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

President Obama made history last night as he became the first active President of the US to be on a late night talk show, in which he made a visit to The Tonight Show with Jay Leno as his last stop in California. Once again he was quick to describe his disgust for the corruption of Wall Street and the greed of executives. However, he was quickly able to shed that problem onto Tim Geithner, as he kept referring to them as "his" or "Tim's" problems. Good job Obama, I would be doing the same thing in this mess.

After more than a week of rallying, we have now had two days straight of downward trading. Both days being led down by, once again, financials. This is why I did not get too excited to excited to jump into banks after Wednesday's Fed announcement. For even though it looked good on paper and sounded good when it was announced, the consequences of such a move that was and is being made by The Fed, is something our children will also assist in fixing. To take such extreme measures as printing/taxing multiple trillions of dollars for the sole purpose to write off debt that has no intrinsic value, but is just air and numbers on a paper, will be devastating to the economy. It may take a bit for this to come full circle, but in my opinion, we will definitely see it.

So for me, I am remaining distanced from banks for the time being and will most likely be ready for a full entry of short for banks very soon. The recent slaughtering in Treasury interest rates have actually sped up the deflationary process a bit, believe it or not. So the storm is very near in my opinion. Also, having the S&P trading at 13 times its earnings is not very reinforcing that we've reached bottom. That is a very high number for these times.


In this type of environment, it's hard to pick stocks to go "long" in, as I feel most, no matter how strong a company's balance sheet is, are vulnerable to being dragged down in this market crash. However, the most healthy companies in this type of market are those that are very cash liquid. Cash is king right now.

Today, Treasure Island of Las Vegas was sold by MGM to a buyer for $775 million. That sounds like a lot of money for some, depending on which market you live in, but is a huge steal for the Las Vegas Strip, considering Treasure Island's rooms were just recently upgraded and their location is center right on the strip. A much more worn down hotel, in a worse location on the strip was sold in 2007 for $1.2 billion. The reason why the buyer of the deal was able to get Treasure Island at such discount is because they had $600 million in cash to put down on the project, in which the rest was financed in a 36 month carry from MGM. Being that MGM is in a heap of debt from their newest project, their problems became someone else's opportunity. The point is, in this market, cash is king, and those companies that are prepared with liquidity, will make a killing the next few years. For some, generations of wealth will be created from just the actions of the next few years.

With this in mind, I feel it is important to be aware of those companies that are cash liquid. Most likely, they will be able to jockey for a larger market share and position themselves as more dominant companies in their sectors (even though most are already dominant). Below are a list of the top cash liquid companies (from Seeking Alpha):

1. Exxon Mobil - (XOM), Chart, Total Cash: $32.007 Billion
2. Cisco Systems - (CSCO), Chart, Total Cash: $29.531 Billion
3. Apple - (AAPL), Chart, Total Cash: $25.647 Billion
4. Berkshire Hathaway - (BRK.A), Chart, Total Cash: $25.539 Billion
5. Pfizer Inc - (PFE), Chart, Total Cash: $23.731 Billion
6. Toyota Motor - (TM), Chart, Total Cash: $23.151 Billion
7. Microsoft - (MSFT), Chart, Total Cash: $20.298 Billion
8. Google - (GOOG), Chart, Total Cash: $15.846 Billion
9. Royal Dutch Shell - (RDS.A), Chart, Total Cash: $15.188 Billion
10. Wyeth - (WYE), Chart, Total Cash: $14.54 Billion
11. IBM - (IBM), Chart, Total Cash: $12.907 Billion
12. Johnson & Johnson - (JNJ), Chart, Total Cash: $12.809 Billion
13. Intel - (INTC), Chart, Total Cash: $11.843 Billion
14. Hewlett Packard - (HPQ), Chart, Total Cash: $11.255 Billion
15. Oracle - (ORCL), Chart, Total Cash: $10.646 Billion

Like I said, I believe everyone is vulnerable to more downside risk, especially if we reach numbers that I believe are coming for the Dow and S&P, but I would also expect some of the companies mentioned above to make some big, critical moves during this time to position them even better in the years to come. So keep an eye on them, and if you're looking to close your eyes for the next few years, and put something in your IRA or 401K, you may want to consider some of the above.

SRS and FAZ enjoyed very large gains today, which I was able to reap with my FAZ call options. However, once again I waited too long for SRS. I still think there is risk for more price slashes to both of these stocks, so I am not loading up quite yet on them.

As I said yesterday, GS has been on my radar for shorting for quite sometime now. Due to the ties that GS has with AIG, their stock has been appreciating, mostly based on the government aid that AIG has received. However, with more problems heading towards AIG, that will most likely reflect back on Goldman's stock price as well. You think it is any coincidence that Ex-Secretary Paulson decided to bailout AIG, when he used to be the Chairman for Goldman Sachs? I believe his retirement is doing much better than others. This is just one example of some of the corruption that has been going on for years now.

I still don't think we're out of the woods yet for this bear market rally. If we continue to see some more downward pressure on trading, my position could swing, but as of now, I still believe there is enough technical support to keep us going a bit longer. However, financials may be sluggish. They're in a league of their own these days. For those looking to trade options, like myself, Zecco.com offers some of the best per contract prices I've seen out there. Worth checking out.

I hope everyone has a good weekend. Next week should be another exciting one. We should expect more news from the government as spending is definitely on their mind. Happy Trading!

