The Insider Report

| George Soros

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It should be recognized that a disorderly default or exit from the eurozone, even by a small country like Greece, would precipitate a banking crisis comparable to the one that caused the Great Depression. It is no longer a question whether it is worthwhile to have a common currency. The euro exists, and its collapse would cause incalculable losses to the banking system. So the choice that Germany faces is more apparent than real – and it is a choice whose cost will rise the longer Germany delays making it. via Germany must defend the euro | The Great Debate.

Stocks To Watch Today – Barrons.com

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Aug 12, 2011 8:38 PM Biggest Insider Buying Week Since March ’09; Where & Who Posted by Dimitra DeFotis Insiders haven’t been buying up their company stock at this pace since the market bottom in 2009. While high volumes of insider activity falsely heralded a market bottom in November 2008, Ben Silverman at InsiderScore.com notes that no significant upside market correction lacked insider purchases over the past three decades. The latest buying was across sectors and may have peaked mid-week, though buying at financial services companies picked up while technology and energy insiders seemed to sit out some of the … Read more

So they look up Jonah, and cast him forth into the sea.

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I think the exit of the PIGS  from the EURO is inevitable.  How can I play that?  I’m not sure if the Euro goes up or down on that.  If the worst credits leave, then the currency gets stronger.  But before that happens, the boat is going to creak and moan until they throw Jonah into the sea.  So the Euro is going to weaken as the ECB puts in good money after bad? It seems that monetary union without political union is a fundamentally flawed idea.  Now that the strains of this unequal partnership are showing on the public … Read more

US stocks rise after unemployment report

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NEW YORK (AP) — Stocks are rising after news that fewer people joined the unemployment line last week and word that a technology bellwether’s profit beat expectations. The Dow Jones industrial average is up 256 points, or 2.4 percent, at 10,972 at 11:45 a.m. in New York. The S&P 500 is up 30, or 2.8 percent, at 1,151. The Nasdaq is up 73, or 3.1 percent, at 2,454. For the first time in four months, the number of people filing for unemployment benefits for the first time fell below 400,000 last week. Analysts say it may be a sign that … Read more

‘s have been scooping it up.

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In a CNBC interview Wednesday, TD Ameritrade Chief Executive Fred Tomczyk said the Omaha, Neb.-based online brokerage processed more than 900,000 trades Monday, adding that “four of the last five [trading] days have been records” for the company, in terms of trading activity.  While retail has been dumping, insider’s have been scooping up stock, graph courtesy of Washington  Service    

Dollar Advances as Fed Fails to Counter Global Growth Concerns

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Aug. 10 (Bloomberg) — The yen gained, approaching a post- World War II high versus the dollar, as the Federal Reserve’s pledge to keep interest rates at a record until mid-2013 failed to convince investors global growth will be sustained. The euro extended its drop against the dollar as European stocks fell amid speculation yesterday’s gains couldn’t be sustained. The Swiss franc weakened after the nation’s central bank said it expanded measures to counter the currency’s strength. The pound dropped after Bank of England Governor Mervyn King said “headwinds” to growth are intensifying. “A lot of people looked at the … Read more

Rage against the machines

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The last week has been the second wildest week of trading I have seen in my long career.  One picture tells the story- look at this the VIX, the CBOE VIX Futures Underlying.  It didn’t matter what you were  today.  Stocks, bonds, commodities, gold, it all  went up and down wildly.  The Dow stretched me like a torture victim on a rack and pinion between 640 points. It opened up sharply sold down, then back up again, plunged when the Fed announcement came out, then rallied straight-line into the close. Whew what a day!   I made a ton of good … Read more

On t’Mark – tin hats, Band-Aids, US psyche hurt, ECB’s peashooter, UK riots

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On t’Mark – tin hats, Band-Aids, US psyche hurt, ECB’s peashooter, UK riots OK, tin hats on; Dora Band-Aids at the ready?  What do you mean we’re out of them?  Oh, the ECB used the last one last night.  What about the Wiggles ones instead?  The Fed used those all up in April!  It will be a dark and ugly day in our markets, and governments/central banks are out of Band-Aids.   I’ll start you will this thought: Geithner announces that he is not resigning, Dow plunges 635pts.  Enough said!   I will try to skip the hyperbole and give … Read more

‘s a Show Me Market Now!

