Tuesday, August 4, 2009

US Stocks Close Higher On Strong Banks, Industrials

More buying in bank stocks and a Caterpillar-led gain for industrials helped stocks close slightly higher Tuesday, though a pullback for utilities, including PPL, kept the day's trading in check.

In what has been a common theme in trading for the past few weeks, financials closed broadly in the green. Insurers, banks and even real estate investment trusts have all moved well off their lows of early 2009 and become the investment of choice for a myriad of investors recently.

Earnings reports have been the biggest driver of this stock growth, and though UBS sank 1.17, or 7.6%, to 14.29 after the Swiss bank posted a seventh loss in eight quarters, the rest of the sector kept on trucking. (more)

Oil futures edge lower on expected rise in supplies

Oil futures finished slightly lower on Tuesday, as expectations of rising supplies soured sentiment in the energy market.

Light sweet crude for September delivery fell 16 cents to end at $71.42 a barrel on the New York Mercantile Exchange.

Trading was very volatile on Tuesday. Oil prices rose as high as $71.91 and fell to an intraday low of $70.16 a barrel on Globex.

"After the huge advance yesterday, the market is uncertain about its next move," said Phil Flynn, vice president at futures trading and research firm PFG BEST Research. (more)

The Wall Street Journal Asia August 4 2009

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Gold Market Points to Consider

1. Pay no attention to the reasons given for gold’s strength. The primary reason for gold’s action is in the US dollar.

2. The idea that the dollar is a safe haven investment is SPIN on a whole new level. Buying interest free non-guaranteed debt of a nation, as is the case with the US dollar that is strangled by growing debt, will provide little safe haven.

3. The US dollar has .7285 as a magnet pulling it down. I rate that influence stronger than the .7600 support level.

4. Gold is going $1224 on its way to $1650. (more)

CNBC Gartman on Commodities

U.S. Dollar Collapse Starting Next Monday ?

The trading week finished with a further attack against the US Dollar, reversing a short-lived strenghening of the US Dollar that could be observed during the last two days.
If you take a look at a 360min chart of the EUR/USD Future, you can see that the short-term correction has not done any damage to the bullish EUR/USD picture. The line of least resistance is safely pointing to the upside, predicting higher prices in the near future, which means a lower US Dollar. (more)

Bob Chapman On Gold, Silver, A Bank Holiday And The Monetary Elite

Daily Bell: Thanks for the interview.

Chapman: Glad to do it.

Daily Bell: You are well known for writing a good deal about a concerted, organized effort by the elite to control the global economy. What interactions have you had that provided you with this conclusion?

Chapman: I've been studying the elitists for 50 years, and I've been writing about them since 1967. None of this is new and now because of the Internet much of it is very visible. It begins with central banking and there is nothing to be said that can constitute a defense of central banking. A small group of men get together around a table and set interest rates, basically the price of money. They do so without supervision or the consent of those who use their money product and they do so pretty much in secret. There is no accountability and lately, again thanks to the Internet and YouTube, people can pretty well see how nonsensical the system is. (more)

This Depression is just beginning

August 03, 2009 "Information Clearing House" -- Too bad Pulitzers aren't handed out for blog-entries. This year's award would go to Zero Hedge for its "The 'Money on the Sidelines' Fallacy" post. This short entry shows why the economy will continue its downward slide and why the US consumer will not get off the mat and resume spending as he has in the past. The fact is the Net Wealth of US Households has "declined from a peak of $22 trillion to just under $12 trillion in early March."
The problem is compounded by the fact that Total US Household debt, as of first quarter 2009, amounts to roughly $13 trillion, and has stayed within that range for the last 3 and a half years.
Zero Hedge:
"From the end of 2007 through Q1 of 2009, household equity has declined by 94%. Is it surprising that today's GDP number would have been a complete debacle if the consumer had been left alone to prop the U.S. economy, on whom 70% of the economy is reliant? Obama pulled a Hail Mary with the stimulus: without it there would be no debate America is in a depression right now." (http://www.zerohedge.com/article/money-sidelines-fallacy) (more)


Your request is being processed... Tax Revenues Post Biggest Drop Since Depression

WASHINGTON — The recession is starving the government of tax revenue, just as the president and Congress are piling a major expansion of health care and other programs on the nation's plate and struggling to find money to pay the tab.

The numbers could hardly be more stark: Tax receipts are on pace to drop 18 percent this year, the biggest single-year decline since the Great Depression, while the federal deficit balloons to a record $1.8 trillion.

Other figures in an Associated Press analysis underscore the recession's impact: Individual income tax receipts are down 22 percent from a year ago. Corporate income taxes are down 57 percent. Social Security tax receipts could drop for only the second time since 1940, and Medicare taxes are on pace to drop for only the third time ever. (more)

BusinessWeek Magazine (August 3, 2009)

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