It looked as it was going to be another straight trading day in the green this morning, as once again the market was soaring, having the Dow almost reach 7400 at one point in the day. However, as the anticipated "last hour" of trading arrived, the selling began, and the Dow gave back all of today's profits closing down 7 points. I am actually surprised it took so long for people to take profits. I thought I was the last person waiting until Monday to cash in on my financials. As I said I was going to do on Saturday, I ended up selling my BAC in the morning at about $6.75, when the market was still good. I felt that a 6 day consecutive rally in one of the biggest bear markets we've seen is more than I could ask for and that I should take profits and run. Good thing, as BAC ended up closing at $6.18.

Nothing significant came from the FASB meeting on mark to market, as expected, which could have contributed to slow up in financials today. I didn't see much that they would be able to do, but of course we had to hype it up. These hype rallies can be dangerous.

So what kind of perspective does this last hour sell off give me for tomorrow? Not much. The trailing trend looked like your standard, profit taking slope to close out the day. Even though after-hours is also down, I do not necessarily believe that this trend means that we open up tomorrow in the red. The profit selling was, in my mind, overdue and Mondays always like to start out the week with some adversity. I am not ruling out a red day for tomorrow, as always, there are continuing negative influences that keep surfacing. In fact, as I said on the chat today, my plan was after selling my BAC, to buy a light round of FAZ and SRS, this being earlier in the day when FAZ was at $35. However, due to a forgotten immediate lunch meeting appointment and some technical difficulties with my Blackberry, I was unable to buy either of two. This was too bad, considering that now FAZ is at $42 and SRS is at $72. Even though I feel I will have another opportunity to buy them, I did miss out on a nice, quick 15% swing. Oh well, stuff happens right?

We will see tomorrow just how good/bad a decision that was for me to go to lunch, since as of now, I see the market going either way. Another mixed day of trading is what I really see happening tomorrow, which could be a good opportunity for you day traders. We may see some more of these intra-day 10-15% point swings for FAZ/FAS, which is nice for a quick profit, that is if you time it right.

Obama got a lot of flack for a survey result that polled Americans in their feelings of the recent corporate bailouts. It seems that over 80% of Americans disagree with the government's choice to write checks to the big companies and in fact over 30% are considered "very angry" in the decision. This is all happening while more news surfaces about AIG executive's cash bonuses, which can't make it any better for Obama.

I still think we have potential to see the Dow climb up back in the high 7000 range. Sure, there are going to be selling days, we're in a bear market, but last week's rally streak is a big move for technicals and should definitely stick around the next week or two, the keyword here being "potential." I never rule out the possibility of a sell off, but my current expectations are what make my short buying "light" at this time.

There are still some lingering elements, which could still cause some significant momentum in either direction. First, being the GM problem. Yes, they're still around. They are like a scab that won't go away. GM still faces the big possibility of going under. If such a thing happens, I would expect a pretty dramatic response from the market for a couple days, even though most have expected it.

Second, the uptick rule. As I have said before, I don't feel that any changes with the uptick rule will directly effect the ETF's I play, from a value standpoint, but they may effect people's confidence in them. Either way, we could see some sluggish movements for a couple days with the shorts if that's the case. It was this way when the financial short ban was announced in October. The shorts got killed the first day or two, only to end up tripling their numbers.

Lastly, new stimulus rumors of a number in the trillions. If Obama has the tenacity to unfold such a trillion dollar plan, that could have a huge influence on short term trading. Stages of planning may be in early or not at all, but if indeed signs of a plan of this measure are shown, I would expect a large short-term rally.

So March remains unsettling for me, which is why I still remain in mostly cash at this point. If shorts remain reasonable tomorrow, I will look to buy a light first round of SRS, FAZ, and maybe QID. With there still being some risk of rallying, I will make sure to not overspend myself. However, I'd like to have some, in case of a 90 degree crash.

So tomorrow should be interesting. It is amazing how many less and less cars are at my office building everyday. It's not a good sign. More and more people are trying to work from home. If you've made recent occupational moves, Try RingCentral Online FREE for 30 days, which is a great company that does phone and fax services. Rates are some of the best I've seen, and is far cheaper than going through Pac Bell or Verizon. Perfect for a job at home, or a company you are working on the side. Check it out.

Expect a podcast tomorrow for those who are subscribed. Like I said yesterday, I plan to do two or three a week (or more), depending on the significance of the day and what news was given. If you have not already and are wanting to, CLICK HERE TO SUBSCRIBE TO CRASH MARKET STOCKS PODCAST. There is a 7-day free trial for you to "feel it out." Have a great evening, Happy Trading and see you tomorrow.

Another critical barrier has been surpassed today on the path downward, as we closed under the critical 7500 number, which has been known to be the rubber bottom in previous months. A move to keep us under 7500 would be a big victory for bears going into the weekend, especially after enduring the several new mortgage announcements we have received this week. So we'll see if the bears have it in them to fight one more day.

I do regret having sold some of my SRS at $80 as there is definitely wind behind seller's sails. At this rate, I believe we could see SRS getting into the $100's very shortly. I have not completely abandoned my fears of a rebound rally, but I can definitely see a strong seller's market right now. Tomorrow will act as a critical day, seeing whether or not we can maintain under 7500. By doing so, I will probably find myself buying some options of SKF, SRS, and FAZ.

Oil has been on my radar the last couple months. As we saw today from DXO (up almost 15%) and other oil funds, there is definitely upside there. I recently was introduced to a distant in-law, who has quite extensive experience in the oil sector. Robert Dupree has a Masters Degree in Economics and, for most his career (30+ years), was engaged in developing and managing systems in support of exploration for oil and gas for Amoco. Along the way he was able to learn certain truths about the industry that I felt very applicable to the site and worth sharing. The following are excerpts from what he said from our conversation:


"I don't think that fundamentals had much to do with the spike in oil prices last year. I think that oil will play a significant role for decades to come. Our reliance on oil will persist for decades under our existing infrastructure and I don't see significant changes ahead for it. I would be inclined to invest as much in oil services as much as in actual energy companies. Companies in the service segment such as Weatherford or Schlumberger are worth investigating. They're being hit right now but their type of service will be vital for quite some time.

