Market Experts See Risk Rising Fast

Financial journalist and neuroeconomist Jason Zweig says don't be happy, worry.

"It is at times like these, when a rising market sweeps our spirits up with it, that investors need to evaluate their emotions and consider whether their beliefs and actions are justified," Zweig writes in The Wall Street Journal.

Since last September through this past March, he notes, officers and directors of publicly traded companies sold twice as much stock in their own companies as they bought, considerably less than the historic average of 7 to one, according to TrimTabs Investment Research.

In August, that ratio jumped to 31 to one. (more)

Will Your Pensions Be Nationalized?

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US Stocks Close Lower As Fincls, Consumer Cos Slide

A disappointing report on the jobs picture ahead of two more government reports later in the week weighed on consumer stocks, including Walt Disney and Macy's, while declines for JPMorgan and several other large financials weighed on equities for a second straight session.

Overall, however, stocks closed only narrowly to the downside. The Dow Jones Industrial Average closed off 29.93 points, or 0.32%, at 9280.67, marking its fourth straight day in the red and its longest loosing streak since June 24.

Helping mitigate some of the losses was robust buying in perceived safer stocks, including gold companies Newmont Mining, up 3.72, or 9.3%, to 43.90, and Barrick Gold, which closed up 2.84, or 8.1%, at 37.89. (more)

Stocks - Recording Another Low...(?)

Yes, we know, could the title of today’s article be any more provocative? Surely we have lost sight of the fact that stocks have already enjoyed a huge advance with the S&P up nearly 56% from the March lows at the recent high near 1040. Surely, we recognize the huge swing to bullishness that has taken place within the recent sentiment polls, a development that always suggests the imminent death of a major rally. Or does it? As many in the babbling media and cacophony of CNBC would like to have you believe, the swing to excess bullish sentiment is NOT an instant death sentence for equities. On Wall Street, any number of technical analysts have also been pounding away on the “excessive bulls” theme. However, we see a lot of these warnings as overdone, and potentially way early. (more)

Worst of slump yet to come, says economist

Ann Pettifor is a member of a select club — the seers who saw it all coming. Now the economist, who predicted the credit crunch as far back as 2003, believes that the worst is yet to come unless there is radical reform of the financial system.

Six years ago she parodied the International Monetary Fund’s annual economic forecast with her own — The Real World Economic Outlook. Then, in 2006, her book The Coming First World Debt Crisis, warned that rich countries were heading for a debt crisis that would overshadow anything seen in the developing world. Both were ridiculed.

With the British and world economies languishing in the worst recession since the Great Depression and with once-mighty banks reliant on government life support, she could be forgiven for being a little smug. Not a bit of it: “No, being Cassandra is not something I wish for. I hate this role of being a gloomer and doomer, as I’m an optimist by nature. But I am very pessimistic now.” (more)

The Wall Street Journal Europe September 02 2009

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Gold: Watch This Wedge

With technical indicators such as the MACD, STO and RSI fairly neutral, gold is at a crossroads. The chart below shows how gold prices are in a large wedge formation, going back a good six months.

This wedge formation is what we will be watching very closely over the next few trading sessions for