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Before the market will rally, we will have to see           Massive insider buying.  I have written several times about the lack of it. Major corporate buybacks or dividends.  For example, Apple could change the dynamics by splitting the stock 10 for 1 and pay a $25 billion dividend.  It would have to be many more than Apple. Step up in takeover activity.  We need to see the prices validated with takeovers. End of the gross excesses in the IPO market that values social media companies at absurd levels. Some good policy moves by the Obama administration.  … Read more

GOLD HITS RECORD HIGHS, MINERS UNDERVALUED

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Gold traded at new highs today however many quality gold miners have not reflected the strong gains in Gold in 2011. Gold miners in general are undervalued, Junior Gold companies are also very attractive as we expect to see consolidation in the industry as high prices drive take-overs and buy-outs. Spot gold was set for a second consecutive daily trading rally, up 2 percent from Friday at $1,696.56 an ounce by 1342 GMT, having hit a record $1,715.01 earlier and having traded at all-time highs in sterling and euros . Investors have bought more gold in the last month than … Read more

THE GREAT FINANCIAL MIGRATION

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  Financial Institutions around the world and especially those in Europe and the USA face a crucial set of choices about the future of their institutions. Western Governments are riddled with debt and their only way out is decades of austerity and taxes, but the new world is a mobile world, globalization has set limits on how much a government can impose it’s will on the corporations and citizenry of a nation. Excess taxes and austerity will lead to a mass financial migration to emerging markets. Having spent most of my life in Asia, I can not remember a time … Read more

U.S. Loses it Triple AAA status, what does it mean, ideas for Monday?

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For the complete report from S & P click here.   Why listen to what others are saying before reading S&P downgrade of U.S. Sovereign credit itself? As for what it will do Monday morning, my guess is that it will go down and undercut the lows of Friday. That was 1166 on S&P 500 and 11,139 on the DJI, so I expect us to undercut the lows.  Apparently a lot of people knew about the impending downgrade on Friday and that explains the market volatility that day.   The market swung wildly about 416 points ending mostly unchanged although NASDAQ … Read more

Hedge strategies to consider

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Investors who aren’t yet hedged, and are interested in cost-effective portfolio protection, can consider buying the VIX September 32.50 call and selling the VIX September 37.50 call. When Schwartz modeled the trade, the VIX hedge cost less than $1 during Friday trading, and it provides protection through the bulk of September, which is historically the trading year’s most volatile month. Why? All of the market’s great crashes have occurred in October. Stephen Solaka, managing partner of Belmont Capital, a Los Angeles money-management firm, advised clients to “collar” their portfolios with SPDR S&P 500 ETF Trust (SPY) options. When SPY was at 119.75, … Read more

Before you jump in up to your head, you better read this first.

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  Stocks May Fall Further Despite Massive Sell-Off – Barrons.com Blood Not Yet Running in the Streets By MARK HULBERT | MORE ARTICLES BY AUTHOR Despite the market’s steep plunge, investors are far less concerned and panicked than they were during last year’s Flash Crash. Contrarian-oriented investors may be wondering if Thursday’s free-fall constitutes the proverbial “blood running in the streets” that noted contrarian Nathan Rothschild famously said marked the time to buy. Unfortunately not, according to my contrarian analysis of advisory sentiment. via Stocks May Fall Further Despite Massive Sell-Off – Barrons.com.

Western Leaders Seek to Contain Euro-Crisis Market Turmoil

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Western leaders huddled on preventing the debt crisis from spreading to the core of the euro area after the biggest weekly decline in global stocks since 2008. President Barack Obama and British Prime Minister David Cameron joined telephone consultations with euro-area counterparts yesterday as investors signaled concern a July 21 agreement to expand the 440 billion-euro ($628 billion) rescue fund would fail to stop the rot. Full article available @: http://www.businessweek.com/news/2011-08-06/western-leaders-seek-to-contain-euro-crisis-market-turmoil.html

A reprint from Zero Hedge about leaving the Euro- a good idea

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How Ireland Can Leave The Euro: One Expert’s View Submitted by Tyler Durden on 02/28/2011 17:15 -0400 Bond Capital Markets Creditors default fixed Germany Greece Ireland Italy Monetary Policy Portugal Via adamsmith.org The following memo, which has fallen into our hands, is a draft of advice to the new Irish Minister for Finance from a British colleague who has a wealth of expertise on how to handle economic crises. He prefers to remain anonymous for professional reasons. Dear Minister, Congratulations on your new appointment. As you read the civil service briefings on the present crisis, you will come to appreciate … Read more

