As of last week, the Market Climate for stocks remained
characterized by strenuous overvaluation, strenuous overbought
conditions, overbullish sentiment, and hostile yield pressures.
True to its short-term form in these conditions, the market pushed
to yet another marginal new high last week. The tendency for the
market to shrug off widely observed overbought conditions may make
it seem that these conditions don't matter. But I can't stress
enough that the pattern of short-term continuation to marginal new
highs is quite typical once the market establishes this syndrome of
conditions, following which
abrupt, nearly vertical
losses are also typical- if unpredictable in timing.
Interesting summation of the fast
approaching debt bombthat is at an extreme.
Where will this refinancing money come from? And this is just the
debt the US is dealing with. International debt compounds the
problem. This can't be good for interest rates which broke out
today which will simply aggravate the problem.
When you
add in sentimentfor the short to mid term
currently at extremes, the market upside could be very
limited considering how over bought it is. This is the definition
of a very risky market. Cash and inverse bonds are looking good
here.
Sentiment says we are at extremes on numerous fronts.
Here's another readingafter today's action.
Upside should be very limited here and being heavily long extremely
risky. Cash is king here IMO.
Here is another
sentiment indicatorreaching extremes that in
the past has warned of a market change in direction. Could earnings
season soon upon us be the trigger?
You can add this
weeks comments from Hussmanas another analyst
who is concerned and relies on historical extremes to guide him.
The market has become a casino which ignores all bad news even
though the economy is overwhelmed with it. It continues to not
matter. Its the only game in town with unlimited support for
another bubble from the Federal Reserve.
This entire rally has been produced with borrowed money in the
many Trillions, a total lack of the rule of law, ongoing accounting
fraud or without any fear or penalties for the corruption being
perpetrated. Some day this will all matter. The question will be
exactly what the Federal Reserve can still do once this latest
bubble it's creating breaks. Interest rates and taxes have no place
to go but up. If that too is ignored, you know we have entered the
twilight zone.
As a follow up on an
earlier post, as more information is found out,
this is turning into just another government disaster. Not only
will it be much cheaper to opt out of 'Healthcare' than actually
pay for insurance for most people, especially if you are young and
healthy, but
companies will drop coverage and lay off
individuals, and smaller companies will stop hiring before they hit
the 50 employee threshold where many penalities take hold.
Now, to totally make this ultimately into a single payer
government run plan quickly, it turns out the IRS may have
no authority to taxyou as it's written, collect
the fine or penalize you financially or criminally if you choose
not to pay. There appears to be no enforceable penalty
for non compliance. Whether this was poorly written or simply a
back door way to have government run the entire industry without
admitting it, it's likely where we are quickly headed. To
provide healthcare for all with few paying for it doesn't sound
like a great formula for the countries survival, considering we are
already virtually insolvent.
So as it currently stands, if this entire plan is not shot down
as being unconstitutional or rewritten, it will ultimately be silly
to pay for insurance until you may need it as you can't be turned
down, the penalty is 'relatively' small and the
enforcement questionable at best. Soon, the only
function of an insurance company will be to do the paper work for
the money losing government coverage if they need to exist at all.
Employees of insurance companies will soon be looking for jobs with
the government with few working people left in the private sector
to support them. Still not seeing how insurance companies are good
investments at this point. Oh...I recommend you don't actually need
care soon.
Many healthcare stocks are going up in anticipation of people
being 'forced' to buy policies. Assuming it isn't stopped as being
unconstitutional as our founders intended, everything I read infers
the penalty will average far less than most new policies. Once
people learn this, they will opt out and wait for the IRS to track
them down and pay the penalty. Because you can't be turned down,
you can buy the insurance when you need it only and drop it again
after you use it. For routine care, you can pay cash and negotiate.
If will be far cheaper to pay the penalty than for insurance in
most cases.
This entire program relies on the young and healthy who don't
need it to subsidize the old and sick who do. But the young may
just opt out. This will turn out to be just another big government
tax and little about healthcare. Rates will be going up not down,
as insurance companies are now forced to cover everyone regardless
of ailment. Companies currently covering employees will drop out
due to higher rates and give the job to the government. Very soon,
insurance companies will likely be good shorts, not the buys they
are perceived today. Should be interesting to watch.
Posted by george_l on 27th of Jan 2010 at 04:36 pm
FYI
I am not a subscriber to Stockcharts. It's great when separate
links are displayed that non subscribers can view. However, as a
new member I notice that virtually all the links provided by Matt
are viewable correctly whereas the links provided by Steve do not
display correctly....at least for me. Are each of you creating the
links for non subscribers differently?
The community is delayed by three days for non registered users.
Meltup
Posted by george_l on 17th of May 2010 at 01:30 am
Interesting new you tube videoworth a watch
Hussman's weekly commentaryis in agreement. As
Comment
Posted by george_l on 12th of Apr 2010 at 03:34 pm
Hussman's weekly commentaryis in agreement.
As of last week, the Market Climate for stocks remained characterized by strenuous overvaluation, strenuous overbought conditions, overbullish sentiment, and hostile yield pressures. True to its short-term form in these conditions, the market pushed to yet another marginal new high last week. The tendency for the market to shrug off widely observed overbought conditions may make it seem that these conditions don't matter. But I can't stress enough that the pattern of short-term continuation to marginal new highs is quite typical once the market establishes this syndrome of conditions, following which abrupt, nearly vertical losses are also typical- if unpredictable in timing.
