Prechter Goes All In (Short)

As the Dow did its mini Moon Shot up this morning on news of an increase in new home sales, Prechter took this snapshot of the market and sent out a recommendation to go 200% short. All in. This chart came in his interim EWT today. He also has another chart for those who wish to know why he is timing it now, but I will leave that for subscribers to consider. This gap could be a continuation gap of a strong 3 of 3 wave up, but he bet the opposite, an exhaustion gap. 

What influenced him was looking inside the housing report: much of this upside surprise was due to aggressive foreclosures. The growth was almost all in cheap condos, the low end of the market. Also, last month's sales were adjusted DOWN, not a good sign. 

So far today he is winning this bet. You have to give him enormous credit for sticking with his analysis despite the slings and arrows of outraged unfortunates. 

Comments

[Brian]

DOUBLE short nonetheless! This is going to get interesting.

[joe]

Your Dow 10,500 call looks like it is going to be right on Yelnik.

Joe

[Michael]

He initially went 50% short on August 5th at SPX 1000. Then, he went another 50% short around SPX 1030 or something around there. The guy has been "underwater" for nearly 4 months now and is once again averaging down on a losing position. How convenient of him. He must have a printing press in his basement!

I don't know of any successful TRADER that operates in this fashion. Some people could use a reality check. They really do.

[TC]

"So far today he is winning this bet. You have to give him enormous credit for sticking with his analysis despite the slings and arrows of outraged unfortunates." - - - Yelnick

Outraged unfortunates???
LOL!

Yelnick, I think that you could use a bit of a REALITY check. Seriously, Prechter is like a broken clock. He might eventually CORRECTLY call a decline/correction in the market, but by then all of his perma-bear "followers" will have lost ALL of their risk/trading capital. It's time to hold Prechter and Hochberg accountable for one blown count after another. You act as if it is no big deal to have been SHORT this market for the past 4 months at SPX 1000, when in fact it has been a HUGE opportunity cost to anyone that is a TRADER.

Why his supporters ( such as yourself ) continue to conveniently ignore this fact is absurd.

[Hank Wernicki]

Ouch !

I would never subject subscribers to that . There are Stops, so why doesn't he use them ??????????

[yelnick]

Hank, he suitably caveated the recommendation at the end. This is why I recommend to all readers DO NOT trade off the snippets from this blog; go subscribe to a service like EWI or NeoWave, or at least do your homework about trading.

[Hockthefarm]

Listening to the talking heads(Europe) last night, the consensus appears to be for more dollar weakness.

What is so magical about 75 verses say 70? Especially when the fed is so willing to pay in the form of debt. And wasn't the old range 70 to 75?

Seems like a really gutsy call to me.
Hock

[yelnick]

TC, traders with stops would have been in and out over the past four months. Sure, they are not happy on the short side - read SlopeofHope to follow a bear who lets it all hang out. But the longs haven't made much progress either.

I think this is all about market timing, and there are times to stand aside, especially when the trend is unclear, until it reveals itself. Trying to pick a top is a difficult game, made up of a lot of outraged unfortunates. This is why I would stand aside until the turn of the month. Nonetheless, the positions of Neely and Prechter of of high interest to me and many readers, so why not keep them informed?

[yelnick]

Joe, seems that way. My timing was off - I thought we would get there faster.

[TC]

Hank, you are correct.

He does not offer stop-losses with his shorting recommendations. I know of no trader that operates like that.

[Hockthefarm]

Maybe Prechter saw this:

http://hussmanfunds.com/wmc/wmc091123.htm

November 23, 2009

Alert for Tanks

John P. Hussman, Ph.D.
All rights reserved and actively enforced.
Reprint Policy

Last week, the Mortgage Bankers Association released the most comprehensive report available on third quarter delinquencies. Here is a summary of points from that report:

“The delinquency rate for mortgage loans on one-to-four residential properties rose to a seasonally adjusted rate of 9.64% percent of all loans outstanding as of the end of the third quarter of 2009. The delinquency rate breaks the record set last quarter. The records are based on MBA data dating back to 1972. The combined percentage of loans in foreclosure or at least one payment past due was 14.41% on a non-seasonally adjusted basis, the highest ever recorded in the MBA delinquency survey.

