Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
USDT is 9-11 for Central Banks the Bitcoin Black Swan - Tether Un-Stable Coin Ponzi Schemes! - 30th Jul 21
Behavior of Inflation and US Treasury Bond Yields Seems… Contradictory - 30th Jul 21
Gold and Silver Precious Metals Technical Analysis - 30th Jul 21
The Inadvertent Debt/Inflation Trap – Is It Time for the Stock Market To Face The Music? - 30th Jul 21
Fed Stocks Nothingburger, Dollar Lower, Focus on GDP, PCE - 30th Jul 21
Reverse REPO Market Brewing Financial Crisis Black Swan Danger - 29th Jul 21
Next Time You See "4 Times as Many Stock Market Bulls as There Are Bears," Remember This - 29th Jul 21
USDX: More Sideways Trading Ahead? - 29th Jul 21
WEALTH INEQUALITY WASN'T BY HAPPENSTANCE! - 29th Jul 21
Waiting On Silver - 29th Jul 21
Showdown: Paper vs. Physical Markets - 29th Jul 21
New set of Priorities needed for Unstoppable Global Warming - 29th Jul 21
The US Dollar is the Driver of the Gold & Silver Sectors - 28th Jul 21
Fed: Murderer of Markets and the Middle Class - 28th Jul 21
Gold And Silver – Which Will Have An Explosive Price Rally And Which Will Have A Sustained One? - 28th Jul 21
I Guess The Stock Market Does Not Fear Covid - So Should You? - 28th Jul 21
Eight Do’s and Don’ts For Options Traders - 28th Jul 21
Chasing Value in Unloved by Markets Small Cap Biotech Stocks for the Long-run - 27th Jul 21
Inflation Pressures Persist Despite Biden Propaganda - 27th Jul 21
Gold Investors Wavering - 27th Jul 21
Bogdance - How Binance Scams Futures Traders With Fake Bitcoin Prices to Run Limits and Margin Calls - 27th Jul 21
SPX Going for the Major Stock Market Top? - 27th Jul 21
What Is HND and How It Will Help Your Career Growth? - 27th Jul 21
5 Mobile Apps Day Traders Should Know About - 27th Jul 21
Global Stock Market Investing: Here's the Message of Consumer "Overconfidence" - 25th Jul 21
Gold’s Behavior in Various Parallel Inflation Universes - 25th Jul 21
Indian Delta Variant INFECTED! How infectious, Deadly, Do Vaccines Work? Avoid the PCR Test? - 25th Jul 21
Bitcoin Stock to Flow Model to Infinity and Beyond Price Forecasts - 25th Jul 21
Bitcoin Black Swan - GOOGLE! - 24th Jul 21
Stock Market Stalling Signs? Taking a Look Under the Hood of US Equities - 24th Jul 21
Biden’s Dangerous Inflation Denials - 24th Jul 21
How does CFD trading work - 24th Jul 21
Junior Gold Miners: New Yearly Lows! Will We See a Further Drop? - 23rd Jul 21
Best Forex Strategy for Consistent Profits - 23rd Jul 21
Popular Forex Brokers That You Might Want to Check Out - 22nd Jul 21
Bitcoin Black Swan - Will Crypto Currencies Get Banned? - 22nd Jul 21
Bitcoin Price Enters Stage #4 Excess Phase Peak Breakdown – Where To Next? - 22nd Jul 21
Powell Gave Congress Dovish Signs. Will It Help Gold Price? - 22nd Jul 21
What’s Next For Gold Is Always About The US Dollar - 22nd Jul 21
URGENT! ALL Windows 10 Users Must Do this NOW! Windows Image Backup Before it is Too Late! - 22nd Jul 21
Bitcoin Price CRASH, How to SELL BTC at $40k! Real Analysis vs Shill Coin Pumper's and Clueless Newbs - 21st Jul 21
Emotional Stock Traders React To Recent Market Rotation – Are You Ready For What’s Next? - 21st Jul 21
Killing Driveway Weeds FAST with a Pressure Washer - 8 months Later - Did it work?- Block Paving Weeds - 21st Jul 21
Post-Covid Stimulus Payouts & The US Fed Push Global Investors Deeper Into US Value Bubble - 21st Jul 21
What is Social Trading - 21st Jul 21
Would Transparency Help Crypto? - 21st Jul 21
AI Predicts US Tech Stocks Price Valuations Three Years Ahead (ASVF) - 20th Jul 21
Gold Asks: Has Inflation Already Peaked? - 20th Jul 21
FREE PASS to Analysis and Trend forecasts of 50+ Global Markets by Elliott Wave International - 20th Jul 21
Nissan to Create 1000s of jobs with electric vehicle investment in UK - 20th Jul 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Goodbye to Stock Market Santa Rally?