Markets On the Fast Track to Hitting a Wall
Posted by george_l on 5th of Apr 2010 at 10:32 pm
Interesting summation of the fast approaching debt bombthat is at an extreme. Where will this refinancing money come from? And this is just the debt the US is dealing with. International debt compounds the problem. This can't be good for interest rates which broke out today which will simply aggravate the problem.
When you add in sentimentfor the short to mid term currently at extremes, the market upside could be very limited considering how over bought it is. This is the definition of a very risky market. Cash and inverse bonds are looking good here.
Sentiment says we are at
Watchlist Comments and Market Comments
Posted by george_l on 5th of Apr 2010 at 09:43 pm
Sentiment says we are at extremes on numerous fronts. Here's another readingafter today's action. Upside should be very limited here and being heavily long extremely risky. Cash is king here IMO.
Sentiment reaching extremes?
Posted by george_l on 5th of Apr 2010 at 01:09 pm
Here is another sentiment indicatorreaching extremes that in the past has warned of a market change in direction. Could earnings season soon upon us be the trigger?
You can add this weeks
At the crossroads?
Posted by george_l on 5th of Apr 2010 at 12:37 pm
You can add this weeks comments from Hussmanas another analyst who is concerned and relies on historical extremes to guide him. The market has become a casino which ignores all bad news even though the economy is overwhelmed with it. It continues to not matter. Its the only game in town with unlimited support for another bubble from the Federal Reserve.
This entire rally has been produced with borrowed money in the many Trillions, a total lack of the rule of law, ongoing accounting fraud or without any fear or penalties for the corruption being perpetrated. Some day this will all matter. The question will be exactly what the Federal Reserve can still do once this latest bubble it's creating breaks. Interest rates and taxes have no place to go but up. If that too is ignored, you know we have entered the twilight zone.
Healthcare
Posted by george_l on 30th of Mar 2010 at 01:30 am
As a follow up on an earlier post, as more information is found out, this is turning into just another government disaster. Not only will it be much cheaper to opt out of 'Healthcare' than actually pay for insurance for most people, especially if you are young and healthy, but companies will drop coverage and lay off individuals, and smaller companies will stop hiring before they hit the 50 employee threshold where many penalities take hold.
Now, to totally make this ultimately into a single payer government run plan quickly, it turns out the IRS may have no authority to taxyou as it's written, collect the fine or penalize you financially or criminally if you choose not to pay. There appears to be no enforceable penalty for non compliance. Whether this was poorly written or simply a back door way to have government run the entire industry without admitting it, it's likely where we are quickly headed. To provide healthcare for all with few paying for it doesn't sound like a great formula for the countries survival, considering we are already virtually insolvent.
So as it currently stands, if this entire plan is not shot down as being unconstitutional or rewritten, it will ultimately be silly to pay for insurance until you may need it as you can't be turned down, the penalty is 'relatively' small and the enforcement questionable at best. Soon, the only function of an insurance company will be to do the paper work for the money losing government coverage if they need to exist at all. Employees of insurance companies will soon be looking for jobs with the government with few working people left in the private sector to support them. Still not seeing how insurance companies are good investments at this point. Oh...I recommend you don't actually need care soon.
Healthcare Stocks
Posted by george_l on 22nd of Mar 2010 at 03:34 pm
Many healthcare stocks are going up in anticipation of people being 'forced' to buy policies. Assuming it isn't stopped as being unconstitutional as our founders intended, everything I read infers the penalty will average far less than most new policies. Once people learn this, they will opt out and wait for the IRS to track them down and pay the penalty. Because you can't be turned down, you can buy the insurance when you need it only and drop it again after you use it. For routine care, you can pay cash and negotiate. If will be far cheaper to pay the penalty than for insurance in most cases.
This entire program relies on the young and healthy who don't need it to subsidize the old and sick who do. But the young may just opt out. This will turn out to be just another big government tax and little about healthcare. Rates will be going up not down, as insurance companies are now forced to cover everyone regardless of ailment. Companies currently covering employees will drop out due to higher rates and give the job to the government. Very soon, insurance companies will likely be good shorts, not the buys they are perceived today. Should be interesting to watch.
This articlehas a more detailed view.
Links Not Displaying correctly
RUT 15 Update
Posted by george_l on 27th of Jan 2010 at 04:36 pm
FYI
I am not a subscriber to Stockcharts. It's great when separate links are displayed that non subscribers can view. However, as a new member I notice that virtually all the links provided by Matt are viewable correctly whereas the links provided by Steve do not display correctly....at least for me. Are each of you creating the links for non subscribers differently?
Thanks
http://www.zerohedge.com/article/316000-nfp-print-friday-bls-seasonal-fudge-factors-make-it-very-likely
+316,000 employment increase tomorrow?
Posted by george_l on 7th of Jan 2010 at 02:54 pm
http://www.zerohedge.com/article/316000-nfp-print-friday-bls-seasonal-fudge-factors-make-it-very-likely
+316,000 employment increase tomorrow?
Posted by george_l on 7th of Jan 2010 at 02:37 pm