When Sub Prime and Inflation Hit

 

HORACE GREELEY: “While boasting of our noble deeds were careful to conceal the ugly fact that by an iniquitous money system we have nationalized a system of oppression which, though more refined, is not less cruel than the old system of chattel slavery.”

If you cared to look the signs of sub prime were noticeable in 2004-2006. I was worried of inflation as early as 2001; buying CPI floater bonds.

For most investors their money mangers and the government gave them this much time to react:

[youtube:http://www.youtube.com/watch?v=l2zHqfPn4gs 450 300]

GW buys EME @ $26.88 and kicks out 1/3 SNHY @ $36.63….Considering SY, DRYS, CHK under $50, HK under $35, and PVA under$60…

GLT

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Alright mixed earnings put us into “deer in headlight territory.” People will ask should I sell, buy, or short.

My prediction last night was spot on, (back and filling,) until [[C]] lost less than expected. As well Teva pharmaceutical bought out Barr Labs.

[[GOOG]] was okay with crap guidance. [[MER]] plain sucked. [[MSFT]] was pathetic. [[COF]] was crap. [[IBM]] was not that bad.[[SLB]] was good too. [[HON]] & [[MAT]] beat the street.

This will cause us to wax and wain today. Being options expiration we should see extraordinary volatility.

My sense we might test 1239-1244 S&P. A test of this area intraday should provide a opportunity to rally if oil continues its slide. Right now oil is indicating higher.

I feel we get a head fake in oil, and turn up a rally in the indices by late today or Monday at the latest. If we breach 1239 S&P on a close then I feel we must test the intraday low of 1200 from Tuesday.

Yesterday’s rally was helped by oil breaking $130 p/b and or showing us an 11% haircut in two days. Also the IMF stated that all governments would have to fight inflation. This gave some hope to interest rates being raised here in the states.

Looking into the market the Dow Jones Transport Index just went from 4657 to 4915…that is 5%.

The banks are ripping with 20 -40% moves.

Technology has been so so…mind you on this last dip in the market, technology did not get taken to the woodshed unless you followed me into GLW.

Airlines have bounced and the cruise line stocks have done well thanks in part to oil.

So that leaves me to question what about the shippers? If oil continues downward then there should be nice trades here. Be careful of earnings though, as they are probably going to get hit by high energy and some global slowdown issues.

I feel oil could reach $110 -$115 p/b over the next week or two barring bullshit tensions from Nigeria, PBR, and Israel.

[[DRYS]] [[EGLE]] [[SB]] [[EXM]] [[NGK]] [[DSX]] [[FDX]] [[UPS]]

Don’t Forget [[DUG]] [[DTO]] [[VLO]] [[HOC]] [[TSO]] [[FTO]] [[SU]]

I’m looking to buy HK, PVA, CHK, CVX, and XOM 5-10% lower from yesterday’s close. Starting 1/2 of a position.

GLT

by GW

[youtube:http://www.youtube.com/watch?v=VBnkJQWe0JQ 450 300]

 

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If speculators are to blame for the run up in oil, should we not praise them for liquidating positions sending oil down?

How is your pension plan now mr. smarty pants? Good job putting hard earned money into commodities at a potential top.

More importantly, how does your bottom go?

Will this be a V, W, or U shaped bottom? So far it is starting off as a V. Tomorrow I predict a test of 1239-1244 S&P and then a surprise rally into the close.

[youtube:http://www.youtube.com/watch?v=UyJInrbFkHE 450 300]

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Oil bears need a break of $130 to make this down turn really interesting! [[DUG]] [[DTO]] [youtube:http://www.youtube.com/watch?v=Dfj1O45qZ5U 450 300]

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PRESIDENT WOODROW WILSON: “A great industrial Nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the Nation and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the world – no longer a Government of free opinion no longer a Government by conviction and vote of the majority, but a Government by the opinion and duress of small groups of dominant men.” (Just before he died, Wilson is reported to have stated to friends that he had been “deceived” and that “I have betrayed my Country.” He referred to the Federal Reserve Act passed during his Presidency).

[youtube:http://www.youtube.com/watch?v=GA3om1F_Gi0 450 300]

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While on the subject of beauty some will argue that long term investments are the way to go for success in the market. In some cases this is true, but you must keep a watchful eye on things when considering what has transpired as of late.

Like all things in life, moderation is key to longevity and being prosperous. I thought after looking at such finite resources it would be interesting to consider H20 and the facts surrounding our precious and seemingly invaluable commodity.

 http://www.wateraid.org/international/what_we_do/statistics/default.asp

With all these figures at hand it is obvious that water is not invaluable, but incredibly precious.

For your consideration and diversification there are some ETFs you can buy for the long term. PHO, PIO, FIW, & CGW.

From these ETFs we can pull individual names like: CCC, CIR, ESE, MWA, PLL, PNR, VE, & WTS. These are a few of the names I think are worth your while regarding due diligence. For pure speculation I have played CLWT for the short squeeze.

Note~I currently do not have a position in any of the above mentioned stocks or ETFs. Being that the market may be at a intermediate bottom I thought this might be a good time to start say a 1/5th position, that you can dollar cost average into. Remember the “Bow Tie” and you will see why buying over time is important.

GLT

by GW

This one goes out to man and his relationship with the planet.

[youtube:http://www.youtube.com/watch?v=qQagCZPRk2c 450 300]

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