Stock-Markets / Financial Markets 2009 Dec 19, 2009 - 06:09 AM GMT

By: Anthony_Cherniawski

Stock-Markets

Best Financial Markets Analysis ArticleNew jobless claims unexpectedly rise. - The number of newly laid off workers filing claims for unemployment benefits unexpectedly rose last week as the recovery of the nation's battered labor market proceeds in fits and starts.

The Labor Department said Thursday that the number of new jobless claims rose to 480,000 last week, up 7,000 from the previous week. That was a worse performance than the decline to 465,000 that economists had expected.


Another $290 billion added to the debt ceiling will only last six weeks.

The House on Wednesday passed legislation giving the federal government the ability to borrow a whopping $290 billion to finance its operations for just six additional weeks. The 218-214 vote sends the must-pass bill to the Senate, which is expected to approve it as its last act before adjourning for the year. The alternative would be a market-rattling, first-ever default on U.S. obligations.  The measure is needed as a result of the out-of-control budget deficit, which registered $1.4 trillion for the budget year that ended in September. The current debt ceiling is $12.1 trillion and is set to be reached by Dec. 31.  The debt ceiling may have already been reached, but no one is saying.  Can’t we just say, “No mas?”

A Debtor’s Dilemma.
Should I stay or should I go? That is the question more Americans are asking as the housing market continues to drag.  In good times, it would have been unthinkable to stop paying the mortgage.   Today, it is an option that many are considering.

Good-bye Santa Rally?
-- Job losses have been unusually steep in this latest recession with some 7.3 million jobs lost since December 2007, according to NABE. There is little evidence suggesting that employees will start hiring on a mass scale anytime soon.

The severity and the speed of the downturn have made businesses exceedingly cautious about the recovery.  This is contributing to a substantial disconnect between their more cautious forecasts, and more confident recovery talk from government officials as well as many in the investment community.  The market may not be in a Christmas spirit.

 


Treasury bonds may rally for a while.
-- Treasuries headed for a weekly gain, trimming this year’s loss… on concern the global economic recovery will slow.

Benchmark 10-year yields were little changed today, near the lowest level in a week, after Federal Reserve officials said on Dec. 16 that the U.S. economy isn’t improving enough for them to raise interest rates from a record low. The U.S. is still in a recession and home prices may resume declines, Harvard University economics professor Martin Feldstein said.

 

Gold bounces at its trendline.
-- Gold gained in London, paring a third weekly decline, as a halt in the dollar’s rally prompted investors to buy bullion after the metal’s biggest drop in almost two weeks.

Gold has dropped 9.8 percent since climbing to a record $1,226.40 an ounce on Dec. 3. A break of the trendline (1100.00) could mean a further decline in the near-term.  Caution is warranted.

 

 

 

The Japanese market isn’t out of the woods yet.
-- Japanese stocks fell, led by banks and electronics manufacturers after international regulators said banks must boost their capital by 2012 and U.S. initial jobless claims unexpectedly climbed. The Nikkei 225 Stock Average slid 0.2 percent to 10,142.05 at the close in Tokyo after falling as much as 1.3 percent. The Nikkei 225 rose 0.3 percent this week.

Investors are uncertain about the economy remains and people are withdrawing money from risk assets. 

 

 

The Shanghai index slumps.
-- Chinese stocks fell for a fourth day, the longest losing streak since August, on concern the government will step up measures to curb property speculation and new share sales will divert funds from existing equities.

The Shanghai Composite Index fell 65.19, or 2.1 percent, to 3,113.89 at the close, the lowest since Nov. 27. It dropped 4.1 percent this week, a second weekly loss.

 

 

The dollar makes a strong advance.
The dollar was poised for the biggest weekly gain versus the euro since January after breaching $1.43 for the first time in three months, forcing traders to abandoned bearish bets on the greenback.

Deterioration in the labor market is “abating,” and household spending is increasing, the Fed said in its statement on Dec. 16. Policy makers held the target rate for overnight lending between banks at zero to 0.25 percent.

