1/7/13…trying to handle the truth

…trying to handle the truth

From The Friars Club Encyclopedia of Jokes: “Americans are getting stronger. Twenty Years ago it took two people to carry ten dollar’s worth of groceries. Today, a five-year-old can do it” – Henny Youngman

Bloomberg Quote of the Day: “A woman is like a tea bag; you never know how strong it is until it’s in hot water.”

 – Eleanor Roosevelt…sure glad a woman said that!!

Bloomberg Top Stories:

*Hedge Funds Squeezed as Rallying Shorts Beat S&P 500 Gain by Most in Year

*Bank of America to Pay Fannie Mae $3.6 Billion to Settle Mortgage Claims…sure makes you want to buy those big bank stocks…thieves! …from the people!

*Stocks Fall in Europe as Yen Rallies; Banks Gain on Basel Rules Agreement

*Citigroup Names James Forese, Manuel Medina-Mora as Co-Presidents of Bank

*Short-Seller Ackman is Just Getting Started Exposing Flaws at Herbalife

*Treasury Yield Forecasts Drop as employment Data Support Purchases by Fed

*Asia Funds Lift Dollar Bonds as Millionaires Proliferate

*Banks Press for More Time as Consumer Bureau Prepares New Mortgage Rates

*Westpac Ousts Wells Fargo as Top Forecaster as Yen Gains Seen

*Bulls Add to Wagers for First Time Since November After Rally in Commodities

*Tarullo Sees Too-Big Banks With New Fed-FDIC Debt Rule Protecting Taxpayer

*Odey Raising Palatial Chicken Coop Bets on Banks as Hedge Fund Returns 24%

*Obama Moves Into Tougher Fight With Hagel Than Kerry as New Team Emerges

*John Brennan, Obama’s Counerterror Chief to be Nominated to Head the CIA

*Wall Street Outspends Law Firms Raising Funds for Romney – natch!  

The first week of the year ended with a mixes session thanks to Apple. All indices were up except the two Nasdaq indices (flat, -0.3%), led by Transports +1.2% and the Russell 2000 +0.8% while Utilities posted a 0.7% gain. Apple’s big loss of 2.8% resulted in a loss of 12.56 index points on the NDQ 100 which had a total loss of 7.77 points! Too much power in one stock! The Dow had the biggest one week point gain since Dec. 2007 – all in two days then spent the last two doing little…something to be proud of or leery?. Total NYSE volume slipped again to 3.42B shares vs 3.82B vs 4.2B. Trades executed on the floor of the NYSE also dropped sharply to a weak 651M shares vs 707M vs 859M shares. Advance/declines and Breadth were all positive by +3.3x/+4.1x! on NYSE and +1.8x/+2.2x on Nasdaq. Note that new 52 week highs hit 713 on Wednesday and fell again to a still strong 428 vs 437 while new lows fell to just 12 from 22!!! After closing at 22.70 on 12/28, the S&P VIX volatility measurement fell again to a near 12-month low (13.32 on 8/17) at 13.83: imagine what could happen with all the budget obstacles and debt ceiling and might show up on options expiry on 1/18!

Global stocks are weaker from 0.1%-0.8%.

The bond market rallied on Friday but remains weak and is unchanged overnight as it comes back from the highest yields since May Day!!!. The 10 yr note is 1.90% vs 1.93%, and the 30 yr 3.10% vs 3.14% – still well above the old 3% high set on 12/18! TIPS also doing a bit better at 0.50% vs 0.55% – but back from the 0.22% record low set on 12/6! Libor is fractionally lower at 0.305%, 3 months, and 0.50% six months. Foreign bond rates are mixed with Germany, U.K. and France lower while Italy is up to 4.30%, Spain 5.05%. Portugal continues to fall (6.12%) while Greece rose to 10.99% vs 10.92%.

Gold tanked again falling $25.70 to $1648.90 0 $20 below the 200 day m’a with huger resistance at $1702! The $1636 low on 12/21 – lowest since 8/21 is now key support. It is still weak at $1644.80 -$4.10! Crude was little changed again closing at $93.09 +.17 – after the highest close since 9/19 but still well above the 40/50 day, and the 200 day: $91.70! Overnight it is slightly weaker at $92.76 -.33. It’s a jungle out there!

…by the day TB is becoming more disgusted with the Congress…not that Obama is doing much better. John Boehner barely held his Speaker slot…becoming emotional again at the swearing in as he received the gavel from Minority Leader Pelosi…there is a lovefest! Paul Ryan is trying to ‘make nice’ while Whip Eric Cantor continues to disgust TB with his extreme right agenda. No better over in the Senate…TB was thinking: what if he had won a contest to have a free dinner with either Reid or McConnell…hmmm. McConnell must be third prize, Reid second, and all you can eat at McDonald’s first!

Why in God’s name was McConnell on all three talk shows yesterday? …and to think they attacked Susan Rice for doing the same! McConnell is the grumpy old man personified with his pursed lips and droll answers. Worse, on all three shows he evaded the questions…most notably: after saying clearly that any more revenues are off the table…done…finished…he was asked about tax reform. He said he was done with revenues…let’ let the fat cats keep their ‘carried interest’ and if you couldn’t cut billions of deductions from the tax code that serve no earthly purpose…well, you might just be qualified to replace McConnell…two more years! Ugh!

When asked directly about how it was the two Bush tax cuts and and two wars that were unfunded followed by Medicare Part D, all with only GOP strong support, McConnell said that doesn’t matter…we just have to fix it. Isn’t that like a guy holding up a liquor store and then pushing to stop robberies? The tax-and-spend Dems at least did that, which is at least paying for what you inflict. TB is sick of this shortness of memory that we are all paying for while only the wealthiest received most of the benefit…sounds fair to TB.

As for the ‘pain’ inflicted on the wealthy by the compromise (?) – they won again. The losers once again were the American people. No serious budget cuts but the GOP liked that just fine as they provided only token tax increases that were still better than before the Bush tax cuts. Quietly the subsidies remain…for oil drilling…as if they need it! The farm subsidy? Oh they fixed the milk problem but meanwhile Cargill and ADM are the two biggest benefactors…protecting those small farmers? Statistics show otherwise while these two behemoths clone hybrids for increased production while hurting everything else in sight…supermarket to the world?….get real!

How can we stand by and watch as our country becomes a duopoly? But in a democratic country that can only stand for so long until the people get angry and find a true leader. They were desperately looking for one with Obama…and he failed them…but consider the alternative where Wall Street switched sides and threw all of their weight at Romney.

If you think TB is upset you are right…and disgusted with the lack of leadership and sense of fairness in this country. It’s every man for himself…after all everyone of those wealthy people did it on their own…the rest of America be damned.

Nothing exemplifies this better than financial sector…where denial of responsibility is their watchword…where no one has gone to jail…been fined (except Angelo Mozillo who definitely should be in jail…instead they sent Martha Stewart! The GOP loves these people with their fat wallets and will do everything in their power to protect them…even as BofA shells out another $3.6 billion for scamming FNMA.

Yet it is the bank stocks that were the best performers of 2012…and are predicted to do so again…while the shareholders continue to fork over money for the sins of management. Free market capitalism has become a myth…it does not exist!

Hope you have a good week in the country that used to be a leader in fairness and equality.

TB

. . .  – – –  . . . (SOS!)  . . .   – – –  . . .  (SOS!) . . .   – – –  . . .  (SOS!)

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