I had a short, fast trip to the Bahamas this weekend for a family wedding. To be honest, the water was beautiful, Paradise Island was nice, but the rest of the country was a little disappointing.
I was hoping to have time to stop by the Bill Cara Advisors conference, but time constraints and communications issues prevented me from doing so.
As took a few moments to lay by the pool at the very expensive Wyndham Resort (Bahamas), I began to ponder all of the events taking place in the U.S. economy over the past few years. When you take time to think, things begin to become much more clear.
A few things hit me during my brief time off;
1) The media is used to constantly pit one American against another. To keep our citizens confused, they really want us to believe you have to be on one of two sides; conservative or liberal, republican or democrat, black or white, gay or straight, pro-choice or pro-life, etc...
To add insult to injury, further distractions such as (like the war in Vietnam; who we now outsource to) the "war on terror", "weapons of mass destruction", "anthrax/ buying duct tape for your windows", were nothing more than scare tactics to keep you even more confused.
In reality, those behind the scenes know what their doing. Changing the fabric of our nation requires keeping the little people distracted.
For example, the financial mess could have been fixed in short order, with very little pain by simply suspending the mark-to-market rule, reinstating the uptick rule, and have the Federal Reserve announce that it would back all deposits of every lending institution. These efforts would have required very little cash.
2) Another issue that came to mind as I traveled through various airports this weekend was healthcare. Knowing how seemingly incompetent the US Government is suppose to be, I was amazed of how quickly the The Transportation Security Administration (TSA) was up and running after the 9-11 terrorist attacks.
If the US Government is really as incompetent as those who oppose a national health care system say they are, then I have to say I am impressed. Obviously those in opposition a national health care system are either lying, corrupt, or have skins in the game.
The recent (concocted?) economic crisis has caused an additional 6.8 million Americans to lose their health insurance.
I was speaking to a Canadian businessman (I've spoken to many others as well) in the Atlanta airport yesterday. I asked him what he thought about the nationalized healthcare system Canadian, and if all the fear tactics being used in the US were correct.
He said the fear tactics used in the US were propaganda and lies (other Canadians agreed). He said there were waiting periods of about 3 weeks for elective surgeries, but all serious cases were dealt with immediately by the best surgeons, at the best hospitals.
He also said, the Canadian government would fly a person with a serious illness to the best hospitals with the best doctors, and not just to a local hospital for surgery. And get this one. While in the US, the Canadian businessman I was talking to said he had to go to a podiatrist for a minor foot surgery. He paid the US doctor, and the Canadian system reimbursed him for the cost.
Not to belabor the point, but don't you feel, as a patriotic citizen of US that you are nothing more than an income stream or a source of revenue for all the various factions that put money in the pockets of politicians?
Today we learned that General Motors CEO, Rick Wagoner was quitting. Actually, if you think about it, bankrupting the automakers to get rid of the union contracts would go even further in completing the globalists agenda. They would kill the biggest union in the nation, and open the door for outsourcing even more US manufacturing jobs. How perfect!
The market IMO is in a short term overbought condition, and a 50% giveback would not surprise me. My finger is on the buy button, not on the sell button. Investor optimism has been on the rise, so waiting for a meaningful pullback makes sense.
With increased optimism, the market likes to go against majority opinion. Selling calls a month out 20% higher on stock positions will allow you to pocket some change as the market corrects.
As we get well into spring, the economy will show signs of life, and the stock market should rebound to levels higher than most thought possible.
Here are our Top 10 ETF's for the week of March 30th:
1) DBA: Powershares DB Agriculture Fund
2) EWZ: Brazil Index
3) DBE: PowerShares DB Energy
4) USO: U.S. Oil Fund
5) VIS: Vanguard Industrials
6) DDM: Ultra Dow 30 Proshares ETF
7) IXP: iShares S&P Global Telecom
8) IYF: iShares Dow Jones US Financial Sector
9) PGJ: PS Golden Dragon China Fund
10) SSO: ProShares Ultra S&P500 Trust
Here are our Top 10 Fidelity Sector Funds for March 2009
1) FBIOX: Biotechnology
2) FSPTX: Technology Portfolio
3) FSCGX: Industrial Equipment
4) FCYIX: Industrials
5) FSCPX: Consumer Discretionary
6) FSCSX: Computers & Software
7) FSCHX: Chemicals
8) FNARX: Natural Resources
9) FSENX: Energy
10) FSRBX: Banking
For the Week:
The stock market is getting up off the mat. After being crushed by the bear over the past 18 months, signs of a reemerging bull are beginning to take hold. To keep you on the sidelines the Wall Street gang will tell their buddies to continue interviewing perma-bears like Nouriel Roubini, but eventually that story will get old.
Roubini worked for Larry Summers, and for Treasury Secretary Timothy Geithner during the Clinton years, but apparently holds different views.
This week, look for action to be taken on the mark to market accounting rule. After that, look for a reinstatement of the uptick rule.
Economic News
New jobless claims rose to 652,000 from last week’s revised 644,000. The trend here is still up but the rate of increases is slowing. The unemployment rate is just over 8%, but looks to be slowing.
The Commerce Department said the nation’s GDP declined at a 6.3% rate in the fourth quarter of 2008, but as the unemployment rate slows, the GDP number will eventually catch up.
The Commerce Department also announced that consumer spending rose in February for the second straight month after six months of consecutive declines. Consumers account for 70% of GDP, so another increase in March will be very good news.
Existing home sales rose 5.1% to 4.7 million February. Bargain hunters are emerging and it looks as if the housing market is beginning to search for a bottom.
New-home sales also climbed 4.7% last month to an adjusted rate of 337,000.
IMO, things are looking up, and the current correction should be seen as a buying opportunity.
-Gold
-The U.S. Dollar
Our current asset allocation is as follows;
95% Equities: (Normally 95%) Aggressive
80% Equities: (Normally 80%) Moderately Aggressive
60% Equities: (Normally 60%) Moderate
40% Equities: (Normally 40%) Moderately Conservative
20% Equities: (Normally 20%) Conservative
