| | | | |
| | | I'm Baaaack | | | Just like Jack Nicholson psychosocially screaming in The Shining, no one wants to hear this context of “I’m baaaack!” After six years of declines, lending for Home Equity Lines of Credit (Heloc) will rise 30 percent to $79.6 billion in 2012.Helocs are adjustable-rate mortgages tied to prime rates, the interest charged by banks to their most creditworthy customers, with the addition of a margin pre-determined by the lender. This is the highest level for Helocs since the start of the financial crisis in 2008, according to the economics research unit of Moody’s Corp. Originations next year will jump another 31 percent to $104 billion. It is this rise in HELOCs that is partially fueling the economy as people are using this money to buy consumer goods. Can we say déjà vu? This is the same foolhardy spending that accelerated the financial crisis in 2008. To put it mildly, this is hardly good news. According to an article in Bloomberg (http://www.bloomberg.com/news/2012-11-26/home-equity-loans-make-comeback-fueling-u-s-spending-mortgages.html. The revival in Helocs comes as lenders including Bank of America Corp. (BAC), Wells Fargo & Co. (WFC) and Citigroup Inc. (C) are still coming to grips with bad loans made during the housing boom that ended in 2006. Pressed by regulators earlier this year, banks are writing off vintage Helocs wiped out by a housing retreat that stripped about a third of home values in four years. Banks charged off -- or declared worthless -- $4.5 billion of equity loans in the third quarter, the most in two years, according to Federal Reserve data. Americans had used their homes like credit cards to go on spending sprees during the 2000 to mid-2006 real estate boom, tapping their equity to buy cars, televisions and luxury cruises. Consumers used about $677.3 billion, or about $113 billion a year, from home equity loans for consumer spending, according to a 2007 paper by former Federal Reserve Chairman Alan Greenspan and Fed economist James Kennedy. Here is further confirmation that we learned absolutely nothing from the housing crisis in 2008 and the government has done nothing to fix the systemic flaws. An axe wielding maniac in a deserted winter motel is hardly threatening compared to the liquidity wielding banksters in their fancy offices. | | Trade well and follow the trend, not the so-called “experts.” | | Behold the age of infinite moral hazard! On April 2nd, 2009 CONgress forced FASB to suspend rule 157 in favor of deceitful accounting for the TBTF banking mafia. | | | | | | | | | |  | | | | is a leading investment education firm that empowers traders to achieve and surpass their financial goals. More than 50,000 students have used Larry Levin's proven techniques for powerful results. | | | | | |  | | | | Congratulations to Benjamin Ramey Results: +$40 | | | | NOTICE: Testimonials are believed to be true based on the representations of the persons providing the testimonials, but facts stated in testimonials have not been independently audited or verified. Nor has there been any attempt to determine whether any testimonials are representative of the experiences of all persons using the methods described herein or to compare the experiences of the persons giving the testimonials after the testimonials were given. The average reader should not necessarily expect the same or similar results. Past performance is not necessarily indicative of future results. No person was compensated for providing a testimonial. | | | |  | | |  | | | | Volatility Commentary | | | Central Banks Waging War Against Speculators? This is just my theory, but the best way to kill speculation is to kill volatility. Volatilities in most all asset markets are near their lowest levels in two-years. Equities, bonds, commodities all are showing incredibly low volatilities. Price volatility attracts speculators looking to profit from rapid price changes. Therefore, high volatility begets higher volatility as more and more speculators try to pile on strong trends in price movements. Often, incredibly high volatilities break the foundation of the market mechanisms themselves, as was witnessed during the past few years. I have read many news reports of how hedge funds, managed futures funds, and other "trading" funds have drastically underperformed or are showing negative performance in recent months. Some would argue that manipulating free market mechanism would eventually backfire. However, there is an argument to be made that perhaps the market mechanisms over the past few years have themselves become structurally broken due to the incredible power of fast money (think oil prices rising to above $140 & then collapsing back in 2008 with no fundamental basis whatsoever). Broken markets cause real pain in the real economy. If killing volatility is indeed central bankers effort to restore market mechanisms, I at least have to applaud their efforts
