7/6/11…doldrums again…is the rally over?

Bloomberg Top Stories:

*China Raises Interest Rates for third time to Curb Accelerating Inflation

*Euro Weakens, Portuguese Bonds Slide on Moody’s Downgrade; Stocks Decline

*Company Bond Window ‘Slammed Shut’ as Portugal Ratings Cut to Junk

*Italy’s Debt Needs Surge as Borrowing Costs Climb to Record

*Kodak Default Risk Reaches 74% After License Suit Delay

*Iceland Credit Raters Miss Resurrection After Failing to Predict Collapse

*Bank Regulators Need Power to Close Failing Institutions, Basel Group Says

*Housing Recovery Hindered in U.S. as Government Works at Cross-Purposes

*Obama Sets Deficit Talks after Faulting Plan for Temporary Debt-limit Fix

*Tanker With Million Barrels of Oil is Ablaze Off Yemen After Pirate Attack

Volume was slightly lower again at 3.3B shares while Big Board volume dropped to 865 million shares. Volume crossed 600 million just 15 minutes prior to the close. Meanwhile the VIX says ‘no problem’ as it plunged from 20 to 15.87 in just four sessions (lowest since April 30th!

Only the two Nasdaq indices and Russell 2000 were up, 0.4% and 0.2% respectively. Transports were the big loser, -0.9% following Friday’s huge 2.3% gain; Dow and S&P 500 -0.1%…running out of steam? Volume was 3.34B shares with 906 million on the Big Board…6th straight sub 1B share day. New 52 week highs rose slightly to 330 vs. 324 while new lows were steady at 36. Advance/Declines ran -1.1x on the NYSE and +1.1x on Nasdaq, while Breadth was -1.5:1 on NYSE and -1.1:1 on Nasdaq. Stay tuned for payrolls on Friday, followed by options expiry the next Friday.

…too soon to tell and too much coming over the next week to make a bet. In addition, we have the debt ceiling issue…not to mention the budget and it could go down to the wire thanks to the polarization of the electorate through fear and rhetoric. Something has to be done but airing one’s laundry in public is not the way to bring an intelligent decision. It is not all black and white. Gosh, where was the GOP ire when they ran the government? Even Gingrich was appalled.

. . .  – – –  . . .    . . .  – – –  . . .

TB did not mean to say that the Constitution was anti-God, merely that it did not espouse one as the Declaration of Independence did. There was good reason for this as a majority should not dictate its beliefs on minorities…instead the point was religious freedom. There is even wide differing between the recognized Christian sects and the fundamentalists further validating this stance.

What TB doesn’t want is for elected officials or anyone to try to tell us what the founding fathers wanted because whether you believe in Madison’s Federalist Papers as the defining piece or some of the others, it is simply not that clear. You decide, not someone with an agenda.

Have a great day!

TB

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