 “There’s a growing consensus that the dollar will do well as we go into the New Year,” said Ronald Leven, a New York- based currency strategist at Morgan Stanley. “We’re seeing ongoing interest to build up long-dollar positions.” A long is a bet a currency will advance.

A word on Strategic Defaults.
 
-- Morgan Stanley, the securities firm that spent more than $8 billion on commercial property in 2007, plans to relinquish five San Francisco office buildings to its lender two years after purchasing them from Blackstone Group LP near the top of the market. The bank has been negotiating an “orderly transfer” of the towers since earlier this year, Alyson Barnes, a Morgan Stanley spokeswoman said.  “This isn’t a default or foreclosure situation,” Barnes said. “We are going to give them the properties to get out of the loan obligation.”   In a pig’s eye!  See what Karl Denninger wrote about this topic.

 

 


Gasoline prices almost $1.00 higher than a year ago.
 The Energy Information Agency weekly report suggests, “Dropping three and one half cents to $2.60 per gallon, the U.S. average price for regular gasoline was $0.94 higher than the price a year ago. Prices declined in all regions of the country. The price on the East Coast decreased almost three cents to $2.62 per gallon. The largest decrease in price occurred in the Midwest where the average fell to $2.52 per gallon, a drop of a nickel.”

 

 

 

NatGas prices are spiking again.
The Energy Information Agency’s Natural Gas Weekly Update reports, “With cold temperatures gripping much of the country for the first half of December, the heating season is well underway with large storage withdrawals and higher prices during peak demand periods. Following an increase of $0.30 per MMBtu during the report week, the price at the Henry Hub is trading near its highest level of 2009. The average Henry Hub price on Wednesday, December 16, was $5.57 per MMBtu, the highest price at this market location since January 13, 2009.”

 


A European house of cards ready to collapse?
As one so vividly remembers, probably the key catalyst that set off the chain of events last fall following the collapse of Lehman were the closed loop (and much delayed) downgrades of AIG, which in a span of hours went from AAA to much lower, thus springing various collateral requirements which the company could not satisfy, and in turn forcing even more downgrades, until ultimately it became clear that the firm (like most others on Wall Street) is merely a lot of hot air and unjustified valuations. Ironically, the rating agencies, and more specifically Moody's, could once again be the catalyst for the much anticipated collapse of the European house of cards, which as all now know, has Greece as its weakest link.

On December 18, 1930…
Market wrap: Stock liquidation broadens, with bad breaks throughout the list. “Brave attempt” at early rally wiped out by fresh flood of liquidation in late morning. Bond market generally weak; US govts. firm and highest grade corp. issues steadier. Commodities mixed; Farm Board hard pressed to maintain wheat support.  No news seen to account for the decline, which was “generally attributed to the desire of additional holders to get out of the market entirely at least for the time being.”

Traders alert:  The Practical Investor is currently offering four months of the daily Inner Circle Newsletter for the price of three to new subscribers.  Contact us at tpi@thepracticalinvestor.com for a free sample newsletter and subscription information.

Our Investment Advisor Registration is on the Web

We are in the process of updating our website at www.thepracticalinvestor.com to have more information on our services. Log on and click on Advisor Registration to get more details.

If you are a client or wish to become one, please make an appointment to discuss our investment strategies by calling Connie or Tony at (517) 699-1554, ext 10 or 11. Or e-mail us at tpi@thepracticalinvestor.com .

Anthony M. Cherniawski,
President and CIO
http://www.thepracticalinvestor.com

As a State Registered Investment Advisor, The Practical Investor (TPI) manages private client investment portfolios using a proprietary investment strategy created by Chief Investment Officer Tony Cherniawski. Throughout 2000-01, when many investors felt the pain of double digit market losses, TPI successfully navigated the choppy investment waters, creating a profit for our private investment clients. With a focus on preserving assets and capitalizing on opportunities, TPI clients benefited greatly from the TPI strategies, allowing them to stay on track with their life goals

Disclaimer: The content in this article is written for educational and informational purposes only.  There is no offer or recommendation to buy or sell any security and no information contained here should be interpreted or construed as investment advice. Do you own due diligence as the information in this article is the opinion of Anthony M. Cherniawski and subject to change without notice.

Anthony M. Cherniawski Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in