05/15/2012: GARY ON NATIONALLY SYNDICATED INVESTORS EDGE RADIO BROADCAST

Byaaronmat-admin

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https://archives.warpradio.com/btr/InvestorsEdge/051518.mp3

JUST LETTING YOU KNOW

A Very Crappy Day in the Market Today

As I have taught you, it is never good when the market is up nicely and then finishes down. We’re getting loads of that right now.

We believe in characteristics of bull and bear phases and the understanding of them. We look at them on a long-term basis, an intermediate-term basis, and a short-term basis.

We look at the daily action because we know that in bull phases, the market will tend to open down and finish up. In bear phases, they tend to open up and finish down.

How do we know this? The study of bull and bear phases. You just have to do a little bit of studying.

And the bottom line out of today is really nothing good came out of today.

I can tell you the news.

  • Greece? Ain’t nothing good going on there. There’s now rumblings that they will leave the European Union.
  • Spain? Their 10-year bond is now 6.25.
  • Italy? Their ratings have now been taken down another notch.
  • Why? Not because of the great people of these great nations. It’s because the people running government decided to spend them into oblivion and forgot that they only way they get an money is to get it from those same taxpayers. And when you let too many taxpayers retire at the age of 50 and get salary equal to 75% for the rest of their lives, you’re eventually in trouble.

And mind you, this has been done on purpose That’s what socialism is all about. Clear no accountability of the tax dollar. So that’s a bit of the story over there.

But over here, in the U.S…

  • Massive deficit and a president that couldn’t care less about them and a president that lied that they cared about them.
  • A major tax increase coming in January if nobody does anything about it. Go read about it.
  • A fake employment number at 8.1%. You know I think it’s really around 10%. Because they’re trying to tell you that things are improving, but all these people are leaving the workforce. You know that’s not how it works. In a better environment for jobs, more people enter the workforce. And the unemployment rate first goes up! So who are they trying to kid.

So that’s all the news.

But we’ve seen markets that accept “not so go news” and they go up…and that’s a bull phase. And we’ve also seen markets where the just keep going down and that would be a bear phase. That’s what we are in right now.

And the genesis of this bear phase is about:

  • More about more stocks breaking support
  • Fewer and fewer stocks working.
  • The Semiconductor Index rolling over badly
  • The Financials breaking down
  • The New High List contracting and the New Low List expanding.
  • All major indices breaking the all-important 50-day moving average on volume, which happened on May 4
  • The NYSE, believe it or not is sitting on its 200-day moving average which is quite amazing.

And that’s how you get into this position.

But that doesn’t change the story of today which mind you was God awful ugly.

Now here’s a few notes today on something I haven’t mentioned in a while…the Dollar and Euro.

The Dollar was soaring because the Euro was crashing. Go look at FXE which is ETF of the Euro. It almost closed at new yearly lows. Why? Nobody trusts the Euro. And keep in mind how this worked. 17 countries got together and agreed to have a common currency. The problem is that you have 17 countries thinking differently and acting differently. The had a treaty that said, “If you want to screw up and spend your way into oblivion and run massive deficits, nobody’s going to help you.”

Well they changed all that realizing that “we own their bonds” and we better do something about it. They talked austerity and they’d do something about spending government-wise. But they really have not…just like here.

So the markets in a little bit of a soup. If and when things change, I will gladly let you know. 

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Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.