Monday, December 29, 2008

How Much Time to Invest in Market Study?


"If you are ready and able to give up everything else, to study the whole history and background of the market and all the principal companies whose stocks are on the board as carefully as a medical student studies anatomy, to glue your nose at the tape at the opening of every day of the year and never take it off till night. If you can do all that and in addition you have the cool nerves of a great gambler, the sixth sense of a kind of clairvoyant, and the courage of a lion, then you’ve got a chance." Bernard Baruch, legendary investor and advisor to presidents.

I continue to want to make things simple. One or two trades each week. Good money management. I spent several hours trying to decide if end of day Esignal would benefit my trading style.

Palisades Research gives a 70% probability for an up S&P day tomorrow.

Tuesday, December 23, 2008

Deflation, Inflation or Stagflation???

Remember FCX as leading indicator?

Gold rallied 31 percent in 2007 as inflation rose at the fastest rate in almost two decades. Consumer prices dropped 1.7 percent in November, the most on record, as energy costs plunged. Crude-oil futures have plunged 74 percent from a record in July.

Will copper and oil and CRX drag gold down again? Gold: "The 885 level should prove to be resistance and the market should soon resume its move down into the 550-600 range." Carl Futia:

"Inflation Coming, But Not in Time
We expect that to change, but not in time to rescue debtors with a flood of cheapened money. We have told you for years to tune out the inflationists because they do not know their butt from a hole in the ground. That is still true. The inflation/stagflation they have been blathering about, and which materialized only fleetingly in the form of a speculative blowoff in commodities, was just a head-fake, a seduction whose purpose was to screw any investor who thought he could outsmart the first deflation ever to occur in the midst, paradoxically, of a global credit explosion.

It goes without saying that you should also tune out the self-aggrandizing charlatans who are saying the housing market and the economy will bottom “sometime next year.” These are the same unmitigated bozos who were insisting just six months ago that the economy would avoid a recession. Deflation will run its course no matter what the puny central banks attempt to throw at it next. It will take years to play out, and the price declines we have seen so far in the housing market are not even halfway to their bottom. As for gold, we will reiterate something we said here earlier: Even if it should fall to $200 an ounce, it is all but guaranteed to be do better, much as it has been, compared to nearly every other investment asset you could conceivably have chosen." Rick Ackerman
Dec 22 2008

I for one am very uncertain about the future.

Here is another opinion:

For the first time since 1940, the yield on the three-month Treasury bill went negative this month. Investors eagerly bought up a negative 0.01% yield. That means that they would rather lock in a certain 90-day loss than risk anything in the stock market.

Probability 72% for S&P up market tomorrow. Very light volume for trading until the end of the year.

My thoughts? First deflation, next inflation and then stagflation. Best assets when I get "buy" signals: Oil and gas stocks , gold bullion and gold producing mining stocks.

Watching a 2 year old girl and her 7 year old sister 24-7 for the last 4 days is like being on night call and going to the Emergency Department every night past midnight to stop a nose bleeds for 4 nights in a row. Our Horseshoe Bay home needs an expansion. Tonight we house 5 grandchildren ages 4 days to age 12 yrs, 6 adults, and 2 small dogs. The happiest I get is when I am with my 2 sons and their families.

Friday, December 19, 2008

Wealth and Happiness

Wealth is the parent of luxury and indolence, and poverty of meanness and viciousness, and both of discontent. Plato (427 BC - 347 BC)

Today I experienced what I call the joy of true happiness. The birth of my second grandson:Fisher Andrew Wills.

My life experience tells me that there seems to be no correlation of wealth and happiness.

Wednesday, December 17, 2008

NEW GOLD AND GOLD SHARES BUY SIGNAL, 86% probability down S&P tomorrow

WEEKLY $GOLD,$HUI,$XAU,RGLD, GIVE BUY SIGNALS. Negative is crude oil delationary and $INDU has not bettered November high. I remain 95% in T bills except for my small trading acount. I am accumulating data for probability forecast for next day broad market direction. Also as noted below a number of medical, personal and professional distractions during this holiday Season. I chair the patient safety committee at my hospital and operate 3 days a week and see patients 5 half days a week. My very early Parkinsons disease is in excellent control but I plan to move to a clinic only practice soon.
I have been busy with family and work--I still take ENT surgery call every other night thru the week and every third weekend. Tomorrow I travel to Horseshoe Bay for holidays and grandson #2 is scheduled for delivery Friday (grandchild #5).
I look for a sell off of the broad market to elevate the VIX and then a good rally over several months--of course this rally may have already started. Until inflation is firmly established via home prices stable, oil and gold prices rising I will remain in the safety of treasuries. I will trade some gold options both long and short--I prefer RGLD as a trading vehicle. My UBB most recent trade is blowing up.

Would my readers please comment --some have complained that the charts are too difficult for them

Monday, December 1, 2008


The charts tell the story. I remain short via RGLD puts.