A message from Main Street:

It is here that MOPE has no power to manage employment, therefore consumerism, and therefore housing.

The MOPE solution is simply to name the situation a "New Normal" as MOPErs attempt to take equity markets to new all time highs.

Jim,

There is no business recovery. I attempt to supplement my church income by selling ads in a magazine published by a police support organization.  We solicit local businesses for support ranging from $35 to $1000, for which we produce ads in a book that is distributed to about 40,000 officials and officers throughout our state.

Ancient road-building companies can no longer secure government contracts because they are not government demands mold.

The trickle-down effect of having no money or credit has affected practically every sort of business, to include liquor stores, banks that are locally owned and not involved in derivatives, good Mexican restaurants, Quick Stop gas stations, hotels, salons, attorneys (I kid you not), and of course all of the businesses that have anything to do with commercial or home construction or automobiles.  The only businesses that seem to be keeping up with things are the mortuaries… a bitter irony, of course.

Just thought you’d like to know from a person who is out there every day banging on doors.

Warm regards,
CIGA David H.

 

Dear Jim,

It looks like the taxpayer gets stuck with all the toxic waste from all the derivative deals GMAC did in its hay-day… I guess that

was when shuffling paper became more important than building good cars!

Best,
CIGA BT

Dear BT,

Shuffling paper is the major industry in the USA, and it is doing better than any other.

Why should banksters go into any form of manufacturing outside of war materials?

Jim

U.S. takes majority stake in GMAC, giving lender $3.8 billion more in aid
By Binyamin Appelbaum
Washington Post Staff Writer
Thursday, December 31, 2009

The federal government said Wednesday that it will take majority control of troubled auto lender GMAC and provide an additional $3.8 billion in aid to the company, which has been unable to raise from private investors the money it needs to staunch its losses.

The Treasury Department has said for months that GMAC would need more federal money, but the decision to increase the government’s ownership stake came as a surprise, cutting against the grain of the Obama administration’s recent efforts to wind down its bailout of large banks.

What initially appeared to be a closing act now looks more like year-end portfolio rebalancing, with companies including Citigroup and Bank of America allowed to repay aid even as the government deepens its involvement in mortgage financiers Fannie Mae and Freddie Mac — and now, GMAC.

More… ^[1]

Greetings Jim,

The Gold Currency Index continues to hold support at the lower boundary of the uptrend from early September (chart attached).  While gold in US dollar terms broke below uptrend support in mid December, the GCI never did, so there is still a very good chance we are bottoming right here and preparing to retest those all-time highs.

Best,
CIGA Erik
Prometheus Market Insight
http://www.prometheusmi.com ^[2]

^[3]

Eric,

The newest MOPE is above or below expectations, which of course comes from the famous "THEY" who wear wizard hats sitting at a darkened back room of F-TV talking heads issuing expectation in the manner to improve all figures.

Jim

U.S. Jobless Claims Drop to Lowest Level Since 2008
Thursday, December 31, 2009
CIGA Eric

Fewer Americans than anticipated filed claims for unemployment benefits last week, pointing to an improvement in the labor market that will help sustain
economic growth next year.

Initial claims rise unexpectedly, then they fall unexpectedly. Measuring strength or weakness from deviations from expectations is a complete waste of time. Who sets the expectations? Direction and rate of change of the direction of the trend, not deviations from expectations, drive economic consensus. As trillions of dollars are injected into the economy, initial claims, naturally, have begun to decelerate. The dominant trend, however, remains up. When the debt-fueled injections do little to spur investment, the necessary driver for future economic growth, the trend deceleration will turn to acceleration in 2010-2011.

More… ^[4]

Jim,

You may have posted this already but it seems now that even $10,000 gold is sounding conservative.

CIGA BJS

CIGA BJS,

Except in the normal voices, where have you heard a discouraging word about this?

The Sheeple sleep on in the dumbed down comatose way, considering the biggest news in town a golf player that was hit upside the head with a nine iron.

These people are those who elect presidents in all present forms of democracy, finding reality TV and the World’s Dumbest Criminals as classy entertainment.

As we now enter 2010 we are going to fish or cut bait. I believe in economic law in stress balance sheet situations on all levels including governments taking command, and MOPE falling to truth-less nothingness.

Jim

Bankers Get $4 Trillion Gift From Barney Frank: David Reilly
Commentary by David Reilly

Dec. 30 (Bloomberg) — To close out 2009, I decided to do something I bet no member of Congress has done — actually read from cover to cover one of the pieces of sweeping legislation bouncing around Capitol Hill.

Hunkering down by the fire, I snuggled up with H.R. 4173, the financial-reform legislation passed earlier this month by the House of Representatives. The Senate has yet to pass its own reform plan. The baby of Financial Services Committee Chairman Barney Frank, the House bill is meant to address everything from too-big-to-fail banks to asleep-at-the-switch credit-ratings companies to the protection of consumers from greedy lenders.

I quickly discovered why members of Congress rarely read legislation like this. At 1,279 pages, the “Wall Street Reform and Consumer Protection Act” is a real slog. And yes, I plowed through all those pages. (Memo to Chairman Frank: “ystem” at line 14, page 258 is missing the first “s”.)

More… ^[5]

 

TA Spotlight: Long Bond
Thursday, December 31, 2009
CIGA Eric

All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical formations and patterns recur on a constant basis. – Jesse Livermore.

End of the year interpretations are always difficult as shrinking volume can exaggerate moves. The long bond market, nevertheless, requires attention as price approaches the neckline of the large head and shoulders pattern. The weekly chart reveals the size of the pattern. The greater the size, the greater energy released in terms of downside price action if the neckline swing low fails.

The daily chart reveals the details of the recent deterioration in price. Again, volume is the key. It needs to pick up to create enough energy to break the neckline swing lows.

TA and money flows* suggest that stakes are very high.

Long Bonds TLT ETF Weekly:
^[6]

Long Bonds TLT ETF Daily:
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More… ^[8]