06 Sep
Daily Market Commentary

Late Day Rally Curbs Early Selling As Global Rout Continues

Tuesday, September 6, 2011
Stock Market Commentary:

Stocks were closed in the U.S. on Monday in observance of the Labor Day Holiday. However, overseas, stocks were smacked as a new round of fears spread concerning the ongoing EU debt saga and the health of the global economy. Stocks were smacked on Tuesday as the U.S. markets played catch up and fear spread that the U.S. and global economy would fall into a double dip recession. At this point, the current rally is under pressure evidenced by several distribution days (heavy volume declines) since the latest FTD. It is important to note that even with the latest FTD, the major averages are still trading below several key technical levels which means this rally may fade if the bears show up and quell the bulls’ efforts.

Monday-Tuesday’s Action: Global Jitters Smack Stocks

U.S. stocks were closed on Monday for the the holiday however equity futures were open and fell hard as European markets plunged to fresh 2011 lows in heavy volume. In recent weeks, European markets, specifically Germany’s DAX, tends to lead the U.S. markets (both higher and lower). Therefore, the fact that several European markets are at new 2011 lows bodes poorly for U.S markets. The Institute for Supply Management (ISM) said its service-sector index rose to +53.3% last month from +52.7% in July. This topped the Street’s expectation for +51% and topped the boom/bust level of 50.

Swiss Central Bank Defends Currency:

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04 Feb
Blog, Uncategorized

Debt: How The World Economy Works

In a small town in Europe..It is raining, and the little town looks totally deserted. It is tough times, Everybody is in debt, and everybody lives on credit
Suddenly, a rich tourist comes to town. He enters the only hotel, lays a 100 Euro note on the reception counter, and goes to inspect the rooms upstairs in order to choose one. The hotel proprietor takes the 100 Euro note and runs to pay his debt to the butcher. The butcher takes the 100 Euro note, and runs to pay his debt to the pig grower. The pig grower takes the 100 Euro note, and runs to pay his debt to the supplier of his feed and fuel. The supplier of feed and fuel takes the 100 Euro note and runs to pay his debt to the town’s prostitute that in these hard times, gave her services on credit. The hooker runs to the hotel, and pays off her debt with the 100 Euro note to the hotel proprietor to pay for the rooms that she rented when she brought her clients there. The hotel proprietor then lays the 100 Euro note back on the counter so that the rich tourist will not suspect anything..
At that moment, the tourist comes down after inspecting the rooms, and takes his 100 Euro note, after saying that he did not like any of the rooms, and leaves town. No one earned anything. However, the whole town is now without debt, and looks to the future with a lot of optimism. And that, ladies and gentlemen, is how the world is doing business today.