Market outlook for July 2 and beyond

The Unemployment rate came in better than expected at 9.5% in June versus 9.7% in May. Hours worked in June were down -0.1% compared to data for May which was up +0.2%. Private Sector jobs increased 83,000 in June compared to adding 33,000 in May. Non Farm payrolls were down -125,000 jobs. Market reaction was somewhat positive with the Futures on the Dow up 12 points. The unemployment rate percentage is better than it has been in about a year. The question of the day is whether this news is enough to stop the downtrend in the market. My view is that it is NOT because the social mood in the country is poor and depressed. Not much for people to celebrate these days. For the past 2 days we have dipped below very strong Support levels which indicate to me that the next stop will be to test 8;000 on the Dow. This will take some time, possibly the Fall, and it will not go in a straight like down but rather a series of lower lowers with small rallies up.

I will be here and reporting my views throughout the morning. Then it is off to see the Marin County Fair and my wife's art pieces which are being shown in the Fine Arts exhibit. Here below are two of her recent pieces of Metal art being exhibited. Enjoy.



Come back later today to see more on the markets. Take time to read some previous posts going as far back as March. I don't think you will be disappointed. Have a Happy July 4th weekend.

UPDATE: 7:50am PST

Well we have enough enough know to see the direction of the market after the market went up then down then up, forming a "W" pattern which slants down. So we should go lower today from the lows on this chart. Also, because Monday is a holiday, I think many will not want to be Long going into it and therefore there will be more selling than buying. Stay tuned!

UPDATE: 8:10am PST

The data is in and the Dow did go lower as the slanted "W" pattern suggested. We will have to wait to see the next "W" pattern emerge but one thing is for certain, while the Unemployment rate dropped to 9.5%, the market is in a negative mood as I said earlier and the trend will continue down in the coming days, weeks and months. It will feel like a Chinese water torture, drip, drip, drip. Hmmm, that sounds like Water Boarding and torture!

Update: 10:53am PST

Here's the last "W" pattern I am posting before the close today. To me it says we are going still lower. So far today, every call has been correct as the downward slanting red line indicates future direction. It is a good, but not perfect, predictor as you have seen. We will see what happens today, but I do not want the indexes to form an inverted Hammer pattern, closing at the low, as it would mean a reversal in trend and I just don't see it in the cards in the immediate future.

NY Times article regarding John McCain and his response

I am disgusted that the NY Times would write an article about John McCain and the relationship he had with a woman lobbyist back in the year 2000, especially now at this time in the Primary process. Shame on the NY Times.! As many readers know I have supported Barack Obama in the Primary on the Democratic side. This is not news worthy of a newspaper like the NY Times. Maybe it is of interest to the Inquirer or other sensational type newspapers, but the NY Times has lowered it standards at a time when the country is trying to unite. I am absolutely positive neither Hillary nor Barack will participate in this story, as they both respect Senator John McCain. I can tell you I won't be reading the NY Times any time soon ever again.

A story worth covering is John McCain's statement, which asked President Bush to Veto any measure which prohibits water boarding use by the CIA. Here is the man who himself was a prisoner of war, and early on in the debate on water boarding, declared that water boarding was torture. This is a major flip-flop by McCain and inconsistent with his stated values and feelings on this topic, before he was a Presidential candidate.

To read the entire NY Times article click here.

Headline reads: U.S. may ask death for 9-11 suspects

According to news reports, the Pentagon is planning to charge 6 detainees at Guantanamo for the Sept. 11th terror attacks and seek the death penalty. Among those who face the death penalty is Khalid Sheik Mohammed, the suspected mastermind of the attacks. He is one of the detainees at Guantanamo who the U.S. admitted using water-boarding, which many consider torture, including the U.N. Chief of the Human Rights Commission.

The Bush Administration wants to finish what they started but many countries are going to object to giving them the death penalty, especially since they used torture (water boarding) to get the confessions. The problem is they plan to hold these trials in relative secrecy, as it will not be televised and although a few reporters will be present, as will be the lawyers, it will be a charade in my humble view. I think this is especially true given the Administration's current position on water-boarding where it claims water-boarding may be illegal now, but wasn't before. Go figure that position out. Attorney General, Mike Mukasey, has "a lot of splainin to do", as Lucy Richardo would have said.

To read the news article click here.

Mike McConnell, National Intelligence Director, take a bow!

Finally, one of the most senior people in the Bush Administration has had the courage to stand up and declare that "water boarding" is torture. The timing is terrific with President Bush in the Middle East. McConnell is quoted in an article today by the New Yorker magazine. Finally, there is someone within the Administration with some backbone. McConnell wouldn't classify whether the technique categorically should be considered torture but is quoted as saying, "If I had water draining down my nose, oh God, I just can't imagine how painful! Whether it's torture by anybody else's definition, for me it would be torture."

Mike McConnell, for anybody, it would be considered torture, and that is the absurdity of the dialogue surrounding this issue. You say the reason you wouldn't categorically define it as torture is for "legal reasons". Yes, we know what the legal concerns are. If it were categorically defined as torture both of your bosses, President Bush and Vice President Cheney, could be brought up to the World Court and would stand trial for War Crimes. Yes, we understand why you might be reluctant to define it for "legal reasons" as torture, but we all know the game that is being played here. It most certainly IS a violation of the Geneva Convention and defines one of the saddest moments in ther 200 years of our history.

We need to consider to elect a President who would be willing to turn over those 2 pretend leaders of our, country to a World Court, which would judge any other leader equally guilty of what these men have promoted and authorized in the name of protecting us. We can not, as a nation, be above the rule of law of the world and expect to be seen as fair and just as a society and of the stature we all want to have back as a nation. We want to be, once again, proud of who we are, in this experiment called “democracy,” which is still in its infancy. As much as I am ashamed of it, we as a country of citizens are not mature enough or conscious enough to be citizens of the world. Heck, many of us aren't even conscious enough to be citizens of this country in the spirit of its legacy. The Founding Fathers were so amazingly conscious of the implications of what they embarked upon. They are now turning in their graves, as to what we have allowed President Bush, Vice President Cheney and former Secretary of Defense, Donald Rumsfeld, to get away with in regards to not upholding the Constitution and the Treaties we have signed in good faith with most of the world.

Do you, as a person reading this post, have the courage and consciousness as a citizen, to ever consider turning over any of our leaders, who may have violated laws of the world, to a World Court? If not, when would you, and under what conditions would you? You see, we demand that every other country in the world comply with our wishes and turn over their leaders to the World Court, when offenses against humanity occur. Torture is an offense against humanity and if you think “water boarding” isn’t, maybe you should try it out on yourself. McConnell has thought about it and I say Bravo!