It's Time to Screw the Public Again

Yes, once again a private equity firm is ready to sell shares to the public. This time, it is the Apollo Group and I am not the only one to notice. Here is a chart to put things into perspective.

Everyone thinks that this marks the end of the rally because these guys are the smartest of tghe smart money. It is interesting, if not a viable timing tool.

This is why the market will eventually crash

OK, the headline is a bit sensational but the article cited below proves to me that investing as we know it is over. Remember, I blogged that stock trading jumped the shark a few months ago when football coach Jimmy Johnson was pushing a trading system. http://quicktakespro.blogspot.com/2009/08/stocks-have-jumped-shark.html. Now I know the world has ended because of this article about the launch of 100x leveraged ETFs on the Nasdaq. http://www.etfexpress.com/2009/11/17/kelly-capital-launches-100x-leveraged-etfs

Of course, it was not a real article but a bit of satire. http://www.istockanalyst.com/article/viewarticle/articleid/3646069. Author Jason Kelly points out that the trend towards leverage is still with us and I say it means we have not learned our lesson.

Kelly goes on to report about the mail he got over the piece, as follows:

"A full 65% of people expressed an interest in owning products that would "go bankrupt within the course of most trading days." A stunning 5% thought they already owned them. Only 30% of respondents got the humor."

PT Barnum was right. There really is a sucker born every minute. Lord help capitalism.

Wet Blanket

Some charts just speak for themselves and this one is the wet blanket on today's rally.

Yes, volume for the NYSE was stinky again - old news. This chart of the banking ETF shows money still fleeing, a broken trendline and former support now acting as resistance.

Note from AAII

I am still on the road but here are a few observations from the American Association of Individual Investors conference.

1- Lunch keynote Mike Santoli (Barrons) said the Fed's mission now is to dampen volatility, not keep rates low or anything else. High volatility makes long-term investment by companies (not talking about stock market investors) difficult.

2- Santoli - Madoff victims did not do their homework. This is NOT to blame the victims but those who were not hurt by him kicked the tires and found funky stuff.

3- The place was packed - thousands of investors

4- My presentation on charting drew the biggest crowd I have ever had. Kudos to the way they formatted the schedule to allow that to happen.

5- Demand for charting from people who have not yet exposed to it seems as if it would be quite high. Simple stuff but high.

6- Exhibit hall had plenty of charting software packages on display. A lot more than I would have thought,

Speaking in Orlando

Vacation is really a misnomer. This is more like a re-location but I'll be in Orlando starting this evening. Friday, I am speaking at the AAII conference and doing the requisite Barron's related schmoozing.

Otherwise, the family is coming with me to the House of Mouse for some time away. I'm still doing the newsletter but I've done it poolside at midnight many times before. Anything for the kindeleh.

Marketwise, liquidity is the rule. G-20 is promising it so the stock market has wings. Broken wings, but wings nonetheless. I just worry about what happens when the economy hints that it can handle a rate increase.

As they say in the bond biz, all of this product (stocks) has not been put away (sold to the final retail buyer). That leaves it is very big, fast acting hands and facing a crowded exit door.

Greenback is Whack

NEW YORK (MarketWatch) -- The dollar weakened Monday, pushing an index of the greenback to the lowest in 15 months, after a weekend meeting of Group of 20 policy makers offered no support for the U.S. unit.

Why would other countries support a strong (insert your own currency here) policy? Nobody wants their own currency to soar. Of course, unless you have your eye on buying chunks of your neighbor instead of selling them things.

Let me offer a different spin on why the dollar plunged to open the week - healthcare reform passed the House. Spend, spend, spend.

The Senate has vowed to kill it so let's see if the dollar reverses course at that time.

In the meantime, gold....... If you have not already seen it, take a look at our Chart of the Day at QuickTakesPro.com.

Classic pattern?

This is a chart we've been watching in Quick Takes Pro. If you have any faith left in technical analysis than a channel breakdown with falling-volume retracement should mean something.

chart printed at 1pm NYT Friday.