Crash Market Stocks - Financial Tips On Making Money In The Stock Market

I hope everyone had a good holiday weekend, as Labor Day usually marks as the "official" end to summer. I know in my line of business it seems as if all are rallying to get sorted to prepare for the end of year actions. The stock market seems to not mind September thus far as it rallied into the close on Friday and has opened and closed up in the green today.

Much of the rallying Friday, came from the better than expected unemployment number, which I had warned about on Thursday. Also, Friday was the lightest day of trading (volume) of the year thus far, so to see it swing is not too surprising. In tonight's premium podcast (subscribe here), I will discuss more about the employment debacle and why Friday wasn't not as good as it seemed.

Today, consumer credit came in down at record low levels for July. Consumer debt fell $21.55 billion in July to $2.47 trillion. This is a record drop and serves as the sixth straight monthly drop. Credit cards alone fell 8.5%. This is a big reason why I have been very bearish on credit card companies the past few months, regardless of how they're stocks have been performing.

It is clear that credit is tightening and continues to tighten, which is very dangerous when you consider how deep we are in this recession. If such a recovery that many believe is indeed here, credit would most likely be flowing to consumers with much more ease. But as I have pointed out time and time again, this recover is leaving the consumer behind, which will eventually come back to bite us. Greed in Wall Street is once again trying to lead this ship back with its captain left behind. Mark my words, in my opinion, when we do find ourselves in a recovery, the consumer will be in the center of it.

It is clear at this point that the consumer is getting drained more and more of disposable income. Credit was our largest source of spending to spur growth. Sure, in the long run it is better that people are acquiring less debt, but unfortunately, these "wise budgeting" practices, will only decay this economy further at this point. The government can only spend their way out of this for so long.

One loan that continues to be available are student loans. Government backing have made college loans still available, however, even those have tightened a bit. Also, due to the large demand of people wanting to return to school, considering jobs are far and few between, enrollment admissions have been competitive. Thus, online education has also become much more popular. Happy Trading.

With all the chatter and cheering going on by Friday's "better than expected" unemployment number, many failed to catch the almost doubled then expected consumer credit loss report, which came in at a loss of $10.3 billion. Keep in mind, last month's the number was later revised from an announced loss of $3.2 billion to $5.4. You can only imagine what this number will be revised to.

Sure, the number is not as significant as the unemployment, but the huge miss in expectations tells a story of where a lot of this money is coming from in the economy. More debt. Just as the popular "cash for clunkers" is temporarily bringing relief to the battered auto industry, it is also piling up more debt for the consumer into one of the biggest money pit purchases people can make. A car is not an investment, it is an income eating luxury.

Thus far today, markets have been down, mostly due to profit taking and more weakening commodities. Financials still continue to perform, with help from Freddie Mae claiming profits as well as stating their cutting the umbilical chord from the government (we'll see about that). Hopefully, we'll see a pullback here, as we are far overdue. I still remain very bearish.