9/27/30…work is the curse of the drinking class

Today’s Quote from the Friars Club Encyclopedia of Jokes: “One has two duties-to be worried and not to be worried.” – E. M. Forster. Ah, the quandary of the money manager

Bloomberg Quote of the Day: “And that’s the way it is.” – Walter Cronkite. Sadly, there are no Cronkite’s or Murrow’s. How can there be when news is managed to draw audiences instead of delivering valuable commentary and…well…news. Oh, Moyers!

Bloomberg Top Stories:

*Yen Strengthens on Japan Tax Outlook as Italian Bonds Drop; Pound Climbs

*Euro-Area Economic Confidence Increases More Than Forecast Amid Recovery

*U.S. Government Shutdown Would Shave Fourth-Quarter Growth as Much as 1.4% – !!!

*Former RBS Trader Fired Over Libor-Rigging Files Suit for Unfair Dismissal

*Carney Sees No Case for Expansion of Stimulus as U.K. Recovery Strengthens

*Buyout Loan Boom Fueling Drive for $20 Billion Financings

*J.C. Penney Hires Goldman Sachs to Arrange Share Sale to Fund Turnaround – this after they downgraded them causing price to fall 14%? Or was that the plan?

*McDonald’s Starts Selling Veggies With Value Meats in Healthy Food Effort –LMAO

*Boehner Plan to Tackle Debt Limit Stalls Amid Government Shutdown Standoff

*Iran Breakthrough With Atomic Monitors Seen Unlikely as Meeting in Vienna- no news!

*NYC Commuters Stranded Again While Asking Why Metro-North’s Power Failed

*IRS Defense of Tax-Preparer Rules Meets Appellate Court Skepticism

What is the most important part of this column? The one that should be of the most use to an investor? The commentary? NO! The news headlines? NO! The correct answer it the data presented since all 99% of investors and managers do is look at the changes – until quarterend rears its ugly head and then panic ensues. That is why TB now has seven days of data…taking us back to when the violent changes caused by (well it was the trigger), the Fed. Meanwhile we continue to trade on little if any information for investors. But who cares? REAL investors aren’t playing in this market as the volume shows and worse rallies are on LOW volume while the declines tend to be on higher volume…big ones on MUCH higher volume. Capische?

Best performers yesterday were the two Nasdaq indices up 0.7% and 0.8% respectively The Dow 30, Dow Transports and S&P 500 followed suit up 0.4% but as the record of the past seven sessions shows…while they are near record highs they are very vulnerable…especially without retail participation! Note how poorly the Dow has done since the change in members last Friday!

The Nasdaq 100 gained 25.5 points on top of Wednesday’s 10 points with 12 members moving by more than a point! 10 up, and just two down. Let’s look again at the leaders and their changes over the past NINE sessions that they were leaders: APPL +3.8 vs -6.1 vs -1.7 vs +19.2!!! vs -4.4 vs +6.4 vs +7.9 vs +4.2 vs -12.3 vs -6.5 – do you see a trend here???; AMZN +2.2 vs -2 vs +1.7, vs n/a, vs +3.2, +3.3. MSFT +2.1 vs -2.5 vs -6.9 vs +2.2 vs +3 vs +1 vs -1.4 vs +2; GILD +1.5 va -1.4, n/a -1.7; AMGN-1.5, n/a, -1.2; FB +1.5 vs +1.6 vs +1.9 vs +2.5 vs +1.2 vs n/a vs +4 vs -2.8; CSCO -3.1 vs +1.4; AMAT +1. Here are others that weren’t movers yesterday: GOOG -2.3, n/a -4.1, +1.2,-1.2, +4.2; Advance/Declines and Breadth were modestly positive. New 52 week were stable as were new lows. VIX little changed.

Bonds gave back a bit of their gains but not in trouble. Crude rose slightly but only after printing 102.20 for a second session creating a double bottom and trading at lowest since 7/8! Gold had a weak session but continues to hold $1300 but remains weak and is higher overnight.

Dow 30 +0.4% vs -0.4% vs -0.4% vs -0.3% vs -1.2% vs -0.3% vs +1%; Dow Transports +0.4% vs -0.7% vs +0.1% vs -0.6% vs -0.5% vs +0.3% vs +1.5%; Russell 2000 +0.5% vs -0.1% vs +0.3% vs -0.1% vs -0.2% vs -0.2% vs +1%; Dow Utilities –0.2% vs 0.7% vs -0.1% vs +1% vs -1.5% vs -0.3% vs +3%!!!; S&P 500 +0.4% vs -0.3% vs -0.3% vs -0.5% vs -0.7% vs -0.2% vs +1.2%; Nasdaq Composite +0.7% vs -0.2% vs +0.1% vs -.3% vs -0.4% vs +0.2% vs +1%; NDQ 100 +0.8% vs –0.3% vs -0.1% vs -0.2% vs -0.4% vs +0.2% vs +1.3%.