Regarding oil prices, they are run mainly by a cartel which must balance supply with the need for revenue. They cannot afford to be as political with oil as they were in the 1970s and they know it. The biggest factors that might affect oil prices are of the "Black Swan" nature which cannot be predicted. They would likely come from political events that could disrupt supply.

The romantic thrill of drilling and making a major discovery is still in the public's psyche. It's akin to the lust for gold. Politicians play upon it and the oil industry uses those offshore rigs as much for image as for real production. The oil industry is not lukewarm about more offshore drilling in the U.S. There is probably less than a year's supply of oil for the U.S. yet to be tapped in ANWAR and off of our coasts. Also, the lead time to manufacture the offshore rigs and put the infrastructure in place is at least a decade. What you have to watch for is new guys who might bid to acquire those leases. When Bush opened drilling in Utah, for example, the operators that came in were not very nice guys. "

As you can see, there is a lot going on behind the scenes that most people never become aware of, in dealing with oil. I'm getting very close to pulling the trigger on some oil stocks and ETFs. Not just necessarily for a short term gain, but for some long term potential. It is clear that it is still our biggest natural resource demand and is one the hardest, so far, to duplicate. I want to say thanks to Robert for taking the time out to share his thoughts with me and all of you and look forward to continuing our communication. I will be looking for an entry point for DXO shortly, which has a Market Club report score of -90 (get your own symbol analyzed for free, all you need is a name and email, Click Here), but I feel more and more oil has settled near its bottom. Also, OIH or even shorting DUG (Ultra Short Oil ETF) could be in my near future.

Tech is by far holding up better than the rest at this point. I have no faith in any financial institution at this point and don't even trust playing them as a short term bump anymore. I am all out of my FAS now and don't see myself getting back into them anytime soon. If I need to play the long side, I will look to companies in tech or even insurance companies. A breath of nationalization could send banks soaring down on any given day. I will, however, sit on some FAZ or SKF to try and take advantage of the speculative worries.

Keep your eye on the CPI number tomorrow. Expectations are a 0.3% change, which I would be very surprised to see us reach. A bad enough number here, coupled with more aggressive selling, could end the week on a strong selling note. As you can see from below, a force definitely wanted the market to rally right before close, but seller's would not back down. We are in a very different environment than we were in November.


Another critical day tomorrow. I plan to be up early and ready. It's always tough deciding whether to make moves on Friday, but tomorrow may be a day I do. I'll look for you guys on chat tomorrow and keep you posted. Also, yesterday I was asked to write a guest post for INO's Trading blog. So being my "bear" self, I decided to go with a bear topic. You can read it here. Remember to Sign up for the $200 promotion for Lending Club, click here for more info. Happy Trading.

With not many more arrows left in his quiver, President Obama heads into this week hoping to be able to combat the army of more economic data being released, that so far, is not looking to be good. As he mentioned last week, Obama hopes to layout his plan more thoroughly this week to subsidize mortgages in his effort to limit home foreclosures. As he is running out of options to consider in stimulating the economy, I expect him to continually try and create new programs to hopefully attempt to bring confidence back into the markets. The problem is failing to create worthwhile plans and programs results in a waste of spending and more let down to an already battered investor. Being green and wet behind the years, I don't see much let up from Obama and his attempts.

I was actually surprised to see the market react the way it did on Friday. With the long weekend, coupled with the "new plan," I thought there may have been some buying going into the weekend. Also, many of the shorts got out of the market on Thursday. As we saw right before close on Thursday, the market shot up from a -200 point loss to almost in the green by close. Sure, Obama's announcement caused for buying, but after looking at the numbers, many of the shorts we're covering and getting out in anticipation of the long weekend. A lot of the shorters didn't want to be stuck in their shorts going into the long weekend, with the risk of new developments of Obama's foreclosure plan. Being that the volume was pretty low on Thursday, the market was very sensitive and reacted the way we saw it. Volume remained lower on Friday, but there were still a plenty of sellers in the market as it closed down over a percent.

Obama has his hands full going into this next week. With more employment, housing, and manufacturing news, which is looking to be the worse in 25 years, I expect the government to have some ammunition set aside in attempt to combat the news. However, as always, I think it will be tough to numb the pain, considering the significance of the numbers being reported. I am guessing housing starts will be the worst we've seen thus far, with jobless claims and manufacturing not far behind. This is indeed a week that could set the stages for a crash, but still much depends on how the government reacts.

I'm keeping an eye on oil as many analysts believe we will know by March whether or not we have hit a bottom. I am guessing eventually oil will settle near $75 a barrel. I'm keeping DIG and USO on my watchlist to maybe look for an entry point. I don't see huge surges from oil in the short term, but definitely some growth over the long term.

TBT is continuing to perform strong, see the market trend graph below (get your own symbol analyzed for free, all you need is a name and email, Click Here). It dipped a bit as corporate bonds received a lot of flack and many started buying treasuries again, but I still feel there is a lot of upside in this etf as foreign nations are bound to pull out of our treasuries as our instability and economic stress increases.

So I plan to be pretty bearish this week. I will be careful entering into mid-week as I do feel there will be more given on the plan to subsidize mortgages. As crazy as the plan sounds, I am sure it will cause some to cheer. I have been very pleased with SRS. I would expect VIX levels to continue to increase, and with that, stronger movements for the leveraged ETFS. So hopefully I can continue to see gains from my shorts.