“Job losses continue to increase and drive up delinquencies and foreclosures because mortgages are paid with paychecks, not percentage point increases in GDP. Over the last year, we have seen the ranks of the unemployed increase by about 5.5 million people, increasing the number of seriously delinquent loans by almost 2 million loans and increasing the rate of new foreclosures (on a quarterly basis) from 1.07 percent to 1.42 percent,” said Jay Brinkmann, MBA's Chief Economist.

“Prime fixed-rate loans continue to represent the largest share of foreclosures started and the biggest driver of the increase in foreclosures. The foreclosure numbers for prime fixed-rate loans will get worse because those loans represented 54 percent of the quarterly increase in loans 90 days or more past due but not yet in foreclosure. The performance of prime adjustable rate loans, which include pay-option ARMs in the MBA survey, continue to deteriorate with the foreclosure rate on those loans for the first time exceeding the rate for subprime fixed-rate loans.

“The outlook is that delinquency rates and foreclosure rates will continue to worsen before they improve. The seriously delinquent rate, the non-seasonally adjusted percentage of loans that are 90 days or more delinquent, or in the process of foreclosure, was up from both last quarter and from last year. Compared with last quarter, the rate increased 82 basis points for prime loans (from 5.44 percent to 6.26 percent), and 216 basis points for subprime loans (from 26.52 percent to 28.68 percent).”

As I noted a couple of weeks ago in The Second Wave Begins, we are now largely beyond the peak of the sub-prime mortgage crisis, and have just begun the second wave of Alt-A and Option-ARM resets. That's important, because what we saw in the third quarter, then, was still part of the relatively tame and predictable March-November 2009 lull in the reset schedule. In that context, the surge in delinquencies and foreclosures on prime fixed-rate loans is disturbing, because that wasn't even part of the reset equation, and represents a relatively pure effect of the weakness in employment conditions.

Now, we face a coupling of those weak employment conditions with a mountain of adjustable resets, on mortgages that have to-date been subject to low teaser rates, interest-only payments, and other optional payment features (hence the “Option” in Option-ARM). These are precisely the mortgages that were written at the height of the housing bubble, and therefore undoubtedly carry the highest loan-to-value ratios.

The inevitability of profound credit losses here is unnervingly similar to the inevitability of profound losses following the dot-com bubble. In that event, it wasn't just that people were excited about dot-com stocks in a way that might or might not have worked out depending on how fast the economy grew. Rather, it was a structural issue that related to the dot-com industry itself – those bubble investments couldn't have worked out in a competitive economy, because market capitalizations were completely out of line with what could possibly be sustained in an industry that had virtually no cost to competitive entry. If you understood how profits evolve in a perfectly competitive market with low product differentiation, you understood that profits would not accrue to the majority of those companies even if the economy and the internet itself grew exponentially.

In the current situation, the assumption that the credit crisis is behind us is completely out of line with what possibly could result from the marriage of deep employment losses and an onerous reset schedule on mortgages that have extremely high loan-to-value ratios. A major second wave of mortgage losses isn't a question of whether the economy will post a positive GDP print this quarter or next. Rather, it is a structural feature of the debt market that is baked into the cake because of how the mortgages were designed and issued in the first place.

If one wishes to monitor the markets for emerging signs of risk, several areas are worth watching. First, the FDIC should release its most current Quarterly Banking Profile later this week. That report will be an interesting gauge of emerging credit stress. Yet even here, a lot of the pressure to properly account for losses on off-balance sheet entities and so forth won't start until next year. In the meantime, credit spreads in general, and credit-default swaps on individual companies may bear closer attention in the weeks ahead. Finally, given the enormous pressure there may be to put a good face on increasingly bad assets, the departure of the chief financial officer of at least one major banking institution, which would not surprise me early next year, might be a sign that all hell could break loose.

