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Weekly Update & Stock Market Forecast. April 12th, 2014 InvestWithAlex.com

daily chart April 11 2014

Weekly Update & Summary: April 12th, 2014

An ugly week with the Dow Jones down 386 points (-2.35%) and the Nasdaq down 128 points (-3.1%). Structurally, the market did very well by closing most of its gaps. In fact, just today the Dow finally closed the before mentioned large gap located at around 16,050. There are a number of smaller gaps left leading all the way down to February 5th low, but the Dow will close them as the bear leg develops further at below mentioned time frame. Overall, it has been a fairly clean week.

WEEKLY REVIEW:

Mortgage Origination Collapses….Real Estate To Follow

According to Black Knight, monthly origination volume was the lowest on record and down 23% month-over-month. This is wonderful in depth look into the state of today’s real estate market. Anyone who believes the real estate market will stay at these levels or move higher is smoking some good quality crack. Click Here to see this outstanding report. Here are just a few points.  

  • Origination volume is the lowest on record with prepay speeds signaling more drops in refi originations. 
  • Monthly sales were essentially flat year over year, but traditional sales were up almost 15% 
  • The government share of originations has decreased, led by a sharp drop in HARP originations 
  • Credit standards have shown few signs of loosening,  with very little origination activity in the lowest credit score bucket.  

mortgage origination

Russia Outlines It’s Economic Warfare Plans Against The USA

In no uncertain terms, Gazprom CEO Aleksander Dyukov outlined Russia’s Economic Warfare plans against the USA in case of further sanctions or any further meddling associate with Ukraine.  To summarize….

  • Fundamental Shift & Move From EU/West To Asia/India: As discussed here earlier, Russia is currently making a major push to shift it’s gas and oil markets from the West to the East by signing a number of large longer-term contracts with both China and India.  
  • Move Away From The “PetroDollar” As A Reserve Currency: To demand payments for gas and oil in Euro, Yuan, Rubble, Gold or whatever else…..as long as it is not the US Dollar. As the theory goes,  since the US is heavily reliant on it’s Reserve Currency status for it’s ability to maintain a heavy debt load, any move away from the US Dollar would collapse the US Economy.  

I don’t buy this for the time being. Any such move by Russia will have a very limited impact, if any, on the US Economy or it’s financial markets as a whole. The US Financial System is way too large, too well diversified and there are way too many international players involved in the system to destabilize it that fast. Plus, our mathematical work in the Treasury market doesn’t confirm this either. I would give this a second thought if China decides to join Russia, but such a move would be highly unlikely at this juncture.    

In short, Putin might try, but he will fail. His own economy is on the verge of a collapse and he should pay a little bit more attention to that. In fact, if the US wants to finish off Russia it should collapse the price of oil to $20-30 for about 2-3 years and you will see another 1991 type of a regime change in Russia in short order. 

FOMC Minutes Confirm Our Forecast

 yield curve investwithalex

In just released FOMC Minutes, FED Officials confirmed their dovish approach to any future interest rate increases.  According to them, “even after employment and inflation are nearly back to normal levels, short-term rates may need to stay unusually low for a while because the economy isn’t fully healthy”. 

While the market is celebrating the news for the time being, this falls in line with our overall forecast. Investors/traders must realize that the economy is running on fumes even though the interest rates are at historic lows. Further, when the economy finally rolls over into an “official” recession there is very little the FED will be able to do in order to induce further stimulus. A double whammy. 

The outcome? An upcoming bear market of 2014-2017, a severe recession, a flattening yield curve and surging gold prices. In fact, based our mathematical and timing work the bear market is just around the corner. As such, now would be a great time to protect yourself. 

MACROECONOMIC ANALYSIS:  

Ukraine/Russia/USA/EU/NATO  continue to  be the most important issue. In fact, I continue to believe things will escalate significantly over the next few weeks.  

While Ukraine interim government backed away from their 24 hour deadline on Friday, the situation remains very tense. I continue to believe the US/NATO, Ukraine’s Interim Government, Pro-Russian Movement In the East Ukraine and Russia are one spark away from reigniting this conflict and going at each other on multiple levels.  While I don’t believe NATO and Russia will get involved in a direct military conflict (for the time being), any misstep here by either side might lead to Russia invading East Ukraine. In fact, I continue to believe it is just a matter of time. Such a move by Russia will spark a number of economic sanctions (from both sides), political storm, war rhetoric and a million other unforeseen consequences.  As you can imagine, this would be incredibly unsettling for financial markets.

TECHNICAL ANALYSIS THE FOR DOW JONES:  

Long-Term: The trend is still up. Market action in January-February could be viewed as a simple correction in an ongoing bull market. Same applies to the market action over the last two weeks. Yet, that in itself can be misleading as per our timing analysis discussion below.

Intermediary-Term: Since February 5th, intermediary term picture shifted from negative to positive. Giving us a technical indication that both the intermediary term and the long term trends are up. Yet, that in itself can be misleading as per our timing analysis discussion below.

Short-Term: Short-term positive trend is about to reverse. If the Dow breaks below 16,000 in the upcoming week, short-term trend will shift from positive to negative. So, while the short-term trend remains bullish for the time being, it might be misleading as per our timing analysis discussion below.  

Again, even though all 3 trends are bullish for the time being, that might be misleading. Please read our Mathematical and Timing Analysis to see what will transpire over the next few weeks.    