The “shorts” who popped a China bubble

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NEW YORK/SYDNEY (Reuters) -They are a rag-tag bunch, often working from home or tiny offices scattered round the world, from rural Texas to Beverly Hills and a suburb near Australia’s Bondi Beach. Some have never even been to China; most don’t speak or read Chinese. And yet in the past nine months, this small group of “short sellers” has published research exposing accounting fraud at a series of Chinese companies listed in the United States and Canada, and made as yet unproven allegations against a whole bunch more. As a result they have scuttled a once hot sub-sector of the … Read more

Dow down 512.76, 9th biggest point drop ever

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Today August 4, 2011 the Dow was down 512.76, the 4th biggest drop point wise in history.  We are now down 4.58% for the year. Largest daily point losses Rank         Date     Close Net Change % Change 1 2008-09-29 10,365.45 −777.68 −6.98 2 2008-10-15 8,577.91 −733.08 −7.87 3 2001-09-17 8,920.70 −684.81 −7.13 4 2008-12-01 8,149.09 −679.95 −7.70 5 2008-10-09 8,579.19 −678.91 −7.33 6 2000-04-14 10,305.78 −617.77 −5.66 7 1997-10-27 7,161.14 −554.26 −7.18 8 2008-10-22 8,519.21 −514.45 −5.69 9 2011-08-04 11,383.68 −512.76 −4.31 10 1998-08-31 7,539.06 −512.62 −6.37 The third largest one-day point drop in DJIA history, and largest at the … Read more

The President will be asking Congress to raise the debt ceiling again.

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Normally, the strongest  time of year for the market is the 4th quarter.  It may be different this year.   Note this email response from the senior Senator from Utah. “Thank you for contacting me to express your thoughts and concerns about recent debate on our nation’s debt and budget negotiations.  I appreciate your timely input on this very important topic. As you may have heard through the news media, a compromise proposal was negotiated over the weekend of July 30th.  The compromise proposal passed the House on August 1, 2011 by a vote of 269-161, the Senate on August … Read more

El-Erian Says S&P Will Downgrade U.S. If It Holds to Outlook

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Aug. 3 (Bloomberg) — Standard & Poor’s will downgrade the U.S. after it enacted a law to reduce federal debt by $2.4 trillion over a decade if the credit-rating company sticks to what it outlined last month, said Pacific Investment Management Co.’s Mohamed El-Erian. “It’s not clear that this is enough to preclude a downgrade by S&P,” El-Erian, chief executive and co-chief investment officer at the world’s biggest manager of bond funds, said in an interview on Bloomberg Television’s “In the Loop” with Betty Liu. “We suspect they’re under tremendous pressure not to downgrade, but if they stick to what … Read more

Deutsche Börse-NYSE Deal Moves Ahead

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BY ULRIKE DAUER FRANKFURT—German exchange operator Deutsche Börse AG Wednesday said more than 95% of shares had been tendered in favor of its planned tie-up with NYSE Euronext, removing a major potential obstacle to a deal that would create the world’s largest cash equities and derivatives-trading platform. The exchanges hope to complete the merger by the end of this year, but further hurdles remain. Regulatory approval in a number of jurisdictions is still required, and the European … Full article provided by the Wall Street Journal @: http://online.wsj.com/article/SB10001424053111903366504576485653685890450.html?mod=rss_whats_news_us&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+wsj%2Fxml%2Frss%2F3_7011+%28WSJ.com%3A+What%27s+News+US%29  

ReInventing the American Dream, Abroad!

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The late George Carlin, the outspoken and controversial comedian and modern day philosopher, said it best: “The reason they call it the American Dream is because you have to be asleep to believe it.”  Well these days that’s certainly true. America’s forefathers and the first colonists risked everything to escape tyranny in Britain, and they fled to the New World to form ‘a more perfect union.’ So what has happened in the last 235 years that has brought the United States to the sorry condition it’s in today?  New American Nightmare First, it’s important to define what exactly the “American … Read more

It is a warning flag if the market is not responding to data correctly.

