Trouble and strife. Catch a falling knife? Not on your life.

Posted on Oct 08, 2008 by .

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Hundreds, if not thousands –perhaps even millions– of traders, investors and technicians are waiting eagerly on the sidelines like the boomer sooners of the Oklahoma land rush hoping to catch the bottom of the panic. This is known in the trade as catching the falling knife. It is not a recommended strategy (what is the difference between a tactic and a strategy? as John McCain would say).

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Market shows contempt for Congressional action. We show Contempt of Congress.

Posted on Oct 03, 2008 by .

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Today, Friday October 3 2008 the House of Representatives finally passed the (take your pick) Wall Street Bailout bill, Pig with Lipstick bill, Pig in a Poke bill, Bank Rescue bill, Pork and tax cat bill, Secretary of the Treasure permission to steal and mess around bill, Bush Administration Swan Song bill, the Reverse Robin Hood bill (rob from taxpayer, give to bank)….  You get the idea.  So did the market which basically urinated on Congress and did what we recently said it would do — tested the recent panic low:

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435 Neros fiddle while the economy smolders, about to burst into flame

Posted on Oct 01, 2008 by .

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In a long (long) career in the markets in which we have experienced many crashes and dramatic market moves we have just lived through a week to remember. This week an almost 800 point drop followed by an almost 500 point recovery. And you know what? No new lessons. There is nothing here for the technician or experienced investor that has not happened many times before. The old worn lessons of the past are reinforced, and the old worn principles of technical analysis are shown to work once again. Magee method investors have been short the Dow all year. So they watch with interest as the “others” (“they”) run frantically around like characters in a Breughel painting. (Garden of Earthly Delights) And, as Rome smolders threatening to catch fire, 435 Neros in the House of Representatives fiddle and pout and stand on their ideological principals. If it were a comedy we would laugh our heads off. But it’s not. It’s a tragi-comedy. Amazingly the half of the traders in the world (or one tenth) who are not being bashed to pieces are lusting to catch the bottom and go long the market. Speaking of the Bonfire of the Vanities. Dear readers do not panic, either way. Technicians WAIT for the bottom to clearly manifest itself. (Remember Enron?) There is no sign of a bottom. Capitualtion is a dish best eaten cold.

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Don’t relax yet. Hard to tell which is worse. Bailout works. Bailout doesn’t work.

Posted on Sep 27, 2008 by .

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Anytime you have daily ranges in the Dow of near 3% or greater you have trouble brewing — if not already brewed.  We are living the Chinese curse:  may you live in interesting times.  While Wall Street burns George Bush and his cronies fiddle with a plan to keep the Titanic from sinking.  Unfortunately they are like the band and haven’t noticed that the stern is already underwater.  Where are the lifeboats?  Hard assets.

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Lie cheat steal. Bamfoozle the public.

Posted on Sep 24, 2008 by .

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While the Administration attempts to rescue some shreds of credibility from the present credit infarction the market dances back and forth as though empty words and threats of action would restore the government’s honor and credit.  No chance.  They are hoist on their own petard.  Free market capitalist con-men until the last — including their attempt to foist the problem off on the taxpayer.  Astounding how little honor men have when money is involved.  And they impeached Bill Clinton about sex!!

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