MATHEMATICAL & TIMING ANALYSIS:  

First, a recap. Particularly for our new subscribers. Over the last few months we have maintained that the DOW will set a XXXX

(*** Please Note: This time around about 90% of the information contained within this section has been deliberately removed as it contain too much technical information. Particularly, exact dates and prices of the upcoming turning points. As well as trading forecasts associated with them. I deem such information to be too valuable to be released onto the general public.  As such, this information is only available to my premium subscribers. If you are a premium subscriber please Click Here to log in. If  you would be interested in becoming a subscriber and gaining access to the most accurate forecasting service available anywhere, a forecasting service that gives you exact turning points in both price and time, please Click Here to learn more.Don’t forget, we have a risk free 14-day trial).

Long-Term Overview:

XXXX

The next turning point is located at.

Date: XXXX
Price: XXXX

XXXX

Trading:

XXXX A lot of them have done incredibly well thus far and I hope you were able to benefit as well. I added my final position during the week as I have mentioned in the daily updates. XXXX

Remember, you should have an exact strategy and entry/exit points based on the forecast above. 

The list below is for your reference point. It entails my investment strategy for my own investment purposes. While you are free to follow me, please do so at your own risk. Do not take this as a trading advice. Please note, all of the positions below have been triggered.    

Stock

Entry Point ($)

Action Taken

Stop Loss @

XXXX

 XXXX

Went XXXX

XXXX

XXXX

XXXX

Went XXXX

1250

XXXX

110

Went XXXX

121-123

XXXX

74

Went XXXX

80

XXXX

XXXX

Went XXXX

260

XXXX

XXXX

Went XXXX

460

XXXX

35

Went XXXX

39

XXXX

65

Went XXXX

70

XXXX

120

Went XXXX

120-130

XXXX

100

Went XXXX

108-112

XXXX

112

Went XXXX

120

Otherwise, I suggest the following positioning over the next few days/weeks to minimize the risk while positioning yourself for a forecasted market action. (This is continuation of our previous positioning).

If You Are A Trader: XXXX

If No Position: XXXX

If Long: XXXX   

If Short:  XXXX

CONCLUSION: 

An incredibly interesting week is coming up. We are now looking for our forecasts above to be confirmed over the next few trading days/weeks. I have also described what to anticipate over the next few months and exactly what you should do now. With increased volatility, multiple interference patterns and an incredibly important long-term turning points coming up over the next few months we must be very careful and risk averse here.  Those anticipating the moves and those who can time them properly will be rewarded appropriately.

Please Note: XXXX is available to our premium subscribers in our + Subscriber Section. It’s FREE to start. 

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Weekly Update & Stock Market Forecast. April 12th, 2014 InvestWithAlex.com  Google

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Stock Market Update. April 11th, 2014. InvestWithAlex.com

daily chart April 11 2014

Another down day with the Dow Jones down 143 points (-0.89%) and the Nasdaq down 54 points (-1.34%) 

The amount of stupidity associate with the recent market decline continues to increase unabated. From Carl Icahn’s barber being excited about this stock market to most market pundits predicting an Earth shattering decline of 5-7% before an eventual bounce. While all of that is going on the iShares Nasdaq Biotechnology (IBB) is already down over 20% while the Nasdaq is down 8.2%. Yet, all of the above is irrelevant.  One must understand where we are in the cyclical and mathematical composition of the stock market. While I have tried my best to drill that information into investor consciousness, most of it falls on deaf ears. That is to be expected, I got the same reception in 2007.

To quickly summarize,  we are still in the secular bear market that started on January 14th, 2000. Based on our mathematical and timing work this bear market will complete itself in 2017. When it does, you will see most of the gains from 2009 bottom vanish into thin air. With the 5 year cycle (1994 -2000, 2002-2007 and 2009-2014) now complete you will see a bear market initiate within a relatively short period of time. If you would be interested in learning exactly when the bear market of 2014-2017 will start(to the day) and it’s subsequent internal composition, please Click Here   

(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). 

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Stock Market Update. April 11th, 2014. InvestWithAlex.com  Google

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Warning: Hedge Fund Secrets Revealed. Why Revealing Just This One Secret Should Get Me At Least A Few Death Threats

Are you ready? 

Secret: Hedge fund smart money is just as dumb as your smart money. Or is it the other way around? I am not exactly sure, but according to the WSJ report below most hedge funds have been caught in the recent sell off, just as everybody else. This should not come as surprise to the industry insiders. At the end of the day 99% of market participants tend to operate in the same fashion (the other 1% make all the money). Including the hedgies. Here is how. 

z23

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Warning: Hedge Fund Secrets Revealed. Why Revealing Just This One Secret Should Get Me At Least A Few Death Threats Google

WSJ Reports: Hedge Funds Scramble As Stocks Tumble

For hedge funds, it’s been a race to the exits in the stock market.

Hedge funds have been cutting their overall exposure to stocks in recent weeks–both bullish and bearish positions–amid the selloff in high-flying technology stocks, Credit Suisse says.

Overall bets on higher stock prices have fallen to their lowest level since August 2012, with the steepest cuts coming over the past month, according to the bank. That can be seen in the “long/short ratio” which compares the amount of long positions to short positions. That ratio has fallen to 46% among the bank’s prime brokerage clients, down from a peak of 58% earlier this year, according to an April 9 report from Credit Suisse.

