3/22/13…take a vet to lunch

From the Friars Club Encyclopedia of Jokes: “The NRA is attempting to lift the ban on machine gun sales. Well, as an avid hunting enthusiast, I’ve been hoping to buy a fully automatic Uzi. One thing about machine guns, it really takes the guesswork out of duck hunting.” – Mark Russell

Bloomberg Quote of the Day: “The only good thing is knowledge and the only evil thing is ignorance.” – Socrates…so why dose the GOP fight it everywhere it pops up? TB

Bloomberg Top Stories:

*Merkel faults Handling of Cyprus Bailout Days Before ECB Funding Deadline

*U.S. Index Futures Advance With Euro as Cypriot Lawmakers Debate Bailout–up, why?

*German Business Confidence Unexpectedly FELL From 10-Month High in March – oh?

*Bonus Crackdown Will Hamper Two-Thirds of Fund angers Working in Europe – good!

*Cyprus May Need Bank-Deposit Haircut, Citicorp’s Buiter Says – CITI…advice???

*Deutsche Bank Weighs Higher Salaries for Board Members on EU Bonus Rules

*Biogen’s Multiple Sclerosis Pill Tecfidera Wins the Backing of EU Agency

*Billionaire Buffett Retakes World’s Third-Richest Title as Ortega Retreats – !!!

*Puerto Rico on Junk Precipice Has Investors Sayihng Never Mind – you have to go ???

*Economist Sees No Crisis Looming With U.S. Debt as Economy Gains Momentum

*McCain Praising Obama Backs Compromise on Revenue in budget Grand Bargain – so much for poor John if he runs again…along with Chris Christy – traitors to the GOP!

*Obama Woos Israeli Public Seekiong a Shift to Resume Mideast Peace Talks

*Secret Gingrich-Santorum ‘Unity Ticket’ Almost toppled Romney ’12 Campaign

One day after a rally (ex-Transports which fell by 0.4% ), it was down and downer as the revered Dow fell 90 points to close near the session low, -0.6%. All indices declined even more with the two Nasdag indices -1%+, Russell 2000 -0.8% along with the S&P 500:

*Volume dipped slightly, total and real, so it doesn’t confirm the losing day as a selloff

*Dow Utilities fell 0.3% vs +0.8%? NYSE Financials higher slammed: -1% vs +0.6%

*Advance/declines and breadth were solidly negative, new highs fell as did lows

*Volatility (VIX) +9.6% vs -12% now THAT’S volatility rare! Above 40/50 day again!

NYSE Volume dipped for a second session leaving just one positive on last Friday’s options expiry (as usual since the only two days where we have high volume are options expiry and sometimes monthend). It was 3.24B shares vs 3.32B vs 3.74B vs 3.15B vs 4.93B (2013 high), average of last 16 sessions is 3.52B shares – weak! Real NYSE volume also fell to an even weaker 647M shares vs 673M vs 731M shares vs 676M vs 1.825B (new 12-month high!!!). The range since 2/11 is 497 to 1.83B with an average of 729M shares. Last Friday’s 1.83B shares was second only to 12/21’s 12 mo. high of 1.88B shares. Note that Friday was the only day since 2/28 to register over 1B shares with no other sessions reaching anywhere near 800M shares!!! Ave vol. 12 mos. 742M, ytd 725M. There have been just NINE 800+M shares in 2013.