The past decade has been largely the experience of watching tanks rolling over a hilltop to attack the villagers celebrating below. Repeatedly, one could observe these huge objects rolling over the horizon, with an ominous knowledge that things would not work out well. But repeatedly, nobody cared as long as it looked like there might be a little punch left in the bowl. As a result, long-term investors in the S&P 500 have achieved negative total returns over a full decade. These negative returns, of course, were also predictable at the time, based on our standard methodology of applying a range of terminal multiples to an S&P 500 earnings profile that has – aside from the recent collapse – maintained a well-behaved growth channel for the better part of a century.

From my perspective, we are again at the point where we should be alert for tanks. We already know that stocks are priced to deliver a 10-year total return in the area of 6.1% annually - among the lowest levels observed in history except for the period since the late-1990's (which despite periodic advances has ultimately not worked out well for investors). We are already observing evidence of weak sponsorship from a volume perspective and growing non-confirmations of recent highs from the standpoint of market internals. The cumulative tally of surprises in economic reports (a metric we credit to Bridgewater, which Bill Hester adapted here), has also turned down decidedly. Though the historical correlation is not always as strong as it has been during the recent downturn, shifts in economic surprises have tended to lead market turns in recent years.

Hock

[TC]

"TC, traders with stops would have been in and out over the past four months. Sure, they are not happy on the short side - read SlopeofHope to follow a bear who lets it all hang out. But the longs haven't made much progress either." - - - Yelnick

I would highly disagree with your claim that LONGS haven't made much progress either.

Feel free to tell that to anyone that has been trading the oil service sector, the mining sector, or the coal stock sector FROM THE LONG SIDE where there have been huge percentage moves off of each of the last 3 previous short-term market lows.

[DG]

TC, traders with stops would have been in and out over the past four months. Sure, they are not happy on the short side - read SlopeofHope to follow a bear who lets it all hang out. But the longs haven't made much progress either.

Yelnick, as someone who's actually been "in and out" of the market over the past four months, I definitely agree. Every long I've had has been stopped out (most, thankfully, for a profit) either based on retracement levels or wave structure logic. Anyone who's been trading the long side and has been aggressively moving stops to preserve profits has undoubtedly had the same experience. Unless you went long in mid-July and had the July lows as your stop-loss point (which is definitely a legitimate set-up and I wrote about missing it due to a bearish bias on my blog back on July 24th, so I saw the potential for that trade, even though I didn't end up taking it), you're really not going to have done that well on any index longs.

I know Michael's been talking about individual sectors and I can't speak to that, so I'm strictly speaking about index longs.

[yelnick]

TC, you are right about those markets! I was presuming equities, and that is a big mistake right now. Dollar weakness means commodity strength. Great point, thanks.

[DG]

Feel free to tell that to anyone that has been trading the oil service sector, the mining sector, or the coal stock sector FROM THE LONG SIDE where there have been huge percentage moves off of each of the last 3 previous short-term market lows.

There have been even BIGGER gains in the coffee stocks, so why haven't you been trading those?

You do know that wave theory doesn't really apply to individual stocks, right? Is it really so surprising, then, that a website dedicated to Elliott Wave Theory would not discuss trades in specific stocks or even sectors?

It's just amazing to me that people who consider themselves so smart can miss out on the simple details. Do you go to baseball games and yell out "Score a touchdown!"?

[yelnick]

Hock, thanks for sharing - pretty powerful analysis

[TC]

Yelnick, No problem.

I think that if people actually stopped trying to call the S&P, and actually focused on trading the commodity sectors that benefit from the inverse-Dollar trade, they'd be much happier given the trends in place in some of these sectors. Feel free to take a look at the chart of BTU, CLF, or MEE to get an idea of what I am talking about.

[yelnick]

TC, then my question for you: is the US Peso bottoming, making all those trades reverse, or are we in a meltdown?

[TC]

DG,

You and your beloved Neely have once again shown themselves to be flat-out WRONG again looking for a "strongly down Monday". I'm sorry that you had such a bad day and that your shorts got ripped to shreds. You really need to stop "lashing-out" at others whenever you lose money.
It's just plain childish.

[Wakeupsid]

Yelnick says you need to subscribe to EWI and Neowave for finding stops , lol

paying someone to lose money , yelnick nice PIMP work!