“It’s battening down the hatches to weather the storm,” said Jon Kinderlerer, managing director at Credit Suisse’s prime brokerage business.

Within the stock market, hedge funds have been shuffling their holdings as well. Funds have been cutting their exposure to high-growth areas of the market and boosting their bets on more defensive sectors. As recently as last fall, bets by hedge funds on so-called cyclical stocks—sectors seen as benefiting from an expanding economy, such as technology and retail—were 12.9 times greater than their bets on defensive stocks.

Now, the figure has dropped to about 5.7.

Many funds had crowded into bets on the high-flying growth stocks that have fallen sharply in the recent market rout.

“We’ve certainly seen risk reduction in the hedge fund space,” said Mr. Kinderlerer. “It’s not a frantic rush for the exits, but gross exposure has come down—just taking down the book size.”

Overall market exposure has also declined. Hedge funds curb their exposure to stocks not just by ditching riskier long positions, but also by closing negative bets and moving into cash. Such moves can lead to a sudden rally in heavily shorted stocks, a phenomenon that took place earlier this week.

Meanwhile, hedge funds have been loading up insurance against further declines by purchasing options contracts that become more valuable if the stock market continues to fall, Mr. Kinderlerer said.

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China Is Tired Of Stimulating Everything & Everyone. 不再

According to Chinese Premier Li Kegiang, there won’t be any more major stimulus this time around to keep the Chinese economy afloat and it’s zombie companies alive. Exactly at the wrong time. 

“We will not take, in response to momentary fluctuations in economic growth, short-term and forceful stimulus measures,” Li said in a speech. 

Too bad. Unfortunately, his statement has a shell life of a banana. Despite already creating the largest credit and shadow banking bubble in the history of mankind (Where Is China’s Hidden Debt Bomb), Chinese Government will be forced to induce further stimulus as soon as the worldwide recession of 2014-2017 hits.  No stimulus at that stage would mean a complete collapse to the Chinese economy, credit/real estate bubbles, chaos in the streets and a possible revolution. Leaving comrade Li with no other choice.   

Chinese Premier Li claps as he attends the opening ceremony of the BFA Annual Conference 2014 in Boao

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Reuters Writes: China says no major stimulus planned; March trade weak

(Reuters) – Chinese Premier Li Keqiang ruled out major stimulus to fight short-term dips in growth, even as big falls in imports and exports data reinforced forecasts that the world’s second-largest economy has slowed notably at the start of 2014.

Li stressed on Thursday that job creation was the government’ policy priority, telling an investment forum on the southern island of Hainan that it did not matter if growth came in a little below the official target of 7.5 percent.

“We will not take, in response to momentary fluctuations in economic growth, short-term and forceful stimulus measures,” Li said in a speech.

“We will instead focus more on medium- to long-term healthy development.”

His comments are among the clearest yet on the government’s plans for the economy, which has rattled global investors this year with a surprisingly lackluster performance.

Trade data on Thursday showed exports unexpectedly fell for the second consecutive month in March, the worst showing in more than four years, while imports fell by the most in 13 months.

Exports fell 6.6 percent in March from a year earlier, following an 18.1 percent slide in February, and imports fell 11.3 percent, their weakest performance in 13 months.

Economists were most worried by the fall in imports, which was seen confirming weakness in manufacturing and consumer demand. Some of the fall in exports was attributed to figures early last year being inflated by fake invoices before a government crackdown around the middle of 2013.

“My bigger concern is imports. It suggests a weakening in China’s own economy.” Louis Kuijs, economist at RBS in Hong Kong.

Data on April 16 is forecast to show the economy grew an annual 7.3 percent in the first quarter, the weakest rate since early 2009, in the immediate aftermath of the global financial crisis.

Economists at Barclays lowered their first quarter GDP forecast to 7.2 percent after the trade data, saying it was to reflect more signs of soft domestic and external demand.

STIMULUS EXPECTATIONS

The almost unabated run of disappointing data this year has fuelled investor speculation the government would loosen fiscal or monetary policy more dramatically to shore up activity.

But authorities so far have resisted broad stimulus measures. On Wednesday, the top economic planning agency said the government had less room to underpin growth because it did not want to inflate local debt risks.

Still, authorities have take some steps to bolster growth. Earlier this month, they announced tax breaks for small firms and plans to speed up some infrastructure spending, including the building of rail lines.

The national railway operator now plans to raise its annual investment by 20 billion yuan($3.2 billion) to 720 billion yuan in 2014.

There have also been moves to cut down on bureaucracy and to open up state-dominated sectors to private investors.

In his speech, Li said China was positioned to sustain a reasonable level of growth over the long term.

“We have set our annual economic growth target at around 7.5 percent,” he said. “It means there is room for fluctuation. It does not matter if economic growth is a little bit higher than 7.5 percent, or a little bit lower than that.”

Investors have long steeled themselves for growth to slow as China’s economy matures, especially as the government tries to steer it away from investment- and export-driven growth and towards consumption-led activity.

But the extent of the slowdown this year has still been a shock to some.

“A lot of people weren’t expecting growth to slow so quickly,” said Julian Evans-Pritchard of Capital Economics in Singapore.

“For us, it’s not unexpected. You’ve seen credit growth slowing since the middle of last year. We think that the current slowdown is a natural extension of that,” he said, adding it would extend into the June quarter.