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Prices move before fundamentals.  It is a warning flag if the market is not responding to data correctly.  This is one of the cardinal rules I write about in the Investment Survival Guide.  I don’t know what happened to the market Tuesday that caused a 265 point plunge on the Dow.   Not that I usually do know or anything presumptuous like that.  Oh sure there are no shortage of pundits offering theories to explain the daily machinations but only the most naive of investors believe they know what they are talking about.  But after seven down days, six hundred points or so and … Read more

‘ Beta and Leverage

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Even though U.S. politicos appear ready to reach an agreement on the debt-ceiling front, the fiercely polarized debate has introduced uncertainty into what was previously thought to be an obligation with certainty. Some no longer consider U.S. government debts to be risk-free. Some foreign central banks seem to be speaking with their feet by diversifying away from the U.S. dollar and are considering gold to be a safe-haven asset, and its price has continued on an upward tear. Many speculate that the last-minute compromise might avert technical default, but given the inability of the political machine to reach any pre-emptive … Read more

I hope I can get a way with reposting this good stuff from Barrons

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Barron’s(8/1) Stumbling To The Halfway Mark (From BARRON’S)    By Vito J. Racanelli The Standard & Poor’s 500 Index managed a respectable 6% total return in the six months ended June 30, but that included two brief 7% drops and rebounds in March and June. The volatility was enough to restrain the brokers’ average return to 5% in the same period (see table below). Thus ends four straight rankings, extending over 2009 and 2010, in which the mean return of the brokers’ focus lists — or best stock ideas — beat the index. Blame the waxing and waning macro concerns in … Read more

10 reasons why stocks should go up

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          The news is pretty depressing.   The economy is slowing, the country is bitterly partisan, and the market has been down several days in a row.  The VIX reflects that and is in overbought territory where it could sell off.  VIX goes down stocks generally go up. The first of the month usually brings in new money.  If it did this month, they were slapped hard. S&P 500 is at 200 day moving average and in oversold territory.  I’d be nervous if I was short Debt ceiling conclusion will lift some of the cloud hanging over … Read more

‘Magic Trip’ Reconstructs Footage From Ken Kesey’s Bus Trip – NYTimes.com

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Maybe I’ve drunk the Kool-Aid but I found a lot of things to buy today.  We went from about 10% invested to 100% invested today and short gold.   Our  historic average hold time is about 7 days but we are prepared to be long term investors when we do buy. Film Hitches a Weird Ride on Kesey’s Bus By CHARLES McGRATH Published: July 31, 2011 “Magic Trip: Ken Kesey’s Search for a Kool Place,” a film by Alex Gibney and Alison Ellwood that opens on Friday, is an exercise in what they call “archival vérité.” It’s a documentary that … Read more

Time to Buy USD

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The big bets have been against the USD in July, but this maybe an opportunity to buy some, cheap. Ninety-four percent of the 17 money managers overseeing a total of $1.26 trillion surveyed by Ried Thunberg ICAP Inc. expect the dollar to be stronger or steady relative to the euro in next three months, while 59 percent expect it to be stronger or steady against the yen. The New Jersey-based firm is a unit of the world’s largest interdealer broker. The dollar weakened 2.2 percent in July, according to Bloomberg Correlation-Weighted Currency Indexes, which track the performance of a basket … Read more

Sea Change in Map of Global Risk

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With Crises Shaking Confidence in U.S. and Europe, Investors Turn to Debt of Emerging Lands The black-and-white borders of the bond market are graying. As the pristine credit rating of the U.S. remains under threat, and the debt crisis in Europe rolls on, investors, traders and policy makers are grappling with fundamental changes in the global bond markets. Many so-called emerging countries, which have typically been charged higher interest rates because of their perceived risk, are now paying as little to borrow as developed nations, if not less. Full article provided by Wall Street Journal @: http://online.wsj.com/article/SB10001424053111904292504576480142807295216.html?mod=rss_whats_news_us&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+wsj%2Fxml%2Frss%2F3_7011+%28WSJ.com%3A+What%27s+News+US%29

Fed Readies Guidance for Banks in Event Aug. 2 Deadline Missed

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July 29 (Bloomberg) — The Federal Reserve is preparing guidance for banks in the event the U.S. debt limit isn’t raised and the Treasury Department runs out of money to pay all of its bills, a government official said. The guidance would cover issues including how payments are made, collateral pledged for loans as well as other supervisory and regulatory matters, said the official, who asked not to be identified because congressional negotiations on the debt limit are still under way. A credit-rating downgrade of U.S. Treasury securities caused by a failure to lift the $14.3 trillion debt ceiling would … Read more