  1. new 52 week highs which have ranged from 121-709, fell to 422 vs 531 vs 328 vs 282 vs 584 vs 652. New lows fell to 36 vs 43 vs 50 vs 42 vs 64vs 50 from a recent high of 98.
  2. Advance/Declines were NEGATIVE and were only positive once in the last four days at -1.9x vs +2.9x! vs-1.3x vs -1.5x vs -1.1x on NYSE and -2.1x vs +2.4x vs -1.4x vs -1.9x vs -1.3x on Nasdaq. Breadth was worse at -3..2x vs +3.2x vs -1.6x vs -2.6x! vs -1.1x on NYSE and -2x vs +3.5x! vs -1.8x vs -2.3x vs -2x on Nasdaq.
  3. The Dow fell 0.6% vs +0.4% after being flat. All indices were down including Dow Utilities -0.3% vs +0.8%? The two Nasdaq indices fell by 1%+ while the resilient Russell 2000 fell 0.8% a day after being top performer at +1%!
  4. NYSE Financials PLUNGED by 1% vs  +0.6% after being the big loser for two days vs -0.7% vs -1.1% most of the loss was due to brokers. NYSE Brokers -1.6% vs +1.6%? vs -0.7% vs -1.1% vs -0.2%. BofA as always most active -1.6%! vs  +0.6% vs +1% vs -0.1% vs +3.8% – the range is $11.11, on 12/17 to $12.78 3/20. Note: 11 cents is a 1% change!!!  GE -0.7% vs +0.6%. Look at brokers and other banks: GS -3.2%!!!; MS -3%!!!; UBS -1.2%; JPM -1.6%!; C -1.9%!; WFC -0.8%; USB -1.1%!
  5. Volatility (S&P VIX), which gapped up on the open Monday(from a multi-year low!!!) rose by 9.6% just a day after plunging 12%, the near round trip looks like this: 13.99 (intraday high 14.21) nearly back from 12.67 (low 12.30),.from a bearish 14.38 (high 16.23? Almost a complete round trip in 3 days!!! Volatile!!! If anyone tells you where this market is headed now or for the rest of ’13, RUN!!!

Global equity markets mixed after being weak 3 of the last 4 sessions: UK +0.3% vs -0.8% vs +0.3% vs flat vs -0.7%; France +0.1% vs -1.2% vs +1.2% vs -0.6% vs -1.3%; Germany +0.1% vs -0.8% vs +0.8% vs -0.3% vs -1.1%; Japan -2.4%! vs +1.3% vs closed vs +2% vs -2.7%; Hang Seng -0.5% vs -0.1% vs +1% vs -0.2% vs -2%; Kospi -0.15 vs -0.4% vs -1%! vs +0.5% vs -0.9%; India -0.3% vs -0.5% vs -0.7% vs -1.5%!!! vs -0.7%. U.S. stock futures up, near session highs in a narrow range: DOW +40; SPX +4.10; NDQ DOWN +8.

Bonds basked in the stock market decline, trading higher for a fourth straight session. Overnight they were flat but now modestly lower: 10 yr Treasury 1.92% -1/8 vs 1.90% but below the 2.06% to 1.85% prior 19 sessions, and the 30 yr’s 3.26% to 3.05%, closed 3.12%, now 3.14% -3/16. The long Tip made it to 0.60% Tuesday but is now back to 0.62% -3/16, the high yield was 0.66%! Libor update: 0.244% 3 mos., 0.448% 6 mos. Foreign bond generally slightly lower in yield.: Germany 1.36% -1; UK 1.84% -1; Italy 4.51% -6; Spain 4.82% -3; Portugal 5.90% +1; Greece 11.60% +1 vs 11.37% vs 11.48% vs 11.21% vs 11.06% vs 10.58%. How does one possibly trade on this???

Gold rose slightly for the 6th time in 7 sessions and remains above $1600 for a fourth day. It is still below resistance but approaching the 40 day m/a!. The 1/17 record high was $1699.90. It closed at $1613.80 +$6.30.  2/21/13’s low was $1554.30 – not seen since May 2012! Last time it was below $1500 was Sept. 2011. Overnight it is $1606.50 -7.30. Crucial to hold $1600 The total breakdown through the 40/50/200 day m/a’s puts major resistance $1619-1669, with major support at $1600, a double bottom from 8/14-15, also a psychological level. Crude fell slightly and has been unsettled since Monday’s wild ride which took it to $91.76, placing the rally in jeopardy before bouncing. It closed at $92.45 -.51 on a slightly outside day after being more or less parallel for two sessions. The recent low is $89.33, lowest since 12/26, set on March 4. Overnight it is $93.09 +.64, still below the just crossed 40 day ($94.32), and 50 day ($94.35)!

Some random thoughts:

As a Vet, TB is fed up….and you should be too as an American. We have gone through a decade of two wars: Iraq, on trumped up charges of WMD yet none were ever found, but oil was a key factor, and Afghanistan.

These wars were a response to the 9/11 attacks, true, but couldn’t they have done like Reagan when the Marine barracks in Beirut was blown up and fight someone simple like Grenada? You do recall Grenada don’t you? Reminiscent of ‘the mouse that roared.

Bush was a president who we spent over a million dollars to train, and failed to fulfill his reserve requirement (he never served on active duty), and Dick Cheney who arguably holds the title as the biggest ‘legal’ draft dodger of all time, and  Secretary of State Donald Rumsfeld who served as an aviator from 1954-57, but in peacetime.

