The Road to Banana Bread

This is the place to stop for banana bread on the Road to Hana. Awesome beach a few hundred feet before here where the waves crash into black lava rocks. Now that you know, I bet you'll stop here, too. LOL.

Life's a Beach!

I haven't thought much about the markets while here in Paradise. Maybe being here has kind of marginalized my interest in the short-term swings from day to day. Normally, on vacation I would sell any short-term individual holdings and either move to an index or cash and just enjoy the time off. This time, I kept everything, including individual names. I haven't traded in a few weeks. Honestly, I'm quite bullish and I can't justify selling anything. And that's despite the omni-present gloom and doom from the media and blogs out there! I just don't buy it.

The temp is above 80 here in Maui. Just offshore, there are whales all over the place. The whale watching trip is extremely worthwhile.

I love the ocean. I can just hang out on the beach for hours.

Sunset over Lanai

This isn't the best shot with the camera phone, but it is amazing...

Above the Clouds

The volcano summit at Haleakala.

Hula Pie

Not what you thought...

It is a dessert at Leilani's. Oreo cookie crust. Vanilla ice cream. Macadamedia nuts. Fudge. Warm chocolate sauce. Whip cream.

So you know.

Zowie, It's Maui!

Need a break from it all. Work is caught up so might as well recharge.

80 degrees here in Maui... LOL...

More later. How about that market?!

Tuesday Thoughts

• Obviously, on a day where market futures are skyrocketing, the last thing a bull wants to see is a reversal and a negative close.
• Nevertheless, I remain bullish and optimistic, despite the overwhelmingly bearishness of pretty much everyone on the planet. I remain 100% long this market.  Mostly in ETFs and a few stocks, and still in those ETFC shares mentioned way back when. 
• Bottom line is that I think the Fed rate cuts will work.  The tax rebates will help.  And folks who are doing their 2007 taxes may also receive refunds, and that'll help.
• Haven't blogged too much lately.   Total anarchy at work.  Long days.  Not many breaks.  I think all is well.  No doubt you've heard the phrase "trying to herd cats?"  Well, sometimes working with programmers is more like trying to teach cats algebra.  Instead of focusing on the problems, they seem to be content battin' at your pencil and chewing up the paper.
• In Sacramento, the town is a-buzz about the Mike Bibby (not pictured) trade to Atlanta for a bunch of fellows who may or may not be able to play the game of basketball.  (Or do algebra).  Time will tell.  I'm not a Kings fan (being from LA), but Kings' GM Petrie has an uncanny knack of dealing away players past their prime and getting value or unwinding salary cap.

American President Gladiators

• I don't know about you, but I'm watching the market almost anticipating the sellers showing up. Get that feeling everyday these days?   Kind of like trying to climb the pyramid in American Gladiators and thinking you have an opening, only to have Justice (not pictured) throw you down.  But like those ever-optimistic contestants, I remain bullish!
• Barack Obama went all American Gladiator on Hillary (never pictured) in yesterday's primaries.  Not only knocking Hillary off the pyramid, but knocking her into the pool in Joust and drilling her with tennis balls in Assault.  He'll have a big lead going into the Eliminator.  The winner faces John McCain in the finale.
• Yeah, silly.
• I listened to Gary Kaltbaum's radio show while in the weight room yesterday.  He is still very bearish and scoffing at those who have claimed "the low" is in.  Also scoffing at those who believe that this is not a bear market and only a correction.  He indicated that he thinks most "last legs" of bear markets are the worst of all and that we haven't seen it yet.
• Still in ETFC, and somewhat concerned about it stalling around here.  Watching.
• I'm switching from "My Yahoo" to "iGoogle" as a homepage.  Just a trial run for now.  Pretty much the same sort of functionality.
• I also dumped Firefox and am using the much quicker Opera as a browser.  Of course, my issues with Firefox may be that I have way too many plug-ins.

Crash

• Having problems with PCs the last few days.   Both my laptop and desktop.  System Restore.  BLEH.
• On Honest Abe Day (not pictured), the market staged a nasty reversal.  Yes, volume was a little light and that's a "good thing."  One could consider the recent action a return to the lows, and the volatility we're seeing could also be interpreted as a "good thing."  And you know the math rules, when you multiply or add two good things together, the result is always a good thing.  Right?
• I feel pretty good about the market.  I believe it will begin to price in some of the Fed cuts and government stimulus pretty quickly here.  I remain 100% long.
• Battling flu bug, but mostly gone now.
• Charlize Theron does Monster, and then follows it up with.... Aeon Flux.  Now, I didn't see the former, but did see the latter.  LOL.
• I think Microsoft should modify their offer for Yahoo downwards.  Counter the YHOO rejection of $31 with an offer of $27.  And in the offer, include the comment "Well, it's still more than the $19 it was trading for before we made the first offer."
• Just saying.