Economists have repeatedly cut their growth forecasts for 2014, with a Reuters poll showing growth is forecast at 7.4 percent, a shade below the government’s 7.5 percent target.

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How Dumb Is Mainstream Financial Media? Warning: They Are So Dumb This Statement Will Boil Your Blood

When will the selling stop and when will the markets bottom? 

According to the article below, when the “Smart Money” quits selling. That’s Just F#&$ing Brilliant Ladies and Gentleman. 

Sure, you can believe this blood boiling bullshit or you can Click Here. Not only did we predict with the pin point precision when this selling would start, but we have already identified when this leg of selling will stop and bounce (in the overall cyclical 2014-2017 bear market). To the day and to the point. So, you can wonder away when the so called “smart money” stops selling or you can pay attention to highly advanced mathematical research that will tell you exactly when. It’s your call.  

Dumb and Dumber(Screengrab)

Market selloff will stop when the ‘smart money’ quits selling

The stock market will stop quaking when the smart money is through selling. 

That might sound glib or obvious — something that’s more or less true by definition of each market drop. But it’s a particularly fitting observation now, because the current market tremors are more a matter of Wall Street’s elephants running from risk than the ground giving way underneath the economic recovery. 

The dominant themes of the sharp pullback have been a reversal of the winning investment trades of 2013 (which got very crowded and expensive), a rush by startup-backers and buyout artists to jam stock offerings into new investors’ hands, and heavy selling of shares by corporate insiders. 

This is all on the up-and-up, and all are typical features of a bull market. Yet there was just too strong a sense in recent weeks that those early to many winning ideas were done pressing their bets and wanted to – or were forced to – cash them in.

Consider:

The first quarter saw the highest volume of initial public offerings since 2000, with 70% of debuting companies having yet to turn profitable. About a third of the deals in the past month had traded below their offer price, a sign that supply was swamping demand or that the quality of the companies was slipping.  The offering for Ally Financial Inc. (ALLY), while a relative victory for the U.S. government, which rescued it with a big investment during the financial crisis, has sagged in its first two days on the market, a decent example of supply-driven action. For good measure, Kenneth Moelis, the veteran investment banker who began at Michael Milken’s Drexel Burnham Lambert ion the 1980s, is looking to take his 7-year-old advisory firm Moelis & Co. public at a $1.5 billion valuation. 

Private-equity firms have been exiting rapidly from companies they bought in recent years. According to data tracker Dealogic, buyout firms have raised $13 billion this year in 31 IPOs of their portfolio companies, a record level to this point in any year. Blackstone Group’s secondary offering of 15 million SeaWorld Entertainment Inc. (SEAS) shares  — about one-sixth of all outstanding equity — as the company reported weak results further sent a message of the sharp guys ringing the register.

Corporate insiders have been selling heavily in recent months, as executives take advantage of all-time highs in many stocks and the big indexes. While this isn’t a great market-timing indicator – and selling always tends to be active ahead of the tax deadline following a great year for stocks, as 2013 was – it fits neatly with the story that those with the best knowledge of businesses are not seeing good value in their shares. 

Perhaps most important to the day-to-day action, certain popular hedge-fund positions — no doubt amplified by margin-borrowing balances at all-time highs — have been upended. Merrill Lynch global strategist Michael Hartnett points out that the winners so far in 2014 (emerging-markets stocks, bonds and gold up) match exactly last year’s losers and vice versa (with the Nasdaq, Japan and the U.S. dollar suffering). 

Michael Block, chief strategist of Rhino Trading, points out some telltale behavior in certain instruments makes it obvious some big players were caught badly offside as momentum trades faltered. 

The exchange-traded fund for Brazilian stocks, iShares MSCI Brazil (EWZ), has been almost perfectly negatively correlated with the U.S. Standard & Poor’s 500 index this week, as if they sat on opposite ends of a seesaw. Brazil has been a popular short, and the S&P 500 and Nasdaq’s growth stocks very trendy longs, and liquidation on some level is washing over it all. Similarly, Facebook Inc. (FB) has traded as the virtual inverse of Petrobras Argentina SA (PZE). 

Another odd move? The surge in the price of nickel on the London Metals Exchange, another seeming beneficiary of desperate speculators being chased from bearish commodity bets, perhaps as their brokers demand they curtail risk exposures and investors withdraw funds. 

As Block puts it: “This is all about pain. Managers came into this long growth stocks, and short things like emerging markets and metals. When someone yells fire, crowded positions take on a life all their own.  I fear that we will hear more about certain managers taking losses in [the first quarter] and April in the coming days.  There’s no two ways about it.  Prime brokers are tightening reins, as are fiduciaries. That’s what this is. Trying to rationalize any of this by citing fundamentals is a dangerous wild goose chase.”

This doesn’t mean fears of a first-quarter lull in U.S. economic growth and a stalling housing recovery are irrelevant, or that China’s weak export data and broader slowdown signs are meaningless. Sure, the market is reassessing its expectations for a growth acceleration come spring and summer.  Yes, there is nervousness about Federal Reserve intentions as it slowly dials down its asset purchases and eyes frothy financial markets. Long-term Treasury yields have receded while short-term rates have held steady, flattening the yield curve, which implies slower growth and/or marginally less-easy money down the road.