I apologize for the delay in my post. I thought with the long weekend, it would be better to wait a couple days in case of anything coming out over the weekend. I will maybe get on chat tomorrow to discuss upcoming developments with the coming week. I also plan to discuss the list of restaurants experiencing leverage risk (I'm staying away from their stock). Remember, two more weeks for the $200 Lending Club promotion. Enter and win with no money required to invest, see here for more! Happy trading and I hope for much green in your trading this week.

For those that called it a day for trading a 3PM (eastern), most likely came back to their computers wondering what on earth happened the last 45 minutes of trading to make what was another 3% down day to just under .1% at close. So what on earth happened to make investors think that it was time to start buying? I find it no coincidence that the movement was made near the 820 S&P, as a closing under 820 would have been a pretty strong technical move. Here's some information that hit the press just in time.

With an hour left before close, the media announced Obama's plan to subsidize mortgages to prevent foreclosures. Once again before any sort of detailed information or laid out plan for the process of doing so, investors immediately jumped on the "rumor" train to gobble up any stocks in sight. It was early in this announcement that caused me to shave off some of my SRS profits from earlier (hit $70 today, I sold some at $68) and went in and bought some FAS. Just in the time before close my FAS went up 3%. This was a complete 180 degrees to what I felt I was going to be doing at the end of the day, but this is exactly why I choose the end of the day to make a lot of my moves. So, yes I indeed joined the buy craze in case this "rumor" train goes into tomorrow. Plus, I got some solid gains from SRS anyway today.



So where do I begin in expressing my thoughts of this new plan. This idea is even more out there than Geithner's plan. Subsidize mortgages? Are you kidding me? Is the government aware of just how much toxic debt is outstanding and is going to be outstanding in the next 3 years? Then what happens when commercial real estate hits the fan, which it will. He talks of securing the assets to try and incentivize banks to keep lending. Again, where is this money coming from? If Obama does indeed decide to pursue this outrageous task, it is inevitable that our dollar will be completely destroyed. So I am curious to see how quickly this plan is shot down by the public, but it all came out so quick today, that investors thought of nothing else to do but to buy. So I believe with the combination of the long weekend, it being Friday tomorrow, and our new "rumored" plan from Obama, it would be good to get me some long positions to try and earn some green tomorrow. But I was pretty surprised to see how quickly my Zecco.com account changed.

If not for the late announcement, I was actually almost ready to pull the trigger on some more shorts. Like I've said before, you never know what's going to happen during the day, especially with this new administration. I had a feeling they had something up their sleeve, as a big selling day for today would have been a bad sign for the markets.

Everyone was surprised to see the market down so much with the, what many thought were "positive, numbers" for retail. A .9% increase reported compared to the -.6% that was expected. However, there was some very bad employment data that came out to quickly kill the optimism. Plus, remember the retail sales is a measure of the total receipts of retail stores, this is not the bottom line. I am more interested in the bottom line of retailers, which can't look pretty. Think of all the liquidation sales that are going on this month and that were left over from the holidays. Everything is on sale. So, indeed, total sales may be up, but I bet you the bottom line or net income is looking pretty scary.

So indeed, I switched it up a bit today and it will be interesting to see what tomorrow brings. I definitely will try to get out of FAS as soon as I can as I see no backbone for financials at the current time. If there is indeed a rally tomorrow, I don't expect it to last long. Who knows, maybe the reality of nonsense of the plan will catch up to the market by tomorrow and there will be no rally, which is why I'm setting a 5% stop loss. I do, however, see nothing for green for gold as continual printing of US dollars should keep gold firing. Check out GDX's market trend chart, a +100, wow (get your own symbol analyzed for free, all you need is a name and email, Click Here).
See you on the chat, Happy Trading and we'll see you tomorrow.

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It is days like today, which solidify my feeling of why I am so nervous to be long in these current market conditions. We saw in just one day, the last three days of green get annihilated, closing the Dow once again under 8000 at 7888. This is why having dangerous days like Friday, in which investors looked right past some pretty devastating unemployment numbers and kept buying on hopes of "The Saving Bailout Plan", sets us up for an even more devastating day of losses as eventually that news will get factored in. The market opened up in the red, but really began dashing down during Geithner's speech, where he attempted to unfold the Treasury's plan with confidence, but failed miserably. A bunch of numbers were thrown out there, as well as phrases like "private equity help" and "should help to unfreeze markets", however the linking equation to execute the promises was missing.

As soon as the speech was over, analysts had their way with Geithner and his new "plan." Many discussions about the Fed's inability to perform on their promises as well as their "lack of preparedness" in the plan gave the media a lot to talk about the rest of the day. This indeed seemed to cause a lot of doubt with investors as the selling continued up until the close.

So what do I think? I think it's a joke. I can't blame Geithner as I feel our current dilemma is a task too big for any individual or entity. We are currently reaping what we sowed for the past 5 years. Falsely labeled AAA-BBB assets were bought and sold with no actual currency exchange, but with new loan documents. This debt has built up to a ridiculous amount that will take much longer than a year or two, in my mind, to begin to see a turnaround. So I can't blame Geithner, although I blame him for falsely preaching hope to investors, causing buying at times when markets should be selling. In the end, this market needs to crash in order to pick itself up again. I believe we are close to these times.


They discussed helping private equity to help buy these toxic assets. What private equity? You mean the $13 trillion in wealth destruction? Sure there is still money out there in certain institutions, but who has the kind of money they need to buy these "toxic assets". I guess this is why many institutions are interested in the plan, but none have signed up. I loved the line, the private sector will "determine the prices for current troubled and previously illiquid assets." Sure that will be easy, just talk it out. These are just a few of problems with this plan.