[Jacque]

Yelnick,

Thanks for the recap.I do think the end is nigh for the dollar carry trade. Reflation without the underpinnings of real growth is a recipe for disaster.

[TC]

I believe that we are already starting to initially see some divergences regarding the correlation weakening between the energy sector and the Dollar.

The Euro was very strong today, and yet oil and various sectors connected to the inverse Dollar trade sold off after the initial "gap" up this morning off the opening. For example, BTU closed $2.00 off the highs and in negative territory today on good sized volume that matched the 3-month average daily volume figures. All of the other coal stocks reacted in the same manner.

I think that these equity names till top FIRST and tip savvy traders off on an eventual sustained Dollar rally. But because so many people on this blog focus strictly on indexes and not on individual stocks, they will most likely miss-out on what this intermarket relationship is suggesting.

[Michael]

I think that anyone who suggests using leverage to go 200% short when they are already underwater on their initial 50% short position to the tune of 10% is extremely reckless.

They either don't trade for a living, or they don't have any idea what they are doing when it comes to risk management.

With this latest 200% short call, I believe that Prechter has really shown a recklessness that is incomprehensible, in my opinion.

[Wakeupsid]

Prechter and yelnick should jerk it off , before leveraging and clear their heads!

[Jim D]

Yelnick, thanks for your work and lively debate here.

I am a Prechter fan until August 5, 2009, the day he went short.
Markets fall again at some point, for that we need to have catalysts. The future catalyst in my opinion is not deflation as Mr.P suggests; I think it will be high interest rates and perception of hyperinflation. We are not there yet, in my view, for rates to react for Bernanke press and Obama deficits. Interest rates will react for sure one day due to decline (or collapse) in dollar.

Bob, Steve and others at EWI are hard working decent people. But EWI subscribers losing big for calling a top in Euro and a bottom in dollar for past three months. EWI need to show patience and wait for market to really top out

[DG]

DG,

You and your beloved Neely have once again shown themselves to be flat-out WRONG again looking for a "strongly down Monday". I'm sorry that you had such a bad day and that your shorts got ripped to shreds. You really need to stop "lashing-out" at others whenever you lose money.
It's just plain childish.

Posted by: TC | Monday, November 23, 2009 at 02:41 PM

TC,

If only I could be as perfect as you and your after-the-fact or vague calls. Boy, life would be grand. At least I post things that can later allow me to be held accountable. Have you ever done so or is your role in life more of the "man on the sidelines"?

You do realize that the trade is still on, right? Or were you unable to understand that, too?

What I said about your apparent lack of understanding of the aim of this website would have applied even if the market were down 30 ES points. It has nothing to do with my position and everything to do with educating you on such a simple thing as reading the subheader on the Planet Yelnick site:

"Commentary on politics, technology and stock markets guided by Elliott Wave principles"

Of course that's going to mean an emphasis on broad-based stock indices that reflect mass psychology and not single-sector or single-name opportunities. I'm sure the "Oil Service Stocks" board over at Yahoo would be happy to oblige your desire to talk oil services.

Also, what I said (echoing Yelnick's point about being "in and out" of the market) about INDEX longs from the July lows is also true. Anyone who can read a chart could see that there were many instances where a breach of rising support or a Fib retracement level should have triggered a sell signal for INDEX longs, unless one got in at or near the July lows and was using that as a stop.

Next time you lash out, maybe you should think through what I've actually said first. You'll save us both a good deal of time. Oh, but doing that wouldn't let you run your mouth, so I can see how you'd be against it.

[cloudslicer]

Micheal,

I seam to remember that he went short in 2007, then covered in Feb 2009 and went long. So for a little while at the bottom he was getting hurt until things turned in his favor. Then he exited his longs in August and progressively went short. It seams to me that this means he is UP overall for the past 3 years.

He is not a trader, he is an investor.

(That took guts going long in February and catching a falling broad sword).

[Glasshopper]

Do you really need someone to tell each & every trade? Are you that bad a trader than you rely 100% upon 3rd party advice? If you do then you are stupid. What's even more stupid is pretending you are such a fantastic trader yourself and putting down others whether good or bad. If you are so goos a trader go work for Goddamn Sachs.