| | |  | | | | Currency Spotlight | | | | During the Presidential campaign, Republican presidential candidate, Mitt Romney told the world that if he was elected president he would label China, the world’s second largest economy a currency manipulator. It should not come to the surprise of anyone that the Obama administration chose not to go down that path. Everyone already knows that China has manipulated their currency and that they are slowly allowing it to appreciate. China kept a low rate in the past to help make their exports attractive to the rest of the world. This story is changing now, as China is trying to also become a consumer driven economy. Earlier this year, China allowed the trading band between the yuan and the U.S. dollar to widen to 1.0% from 0.5%. They also pledged to keep loosening for the next few years. The yuan is getting stronger at a pace beneficial to China. Yesterday’s news of not labeling China a manipulator should not be considered a sign of weakness by the U.S., but a pause in playing the game of politics. Perhaps, the U.S. is saving that moment for a more meaningful time or possibly behind closed doors
| | |
|  | | | | Watch List | | | We saw a small pullback today in the market which was a bit surprising based on the news that came out on Greece and Housing data. Usually this type of news will send the market into a frenzied rally. Yet today we saw some pops and dips, with the occasional snooze button move where you have to check your charts to see if its frozen or the market is really that quiet. I still feel the market is in position to turn and close near the 2012 highs or even better by the time 2013 rolls around.
While we saw Research in Motion(RIMM) fall flat today and slide below the 11.00 price point, we are still seeing Faceplant..errr I mean Facebook(FB) rally and it seems to be now running with the bulls. It seems that not only does the public finally believe in the stock, but now we have the big money adding onto the momentum and is joining the fracas of The Mark Zuckerberg experiment gone wrong.
Watch the tech sector as they took another hit today. Now we can be bottoming out here, but I still see a lot of weakness and I am not yet convinced that I should start looking for longs in these stocks,,,yet. I feel the retail sector can rebound here and grab some nice gains, and I am looking at Ebay(EBAY) and Amazon(AMZN) to lead the way. If you are in the market these days, keep looking for the shorter term play and watch for the volatility. These ranges are defining themselves early on and the reversals are happening fast and swift. If you don't protect your profits, you can lose them in a blink of an eye these days. The volume is thinner and that can lead to very quick moves out of nowhere. Let's trade smarter and not harder! Open Position: IBM Stocks to Watch: IBM GOOG AAPL AMZN GMCR NFLX FB BAC C FSLR RIMM. .
Focus was on retail stocks today in the market. While stocks like Target(TGT) and Walmart(WMT) took a slight hit, Ebay(EBAY) and Amazon(AMZN) made moves to the upside today. Pretty easy to see on a day like "Cyber Monday" where the traffic to these websites almost double, if not triple on this day, as people scramble to get the hot deals advertised by the 100+ emails that must have hit your inbox starting at 4am cst. It will be interesting to see if these are short term plays, or if these stocks can maintain the momentum for the holiday season. I am still Bullish on EBAY and bearish on AMZN, and only time will tell if I am right. Let's shake off the access weight we have all put on since last Thursday, and take advantage of the short term plays that are showcasing themselves this week. Open Position: IBM Stocks to Watch: IBM AMZN AAPL NFLX FB BAC C GMCR FSLR RIMM
| | |  | | | | Futures Data | | | ES 1404.50 / 1397.50 POC… 1398.25 YM 12940 / 12874 NQ 2653.25 / 2641.75
Notes from the Pit
Click Here to Read
| | | | | |  | | |  | | |  | | | | Larry Levin- Do You Deserve to Make Money? | | |  | | | | | | | | IMPORTANT NOTICE: Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. Nothing in our website shall be deemed a solicitation or an offer to Buy/Sell futures and/or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on our site. Also, the past performance of any trading methodology is not necessarily indicative of future results. | | | | DAYTRADING involves high risks and YOU can LOSE a lot of money. Hypothetical or simulated performance results have certain inherent limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not actually been executed, the results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profits or losses similar to those talked about in our site. | | | | | |
No comments:
Post a Comment
Keep a civil tongue.