So I'm very glad to have sold out of BAC yesterday. There was a lot of green in my Zecco.com account today, as after my FAS shares sold, there were nothing but profits all around. Indeed, in this market, we can expect these selling days to be much more violent than the buying ones. Before close, I took a lot of my SKF profits off the table as I don't think we're quite out of the "rally woods" yet and wanted to pocket some in case of a rebound rally. I don't necessarily feel that we will be green tomorrow, but I made enough gains from my shorts today, I can play it a bit more conservative for tomorrow. In fact, with retail sales coming this week, and the poor earnings from NVIDIA and Applied Materials after today's close, we may see another day of selling for tomorrow. I am keeping all of my SRS as I still continue to love that ETF and will average down if hurt tomorrow.

After the huge day of selling, we could see a day in the green, but I don't expect big green numbers, unless we get some additional news. Days like today take a good bite out of sentiment. Sure, there may be some profit taking, but I don't feel that there is much wind behind Bulls sails. If we do indeed end below 8000 for tomorrow and possibly end under 820 for the S&P, I would expect a continuing downward trend. We'll see what tomorrow brings though, 8000 has been very, very tough to stay under and Hogan's bottom seems to have a spring on it.

My DGP did quite well today, as gold continues to do well in these uncertain times. I'm continuing to like plays like these, and even oil right now as I think there will soon be some more separation between Dow movements and commodities. Plus, DGP has a market trend score of +55, not too bad (get your own symbol analyzed for free, all you need is a name and email, Click Here).


So tomorrow will be interesting. I plan on getting into a position in the morning as I believe we will see some definition of the day's trading pretty early on. So yet another day of early rising for me and we could see the markets hit some critical technical numbers tomorrow. I'll be on chat later and tomorrow, so I will see you then. Happy Trading.

Just as I anticipated, we encountered a pretty volatile day which made a sharp u-turn around mid-day, resulting in a pretty strong sell off of most everything, tech holding up the best. Once again we have dipped below the 8000 mark and may stay there to end the week, pending some big announcement that I am not foreseeing. Talk of the town today has been Obama's decision to regulate bank executive's salaries to a maximum of $500,000 annual. They do have stock option bonuses, but there are still lots of restrictions of when they can cash in on those. Sure, there is a need to regulate some of the antics that are going on around some of these companies and an accountability for spending, but I don't know if this is the right move.

I worry about Obama attempting to go to war with the upper class as he will most likely lose. There has to be a cohesive plan that can benefit all parties without dragging the upper class through the mud. We will see what response is given from the banks and the market dealing with this new development.

It has been a different week for the market and there are a few things on my mind which will most influence my upcoming trading. These 5 things are:

Effects of Restricted Bank Salaries
This may look like a good plan on paper, but there could be some pretty bad consequences if this plan backfires. No doubt there has been ridiculous spending by some executives that should result in some accountability. The problem I am worried about are banks losing their top executives to foreign competition. I mean how easy is it for foreign countries to match the $500k cap, not to say blow it out of the water. This filter will not only put a leash on the bad-performing executives, but also the good ones. If we risk losing some of our top executives, I can't see that being a good sign for banks and our overall economy.

S&P Closing Below 820
It has been a while since we have seen a sub 820 close for the S&P. Knowing the technicals are pretty strong at that point, I am very curious to see if we close under 820 sometime this week. If this is the case, I would expect there to be some extra downward momentum, possibly sending the S&P close to 800. Below is the recent market trend analysis for the S&P (get your own symbol analyzed for free, all you need is a name and email, Click Here).

Unemployment - Record Setting
I am very curious to see what unemployment numbers we see reported on Friday, as I personally feel they will be record setting. If you have been tracking the layoffs as I have, you have noticed the daily massive job cuts which have been going on. This is not to mention all of the mom and pop layoffs that are going on behind the scenes. This could be a big drag on the market.

Bad Bank - Nationalization?
I have not been able to wrap my fingers around this bad bank plan. I see them wanting to set up a similar system as the RTC program in the 80's and 90's, but I don't see how this plan works without instilling the nationalization of banks. And if that's the case, I would think that most of the shareholder's equity would be wiped out. Having Citi's or BAC's equity wiped out would most likely kill confidence in the financial markets and maybe cause a market crash.

Stimulus & Government Intervention
I still am waiting for Obama's bag of tricks. He has a good gift of linguistics and can do a great job of selling the country on hope. However, he has been very careful of not leading people's hopes astray. I think that's good. More false hope can cause even more problems in the long run. Still, I can't help but think that Obama has something brewing to attempt to counter this plunge and try to spark a big rally.

These things have been going in and out of my thoughts and continue to keep me guarded of what to buy. Indeed I am still heavily short, but have not gone as short as I would like because of some uncertainties. Hopefully, more clarity is brought the next couple of days and I can get back on track. Until then, I guess these thoughts keep creeping. Your Thoughts? Happy Trading.

PS - Seems as though the chat is working good. Good call on the recommendation. I will try to comment as much as I can during the day, however, I am often away for other business. By the way to clear some of your questions, Zecco.com is still offering free monthly trades, you just need to have more than 25 trades a month, which I'm sure most of you, like me, are doing. Just to answer those that thought the promotion was over.

Free Trading Analysis Video click here

Well, as expected, we experienced a pretty aggressive selling day as yesterday's gains, and then some, were wiped out today with the Dow closing at 8149. I was glad to have sold out of almost all of my bank positions yesterday, as most of the profits were wiped out from today's selling. Tomorrow is a pretty critical day in deciding the future movement of this market. Another devastating day of selling could be enough to put the Dow below 8000, which would be a critical point of closing, especially with the market mostly trading up the first part of the week. As I've said in the comments, I'm a bit torn at which way it will go since so much depends on the GDP announcement and how it is spun with the media.