Oh! Wait. You ain't clever enough to work for Goddamn Sucks & your trading techniques most certainly ain't profitable enough for them. That's why you trade at home.

Since the failed head & shoulders we have been experiencing a massive short squeeze on a level not seen since the Great Depression. Not only that but longs have been getting their throats cut too by market manipulators so nobody has made money just pennies. That means EVERYBODY J6P has been getting rammed up the ass except those that went long in July without stops and how many here did that?

Precheter has made a call based on technicals of his profession & upon the data he observed. He has not made every single call correctly I'm sure but the question to ask before you play judge & jury is, has MY trading been substantially better that i can make judgement & I don't mean a few dollars but tens of thousands.

No?

Not many have made money since July, so bear that in mind before you jump on the lynching team about somebody elses call is when yours are worse.

If you disagree with what I say then I challenge you to give a price & date for the next pivot in the SPX that will deliver 100 or more S&P points. Prechter did and that was 10495 Dow Jones. What about you? Then go work for Goddamn Sachs

[yelnick]

Wakeup - together??? not a pretty thought.

[twitter.com/DrBubb]

"Markets fall again at some point, for that we need to have catalysts."

Sure. The catalyst will be a weaker dollar. Monday's rally came "out of the blue" when the Euro rallied/ Dollar fell.

Who knows what will move the Dollar, but if the dollar soars, stocks will slide. Rate movements are a likely motivator of such a move, but they are not the only one.

I do think we are at a stretched-on-light-volume stage where a move can feed on itself, and pick up momentum.

[Cary Lloyd]

Yeah, I don't get the 200% either. The only people who can go 200% short are people who have been ignoring Prechter's advice thusfar. Or oblivious to it. Maybe the 200% short recommendation is aimed at the two people who signed up for subscriptions in the past month.

[DG]

Yelnick,

Regarding the dollar, at some point doesn't it become self-preservation for the Fed to keep its value up? Aren't all the top dogs at the Fed very wealthy mean, whose wealth is primarily denominated in dollars? Being wealthy, doesn't that also mean they are part of the creditor class and have a significant interest in not being paid off in debased dollars?

[Jim D]

Prechter put his reputation on line because he thinks (correctly so) US economy can not sustain growth to support current equity valuations. Before Prechter is proven right traders following him may lose their capital to Wall Street manipulators (some of them claiming to be doing god's work). With zero % rates, dollar weakness, Obama spending and Benanke printing it is hard to envision onset of a C wave crash. We need a catalyst something like dollar collapse or China real estate collapse for Prechter to be correct. It is prudent to be flexible and not committing more than 10% capital on either side until market shows its hand.

Relying on Bernanke printing press, I am long all things tangible like gold, silver, oil etc.. When Euro hits 1.52 (or 1.47) I will assess my position.

[Michael]

"Not many have made money since July, so bear that in mind before you jump on the lynching team about somebody elses call is when yours are worse." - - - Glasshopper

You obviously don't trade the market for a living. If you did, you'd know just how absurd your statement above is and would have most likely never have made it. Since you did, it's obvious to me that you are someone that might dabble in a trade here and there, but has very little knowledge about how STRONG THIS RALLY has been since March, let alone July.

[yelnick]

DG, the Fed doesn't seem particularly worried. Their bigger challenge is continuing to finance the deficit. They have put an awful lot into mortgage backed securities, which might be illegal (outside their charter) since the Fannie/Freddie complex is insolvent, ie. hard to argue these are govt backed anymore. if you look at Fed history, you see two patterns:
- rates don't go up until unemployment peaks
- Dollar doesn't bottom until about a year after rates go up

Put these together and we have:
- earliest rates go up is Q2, Fed actually thinks end of 2010
- hence USD is in a slide for up 18-24 months

Hard to square this with ewave. So in a way it is a great test of how right/wrong ewave is.

I may pop this up to a high level post. Worthwhile to get comments to it.

[Michael]

"Micheal,

He is not a trader, he is an investor."
- - - Cloudslicer

If that is in fact the case, then why does he have Steven Hochberg issuing a short-term update 3 times per week?

[Hank]

"You do realize that the trade is still on, right? Or were you unable to understand that, too?"

