Is it Possible not to Like Alibaba's Jack Ma?

     I say no. I wrote the day of BABA's IPO that this guy was reason enough to buy the stock. It's amazing that coming in that one of the concerns about BABA before the IPO was Jack Ma having too much control-it's his company that he started in his own apartment over 20 years ago.

    http://diaryofarepublicanhater.blogspot.com/2014/09/for-alibaba-jack-ma-is-feature-not-bug.html

    After watching this guy I felt that, yeah, maybe the Chinese government is big and scary but I'm not worried about it with Ma around-he's gotten this far. Anyway, the Chinese government isn't really communist anymore or it is but it wants China to be the most successful in capitalism in the world.

    I was struck by how smart and likable Ma is. Yesterday he gave us another gem: He learned public speaking by listening to Whitney Houston.

    http://www.usatoday.com/story/tech/2014/10/27/jack-ma-learned-how-to-make-a-speech-from-watching-whitney-houston/18040105/

    Maybe, he learned public speaking from her, but what strikes me is how well he speaks American. This is what's so disarming about him. When you think of the history of hostilities between our two countries-from the days of Chiang Kai-shek to Mao, to the famines. to the cultural revolutions, to American anxieties about China surpassing us -it all seems so remote when you listen to Ma.

   Or maybe, the Jack Ma moment is the latest in American-Sino rapprochement. of finding common ground that goes back to Nixon  going to China. Nixon would have liked Ma I believe. Again, Ma speaks such fluent American. His heroes, his reference points could not be further from Mao and any cultural revolution. He doesn't even mention Deng though he's the latest move in Deng's line. He speaks to us of our own real heroes-Forrest Gump and Whitney Houston.

   Washington DC may be our capital, but Hollywood is our Holy City.  He doesn't speak to us of Chinese ideology but rather of our own American ideology.

   I'm not really a buy and hold type of a guy. Part of this is I remember 2008. However, I don't think it's primarily because I fear losses. Obviously not as you actually can lose a lot more going short term or trading, etc. I'm just impatient and want the biggest potential bang for my buck possible. That's why I love options so much.

   However, Ma has made me a believer. Here is one stock I can see holding long term, if not forever. It seems I'm finally in the right positions. I have lots of shares in BABA and I have $104 November 14 calls in Apple. My price target for AAPL is $107 and it's now just touched $106.30 as we speak. When it breaks $107 I'll get out and with the profits-which should be about $2700-I'll buy more shares in BABA-I want a total of 100 shares and will be able to get them when Apple hits that level-just a question of when and that could be today.

    I don't think there's any queston that BABA and AAPL are the safest stocks in the market, the safest place to put one's money. Now today, these two superpowers are making googly eyes at each other-Tim Cook and Ma. Both stocks are at all time highs this morning.

    http://inagist.com/all/526929452509298688/

    My home girl Kim Kardashian is at the Mobile conference today in California and she revealed her perference is not Iphone but a Blackberry! Then Kevin O'Leary-of the Shark Tank-agreed with her. Is this a time to buy Blackberry? She mentioned buying them-just in jest?

    I see that she's showing up everywhere now as she was in 2 Broke Girls last night. I'm hoping this is the start of a bigger trend towards seeing her get into acting.

    O'Leary made an interesting point: Google maybe should just be evil. It may turn out to be a big tactical mistake not going into China. It's not really evil to operate within Chinese law when in China. How high would the stock go today if they had second thoughts on this?

     Of course, what I hate about Google is what they did to my blog-they dropped me from Adsense without any explanation. 

Chris Christy's Ebola Quarantines: the GOP as Paper Libertarians

      I see that over the weekend both New York and New Jersey introduced quarantines for health care workers that treat Ebola in West Africa. We have Democrat Andrew Cuomo Governor of NY and Republican Governor Chris Christy of New Jersey implementing these policies that I'm not a fan of. 

