The Birthers will be excluded from the real Presidential hopefuls soon! UPDATE

Much has been made about the latest assertions of Donald Trump and his pushing the "birther" claims that President Obama was not born in the US. He has risen to the top of the Republican Presidential hopefuls with these assertions as it has played well to a minority, a loud minority, within the Republican Party. In my view, the 'birther claim is code for we never will recognize any black man as our President. But soon this "birther" gauntlet will be abandoned by the extreme Republicans in favor of more moderate ones within the party.

You see right now it is a litmus test to show if you are conservative enough. Soon it will revert in the other direction, as a test to separate out the extreme candidates from the more serious Republicans, and it will happen in the blink of an eye. Several respectable candidates have stood up and renounced there idea that the President wasn't born here, like Mitt Romney and Tim Pawlenty. Mayor Bloomberg did this week. These are the adults out there. People will be reminded by the media of their position on this issue as time carries on and those who sided with the birther thinking will be left out of the running. That will include Donald Trump, Mike Huckabee, Sarah Palin, Newt Gingrich, Mike Pence and Michele Bachmann. You just watch!

UPDATE: Wednesday, April 27th
Well today President Obama through his complete Birth Certificate on the web dashing the Carnival Barker, Donald Trump, under the bus in as classy a way as our President has behaved since his Presidency. For his part, Trump claimed how great he was that he was able to force the issue on President Obama to finally present his birth certificate, but he said he had to see it first and go over it carefully before he was willing to proclaim it valid. What nonsense by Trump. He is a fool and a racist. I would never watch his TV show and I hope you give it up too!

Market summary for June 22, 2009 and comments

Today the market dropped on the Dow 202 points closing at 8,339, while the Nasdaq closed down 61 to finish the day at 1766 and the S&P 500 closed below 900 for the first time since May 27th, closing at 893. The Volatility Index closed at 31.17 after hitting a high of 32.05 earlier today. The Put to Call ratio closed at 0.92 while Gold closed at 923, down 12 dollars/ounce. The signs have been there for weeks since the Candlestick pattern on June 5th showed the first sign of market reversal, and then was confirmed again on June 15th, as I wrote in my post on both days. Both the Dow and the S&P 500 are now below the 200 day Moving Average again.

Meanwhile, contributing to the market decline today was this little tidbit: World Bank Says Global Economic Recession to Deepen from Bloomberg news. And I quote, "The world economy will contract 2.9 percent, compared with a previous forecast of a 1.7 percent decline, the Washington- based lender said in a report today. Growth will be 2 percent next year, down from a 2.3 percent prediction the bank said."

Also in the article was this: "The World Bank cut its forecast for the U.S. this year, calling for a 3 percent drop in the world’s biggest economy, after predicting a 2.4 percent contraction in March.

Japan’s gross domestic product will shrink 6.8 percent, more than the previous prediction of a 5.3 percent decline, the lender said. The euro area’s economy may shrink 4.5 percent, compared with the previous estimate of a 2.7 percent contraction.

Global trade may drop by 9.7 percent, compared with a March forecast of a 6.1 percent decline.

I do expect the Dow to go below 8,000 and the S&P 500 to go below 840 as well. Options Expiration for the Quarter in June 30th and I do not know what the effect of that will be on the market.

One other piece of news I thought was relevant was this gem: "Insiders Exit Shares at the Fastest Pace in Two Years." I have been saying this was one of the reasons I thought the market was headed down and wrote so on many occasions. I receive 2 reports daily on Insider Buying and selling from J3SG.com and for months it has shown the dollar amount of Insider Selling far exceeded the dollar amount of Buying for any given day. I had posted the theory, how can things be really getting better in the economy if so many Insiders who have most likely lost money like the rest of us, are selling their company stock. If they saw Green Shoots and recovery wouldn't it make sense to be buying more shares of their company stock? Anyway, read the "Insider Exit shares at the Fastest Pace in Two Years" article and conclude what you will. I am still holding my ETF Ultra Shorts Triple pay of the Small Caps, symbol TZA, as well as the Ultra Short Triple lay of the Financials, symbol FAZ.

The market should just be in the beginning phases of a eventual retreat to 7,300 lows or lower by the end of October.

Summary comments on market: Has anything really changed in my outlook?

The market closed the week today with what apparently looked like indecision. But to the contrary, today's market confirmed a reversal in all Indexes, the S&P 500 Index, the Nasdaq composite Index and finally the Dow. The Nasdaq closed down only 1 point but the Candlestick pattern was a Hammer. The S&P closed at 940, down only 2 points, but it confirmed the Hammer candlestick pattern of Wednesday's close. The Dow closed at 8,763, up about 13 points.