These three men with impeccable credentials then goaded and guided us into a war, by overruling and then allowed Secretary of State Colin Powell to be duped into intelligence derived from dubious sources (who were paid and had their own power agenda), and made a fool of in his presentation of photos of WMD installations in Iraq – could you determine what they were?

Rumsfeld sent us into Iraq to get Saddam Hussein with inadequate forces to protect Baghdad after we captured it, allowed the central bank and the Museum of Antiquities to be sacked but did manage to protect the Ministry of Oil which contained those precious oil contracts. Then along came Donald Bremer to further upset the power structure by not enlisting the aid of former Saddam backers, when his marching orders were that the Iraqi’s knew who the bad guys were. The mission was not accomplished, in fact we left the country worse off than before…at least they had electricity 24 hours a day in Baghdad under Saddam.

But worse, they took down Saddam on his ‘bluff’ – the only protection he had against their enemy (and ours), Iran – thus upsetting the balance of power in the Middle East.

Look where we are as a result: Iran is close to having nuclear capabilities, the Arab Spring has created total conflict in the entire Middle East. Israel is caught in the middle, yet it was their allowing Israeli squatters to force out the Palestinians thus angering all Muslims against them and the U.S. for supporting them. Yet they still, now out of a righteous fear, keep building fences, walls, and demonstrating their strength.

Let’s not forget about China and North Korea and how Russia interacts with everyone!

One can say it is not our battle, but it is. That cannot be denied as we are joined at the hip with them. It makes you wonder if deflation and war are the way out of this mess.

But the point is this: our Congress, where only a handful of its illustrious (sic) members have served – our had their sons or daughters serve – proudly and defiantly send our troops off to war. They lament the deaths and injuries, yet deny or delay them treatment and the benefits they were promised when they return. It has gotten so bad that a vet can expect to wait a year…two years…or even three in NYC to get claims settled, or treatment! Meanwhile the highest suicide rate here is among war vets.

Frankly, the VA has never been a true friend of the veteran. They have tried to do everything on the cheap, through inferior care, denying and delaying treatment for PTSD, and in a case TB knows only too well denial of Agent Orange injuries.

Yet Congress, who failed to fund the two wars and increased military spending, refuses to acknowledge that they are/were the problem…and the right continues to say ‘spending’ is the problem as if they got religion overnight. Meanwhile, our infrastructure is crumbling. Don’t you have to wonder what this country will look like in another decade? Already we have an inadequate power grid, declining water quality, crumbling roads and bridges, and an accepted fact of global warming which is producing larger and larger catastrophes (not causing them, but clearly increasing the intensity and thus damage), and produced the highest average temperatures last year of any year since recording began.

If you are proud of this country, you don’t understand the situation. Furthermore, if Paul Ryan and the extreme right has their way more pain will be inflicted on all but the wealthiest…the ones who have suffered the most already. Let them give more!

Social Security is not bankrupt, it can be ‘fixed’ and is fully funded until 2034 (Medicare until 2023)…the ‘trust funds’ which were spent by Congress and replaced with IOU’s to pay for wars, and other pet projects, and two rounds of unnecessary temporary tax cuts – which when any part is attempted to be retracted is labeled a tax increase by Grover Norquist, ignoring the fact that it was the wealthiest who benefited most and in many cases were the cause of the financial crisis that the world know grapples with and is being ignored by manufacturing crisis after crisis by a Congress who can’t even speak to one another without being labeled a traitor to the party.

Yesterday, Congressional Medal of Honor recipients rang the closing bell at the NYSE – isn’t that special? Meanwhile, the military is attempting to create a medal for non-combatants – those who fly the drones from airconditioned rooms in the U.S. Can you imagine anything more ridiculous? Medals only serve one purpose anyway: to instill a sense of honor and duty…yet the majority of the recipients don’t feel they earned them: they should be reserved for those who died, not for doing what is expected, but that doesn’t make it exciting enough, does it?

Makes you proud to be an American doesn’t it? Also, makes you want YOUR kid to join the military…because its he right thing to do. We are running out of options on how to defend our country in the next real crisis.

If you disagree, that is your right…I finally got it off my chest. Just make the right decision and do it fast.

Have a great day!

TB

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