No dramatic real-economy developments

Yet none of these real-economy developments are particularly dramatic or new enough to account for the degree and character of this selloff. The corporate-credit markets have remained firm through all this, which likely wouldn’t be the case if markets were sniffing out the makings of a nasty economic shock or higher risk of U.S. recession. 

That’s the good news. The bad news is that so many market sectors – especially the ones that led the push to new highs in late 2013 and early this year, such as Internet, biotech and small-cap stocks  – had appreciated dramatically more than the pace of economic or earnings growth did. So there arguably could be plenty of room for the hottest, growth-iest parts of the market to re-price lower before this corrective market action is through. 

Just in the past couple of days, the weakness broadened to other areas such as banks and large-cap industrial stocks that were being used as havens. That’s healthy, as are the emerging signs that individual investors are registering more fear about the declines.

These are the prerequisites for an enduring recovery, but plenty of damage to the uptrend has been done already. Before sounding an “all-clear,” investors should look for signs that stocks can react reasonably well to earnings news in coming weeks, which would indicate expectations have been pounded low enough. And they should hope for the IPO window to narrow or close, insiders to quit selling and the trendy hedge-fund trades to stabilize.

In the past year-and-a-half, this market has seen pullbacks halted a bit before all the signs of capitulation have lined up. We’ll soon see if this is yet another 2013 pattern that is now working in reverse.

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How Long Before Gold Breaks Above It’s $1,900 Top? If True, This Will Disturb Most Market Participants

According to CNBC and after losing over $1 Trillion in value over the last few years……NEVER. Yet, we are a little bit more optimistic. Our case is very simple. Based on our mathematical and timing work, there will be a severe bear market (2014-2017) and a subsequent deep US Recession. Stocks will collapse, economic growth will come to a halt and the FEDs will be forced to inflate/stimulate in any way that they can. As you can imagine, Gold does very well in such a “Risky, Volatile & Inflationary” environment. 

While we do not have the mathematical composite breakdown for Gold (as we do for the stock market), we can look at our stock market guidance to connect the dots. As such, we would expect the US Economy to be in an “official” recession by this time next year and FEDs talking about or already infusing further stimulus. Therefore, we would expect Gold to be approach/breaking $1,900 by the end of 2015 at the latest.  

gold investwithalex

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How Long Before Gold Breaks Above It’s $1,900 Top? If True, This Will Disturb Most Market Participants  Google

CNBC: Will gold ever recover from its ‘$1 trillion crash’?

This week last year, the price of gold (Exchange:XAU=)suffered a 15 percent drop inside two trading days. It was a volatile year for the precious metal — 2013 finally put an end to a 12-year bull run. And that is unlikely to be reversed no matter how volatile the markets get, analysts have told CNBC.

Gold has been trading near two-and-half-week highs and is on track for its best week in a month as equity markets have been hit hard and tensions continue to mount in Ukraine.

Read More As gold hits 6-month high, traders look to Crimea

In the near term, analysts have said gold is an obvious play as stocks around the world have had a challenging week, with the Nikkei (Nihon Kenzai Shinbun: .N225) suffering its worst week since Fukushima and U.S. and European technology stocks seeing heavy declines . Spot gold traded close $1,319 after three days of gains, peaking at $1,324 on Thursday.

“Investors are becoming more defensive, we have seen equities come off and that is where the value of gold really shines for investors,” said Martin Arnold, director and research analyst at ETF Securities.

Read More Gold suffers worst November since 1978 

But Arnold added that market volatility would ultimately not be enough to drive the price of the metal consistently higher – and this is down to Asia’s weak demand.

“We saw last year that the strong physical demand came in when the gold price slumped, but in the current lack of strong investor demand, you can’t expect very strong price gains. We expect a modest move higher this year – but see better opportunities in the commodity space, particularity with other precious metals with more industrial application,” he told CNBC.

At its peak in September 2011, gold topped $1,900. Investors who had hung on to the metal in the decade up to its all-time high would have seen a sevenfold increase in its price, or gains of 575 percent.

Read More Gartman on Gold: We’ve Never Ever Seen Anything Like It 

Beat Wittmann, CEO of TCMG Asset Management said the metal has been treated as “nothing more than a hedge in the last two years,” but as interest rates are relatively low at the moment, the opportunity cost of gold is not too inhibitive for investors.

“There are people that don’t want to be in credit or equities for structural reasons, gold then is a valid asset class. As long as we are in a very low interest rate environment, the alternatives are not very attractive, so the opportunity cost to hold for a lot of people is still OK,” he said.

The $1 trillion crash

The collapse of the gold price in April 2013, which saw the yellow metal sink below the key psychological level of $1,500 an ounce, was what Adrian Ash, head of research at BullionVault describes as the “$1 trillion dollar crash”.

“Gold lost one-tenth of its market value on Monday 15 April alone. That wiped the equivalent value of London’s entire housing stock off the world’s above-ground gold holdings,” he said.

Read More Why this top technician recommends buying gold now 

“Investors buying gold and gold derivatives because they expected gold to rise for 13th year running naturally took fright. But Investors still without it might ask what they’re missing in the bigger picture now gold’s rallied 10 percent already in 2014,” he said.

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Mainstream Financial Media Anticipates A Devastating Stock Market Collapse Of…Wait For It….

5-7%. But not to worry, the markets will surge higher thereafter, so “Buy The Dip”. 