I didn't make many moves with my Zecco.com account today, as I still feel I want to be mostly short for the time being. I did, however, pick up some more TBT for myself. It has performed so well for me since I first wrote about buying it last month and I see it going nowhere but up this year. US treasuries have been so over bought, it's ridiculous. The yield with Treasuries hit 0%! It is very clear that Obama's plan is to spend our way out of this crisis and by doing so will even more saturate the market with more, already oversold Treasuries. Plus, as our government continues to print money, other nations will continue pulling their money out of Treasuries and putting them into corporate bonds, because their dividends are much more stronger. So I expect TBT to continue to do just fine for me.

I would expect big numbers from my FXP tomorrow, as Asia is currently looking like a market crash. Surprisingly, FXP is holding up pretty strong fundamentally, as they have a market trend score of +55 (see below. Get your own symbol analyzed for free, all you need is a name and email, Click Here). I did shave off some of FAZ earnings today as there was some huge gains today from it (almost 20%). It's not that I don't think there is more to grow with FAZ, it's just like I said yesterday, I can't be greedy.


My DGP performed well for me today, already being up close to 5%. This is one I plan on hanging on for a while. I sold some of my GDX for a pretty strong profit (first bought in at $18). I am seeing more upside for DGP in the long run than GDX. I think gold is bound to spike sometime throughout the year with this overspending.

So we all wait and see what the GDP Gods shall bring us. The number is going to be bad, no doubt about it. The next GDP announcement should be even worse. I cannot believe the devastation we have already experienced in January. Consumer sentiment is another one to keep your eye on, although I do feel it will be overshadowed by GDP. If indeed sellers take over this market tomorrow, which has usually been buyer's territory, I would expect that momentum to push harder into next week.

My Lending Club account is doing great so far. Payments are being made and my returns are looking to be strong. It's good to be diversified and helps me sleep a bit better at night. Below is an example of notes that are available to invest for 10%+ gains. I chose to pick higher valued loans, and not shoot for the 20% returns. Remember, my $100 promotion for Lending Club ends in a couple days. It's free to sign up, click here for instructions.


I will be on the comments tomorrow so check back and share your thoughts. I will probably be making some moves mid-day tomorrow so we'll see what happens. Have a good night and Happy Trading.

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There sure was a lot of hustle and bustle on the floor today as hopes for Obama's new plan filled buyers with confidence, especially concerning financials. Sure, myself was included in the mass of buyers, but for me it was not an emotional buy. It was purely just buying knowing that there would be many believing that Obama's new plans will push us through this depression and financials crisis and on to greener pastures. I surely did enjoy profiting off of the emotional compulsiveness of other investors and plan to do it more often. So what was today all about?

Wells Fargo up 30%, Citi up 20%, and Bank of America up 15%. Wow, that's some strong pushes, what on earth could have happened today? To be frank, not much. Sure there were a lot of talks and whispers in headlines throughout the day, but fundamentally, not much changed and unfortunately these kind of "emotional rallies" can really tee up a strong market crash.

First, news came last night that Obama plans to push this stimulus through ASAP. No need to cross the T's and dot the I's, just get it signed. Considering "checks and balances" no longer exist in our government currently (as democrats control all the powers), there shouldn't be much delay in getting this passed. Some may think this is just the beginning of the road back up, especially with the banks. As for me, I took most of my profits and ran.

So, yes, I did get out of most of my position in financials today, before the close. What I have learned recently is that you can't be greedy in this market, and getting a 14% return in a day is fine by me. So I took most of my money out, just leaving some in case of another day running. Believe it or not, but I took a lot of my earnings and put it into SRS and DGP (a Deutsche Bank Double Gold fund, see trend analysis below, get your own symbol analyzed for free, all you need is a name and email, Click Here). I think we went a bit overboard in the buying today and I expect some serious pull back either tomorrow or Friday, especially with GDP news coming up, and here's why.



One announcement that has seemed to cause excitement with financials is the new "bad bank" plan. This is, in a sense, a plan for the FDIC to take control of the bad assets and hold on to them until values once again appreciate. So far, the way of doing this is unclear, but many speculate that many of the banks deemed "bad banks" would essentially be temporarily ran by The FDIC, or in a sense, the government. So in other terms, "nationalizing" a lot of these banks. A similar program was adapted during the last real estate catastrophe, where the government issued an RTC program to buy back troubled assets. The problem is that our debt is far greater than that of the RTC days and our length of this recession/depression is unknown and is most likely to much, much longer. What I don't get is why are so many people buying up financials, when in fact if some of these banks do become nationalized, shareholder's equity most likely will get wiped out? Analysts are warning (well the smart ones) of this, but investors have tuned them out as they listen to the new songs of "bank bailouts". My point is, I do not want to be stuck with a slue of bank stocks as the governmental begins to experiment with different nationalizing ideas.

Then we go on to the new Obama stimulus plan itself. Have you read it? This thing is suppose to be devoted to assist in job creation and we're spending $350 million of tax dollars on STD education and prevention? How is that going to help? I mean at least if STD's are still flourishing there will be money spent on pharmaceuticals and doctor visits (a joke). Also, there's a allocation of funds to landscaping the capital building. Who cares? We are in a depression and you want to worry about landscaping. Truly, there is a lot of wasted money in this bill and if we are only dedicating 50 cents to the dollar to actually assisting in job creation and the buying of bad debt, it will take over $5 trillion in bailout funds to begin to do something. Get it together guys.