The Unemployment rate rose more than expected and closed up 9.4% for the month of May. Employers eliminated the fewest jobs in eight months in May, strengthening signs that the recession is easing, while a drop in wage growth offered a warning the recovery may be muted. The job losses were lower than expected but more people were added to the ranks as eligible workers, so the rate rose higher than expected. The country needs to create about 200,000 jobs a month just to be at break-even. When you add in the losses the rate goes higher quickly. Many commentators on CNBC and Bloomberg today said that there the real Unemployment rate is about 16% because many are working part-time and can't get a full time job. Also a number of the unemployed have given up filing for Government Unemployment Insurance Benefits, as either their benefits have run out or they have given up looking for work.

Nonetheless, the media and commentators are continually hyping we have turned a corner and that we should be out of the recession by the end of the year. This does not make any sense at all as it appears we are headed for another poor Christmas season with so many unemployed. Since the Consumer represents 70% of the economy, it seems delusional to think that we are going to be out of this mess anytime soon, let alone by year end. I wish it were true but the facts do not support the optimism.

Several other measures give pause regarding the Consumer's ability or willingness to stimulate or drive the economy. First that there are going to be new rules governing Credit Card issuance for younger people of college age. Secondly, this was not that widely reported but Consumer Borrowing plunged $15.7 Billion in April. That is both good and bad news. It is good because maybe people are only paying now for what they can afford and have stopped borrowing beyond their means. On the other hand, maybe they can't borrow because they can't pay the debt back easily. The category in Friday's report that includes credit card debt dropped at an annual rate of 11 percent in April, following an 11.2 percent plunge in March. And a complimentary story I reported earlier in the week, Consumers saving rate jumped to 5.7% in April.

The banks also made news today. From Bloomberg news: Bank of America Corp. and nine U.S. lenders, facing a June 8 deadline to explain their capital- raising plans to regulators, are relying on preferred-stock conversions for 22 percent of their fundraising. Collectively, the 10 banks told by regulators to raise $74.6 billion have announced plans covering $70.6 billion of the gap, with some including Bank of America expecting to “comfortably” beat its target. They’ll get about $15.4 billion from preferred stock conversions, a tactic that improves the gauges of financial health that the government is focusing on without bringing additional cash into the company. “Conversions from preferred to common don’t do anything; you can just ignore them,” said Christopher Whalen, managing director of Institutional Risk Analytics, in an interview this week. “It makes the ratios look better, but it doesn’t increase the capital in the house.”

And another related Bloomberg story about the banks: Analysts who have examined the quarterly profits and government tests say that accounting rule changes and rosy assumptions are making the institutions look healthier than they are.

The government probably wants to win time for the banks, keeping them alive as they struggle to earn their way out of the mess, says economist Joseph Stiglitz of Columbia University in New York. The danger is that weak banks will remain reluctant to lend, hobbling President Barack Obama’s efforts to pull the economy out of recession.

So while we hear things are getting better and that they see more "Green Chutes" there does not seem to be fact based data to support the market hype. Bill Gross, of Pimco, has started to raise the alarm as has Fed Chairman Bernanke in his recent testimony before Congress. I would listen to Bernanke and Gross as they have a front seat to what is happening here. I don't see a "V" shaped recovery but that is what the stock market movement is implying. I see more of an L shaped recovery. If that does prove to be the chart outlook, then we will retest the lows and stay in a tight range for the next 6 months to a year. This a a longer outlook than I have stated here in the past but the good news in this scenario is that we aren't going to go below the lows and are going to eventually recover. I think it is a good thing that many are saving now. It took many a lifetime to learn this lesson. But we have been affected permanently and spending patterns have changed for the foreseeable future. It may bring families closer together as well and learning new ways of being present with loved ones, without the distraction of material things. When i grew up my family would play games at home almost every Friday and Saturday evening. Looking back, those were some of the best times I spent in my youth with my family.

Ann Woolner lays bare the Guantanamo ruling by the Supreme Court

This news and commentary is worth the read. I have been saying this for years. See what the Court has said about Guantanamo detaineees. It is posted on Bloomberg and written by Ann Woolner. Here it is and the link:

Don't Believe Me About Guantanamo Bay, Read This: Ann Woolner
Commentary by Ann Woolner

July 7 (Bloomberg) -- Because of the close, ideologically divided vote, you may give slim credit to last month's 5-4 Supreme Court decision slamming the U.S. handling of suspected enemy combatants.

You might write off as knee-jerk liberal, Sept. 10 naïveté the commentary (like mine) that says even in time of war it's un-American to imprison people indefinitely with no real chance to show they were mistakenly nabbed.

If you believe the U.S. military is doing a sufficiently OK job sorting enemy from friend at Guantanamo Bay, Cuba, I have a court ruling for you.

