Top Dog Needs to Focus on New Tricks

Save your money is the message

NEW YORK (Reuters) – The United States cannot battle its economic crisis by simply trying to go back to its old ways of spending too much and saving too little, two Nobel prize-winning economists said on Friday.

Jeffrey Sachs, director of the Earth Institute at Columbia University in New York, said a $40 trillion loss in global wealth, a reflection of declines in stock prices and home values, would not easily be reversed.

“The scale and drama and rapidity is extraordinary,” Sachs said at a panel at Columbia. “We’re not likely to be sending demand and consumption back up. Fixing the banks is not really the key to unlocking the demand side.”

Joseph Stiglitz, a former chief economist of the International Monetary Fund and a professor at Columbia, said in a separate panel that the banking sector has shown itself to be a detriment to society rather than a positive driving force.

The world economy is in the grips of a crisis that shows few signs of abating, and which most analysts consider to be the most severe shock since the Great Depression of the 1930s.

Stiglitz said that, under the guise of innovation, banks discovered new ways of taking risks that brought few benefits to most people and are now threaten the entire global economy.

“They not only didn’t innovate, they actually resisted innovations that were important,” Stiglitz said. “It was heads I win, tails you lose. And you lost.”

He argued that talk of increasing transparency is actually an effort to divert attention from the real issue: financial complexity designed to pad profits and hide them from the eyes of regulators.

He suggested that, to date, efforts to simply pump money into banks have been a fool’s errand. “Think of what we could do if we had spent $700 billion in a new, good bank.”

Talk about moving toxic assets off bank balance sheets is also misguided, Stiglitz said. “Moving things around doesn’t actually create value.”

With this in mind, Sachs said that rather than trying glue back together a broken financial financial system, policy-makers should focus on a long-term vision that includes productive investments in transportation and energy infrastructure.

“We ought to be thinking about how to get the saving into future oriented development, not to recreate the bubble,” Sachs said.

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Tax cuts take effect by April fools day

WASHINGTON (Reuters) – President Barack Obama ordered the U.S. Treasury on Saturday to implement tax cuts for 95 percent of Americans, fulfilling a campaign pledge he hopes will help jolt the economy out of recession.

The tax cuts are part of a $787 billion economic recovery plan passed by the Democratic-controlled Congress over Republican opposition. The aim is to put more money in the pockets of Americans and stimulate the economy by increasing consumer spending.

“I’m pleased to announce that this morning the Treasury Department began directing employers to reduce the amount of taxes withheld from paychecks, meaning that by April 1st, a typical family will begin taking home at least $65 more every month,” Obama said in his weekly radio address.

“Never before in our history has a tax cut taken effect faster or gone to so many hard-working Americans,” he said.

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Worried Investors

JUST when the United States really, really needs the money, overseas investors seem to be less willing to buy long-term American securities.

The government said this week that net purchases of those securities fell to $412.5 billion in 2008, less than half the 2007 level and the lowest annual total since 1999, when the federal government was running a budget surplus.

Money did come in, but it was diverted into the safest investment around, albeit one with almost no expectation of profit, Treasury bills. Overseas investors increased their holdings of those securities by $456 billion, an unprecedented flow.

A good part of that cash may have come from investors who would otherwise have invested in bonds issued by Fannie Mae and Freddie Mac, the government-sponsored mortgage lending enterprises.

For many years, those securities, which carried an implicit — that is, not certain — government guarantee, were popular overseas because they yielded more than Treasury bonds but seemed to have little additional risk.

But foreigners began selling them as the financial crisis accelerated last summer, and continued doing so even after the government rescued Fannie and Freddie and issued an explicit guarantee of their debts. Over all, foreigners sold $37.8 billion of agency securities. It was the first year since 1983, when the agency market was much smaller, that foreigners were net sellers.

The aversion to risk also showed up in the choice of long-term securities that were purchased. Foreigners bought a net $316 billion in Treasury notes and bonds, the most in three years. But purchases of corporate bonds and stocks plunged.

It has long been a cliché that foreign investors in any market lack local knowledge and get the timing wrong. The data bears that out this year. The largest annual flow into American stocks ever was in 2007, when $195.5 billion came in. That broke the previous record of $174.9 billion, set in 2000. Stock prices fell sharply after each of those years.

The decline in funds for corporate bonds was not entirely attributable to a new hesitation to lend money to companies. The government counted other securities — like private mortgage-backed securities — as corporate bonds, and those markets have basically dried up. In any case, foreign purchases of corporate bonds fell to under $100 billion in 2008, less than a fifth of the level two years before.

Official institutions — foreign governments and central banks — have largely stopped investing in long-term American securities, a fact that may reflect their need for funds at home as the global recession deepens. Those institutions were net sellers in every month from July through December, an unprecedented stretch.

The fact that so much of the money came into Treasury bills — which mature within a year — means that the owners can get their money back whenever they wish, and will get it soon if they simply do nothing. It is thus readily available to move rapidly.

When the fear that drove money into Treasury bills fades, it may become clearer whether the rest of the world still sees the United States as a good place for long-term investments.

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Cash Position
I’m interested to know what cash position you have in your portfolio.	5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% I am a trader 90-100% every night
	Current Results

Rarely do we get to stop and smell the roses ! Sometimes it is necessary to break away from reality. One of the best ways to do that is to escape through pictures.