I do believe that above all, banks need keep the consumer's confidence. That was the biggest cause of the Great Depression. People lost faith in the banks and banks failed. However, I believe there are many ways to keep banks lending, and help manage their current "over leveraged" state. They just need to tweak things back at the drawing board.

Starbucks gave some more bad news today as they are looking to close even more stores down. The worst part about these rallies, is many times, real economic data sometimes gets tossed aside as people are"high" with emotion. Hey, even the US mail is struggling. They are toying with the idea of only delivering mail five days a week instead of six. The point is the rest of the world is going on behind this bailout fluff, and it doesn't look pretty.

At any rate, I'm glad to be out. Sure, we may indeed rally more tomorrow, but like I said, I can't be greedy. Indeed I feel if our government is not careful with how we spend these next trillions, we could end up spending our way to death. Hopefully, Obama can round his people together to find a good solution, I just still believe there is A LOT of work to be done to their proposed plans. Tomorrow should be interesting. Seeing how we open will determine whether I make any moves, but as for now, my Zecco.com account is staying put. I will keep you updated on what I do in the comments section. I hope everyone has a good evening, Happy Trading and we'll see you tomorrow.

Call it a hunch or call it an overdose of OSD (Obama Stimulus Decisions), but I actually made a SHORT TERM move into longs today. Many more speed bumps have arrived into this road to destruction of our economy than I first anticipated and in order to maximize my value, I'm looking to try and play both sides a bit more, for the time being. Currently, investors are very vulnerable to just announcements of hope and with the new President being busy and active, I definitely feel there will be many more announcements to come in his first months of office. Please don't misunderstand me, I still strongly believe that our economy is still very much spiraling downward, I just feel I can make some extra $$$ on the bumps. Call it the day trader in me. I don't plan on actually "day trading" per say, but my trade volume should definitely be going up. I'm still very bullish in my current short positions, I would just like to make some cash on the bumps up to load up on my shorts at lower levels, because in the end, I believe the market will come crashing...and fast.

Today I sold off my remaining SKF and put them into BAC and C. With Obama just being put in office, he is wanting quick action. I expect to see things turn much quicker that we did with the Bush administration. Sure, this can eventually lead to worse things for the economy and probably will, but the point is the market will probably rally from it in the short term. These are the reasons to justify my longs. I do still have a strong short position in SRS, FXP and EEV. I just feel these can hold up better during these rallies than SKF and FAZ.

Either way, my holding of these stocks will be very short lived. In fact, I would like to be completely liquidated from them before Thursday's close, at latest. I do not want to be stuck with financials going into GDP announcements. By doing this, I plan to throw my gains from the hopeful quick rally into more short positions, which will, I believe, ultimately yield strong gains.

So far my plan seems to be working out for me as it looks as though Obama is trying to get his stimulus plan (maybe $900 billion) to pass ASAP. Although, he is getting a lot of opposition from the GOP, signs are looking good for the ability to get something passed as early as maybe next week. Just whispers of this has sent financials up almost 10% in after hours. If this sticks into tomorrow, I will most definitely shave some profits off the top, as with all speculative announcements, the cheering is usually short-lived. Also, as you can see, momentum charts for Bank of America do not look pretty. -75, OUCH. Get your own symbol analyzed for free, all you need is a name and email, Click Here.


Yahoo also announced "better than expected" earnings, however yielding a loss for the quarter. But, as usually, investors think of this as a good sign as the stock is trading up 5% in after hours. I actually like yahoo, even before the earnings announcement. I believe over the next five years, a lot of focus is going to be shifted over to e-commerce, which should indeed boost value for Yahoo. Plus, I also think at Yahoo's recent low stock price, they are still very vulnerable for a hostile takeover. I think something should happen, definitely before the end of the year.

Keep an eye out for FOMC's meeting notes tomorrow. We shouldn't expect much as far as a rate cute (since we're pretty much already at 0%), but they are definitely still capable of moving a market in either direction depending on their economic outlook. If something substantial is announced, we can expect to see a strong run in which ever direction it heads. I personally feel we will have an up day of trading tomorrow as the hope of new stimulus could really ignite the buying the next couple of days, pending that something largely significant is not announced.

New home sales and GDP numbers are still to come at the end of the week. As I said earlier, I would like to be fully out of my longs before that GDP number is given. In fact, I believe Thursday we may trade down just expecting a bad number. Analysts have tried to soften the landing by projecting an enormous -5.4% result. Their hopes is that anything even slightly lower than this number can be manipulated to investors as a positive sign and erasing the memory that our GDP just did indeed fall almost 5%. Sadly, I am not as easily fooled. Anything below 3% and I am running for the hills. Why roll the dice with longs right now when I can just stay in cash and earn 2.45% APY* with HSBC Direct Online Savings, all FDIC insured. I will be able to sleep better at night, that's for sure. So I don't see me in BAC and C longer than a week.

Well, let's see how tomorrow goes for my new long positions. I am a bit more nervous going long in this market as I feel it is more of a gamble, but I do see some opportunity in it. Check out these free INO technical stock trading videos, very informative, click here. Happy Trading everyone and have a good night.

By looking at today's Dow graph (below), it seems as the violent volatility is getting more and more every day. That coupled with the strong influx of volume we have received the past couple days can be a combination of disaster when tip toeing around a financial depression. With all the uncertainties out there, a big failure could send this market tanking. Lucky for the market, we happen to be in a week with almost no economic data reported, aside from our horrible home starts for December reported today, but no one pays attention to that right? Just to note it, they were expecting 605K in new housing starts for December. The actual number was only 550k. Even though many of these numbers are cast aside and not paid attention to, I definitely make note of the continual problems our market is seeing, because sooner or later it will catch up with us.