TGIF

• I'm still in my ETFC trade, for what it's worth. I was concerned with the selling earlier in the week, but nothing moves up in a straight line.  Being patient and watching how it reacts here near recent highs.  Volume is kind of light.
• Overall, I'm still bullish on the stock market, even with this relatively severe market correction.  Hey, they happen.  We can't just have smooth and orderly 5% pullbacks now and then.  Every once and awhile, folks need to stare fear down.
• My playbook says, and who really cares, but it says that pre-options week weakness should be bought ahead of a potential options week rally.
• Fed's Janet Yellen:  Economy weak, but no recession.  "I consider it most probable that the U.S. economy will experience slow growth, and not outright recession, in coming quarters," Yellen said.
• On the tax rebates, Yellen was positive about Congress' economic stimulus bill and relatively low inflation. She said that the tax rebate legislation, which was passed late Thursday, "could provide notable stimulus in the latter half of the year."
• Came down with the flu or cold yesterday.  Using Zicam.  It's pretty much a miracle drug.  Highly recommend it.
• The neutral signal is on at Jason's!  This just means that the market is at a decision point and that should be decided tomorrow or Monday on whether the bear rally will resume which should lead to new bear rally highs or whether the lows getting taken out.
• With Mitt Romney dropping out, McCain is now The Chosen One.  But the bad news for Honest John is that the conservatives don't support him.  With the Republicans in the popularity doghouse, I don't expect McCain to win this fall anyways.  The Democrats should enjoy a landslide victory in the Fall.
• Prepare yourself for higher taxes.  And how will that play out in the stock market?  Right now, long-term capital gains taxes are at 15%.  They'd most likely go up under Hillary or Obama.  And if the marriage penalty tax comes back, married couples will be paying more taxes.  The Democrats have also talked about raising or eliminating the Social Security tax ceiling. 
• From Liberal Larry: 

Rejoice, fellow liberals, for with Hillary and McCain both poised to receive their party's nomination on this most Super of Super Tuesdays, November will mark the first time in U.S. history that two Democrats have ran against each other in a Presidential election.

The question everyone is asking, however, is whether McCain has what it takes to energize his liberal base. His calls for amnesty for undocumented workers, his opposition to Bush's Tax Cuts for the Wealthiest One Percent of Americans, and his long, romantic walks on the beach with Senator Kennedy suggests that he does. However, there is reason to suspect that despite his progressive record in the Senate, McCain isn't as devout a Democrat as he would like everyone to believe.

First of all, he's running as a Republican. That's already raised some eyebrows within Democrat Party circles. Secondly...well, I guess that's about it. I can't really think of any other reasons to believe that John McCain is a conservative.

Nevertheless, I'm not ready to make an official endorsement.  I was almost tricked once. It may yet turn out that McCain is every bit as conservative as Obama is.

 

Subprime Takeovers and CA Voting Guide

• Microsoft to borrow money for Yahoo deal. I believe the details are no money down with a low 2-year teaser rate that's negatively amortized, and then resets at prevailing rates.  Seems like nothing could go wrong there!  Subprime takeovers!
• Well, the market stumbling out of the gate again today.  The common consensus is that the bear market rally (aka "countertrend rally") has run its course and now we're heading back down to retest the lows.  Even Investor's Business Daily seemed to bend their rules on follow-through days last week, stating that we didn't have a follow-through day because of some newly invented reason.  I heard the info second-hand so I'm not going to try to reiterate all of the details, only that they're not bullish as far as I know.
• Of course, the market wedged up off the lows and needs a breather.  While a retest of the lows is likely inevitable, I'd think any countertrend rally worth its salt would have us trade in a range here for a bit before heading back down to the lows.  This kind of action would create the kind of throwing in of the towel capitulation that we need to end the correction and resume the bull market.
• Super Tuesday here in CA! Muckdog's CA voting guide:

President:  Mitt Romney.  He's a Mormon, just like Donny and Marie.  And who didn't like that 1970's variety show? Marie recently did well on Dancing with the Stars, too.  I think a Mitt Romney administration would probably include cabinet positions for Donny and Marie:  Secretary of Country and  Secretary of Rock'n Roll. 

Other than that, Romney is just your vanilla GOP candidate.  Low taxes.  Tough on terrorists.  And here's a Republican who has a command of the English language.  Hello, breath of fresh air!  Mitt 2008! 

No on Propositions 91, 92 and 93.  There is something to be said for the status quo.

Propositions 94-97 - Expand Indian gaming.  Yes.  The state needs the money, and gambling revenue is one of the only ways to tax the poor.

• On the Democrat ticket, I imagine Hillary is the favorite to win despite the emotional fervor Obama has.  I think the younger voters are pretty enthusiastic about Obama.  I think that makes Obama the JFK or Reagan candidate of this era.  Whether or not the nation is ready for that, I don't know.  But he's a very motivating speaker that would definitely change the landscape from this one of gridlock and infighting to one of "working consensus."
• Should Hillary win, I think it'd just be more of the same of what we have now.  She's the status quo candidate.  Which is fine if you believe that gridlock is the best form of government.  Many people are of that view.

The NY Giants (and '72 Dolphins) Win!

• Congratulations to Bob Griese and the only team ever to go undefeated through an entire season, the1972 Miami Dolphins!
• The casinos were handing out free cash yesterday on the Giants win.  Easy money.  You did have the G-men on the money line, right?
• A friend picked the Giants in August at 38-1 to win the Super Bowl.   When we were up in Reno at the time, I thought....  Uh, no Tiki... Ain't gonna happen.  Hah!
• Well, unlike the 1972 Miami Dolphins, the stock market is not celebrating the Giants win or Patriots loss today.  Back to reality today.  I can't remember where we left off before the Super Bowl.  Something about runaway inflation (PCE core at 2.2%) and everyone unable to make their monthly mortgage payments.  Does that about sum it up?
• Is Microsoft buying Yahoo like Time Warner buying AOL?  Both AOL and Yahoo seem to be at similar points in their business model, where they're no longer industry leaders.  Just saying.