$INDU: Break of 14,600 Has Significant Postive Consequences for the Bear Case

Friday's Update on $SLV

Point & Figure Charts are really good at identifying a stock's stage.  That is, accumulation (Stage 1), advancing (Stage 2), distribution (Stage 3), and selling (Stage 4).  For $SLV, its current stage is "selling, or Stage Four."  That is why the recent rally would simply be categorized as a throw-back to resistance at $24 to relieve an overbought condition within a Stage 4 phase, which is clearly observed with a Point & Figure Chart.

Detroitification

Detroit had everything.  Now, it has nothing. Over the past sixty years, Detroit has gone from one of the most prosperous cities in the world to one of the poorest.  Its average annual per capita income is approximately $13,969, which is less than the average per capita income of Belarus, Botswana, and Romania.

Detroit has over 150,000 abandoned buildings. It has 11,000 unsolved homicides. Police response times average almost an hours.  Forty percent of the city's stoplights don't work.  Almost half of all property owners are refusing to pay property taxes.  In other words, Detroit is America's first third-world city.  However, it is not going to be the only city to collapse.  Other cities in various stages of Detroitification are Chicago, Baltimore, New York, Los Angeles, Oakland, San Diego, Portland, Providence, and Houston.  Welcome to Eschaton!

Investment Instrument That Benefits From a Rising Interest Rate Environment

Vulnerability of the Economy Based on Wal-Mart's (WMT) Performance

Since our economy, as measured by GDP, constitutes approximately 70% of consumer expenditures, the trend of the revenue growth for WMT is definitely not an encouraging sign.

Common Core for Math: New National Curriculum for Public Schools

The emphasis on the "New Math Common Core" is moving more towards the explanation, and the how, and the procedures at arriving to get an answer, rather than on the correct solution.  In other words, as long as a student can explain the process to a math problem, say 3*4,  but arrives at 11, not 12, it would be close enough, because the student was able to explain the process involved.  Welcome to the new "normal."  Please tell me what was wrong with the basic fundamentals of "reading, writing and arithmetic?" 
 

Real Median Household Income

Since the consumer accounts for approximately 70% of GDP, the above chart of household income does not portend well for GDP going forward.  The current real income level for consumers is at the same level as it was in 1995. 

$SLV: Is This the Time to Bet the House?

The Big, Bad Bear

Is the "BEAR" finally coming out of hibernation?

DJIA: Short-term Price Objective Has Been Reached!

On July 26, 2013, my comments on the DJIA were as follows: "DJIA is in the early phase of declining to its 50-day EMA at 15,198, or 360 lower!  Full Stochastics and PPO are in "overbought" and turning down from these levels."  Currently, we have reached that level on the DJIA (15,136).  On a daily basis, the DJIA has just reached oversold levels, based on Full Stochastics and Wm%R.  Further weakness is still possible; but, given these oversold readings, a relief rally should occur over the next several days to relieve the current selling pressure.  However, what happens after any sort of relieve rally needs to be watched carefully.  Why?  Because it's 200-day EMA is currently 14,526, which would be the next major support level.

The Day of Cheap Money is Over!

Over the past month or so, my focus has been on the outlook for interest rates, specifically the rate on the 10-year Treasury Note.  This is the "key rate" that determines the rates on car loans, consumer loans, and mortgages.  During this time, my forecast has called for a major trend change in interest rates.  If you are not convinced that rates are heading higher, you may want to go back and read my following posts: "Interest Rates Going Forward from July 3, 2013," "$TNX: Stage 2 Advancing Phase for 10-Year Treasury Rate Confirmed from July 5, 2013," "Don't Buy Bonds from July 30, 2013," and "Avoid Bonds, Period from August 2, 2013." 

I believe you have now been sufficiently warned.  How you use this information is totally up to you.

$SLV: No Change in My Price Forecast Since June 21, 2013

My post on $SLV from June 21, 2013 stated the following: "The derivative for silver is closing in on my downside price objective of $18, which should provide some near-term support and possible reflect rally back to $21. If $18 is penetrated, the next downside price objective is $14. All of the current price action is taking place in a Stage 4 -- Declining Phase."  Since June 21, $SLV did reach $18 and has retraced back to a close of yesterday at $21.09.  Currently, $SLV has entered into the overbought levels, based on the Full-Stochastics and Wm%R.  If $SLV weakens from the $21 level, $18 remains the key support price.  The proverbial bottom-lines remains that $SLV is in a "Stage 4 Selling Phase."

Gallup: President Obama Falls to a 41% Approval Rating

Watch out President Obama, because you are fast approaching the average approval ratings for a second-term President set by Presidents Bush, Nixon, and Truman.

Second-Term Approval Averages

President	Dates of second term	Ave. Rating
		%
Harry Truman	January 1949-January 1953	36.5
Dwight Eisenhower	January 1957-January 1961	60.5
Lyndon Johnson	January 1965-January 1969	50.3
Richard Nixon	January 1973-August 1974	34.4
Ronald Reagan	January 1985-January 1989	55.3
Bill Clinton	January 1997-January 2001	60.6
George W. Bush	January 2005-January 2009	36.5

Government Motors (GM) Cuts Volt's Price by $5,000 Plus Free Fire Insurance

The first Volt, a 2010 model, cost $41,000.  Today, you can purchase a Volt for $34,995 with free fire hazard insurance for 100,000 miles or 10 years, which ever comes first.  Volt sales in July totaled 1,788.  For the first seven months of the year, Volt sales were 11,643.  I really like that free fire insurance.

Avoid Bonds, Period!

Part-time Employment: The New Normal

Of the 953,000 jobs created so far in 2013, only 23%, or 222,000 were full-time jobs.  That means, of course, part-time jobs created were 731,000.  Welcome to the new, normal economy where it is extremely difficult to get a full-time position.

Source: ZeroHedge