*NYSE Volume took another dive to a well below average 2.79B shares vs 3.12B  vs 3.2B vs 3.07B from a record high (?) 4.82B shares vs 3.72B vs 3.96B (2.52B is 4th weakest of 20131.96B is the low). REAL NYSE Volume also plunged to a way below average 603M shares vs 641M vs 674M vs 690M from the third highest ever, 2.06B shares (6/30/06 3.38B; 7/12/02 2.29B) vs 738M vs 820M (482M on 7/3 in a shortened trading session is the 2013 low). The 12-month average is 719M shares. The range since 6/28’s 1.75B share day, excluding the four sessions above 800M, is 482M-798M shares. The average since 6/28 is just 689M shares, ranging from 482M to 906M plus the 2.025B shares on Friday. There have been just EIGHT 1B+ share sessions! There have been 32 800M+ shares in 2013: 13 up, 17 down, and two mixed.

*New 52 week highs have ranged from 33-864. They lay dormant at 21 vs 276 vs 367 vs 221 vs 590 vs 587 vs 310. New lows also quiet at 44 vs 43 vs 49 vs 168! vs 36 vs 56 vs 59.

  1. Advance/Declines were modestly positive: +1.8x vs 1:1 vs +1.3x vs -1.4x vs -2.5x vs-1.4x vs +6x!!!; (recent range -17.5x to +6x) on NYSE and +1.5x vs -1.1x vs +1.2x vs -1.3x vs -1.1x vs -1.2x vs +2.8x (recent -3.5x to +3.8x). Breadth was similar: +1.4x vs 1:1 vs -1.1x vs -2.1x vs -4x!!! vs -1.7x vs +7.2x!!! (recent -18.6x!!! to +7.2x!!!) on NYSE and +1.9x vs +1.4x vs +1.5x vs -2.1x vs -1.5x vs +1.3x vs +3x (recent -12.8x to +6.5x)  
  2. NYSE Financials barely budged by +0.1% vs +0.2% vs -0.3% vs -0.8% vs -0.8% vs -0.6% vs +1.7%! BofA 2nd most active (JCP #1 again +3% vs -14.6%!!! on downgrade by GS) -0.4% vs +0.5% vs +0.1% vs -2.1%!!! vs -1.1% vs -0.7% vs +1.3%, closing at $14.08 -.06 – lowest levels since 8/30! It has struggled since hitting $15.03 on 8/1 – highest since Jan. 14 and major res. Brokers -0.1% vs -0.1% vs flat vs -0.5% vs +0.4% vs -0.5% vs -0.9%!; KBW Banks -0.3% vs +0.7% vs -0.4% vs -1.6%!!! vs +0.2% vs +0.2% vs +0.2%; Nasdaq Banks -0.3% vs +0.3% vs +0.6% vs -0.4% vs +0.7% vs -1.4%!!! vs -0.3%.
  3. Volatility (S&P VIX) dipped below 14 for a 3rd day but closed at 14.06 +.05. Range was 13.58-14.40 vs Friday’s low 12.52. On 8/30 it closed at 17.01 but a week prior it was at 13.98. The recent range is now 11.83-17.81. It peaked at 22.79 on 12/28/12. It is now below the 40 day (14. 36), the 50 day (14.10) and the 50 day (14.46)…ytd the range is 11.05 (3/14) to 21.92 (6/24)!

European stocks weaker for a 2nd day, Asia mixed: UK -0.8% vs -0.1% vs -0.2% vs +0.3% vs -0.5% vs -0.2% vs +1.4%!!!; France –0.2% vs -0.2% vs -0.2% vs +0.7% vs -0.3% vs -0.2% vs +0.9%; Germany -0.3% vs -0.2% vs flat vs +0.3% vs -0.4% vs -0.2% vs +1%; Japan -0.3% vs +1.2%! vs -0.8% vs -0.1% vs closed vs -0.2% vs +1.8% vs +1.4%; Hang Seng +0.4% vs -0.4% vs +0.1% vs -0.8% vs -0.6% vs closed vs +1.7%; Korea +0.2% vs +0.5% vs -0.5% vs -0.1% vs +0.2% vs  closed vs -0.4%; India -0.8% vs +0.2% vs -0.3% vs +0.1% vs -1.8%!!! vs -1.2%! vs +3.4%!!! U.S. equity futures weaker and still in what has become the norm: a very narrow trading range! DOW -53; SPX -7.80; NDQ -12.25.

