Thursday, May 7, 2009

Morning Update/ Market Thread 5/7

Good Morning,

Nothing like a completely unbelievable lie to kick the markets over top of all those hammers I pointed out in yesterday’s update:
Bank Results ‘Reassuring,’ Show No Insolvency

May 7 (Bloomberg) -- Federal regulators today unveil what Treasury Secretary Timothy Geithner said will be a “reassuring” picture of a U.S. banking system able to withstand whatever stresses the recession may inflict on it once a handful of institutions add to their capital base.

Now who could have ever guessed that little weasel Geithner would come out and say a thing like that? Nice show Timmy, thank you so much for the act, now please do your country a big favor and go jump off the Empire State Building or something, will you? Plllleeeeaase… give me a break. I’m sorry, but I have to interrupt this update with a very appropriate tune:

Three Dog Night – Liar:

And absolutely there are more “greenshoots.” Heck, GM only burned through a little more than $10 billion dollars in the first quarter, losing $6 billion on the bottom line in a real sign of health and good times to come.

Not to worry, the banks show no insolvency. Riiiight.

And for the past week jobless claims fell to a very reassuring 601,000, that’s all… yet another green shoot. Please ignore the new all time record in continuing claims that grew to 6.35 million, that’s irrelevant and a “lagging” indicator. No, we’re looking across the valley to the other side and what a nicely shaped V valley it is too.

So, with the /ES leaping the 912 pivot area, it now becomes support and the next higher pivot is at 935. Here’s the overnight action:

We’re actually not getting too far from the last significant high on the SPX which is up at 944. A break over that would be bullish indeed.

And I just want to point out clearly that I made another good call in my update yesterday (cough)! You did see all my caveat’s… right?

Have a great “reassuring” and “stress” free day,


PS - And whatever you do, don't watch the video in the post below this one, that might take away your confidence that the government has a single check and balance on it. I'm so glad they have their tenacles in so many large institutions now...