What a bunch of jackasses!!! 

iShares NASDAQ Biotechnology Index (ETF) is already down 20%. If you follow the advice above you will get your portfolio or retirement account shredded into pieces. Would you be interested in highly unique financial analysis that can predicts the markets? I have to warn you thou. What it shows is not pretty. Certainly not the 5-7% drop. Still interested? Here are a few reports you can start with

 CNBC Idiots

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Mainstream Financial Media Anticipates A Devastating Stock Market Collapse Of…Wait For It…. Google

Talking Numbers: The correction is on. Here’s how bad it’s going to get.

Thursday wasn’t just bad for the markets, it stunk.

While the Nasdaq composite index saw its worst loss since 2011, the market benchmark S&P 500 index lost 2 percent and is now negative for the year. Only 21 stocks in the S&P 500 were either positive or flat Thursday and the index ended the day at 1,833.08.

And, it may get worse before it gets better.

Chad Morganlander, portfolio manager at Stifel’s Washington Crossing Advisor, sees the potential for a 5 to 7 percent correction in the S&P 500 over the coming months. That could come as the Federal Reserve continues to taper its monetary stimulus program. During that time, according to Morganlander, investors will flee to more defensive, quality names.

However, the year may end on a positive note, Morganlander believes.

“We think in 2014, a 6 to 8 percent total return on the S&P 500 could in fact happen,” he said. “That would be on the back of around 3 percent GDP growth [and] earnings growth of 6.5 percent, which would get your S&P earnings to $115.”

Though Morganlander also sees somewhat higher revenues ahead for companies, stocks will also be pushed up with continued share buybacks.

“You have revenue growth of around 3 percent,” predicted Morganlander. “Perhaps you have buybacks of 2 percent of the total amount of shares. And, overall total amount of return is around 6 to 7 to 8 percent on the market.”

Ari Wald, head of technical analysis at Oppenheimer & Co., agrees with Morganlander that a correction could be ahead, though he sees it in a range between 6 and 8 percent. And, like Morganlander, he also thinks the market will close the year on the upside.

“For the S&P 500, I’m still remaining positive,” said Wald. “I think we do get that 6 to 8 percent correction. We’re due for one. Summertime is when you would expect it.”

Wald thinks investors should pay attention to the fact that the S&P 500 still trades above its 200-day moving average.

“Sometimes, it’s just as easy to follow the trend and follow the rising slope of the S&P 500’s 200-day moving average,” said Wald. “The tactical opportunities are on the downside, to buy dips rather than to sell rallies.”

The important level to watch, according to Wald, is one the S&P 500 just broke below: 1,840.
“If you can’t hold that,” said Wald, “maybe that correction comes a little bit sooner rather than

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Obama Wins A Prestigious F#&# The Press & Freedom Award. George Washington Flips In His Grave

“Change We Can All Believe In”  Yep, change for the worst. Now, before you send me conservative love letters or liberal hate mail, understand, I am neither…..so don’t bother.  It is time Americans take back their freedom and liberty from warmongers in Washington. It is only my hope that the upcoming bear market and a severe recession in the US Economy will wake some people up. 

On Wednesday this week, the Thomas Jefferson Center for the Protection of Free Expression announced that the US Justice Dept. had topped this year’s list of “Jefferson Muzzle” recipients, an award handed out every April since 1992 “as a means to draw national attention to abridgments of free speech and press and, at the same time, foster an appreciation for those tenets of the First Amendment.”

The White House Press Office was listed in the second slot among this year’s “winners,” trailed immediately by a third-place tie between the National Security Agency and the Department of Homeland Security.

And that is precisely why President Obama should be declared an enemy of the state and sent to Gitmo. 

obama

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Obama Wins A Prestigious F#&# The Press & Freedom Award. George Washington Flips In His Grave Google

RT Writes: Obama administration wins Jefferson Muzzle award for restricting free press

The United States Department of Justice and the White House Press Office are this year’s top winners of a dubious award extended to those considered to be “responsible for some of the more egregious or ridiculous affronts to First Amendment principles.”

On Wednesday this week, the Thomas Jefferson Center for the Protection of Free Expression announced that the US Justice Dept. had topped this year’s list of “Jefferson Muzzle” recipients, an award handed out every April since 1992 “as a means to draw national attention to abridgments of free speech and press and, at the same time, foster an appreciation for those tenets of the First Amendment.”

The White House Press Office was listed in the second slot among this year’s “winners,” trailed immediately by a third-place tie between the National Security Agency and the Department of Homeland Security.

It isn’t unusual for the free-speech loving organization named in honor of the third president of the US to condemn federal agencies for infringing on the constitutional rights of American citizens, but the Obama administration swept this year’s honors, undoubtedly lending further credence to allegations that the White House has ravaged First Amendment-protected freedoms by interfering and attempting to influence even the most venerable mainstream press outlets in the country.

According to the Jefferson Center, first place honors this year were awarded to the Justice Dept. due to the Obama administration’s relentless aggressive pursuit of individuals alleged to have leaked government information, while the press office’s routine shunning of journalists from official functions in exchange for regularly relying on a private White House photographer earned that department second place standing. The NSA and DHS were selected not as a result of any new infringing policies put in place by those offices, however, but rather because they went after Americans who parodied the official government seals of either department.

Elsewhere on this year’s list of winners are the North Carolina General Assembly Police and the Kansas Board of Regents rounding out the top five, followed by Modesty Junior College, the Tennessee State Legislature and the principals of schools in Florida and New Jersey.