The federal appeals court in Washington D.C., the first court to look into the facts behind a specific Gitmo detention, decided the military had no credible evidence to label a man an enemy combatant and keep him locked up for six and a half years.

``It is undisputed that he is not a member of al-Qaeda or the Taliban, and that he has never participated in any hostile action against the United States or its allies,'' the court said.

Made public last week, the ruling found not a shred of credible evidence to support the government's claim that Huzaifa Parhat had anything at all to do with America's enemies, whether through combat or support or association with a group that may have associated with them.

One of Many

Parhat is one of 13 Chinese Muslims held at Guantanamo who fled persecution in China, camped in Afghanistan and wound up in Pakistan, where authorities handed him over to the U.S. His case is essentially identical to the dozen other detainees who are all members of the Uighur ethnic group. (That's pronounced WEE- gur.)

Beyond those 13 cases, the Parhat decision shows how little it takes to get labeled an enemy combatant and imprisoned for years on end.

You can't slough this one off as some nutty ruling by a bunch of ACLU-loving, Democratic-appointed activist judges. The three judges on this panel, which ruled unanimously, were appointed by Presidents Ronald Reagan, Bill Clinton and George W. Bush.

They include the Chief Judge of the D.C. Circuit Court of Appeals, David Sentelle, protégé of former North Carolina Senator Jesse Helms and one of the federal judiciary's most conservative members. During his time on the bench, Sentelle has voted to set aside the Iran-Contra convictions of Oliver North and John Poindexter and, at Helms's urging, named Kenneth Starr to lead the Whitewater investigation. He has also ruled in favor of the Bush administration on another Guantanamo issue.

No Hotbed

And then there's Thomas Griffith, whom Bush appointed to the bench in 2005, when Griffith was general counsel to Brigham Young University in Utah, hardly a hotbed of liberalism.

The Clinton nominee on the panel is Merrick Garland, who clerked for the late and liberal Supreme Court Justice William J. Brennan, worked in the Justice Department during the Clinton years and wrote the opinion in the Parhat case.

And yet, on this matter, they all agreed.

It's not as if the judges reached their conclusions using a defense-friendly, beyond-a-shadow-of-a-doubt examination.

They abided by standards Congress set in 2005, which are so stacked in favor of the government that the Supreme Court ruled on June 12 that they don't afford necessary constitutional protections.

While awaiting that decision, the D.C. Court of Appeals used the standards, anyway, because Parhat's lawyers -- eager for a quick decision and confident of the outcome using any rules -- agreed to go along with them.

Flimsy, Unattributed Evidence

Sure enough, the court said the evidence against Parhat is so flimsy, so unattributed that it's impossible to assess, much less rely on.

``To affirm the tribunal's determination under such circumstances would be to place a judicial imprimatur on an act of essentially unreviewable executive discretion,'' the judges said.

``We won in their court, on their statute, before judges that are not predisposed to our side,'' says Sabin Willett, a Boston lawyer representing Parhat.

The worst the government could say about Parhat was that in 2001 he lived in an Afghan camp run by a leader of a Uighur independence group who trained him in weapons.

That group, the East Turkistan Islamic Movement, may or may not associate with al-Qaeda and the Taliban, which Parhat may or may not have realized because there's no evidence he's a member of the group, anyway, the government acknowledged.

Thinly Sourced

It's hard to pin down whether the military believes its own accusations, the court said. Even its classified information is so thinly sourced and so poorly presented that the prosecution couched allegations in terms like ``said to be'' and ``apparently.''

Parhat swore to the Combatant Status Military Tribunal that China was his only enemy, not the U.S. He denied membership in the Uighur independence group or any knowledge it might be connected to America's enemies.

He attributed at least some of the accusations against him to Chinese authorities, hardly credible informants when it comes to dissidents.

If Parhat's right, China is using the U.S. to carry out its persecution of the Uighurs. Nice, eh?

The appeals court ordered the government to either release Parhat or grant him a speedy new tribunal hearing. It also suggested he seek release through a habeas corpus petition in federal court, which Willett says he is pursuing.

``We need a remedy,'' says Willett, ``a real honest-to- goodness remedy and an end to all this appellate badminton.''

The administration says it has been looking for a place to send the Uighurs, even while insisting they are enemy combatants.

Why keep them in prison, why keep them fighting in court? Why not give them their freedom in the U.S., which robbed them of it in the first place?

At the very least, admit we did wrong, stop fighting every single issue in court and look for a real solution to the self- inflicted disaster that is Guantanamo Bay.

(Ann Woolner is a Bloomberg news columnist. The opinions expressed are her own.)

Ann did a great job not letting this story die away, as many wish she had. Bravo Ann!