Posted by: DG | Monday, November 23, 2009 at 03:24 PM

The SPX was +15 points today.
Where's your stop-loss?

[DG]

DG, the Fed doesn't seem particularly worried. Their bigger challenge is continuing to finance the deficit.

Sure, I realize there are institutional imperatives that require attending to, but as I understand it, those in and around the highest levels of the Fed tend to be restricted in what they can own in their personal portfolios and, if I'm not mistaken, those restrictions expose them greatly to dollar weakness on a personal level, which is as it should be, according to the theory that you want alignment of incentives between the Fed and US citizens whose currency they caretake.

It's just something I've become curious about as I listen to people talk about the dollar going to zero.

[Wakeupsid]

Ok yelnick , we will one more day!

[JP]

Annualized Return:

* Wilshire 5000 Index + 9.7 percent
* Prechter's Trading Advice -15.4 percent

Total Return:

* Wilshire 5000 Index + 857.1 percent
* Prechter's Trading Advice - 98.3 percent

http://www.erictyson.com/articles/20090616

[Michael]

"those in and around the highest levels of the Fed tend to be restricted in what they can own in their personal portfolios and, if I'm not mistaken, those restrictions expose them greatly to dollar weakness on a personal level, which is as it should be, according to the theory that you want alignment of incentives between the Fed and US citizens whose currency they caretake."

DG,

These people aren't even managing their own personal portfolios. Ever hear of a BLIND TRUST???

[joe]

"- rates don't go up until unemployment peaks
- Dollar doesn't bottom until about a year after rates go up"

Yelnik - the dollar "bottoms" against other currencies - its relative value is based on the underlying strengths or weakness of other countries currency - their monetary policies. The US may be weak - but I suggest if we are weak, than the euro should be on life support.

And the dollar index is heavily weighted toward euro.

I do believe we probably have seen a bottom in dollars at just below the 75 level. And the longer it keeps holding that level the clearer it is that we bottomed and in the end - this can only result in a short squeeze of "giant proportions"

Joe

[Roger D.]

Prechter is probably right as the 10,500 as about the top of the wedge. This present wave up could extend in a xa,xb,xc.xd, and xe. Looks to have completed xa and xb today.

This market should really come down from here as everything looks to be making supercycle patterns here and there all reversal patterns. Patterns include H&S,Broadening tops and EDT's.

First leg down should take us to 9000 with a good bounce and then bye bye baby.

[DG]

DG,

These people aren't even managing their own personal portfolios. Ever hear of a BLIND TRUST???

Posted by: Michael | Monday, November 23, 2009 at 04:54 PM

Of course I've heard of a blind trust. My question was about the people at the Fed and the various senior level advisers, etc. I don't need generic information about blind trusts. Sheesh.

Here's something I found quickly:

http://www.watoday.com.au/business/bernankes-personal-investments-go-backwards-20090729-e0gw.html

Again, it seems to me that these guys' fortunes are tied up with the dollar, so letting it go to zero isn't really an option.

[Roger D.]

Checked the SPX 15 minute chart and looks to have a break-away,continuation and exhaustion gap. Also the decline could be a impulse down with abc completed at the EOD.

Futures down,gold down,and USD up. Could be it, but it's not over till the bulltards or GS says so.

[Glasshopper]

Michael

[quote]You obviously don't trade the market for a living. If you did, you'd know just how absurd your statement above is and would have most likely never have made it. Since you did, it's obvious to me that you are someone that might dabble in a trade here and there, but has very little knowledge about how STRONG THIS RALLY has been since March, let alone July.[quote]

You need to look at a few technicals yourself, I shall point some out to you

1. Market divergences in DJI & DJTR, DJU RUT to name a few which resulting in bearish inter-market non-confirmations since October rally but especially this trading day which the Dow outperformed all other indexes.

2. Declining NYSE volume since October but most especially today that was the lowest 10 day avrage since March
3. Lowest put/call ratio since July
4. Fibonacci relationships of which there are many
5. Ellliot Wave count in most indexes & currency crosses
6. Trend line confluences mostly upper trend line from the March rally & Oct 2007/May2008 trend line

All of the above mentioned point to a weakening market and a waning of market strength.

