AP-CNBC Poll: Investors wary of stock trading

Retail money does not have a good track record. Fear and pessimism towards stocks coupled with aggressive inflows by 'connected money' is bullish.

The survey confirms that average investors have been growing more concerned about the stock market as a safe place to invest for retirement. And news about the market has been unsettling for ordinary investors of late: More than 60 percent of those surveyed said they had paid attention to news reports about swings in the stock market.

Source: finance.yahoo.com

Currency wars set to break out as volatility grows

The global economic battle which ignores the calendar is omnipresent. The race to the bottom in fiat, or battle to own the weakest currency while still being able to issue debt is not a new trend. Beggar thy neighbor was used to describe policies where one country benefited at the expense of another. The use of tariff or quotas on imports or currency devaluation used to improve the trade account of one nation at the expense of another was common in the Great Depression. The policy practice can be seen growing in popularity today as the pace of global growth slows.

GET set for an outbreak of currency wars with the potential to shake global confidence as markets move towards the volatile October period.

Source: theaustralian.com.au

Contributed by Bob

Executive Who Questioned Ratings Sues Moody’s

Moodys also oversees rating on sovereign debt. Anyone expecting a proactive downgrade of key sovereign debt is smoking too much whacky tobacky.

Mr. Kolchinsky’s battle with Moody’s began years ago. In 2007, he questioned how Moody’s rated mortgage securities called collateralized debt obligations, or C.D.O.’s. At the time, he oversaw ratings on bundles of subprime mortgage bonds, the sort that included mortgages to borrowers with the riskiest credit. Shortly after, he was transferred to another unit, and he filed an internal complaint.

Source: nytimes.com

Uranium Participation

Uranium Participation is a decent exchange listed proxy for the price of U308 or UF6.
Trend energy has been tracing out a series of higher lows since 2007. This positive divergence with prices reflects what Wyckoff characterized as accumulation within a context of an operation. Accumulation comes first. This is followed up by the mark up phase.

Uranium Participation Corporation (U on TSE):

Uranium Participation Corporation is an investment holding company which invests substantially all of its assets in uranium, either in the form of uranium oxide in concentrates ("U3O8") or uranium hexafluoride ("UF6"), with the primary investment objective of achieving appreciation in the value of its uranium holdings.

Source: uraniumparticipation.com

Natural Gas

Commercial traders are again buying aggressively (even more so than the April setup) as price retests the April lows. While natural gas still has a lot of technical work to do, its leverage money flows are becoming increasing concentrated. Concentrated, leveraged money flows tend to support a directional break anticipated by connected money, so it’s worth monitoring.

Natural Gas ETF and the Commercial Traders COT Futures and Options Stochastic Weighted Average of Net Long As A % of Open Interest:


A quick look at retail money flows suggests that the short trade could become even more concentrated.

Natural Gas ETF and the Nonreportable Traders COT Futures and Options Stochastic Weighted Average of Net Long As A % of Open Interest:

Harrisburg, Pennsylvania, Bond Default Averted With State Aid

The back door printing press supports the Treasury auctions. The Treasury auctions support the Federal programs. The Federal programs include bailouts of the States. The States, in turn, bails out the local governments. The only catch is that the debt burden continues to grow as the real economy contracts. As long as source of the money providing increasing support to the Treasury auctions remains anonymous, the game is played as if all is well.

Pennsylvania’s capital city, Harrisburg, will get an advance on state aid to meet $3.3 million in bond payments due the day after tomorrow, averting what would have been the second-largest general-obligation default in the U.S. this year.

Source: businessweek.com

Thanks Bob!

Hitachi head wants government to fight strong yen

Tackling or fighting a secular trend is always futile. The Yen remains strong as capital flees the the perception of relative risk. The Yen and U.S. dollar, though clearly underperforming gold, remain liquidity alternatives to the Euro. This trend cannot be reversed through government internvention.

The new president of Hitachi Ltd. urged the government to tackle the strong yen, which is squeezing business as he seeks to transform one of Japan's biggest companies.

Source: finance.yahoo.com