Bonds were weaker following four days of rally. They are not strong but have erased the gap down from 8/30! Overnight they are showing some strenght: 10 yr Treasury closed 2.64%, now 2.63% +3/16 (recent range now 2.99% to 1.63%!!!), and the 30 yr range 2.67% to 3.90%, closed 3.70%, now 3.67% +3/8. The long TIP closed 1.36% and is now 1.35% +3/8…still weakest of the bunch! The (record?) low of 0.36% was set on 4/5. Recent high yield: 1.63%! Libor update: 0.248% 3 mos, 0.367% 6 mos. Another new record low on 6 mos. 3.67%, and now the 3 mo. took out the Jan. 2010 record lows (0.245% and 0.382% respectively). Foreign bond yields lower ex-Italy: Germany 1.79% -4; UK 2.72% -2; France 2.35% -1; Italy 4.40% +7!; Spain 4.34% +1; Portugal 6.75% -11!!!; Greece 9.15%!!! -30!!! vs 9.48% vs 9.59 vs 9.71%  +10 vs 9.57%!!! -26!!! vs 9.79% -25 vs 10.13 Recent range: 8.04% to 12.57%. Japan 0.67% -2.

Gold closed lower, and continues to oscillate following Monday’s low of $1313.40 held as did $1300, closing at $1324.10 -$12.10. The recent low was 9/18 at $1291.50, first time below $1300 since 8/9! Overnight it gained it back and then some to $1342.00 +$17.90! Recent high was $13.75.40 on 9/19 while 9/10’s high was $1391.40. 9/17’s low $1304.60!!! 8/14’s session low was $1271.80 – lowest since 7/17! 6/27’s intraday low was $1179.40 – lowest since at least 2011 and critical support. $1300 remains psychological support, while the 40 day ($1351) and the 50 day ($1345) are MAJOR RESISTANCE. The 200 day is at $1474.

Crude closed slightly better following five straight down days closing at $103.03 +.37 – with an intraday low of $102.20 for a 2nd day thus creating a DOUBLE BOTTOM!!! That is lowest close since 7/8!!! 9/18’s session high was $108.49 from $104.94! Just 14 days ago it set a rally high and close of $110.70 and $110.53 respectively. It is way below the 40/50 day m/a’s ($106.46-.33), and crossed! The 200 day ($97.57) is major support!!! 4/18’s low of $85.61 was lowest since 12/11! Major Res is the high the spike to $112.24 on 8/28. That move was immediately rejected! The range is $85.61-$112.24 since March 1, 2012. Overnight it is slightly weaker at $102.81 -.22. Like Gold, it too is weak and oscillating with no visible direction.

 

Some random thoughts:

So you think TB is a ‘rich hater’. On that you would wrong…very wrong. He is not the enemy of the wealthy, no need to be: they are their own worst enemy! Why? Because anyone who has wealth and has no compassion for the less fortunate is looking for trouble and that means hurting their lifestyle. History is full of evidence: the French Revolution, Great Britain, the U.S. leading up to the Great Depression. Why don’t we learn from history? Because we are too stupid to heed it and money…especially ‘old money’ has little or no use for history. As for ‘new money’ it is too busy getting there they don’t see the problem.

Yet the IRS had to create a new category. No longer the top 1% of taxpayers but the top 0.1% and that should probably be moved to the top 0.01%!!!

What is insane is this: how much money do you need? Frankly, that is of no importance to them as the newly rich use it as a ‘counter’ and so long as someone else has more they want more then the other guy. Perhaps even more insane is the middle class which is being depleted while the lower 25% and the poverty level people grows. Have we forgotten that it is votes that get someone elected? No, its money…so far but IF we get a ‘uniter’ – sadly as occurred in Germany after WWI – the entire government could be twisted. Which might be a good thing. Hampering this is the millions being put up to elect incompetent people…dare we say Sen. Cruz? The Tea Party, funded by the infamous Koch brothers is the culprit…and now it is in disarray and many of those elected by them are considered ‘too liberal’ and must go.

So if and when a ‘uniter’ appears (we thought it might be Obama but he was a failure, partly due to his lack of desire to ‘mix it up’ and partly due to stonewalling by the opposition), we…especially the wealthy among us better hope…and pray…that they are of the benevolent sort or the status quo might not just be upset but overturned.

When even the U.S. Supreme Court succumbs to politics (election of Bush II, overturning portions of the Voting Rights Act and saying Congress can rewrite it…really? Not when two parties can’t even be civil to one another and a fanatic minority can stop the government dead in its tracks. Note that immediately after the decision, some of the worst offenders of voting rights passed legislation on voter ID’s, and other discriminatory practices. It seems someone is afraid that their greed will upset the status quo.

Lastly, the GOP was trying to woo Hispanic voters…now to defeat Obamacare with what amounts to extortion, that has fallen by the wayside and with it the hopes of the GOP winning a national election.

No need to criticize the wealthy; they are doing so well at it on their own.

Have a nice relaxing weekend,

TB

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