“From the White House to the statehouse, from universities to high schools, members of the press have had to defend against a variety of challenges, some never seen before,” Jefferson Center Director Josh Wheeler said in a statement this week.

Indeed, the Obama White House in particular has been accused in recent years of treating the press in a manner unheard of since the administration of Richard Nixon — an allegation that would seem overblown had it not been made by the likes of the internationally renowned Committee to Protect Journalists and some of the country’s most well respected reporters.

“I think we have a real problem,” New York Times national security reporter Shane Scott told the CPJ for their report on eroding press freedoms in the US last October. The administration’s prosecution and persecution of leakers was having a real “deterrent effect,” Shane acknowledged, adding, “If we consider aggressive press coverage of government activities being at the core of American democracy, this tips the balance heavily in favor of the government.”

Six months later, the Jefferson Center agrees and has put the White House’s war on leakers and the journalists accused of “aiding and abetting” them at the top of this year’s list.

“The government surely has a legitimate interest in identifying those disclosing such information,” the center said in an explanation included in this week’s report. “Yet if the press is to fulfill its role as a government watchdog and report what it sees to the public at large, it has to be able to assure its sources of confidentiality.”

Imperative as it may be, doing as much has been made harder than ever due largely to the administration’s targeting of leakers: WikiLeaks source Chelsea Manning was sentenced last summer to 35-years in prison for disclosing state secrets, and Edward Snowden — the former intelligence contractor who last year began to supply journalists with classified documents pilfered from the NSA — is wanted for espionage in America and has spent nearly the last year in Russia as a result.

And though these instances are few and far between, the severity of these prosecutions and similar investigations into outlets like Fox News and the Associated Press waged by the Obama administration to narrow in on leakers has been credited with creating a chilling effect that is allowing for the government to essentially scare sources and reporters from covering certain topics, lest they wish to risk a federal prison sentence: former Central Intelligence Analyst John Kiriakou is currently serving timeat a correctional facility in Pennsylvania for confirming the name of a colleague to an established reporter, and last month State Department advisor Stephen Kim was sent behind bars for having shared secrets with a Fox Reporter — which, in turn, led to the Justice Department seeking in secretthat journalist’s private emails. In that instance, the Washington Post wrote recently, “court documents in the Kim case reveal how deeply investigators explored the private communications of a working journalist.”

But when the government hasn’t been hounding journalists for speaking to sources, it’s been influencing the way the world sees its news to a certain degree. The White House Press Office, the Jefferson Center wrote, was also awarded a Muzzle award this year because the administration has “dramatically limited” access to the president for photojournalists, instead compelling a government cameraman to create the images dispersed worldwide by the White House to narrate the administration’s otherwise-often-secret inner workings.

“The White House counters that it has released more images of the President at work than any previous administration. While that may be true, the journalistic value of such photographs is a product of their content, not quantity,” the center said. “For systematically rejecting independent journalistic access in favor of its own sanitized visual record, the White House Press Office has earned a 2014 Jefferson Muzzle.”

Tied at third-place, the NSA and DHS were both deemed Muzzle-worthy by the Jefferson Center for spending three ears pursuing an American citizen who designed parodies of those agencies logos, including one which touted the “US Department of Homeland Stupidity.”

The Obama administration was last awarded a Jefferson Muzzle in 2011 for what the center described then as restricting media access to the BP oil spill in the Gulf of Mexico a year prior.

“Since 1992, the Thomas Jefferson Center for the Protection of Free Expression has celebrated the birth and ideals of its namesake by calling attention to those who in the past year forgot or disregarded Mr. Jefferson’s admonition that freedom of speech ‘cannot be limited without being lost,’” the organization says on its website.

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Carl Icahn Confirms Our View. And It Is So Disturbing You Won’t Be Able To Sleep Over The Weekend

In his brief interview with CNBC (see video below), Carl Icahn confirmed what we have been saying on this blog for quite some time. First, everyone loves this market (even his barber) a little too much and that in itself should raise some red flags. Second, most earnings you see today have been artificially driven by cheap credit infused by the FED.  That’s exactly what we have been saying here for a long time. Today’s earnings are a mass delusion at best. As we have said before, if you take credit driven earnings out, the true market P/E should be around 60-80, making this market not only expensive, but “Are You F#&$ing Kidding Me?” expensive. You will see the P/E ratio surge (as they did in 2008) once the markets crater and the US Economy falls into a severe recession later this year. 

Finally, Mr. Icahn insinuated that there will be a major correction over the next 3 years, but he doesn’t know exactly when. While he doesn’t, we certainly do. And not only to the year or to the month, but to the day. That’s right, our mathematical and timing work shows us exactly when (to the day) the bull market will top out and the subsequent bear market composition (bear market of 2014-2017). If you would like to gain access to such information, please Click Here.   

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Carl Icahn Confirms Our View. And It Is So Disturbing You Won’t Be Able To Sleep Over The Weekend Google

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JP Morgan Chase Missed By A Mile. What They Have Said About The Real Estate Market Will Send Chills Down Your Spine

In October of 2013 I went out on a limb by calling for a housing market top. You can see it here I Am Calling For A Real Estate Top Here. At that time I suggested that while it might be incredibly difficult to see the actual real estate market top (because most real estate markets are local and they will roll over on their own accord), by the time October of 2014 rolls around, we will see clear negative numbers on Year-Over-Year basis. Confirming that the Fall of 2013 was indeed the top. 

