Taking a long needed break

I have been absent from Blogging the past month or two and have decided I need a break, since I have been at this for over 6 years. I am not going to be posting on a regular basis, but will post when something gets my attention and/or bothers me. For now let me say that I very much appreciate your visiting my site over all these years. This week I attained a milestone of 80,000 visitors since I started. Those visitors read some 130,000 page views. So again thanks. Don't forget to vote in the min-poll to the right as we are all concerned about the countries solution for its debt problem.

Market comments for Nov. 10th

Data released this morning on Initial Jobless Claims came in at 435K as compared to an expectation of 450K. Last week the number was 459K so this is in the right direction for the unemployment rate to start coming down, but it is so small a difference it is still much too high. Remember these are Initial claims, new claims, and all to add to the Millions of Unemployed in the country.

The effect on the market was that the Dow, which was down about 12 before the announcement is now showing it will open up, about 5-10 points.

Other data released today so far was Export prices ex-agriculture was up 0.7% while Import Prices ex-Oil was up 0.3%.

The Put to call ratio has risen a bit to 0.84 at the close yesterday but as you have seen the past few days the 7th month low in this indicator I reported over the weekend did show the market was overbought and the market would most likely go down, which it has both Monday and Tuesday.

New milestone for WeThePeople visitors

I had to update my Blog Tracking data. Evidently a day or so ago I crossed over 60,000 Visitors have come to my site and they have viewed over 95,000 pages. This covers 1403 posts over that period. While that might look impressive, it isn't as I have had this web site for a few months longer than 5 years. Anyway, I want to thank you all for visiting this site. This past year I think I have had about 5-6 really great posts. They are difficult to write and they take the most time on my part, and that can be fleeting, as other matters often take priority. I will strive to do a better job and increase not only the quality of my posts but the diversity of topics again. I have enjoyed writing about the stock market and the economic news, but I also like pulling together apparently non related facts and weave a story that shows they are very related and often affect peoples lives. Wish me luck. :)

Market comments for Aug. 27th (UPDATE)

While I was waiting for the GDP numbers to be released this morning and knowing September was just around the corner, I was wondering how this Sept. markets were going to be compared to other years. Then I got the Chart of the Day from chartoftheday.com and see they have answered my question with today's chart. It isn't looking pretty is it.

The GDP number came in at +1.6% Revised from 2.4% previous estimates and they had expected the number to come in at +1.3%. Before the release of the number the Dow Futures were up +27 and after the release of the data it is at +68. There is a definite upward bias going into the open this morning. European markets are mixed with not much movement up or down at this point. Think about this for a moment. When is a 1.6% revised GDP worth it for the markets to go up? Answer: When they thought it would be much worse! That's where we really are in this economy!

Only 3 trading days left in August. As you can see from the chart above that August usually is barely over +0.2% gains for the month. The Dow closed July at 10,466, so we are significantly down form that going into today's trading. We started off the year at a Dow of 10,428, so we are definitely down for the entire year so far and I don't see any recovery in the market before the end of the year and as I have stated many times I see us going a lot lower into the next year. So hang on to your hats today as it is difficult to guess whether the market will be pumped up or trashed. VIX should be something to watch today. Yesterday it closed at 27.37 and for the past it has stayed above its 50 day Moving Average for the first time in about a month and a half.

Fed Chairman, Bernanke, will be speaking today in the Jackson Hole, WY gathering of business leaders and is expected to take questions from them. His comments will move the markets.

With the Dow set to move back up today, expect Gold to also go up so that the net Dow to Gold ratio stays low. It has been recently in an 8.1 to 8.3 range and I don't see this ratio going higher any time soon. In fact I see it going lower. The net is that when the Dow does rise, its real value as measured by Gold is less.

UPDATE: 7:00am PST
While the Fed Chairman was releasing his speech to the press, the Univ. of Michigan Consumer Sentiment number was released and it came in lower than expected at 68.9 vs an expectation of 69.6 for August. Last month the data came in at 69.6, so this is even lower and marks a number of months it has slipped.

Market comment for Aug. 18th

It is going to be a quiet day. No real economic data is released until Thursday, when we get Initial Jobless Claims and Continuing Claims data. The Jobless Claims numbers are very important because we have a number of weeks in a row where there has been an increase. This is not good and in the wrong direction. If the number can come in at equal to or less than 465,000 that will help stop this trend and give us a breather for another week. If the number comes in equal to or over 490,000 that would be nerve-wracking for the market and we could take a bigger step down. Tis would increase the volatility because of Options expiration on Friday.

The Dow and the S&P 500 are in a tight range of about 7-9% as is drawn on the 2 charts above. That is very difficult to trade unless you have some computer program telling you when to buy and when to sell. So best to wait for a breakout one way or another. I am sitting pat expecting the market to drop in Sept. I'll keep that strategy until the data shows something else.

Economic data released today, Aug. 17th (Update)

The beginning of economic data for the week was released this morning. First up was Housing Starts for July. They came in at 546K. Expectations were for 555K. The prior month was revised down to 537K from 549K. Building Permits for July came in at 565K. Expectations were for 573K. The previous month was revised down to 583K from 586K. While these numbers are lower than expected, it wasn't off by a lot so the market will look at these as good news.

The PPI number came in at +0.2%. The market expected +0.2%, so that was in line with expectations. The Core PPI came in at +0.3% for July. The market expected +0.1%, so this was higher than expected.

Industrial Production came in at +1.0%. The market expected +0.8%, again better than expected.

This has set up the market to rise as the Dow Futures now are +65 going into the open. Now we wait for the Initial Jobless Claims for Thursday and Continuing Claims. The Initial Jobless Claims will be the most important going into Friday's Option Expiration for August.

WallMart had better than expected earnings form oversees growth. That set the market up for a rise earlier. It is clear China is still dragging some of the world economies to a better than expected Q3 GDP number no matter what the final result would be. But if they slow down the world is screwed as is China as expectations have been building with the Chinese population of an ever growing improved condition in their lives. It's hard to get off that drug, once someone has had the initial taste as the Chinese will certainly find out some day. It is their only concern about destabilization within its borders.

UPDATE: 7:45am PST

Capacity Utilization data came in at 74.8%. This was exactly what was expected. It is an uptick from the prior month reading of 74.1%, so it is in the right direction. But Factories need to get to a minimum of 85% to be generating lots of jobs and we have a long way to go to get there. Here is a historical perspective on the data.



Average 1972-2009 79.2%
From 1988-1989 high 85.2%
From 1990-1991 low 78.7%
From 1994-1995 high 85.1%
From 2008-2009 low 68.2%
July 2009 69.1%

Now this is the progression for 2010
Feb. 72.4%
Mar. 72.8%
Apr. 73.1%
May 74.1%
Jun. 74.1%
Jul. 74.8%

So the data is definitely improving and going in the right direction for a recovery but at this rate it would take several years to get back up to 85%, assuming we don't have a setback.