Google came in today with what they're calling good news by "beating market expectation." As a result, investors are cheering and buying up GOOG in after hours. Sure, they have beat SOME of the analyst's forecasts, but the fact is they're net still plunged 68%. So if you think that's something to cheer about go ahead and buy. A lot of times people become so caught up on the wording of events like "they beat market expectations" or "beat earnings" and they just turn around and buy without reading in between the lines. They're net income for Q4 fell from $1.2 billion to $382 million from the same time period just last year. OUCH. Some are calling it good news, but as for myself, I'm steering clear.

Check out the updated Market Trend graph for SKF after today's trading (Click Here to analyze a symbol for free, you just need a name and an email!). +100, which is the highest momentum rating the tool can rank. The fundamentals are definitely pointing upward and with the continual woes hitting the banks, I have to think it's going nowhere but up this month.


It was good to see SRS get a nice bounce back today as well as FXP. Asia has been having a disaster of a time trying to explain their horrible fourth quarter reports. I will touch more on that tomorrow. Watch out for our usual Friday rallies tomorrow. As I've mentioned before, Fridays have a tendency to be bullish. Especially with the downward day today, Google's "positive earnings" and the slight pullback towards the end, we may find ourselves in the green. I didn't buy anything else to prepare for it, as I already have a small position of C and UYG. A down day would definitely yield me stronger returns, but I have some long just in case.

In any case, I would expect higher volatility levels as there remains a lot of uncertainty. With that in mind, the increasing volatility is going to make the leveraged etfs extremely volatile, as prices for options should continue to shoot up with the "fear index" increasing. This is a great time to make quick 10% profits in a short amount of time. It can be very risky, but with the use of stop losses and buying on the right bumps, you can hedge some risks and make some profits.

Warren Buffet said today that he feels the credit crisis is "softening" (ha, maybe for billionaires), but that business has slowed more. He says that the negative sentiment has really slowed down consumer spending and has made it very difficult for businesses to survive. He said he expects the recession to last a while, but wouldn't speculate when. Obviously, I think that means he's planning on it being around a couple years. I like to listen to these old dogs as they're probably the only ones who's been close to experiencing what we're in.

If tomorrow does indeed rally, I plan on bulking up a bit more on SKF and FXP. I still have a ton of shares of SRS, as I still feel there is a lot of potential for profits there. If we go down once again tomorrow, I will enjoy another day in the green for my Zecco.com trading account. That coupled with my strong Lending Club returns is making it a pretty good month for me. Here are some great free videos on stock analysis you can watch click here, definitely worth watching. Happy trading everyone, have a good evening and we'll see you tomorrow.

The Friday rally returns. And in the midst of so much adversity too. I was surprised today to see my Zecco.com account in the red today when I first checked this morning. This definitely has to be the Obama anticipation rally, because I can't think of anything else that would end today green other than that. The belief in Obama's ability to continue to print money is ringing much louder in everybody's ears than the fact that there is much to be worried about in the near future.

Circuit City announced today that it's official. They have been unable to reorganize their business and will move to the next step, liquidation. For those who have been reading my site for a while, we knew this back in November. There goes another tens of thousands worth of jobs as well as an American business that has been around for more than 20 years. GE capital, Conoco, AMD and Pfizer are also in the plans for some massive layoffs. January-April's unemployment numbers are going to atrocious. Every single sector of business is somehow struggling in this market. There is no immunity.

As I said I was going to do yesterday, I picked up some Citi shares today. Due to their unfavorable earnings and their splitting, at $3.50, it is low enough for me to make the gamble. I predict some serious bank rallies next week as Obama gets put into office and begins to unfold his huge bailout plan. Although I feel this won't fix anything in the long term, it should make some serious movements in the bank stocks. Hopefully I can make a 30-40% return and get out of it before it comes down again. Sure it's a risk, but I'll take it.

I also picked up some more GDX options today. With the huge bailout plans, will come some serious money printing. Gold is sure to get a good bounce as Obama looks to unload a good chunk of cash. Just today, gold was up $35. This should be even more next week.

Bank of America and Chrysler got another check from the Fed today. Now people are wondering whether Circuit City should get a piece too. Why not? Everyone else has. They failed to draw the line with the autos, so they have opened this door and now have to deal with it. It really does scare me of what our deficit will be when all of this is done. I do recognize the principle of backing the banks, no matter what, but it should end there.

For all you Californians, enjoy your IOU from Arnold concerning your tax refunds. Due to the $41.6 billion California deficit, Arnold is looking to either issue IOU's or postpone the payment. Either way, holding tax returns will not stimulate the economy and should cause for even more problems. State government IOU's, are you serious? California is desperate.

It was another volatile day going from 100 up to 100 down and back up again. We are nearing market conditions from past October and it is beginning to become thin ice with trading again. After the Obama change, what is left to cheer? More bailouts? Either way, I think we're in for a tough run until May.

With the Vix getting back into the 50's, it's prime for buying the 2x inverse etfs again soon. Since they are momentum movers, the higher the VIX, the better, as long as you're going the right way. I hope you all have a good weekend. Next week is the big one, lets hope for some serious dollar signs. Happy Trading.

PS - I am running a promotional contest to win a quick $100 on behalf of Lending Club to try and instill some curiosity in the company. We've talked a bit about it on the site and I do feel they are worth checking into. So if you are interested, than go here for details. It requires no money to enter the contest, just filling out a form and poking around the site. I'm just trying to stimulate some curiosities.