As JP Morgan Chase reported their quarterly results this morning, we continue to gather evidence that the call above was dead on the money. Not only did JP Morgan missed, it missed by a mile. Revenue $23.9 Billion Vs $24.5 Billion expected, earnings $1.28 Vs. $1.38 consensus. Most importantly, JPM suffered  a 42% drop in mortgage revenue and a 21% slide in fixed income trading. Further, it set the precedent to expect the same results from other banks and financials. I wonder how long before the weather is blamed for such fundamental misfortune.  

jp morgan

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JP Morgan Chase Missed By A Mile. What They Have Said About The Real Estate Market Will Send Chills Down Your Spine Google

 

 

Bloomberg Writes: JPMorgan Profit Falls 19% on Trading, Mortgage Declines

JPMorgan Chase & Co. (JPM), the biggest U.S. bank, said first-quarter profit fell 19 percent on lower revenue from fixed-income trading and mortgages, themes that may be repeated across Wall Street next week. The shares declined 2.9 percent.

Net income dropped to $5.27 billion, or $1.28 a share, from $6.53 billion, or $1.59, a year earlier, according to a statement today from New York-based JPMorgan. Ten analysts surveyed by Bloomberg estimated $1.46 a share on average.

JPMorgan, the first of the top U.S. banks to post results for the period, said profit fell in every major division, amid a 42 percent drop in mortgage revenue and a 21 percent slide in fixed-income trading. Chief Executive Officer Jamie Dimon, 58, warned investors in February that trading had fallen 15 percent for the first two months of 2014, a decline analysts including David Konrad of Macquarie Group Ltd. blamed on a reduction in the Federal Reserve’s bond purchases.

“It’s been a tough quarter for the industry,” said Pri de Silva, senior banking analyst at CreditSights Inc. in New York. “I’m not overly worried about JPMorgan unless I see something else going on apart from what we already know is lower fixed-income trading and mortgage results.”


Photographer: Peter Foley/Bloomberg

JPMorgan, the first of the top U.S. banks to post results for the period, told… Read More

JPMorgan fell to $55.75 in New York trading at 7:41 a.m. from $57.40 yesterday.

Konrad said in an April 4 research note that banks will have a “challenging quarter” as higher interest rates reduce loan refinancings.

Revenue, Expenses

Total revenue dropped 7.7 percent to $23.9 billion, as noninterest expenses declined 5.1 percent to $14.6 billion.

JPMorgan’s investment-banking head, Daniel Pinto, said this week he was overhauling the division’s reporting lines after his former co-head, Mike Cavanagh, left to join Carlyle Group LP. Pinto named Carlos Hernandez co-head of global banking with Jeff Urwin, John Horner head of investor services and Joyce Chang global head of research.

Earnings at Pinto’s corporate and investment bank dropped 24 percent to $1.98 billion, as revenue declined 15 percent from a year earlier to $8.61 billion. Fixed-income trading revenue fell to $3.8 billion on “weaker performance across most products and lower levels of client activity,” the bank said.

The 21 percent drop in fixed-income trading revenue surpassed estimates of a 15 percent decline from Moshe Orenbuch, an analyst at Credit Suisse Group AG, and 17 percent from Wells Fargo & Co.’s Matt Burnell.


Photographer: Ron Antonelli/Bloomberg

People stand inside the JPMorgan Chase & Co. headquarters building in New York.

Consumer Bank

Net income from consumer and community banking, run by Gordon Smith, fell 25 percent to $1.94 billion as provisions for credit losses surged 49 percent to $816 million. Revenue was $10.5 billion, down 10 percent from a year earlier.

Mortgage revenue dropped to $1.57 billion in the quarter, from $2.72 billion a year earlier. Home-loan originations were $17 billion, down 68 percent from the prior year as higher interest rates curtailed refinancings.

JPMorgan said profit in asset management, run by Mary Erdoes, declined 9 percent to $441 million, as costs rose 11 percent to $2.1 billion on “headcount-related expenses.” Assets under management climbed 11 percent to $1.6 trillion amid greater inflows and rising equity markets. Commercial banking, a division run by Doug Petno, posted a 3 percent profit decline to $578 million.

Blythe Masters

Another top executive, Blythe Masters, plans to depart. Masters, 45, will resign after she helps the bank complete the $3.5 billion sale of a commodities unit to Mercuria Energy Group Ltd., the company said last week. Over 27 years she rose from being a JPMorgan intern to running several credit desks and finally heading the commodities business.

The departures followed a trying year for Dimon, who agreed to more than $20 billion in legal settlements tied to lapses including mortgage-bond sales and trading losses in 2013. Resolving the disputes was the “most painful, difficult and nerve-racking experience that I have ever dealt with professionally,” Dimon said this week in his annual letter to investors.

JPMorgan could eventually earn $27 billion a year, or about $6.8 billion a quarter, as legal costs subside and higher interest rates boost margins, the bank said during its Feb. 25 investor meeting. The company said the quarterly dividend will rise to 40 cents a share from 38 cents, and it authorized a $6.5 billion stock buyback after the Fed approved the lender’s capital plan.

Citigroup Inc. reports earnings on Monday, followed by Bank of America Corp. April 16. Goldman Sachs Group Inc. and Morgan Stanley announce results on April 17.