Whatever market strength the market had does not guarantee future strength as you should know if you are the 'great trader' I think you think you, are past performance does not guarantee future returns. It could all end from tomorrow or go on to infinity.

But since you have not supported your argrument with any fact and only put forward opinion & conjecture your argument does not have the strength as you yourself point the market has

I shall now opine that you must be one of the traders that I complained about who put down fellow traders when he himself cannot make an argument without reverting to unverifyable conjecture, insubstaniate thought & totally unfounded beliefs in previous events that do not portend one iota to future performance.

Rather than tell me how strong the market has been your argument would have been stronger in itself if you could tell me/us how strong the market in going to be. That is the point of my argument which unfortunately gone a touch beyond you. Prechter has made such a call undoubtedly supported with evidence. You unfortunately have jumped on the lynching team about somebody elses call is when yours are actually nonexistence. Then to add insult to injury you claim absurdity in my argument when you have completely missed the point I was making. Regardless of the "strength of this market'.

I have already mentioned that past performance does not guarantee future gains (or losses) I have supported my argument with some facts for you to ponder upon my lack of understanding the strength of the recent rally from March and supplied you contradiction of my "misunderstanding" of the market. However my lack of understanding or experience was not the point I was making and you have completely misunderstood my argument. Since one of us has so misunderstood I will have to reiterate my point so that you can clear yourself of the absurdity and I can be clear of ambiguity.

Just because someone has made a call, it does not mean it is bad call, especially under market conditions. But since the market has been so strong & because many of us have had such a tough time to trade it then unless you have been trading better yourself you should either shut up or apply for a job at Goddamn Sucks where you will be bountifully rewarded for your exception trading skill under difficult market action.

Does that clear the fog of absurdity you seem possesed of?

[Don_wolanchuk]

THE epicenter of primary wave 3 up is underway......as for prechter getting short in 2007 .....that is ded wrong......they actually got short in 2003 and stayed that way till this past spring....all this is documented by timer digest....and as for calling the 87 crash???...lol....another fallacy.....in the summer of 87 in one of his letters prechter sed that he gave the odds of a crash as 10%.....and when he turned bearish just hours before the 87 crash low he then wrote....i give the odds of the dow ever exceeding 2700 again as 10% and in the unlikely event 2700 would be exceeded eurphoria would be so hi that the market would surely crash....then in the fall of 1990 whent there was a 5 wave decline he got so bearish that him and jack frost couldnt see straight......then in 1994 in a barrons interview prechter sed that if the dow ever got above 4000 it would prove that i didnt know what i was talking about and nobody shud ever listen to me again........i saved that barrons interview for posterity....and the beat goes on..DA_CHEIF

[jim d]

Two Trillion dollar debt to mature in next 12 months - NY Times article.

This article will explain why either US $ or stock market must give-in. It is evident through their actions, that the Fed wants to sacrifice US$ for saving stock market.

Must read article for all US residents to prepare for the future.

http://www.nytimes.com/2009/11/23/business/23rates.html?pagewanted=2&_r=2&th&emc=th

[yelnick]

Jim D, you cannot look at the NYT article in isolation to the swirl of other events. Andrew Revkin of the NYT may have been in on the ClimateGate scandal; he was certainly in close contact with the cabal. Now he will likely do what he can to divert attention away from it (ie to the 'hackers' not the liars). Similarly this article comes out shortly after Obama talks of a double dip. What is the agenda? Surely in part to divert attention from the horrific deficits from Healthcare. The Senate bill scores at $1.8T over 10 years if you skip the transition-in period. And to set up a tax increase argument - maybe a carbon tax not cap & trade. Or an acceleration of the 2011 tax increases (due to Bush's cuts expiring). At the very least, an appearance of concern over deficits h=just as he passes budget busting bills.

What is the Fed to do? Apparently continue QE as long as it works, and also to provide reserves for banks who recycle back into Treasuries.

There is a bigger story here that I hope begins to be unveiled.

[Jim D]

Yelnick, completely agree with your assessment. It is bad for the country and $ in the long run.