While on the subject of escaping, I just went skiing last week. Jack Frost will be loosing his grip soon, so take the kids out for some last moments of fun in the snow.

Insanity Files
Boy marries dog to ward off tiger attacks…hello

How could you go wrong with this category ?

Health Matters
Did you know that man has only been cooking with fire for about 10k years. Follow me here; the mitochondria gene mutates every 20k years, which means our bodies have not been able to adjust to the digestion of foods that need to be cooked in order to digest them.
This brings me to celiac disease.

Try to eat less refined carbohydrates and enriched breads. The fine texture of the flour can block your small intestine and cause poor or no absorption of the vitamins, minerals and proteins we need to stay healthy.

You might find that practicing a gluten free diet every so often will give you more vitality and the ability to think clearly.

Science Files
This is slightly stale, but interesting and something you probably have not seen.

Finally go and get what you want !

Remember to laugh !

Keep on Laughing

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[youtube:http://www.youtube.com/watch?v=JLQVJCdRazI&feature=related 450 300]

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Top Story:Short Term Nationalization May Be Needed

NYSE Percentage Winneres
CAB, KND, PUK, IBI, SLW, GPI, TCI, THI, ABN.p

NASDAQ Percentage Winners
BPOPP, VDSI, TRCI, BPOPO, STRN, CECO, OSBCP, SOAP, MXWL, NFSC

NYSE Percentage Losers
CQB, FSB, STD.p, BCS, C prw, C prm, PL, prb, BCS.p, HFC.p,

NASDAQ Percentage Losers
CASTU, LNDU, LBTYB, GFIG, CNEX, LCAPB, LMDIB, FFHS, FRCCO, PVSA

Unusual Volume
LOPE, CECO, WOOF, RRGB, HMSY

PPT

Market Overview
Average Technical Score: 1.32 Strong Sell
Average Fundamental Score: 3.62 Buy
Average Hybrid Score: 2.31 Sell

Top 10 Ranked Stocks
All Ranked Stocks
Rank Symbol Hybrid Hyb. Chg. (Daily) Hyb. Chg. (Weekly)
1 ICUI 4.25 0% +6.3%
2 ODSY 4.23 +18.16% -0.26%
3 CECO 4.2 +32.49% 0%
4 ORLY 4.08 -4.23% +22.69%
5 AIPC 3.98 +8.45% -12.09%
6 WPI 3.86 -10.02% +5.43%
7 EGO 3.85 +15.27% +3.4%
8 AZO 3.84 0% +25.9%
9 LFT 3.79 +9.86% -5.92%
10 HLTH 3.77 +13.9% -14.88%

Bottom 10 Ranked Stocks
All Ranked Stocks
Rank Symbol Hybrid Hyb. Chg. (Daily) Hyb. Chg. (Weekly)
1 ELN 0.92 -10.68% -19.49%
2 SUI 1.15 -22.82% -20.57%
3 PACW 1.16 -9.38% -20.98%
4 OSTK 1.2 -22.58% -23.6%
5 OZM 1.2 -16.08% -32.04%
6 CVC 1.23 -15.17% -21.88%
7 CEL 1.27 -23.95% -12.68%
8 SONC 1.32 -14.29% -18.35%
9 CQP 1.35 -31.47% -2.52%
10 BAGL 1.37 -8.05% -7.89%

Top 10 Ranked Industries
All Ranked Industries
Rank Industry Hybrid Hyb. Chg. (Daily)
1 Drugs – Generic 3.37 -1.40%
2 Auto Parts Stores 3.26 -6.61%
3 Consumer Services 3.12 -3.03%
4 Healthcare Information Services 2.93 +3.87%
5 Home Health Care 2.91 -12.68%
6 Education & Training Services 2.89 +6.11%
7 Gold 2.84 +7.30%
8 Drug Stores 2.84 -10.85%
9 Major Integrated Oil & Gas 2.79 -6.47%
10 Technical Services 2.71 -6.98%

Bottom 10 Ranked Industries
All Ranked Industries
Rank Industry Hybrid Hyb. Chg. (Daily)
1 Semiconductor- Memory Chips 1.67 -6.07%
2 Major Airlines 1.76 -18.23%
3 Real Estate Development 1.85 -9.96%
4 Residential Construction 1.87 -6.68%
5 Publishing – Newspapers 1.88 -2.71%
6 Lumber, Wood Production 1.89 -11.81%
7 Office Supplies 1.90 -13.30%
8 REIT – Office 1.91 -3.27%
9 Recreational Vehicles 1.91 -7.16%
10 Marketing Services 1.92 -6.87%

Top 10 ETFs
Rank Symbol Technical Score
1 GOE 4.46
2 BOS 4.00
3 CMD 3.90
4 DGL 3.85
5 GLD 3.81
6 PVI 3.75
7 AGA 3.65
8 BOM 3.65
9 IAU 3.61
10 NYF 3.56

Bottom 10 ETFs
Rank Symbol Technical Score
1 LD 0.61
2 DJP 0.70
3 PJB 0.70
4 SDY 0.70
5 JJG 0.70
6 RJZ 0.70
7 EWL 0.71
8 EWM 0.71
9 GSG 0.71
10 ITF 0.71

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