really help? Should the Federal Reserve be printing money so rapidly? Will this give us a genuine economic recovery? Can we really rescue Capitalism by trying to borrow and spend our way out of debt?

Also: are private markets really to blame for the Crash of 2008? Wasn’t government even more responsible? If so, can we expect government to fix the problem?

In short, should we be relying so completely on Keynes? What if he is wrong? What evidence is there that he is right?

These are important questions. If Keynes is wrong, then so are the economic policies of Barack Obama, George W. Bush, and virtually all world governments today. Instead of giving us a sustainable economic recovery, they will just lead to inflation, bubbles, and crashes.

Where Keynes Went Wrong presents the economic arguments that will shape our future in a lively, stimulating, and transparently clear style

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#6) On December 29, 2009 at 6:52 PM, topsecret09 (86.35) wrote:

According to hedge fund manager Eric Sprott, the S&P 500 will collapse below its March lows as an expected rebound in economic growth fails to materialize.

The Toronto-based money manager, whose Sprott Hedge Fund returned 496 percent over the past nine years while the S&P 500 lost 32 percent, said the index’s 67 percent rally since March reflects investors misinterpreting economic data. He’s predicting the gauge will fall 40 percent to below 676.53, the 12-year low reached on March 9.

“We’re in a bear market that will last 15 or 20 years, and we’ve had nine of them,” Sprott, chief executive officer of Sprott Asset Management LP, which oversees C$4.3 billion ($4.09 billion), said in an interview Dec. 18.    TS....   Something to chew on?

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#7) On December 29, 2009 at 7:11 PM, topsecret09 (86.35) wrote:

Wall Street has formed a fairly solid consensus that corporate earnings will spike in 2010. The problem for stock investors is that the market may be priced for it already.  

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