     Still, as usual the Republican is a little more vociferous in the implementation of the policy. Cuomo's policy does at least allow for returning health care workers to stay in their homes for the 21 day period-albeit this was due to some pressure so I don't want to laud him too much. 

    http://www.nytimes.com/2014/10/27/nyregion/ebola-quarantine.html?_r=0

     Christy, however, has really outdone himself. He's already under investigation for Bridgegate for his appalling abuse of power and now he's again infringing on the civil rights of New Jersey residents. A nurse placed under this forced quarantine over the weekend now has a lawyer to sue. Yes, I know you have all these conservatives up in arms about lawyers run amok, but you hardly have to be a 'bleeding heart' to be given more than a little pause than just how Christy's draconian policy has been instituted/ 

    "The New York quarantine policy appears designed to strike a different tone from New Jersey, where Kaci Hickox, a 33-year-old Doctors Without Borders nurse, has been held in a tent in a Newark hospital for three days under conditions that she said Sunday were “really inhumane.”

    Yeah holding someone hostage in a tent. That's what an alleged libertarian like Christy thinks is acceptable in 2014 America. At least he understands the hardship he has placed Ms. Hickox who just wanted to help people suffering and epidemic in. 

     "New Jersey Gov. Chris Christie held firm on his decision to quarantine returning health-care workers. “I absolutely have no second thoughts about it,” he said on Fox News."

       Oh wait.. This is really pretty despicable on Christy's part. Can this really be someone who Americans are considering electing President of the United States in 2016? I mean if you think George W. Bush didn't care about civil liberties wait to you listen to this guy. 

       I have always found Christy to be particularly lacking in empathy-call it the 'empathy deficit.'  Even here, you can make a coherent argument for a quarantine but at least admit that it's a real hardship on health care workers who are trying to do God's work. We don't need to put a chilling effect on those who want to go to West Africa and fight this epidemic there before it comes here. Oh wait-it's too late, it's already here. At the least then let's fight that epidemic there before it becomes an epidemic here.

       At least Mr. 'Sticking to my guns' and Mr. "I'm holding firm' understands the subtitles of the issue:

      "Mr. Christie said Saturday that “I’m sorry if in any way she was inconvenienced, but inconvenience that could occur from having folks that are symptomatic and ill out amongst the public is a much, much greater concern of mine. So certainly nothing was done intentionally to try to inconvenience her or try to make her uncomfortable.”

       Don't ever let anyone tell you he's not a sensitive guy. NYC Mayor de Blasio had it right here:

        "Mr. Cuomo’s announcement on Sunday was made with New York Mayor Bill de Blasio , who had criticized how Ms. Hickox was treated. “State governments have the right to make decisions. But this hero coming back from the front, having done the right thing, was treated with disrespect,” Mr. de Blasio told reporters.

        Look, I don't necessarily want to laud the civil liberties sensibilities of Democrats-they are often unreliable and follow the GOP's lead into hysteria unrelated to what President Obama tells us we ought to focus on-the science. 

       However, even when Democrats go with policies like this they are usually following the GOP's lead and going with a general fear and panic feeling that respecting civil liberties may be bad politics. 

       The GOP always runs rather than walks into policies like this. So where are all those libertarians I'm always hearing about on the Right or does this only apply to corporations having to pay taxes? And don't tell me about Rand Paul-he's been arguing for quarantines. 

       http://www.bloomberg.com/politics/articles/2014-10-20/rand-paul-calls-for-quarantine-of-countries-struck-by-ebola 

       In fact he's been a major leader in whipping up fear. Calling for outright bans for travel from the afflicted countries. 

     http://www.newrepublic.com/article/119903/dallas-ebola-quarantine-effective-will-panic-stoking-politicians-pay

     Can we just once and for all put to be this talk of 'the libertarian Rand Paul? This has got to be as anti a libertarian policy as you can imagine and yet where is the criticism? Or the whole idea of libertarians is totally vacuous. 

      I'll tell you one thing. I thank God that we don't have a Republican in the White House right now with the start of this terrible epidemic. Obama has hit just the right note. 

     "The White House has voiced concern to the governors of New York and New Jersey about the potential impact of quarantine orders imposed on medical workers returning from West Africa who had contact with Ebola patients, a senior administration official said on Sunday."

      "We have let the governors of New York, New Jersey, and others states know that we have concerns with the unintended consequences of policies not grounded in science may have on efforts to combat Ebola at its source in West Africa," the Obama administration official said in a statement.

       "We have also let these states know that we are working on new guidelines for returning healthcare workers that will protect the American people against imported cases, while, at the same time, enabling us to continue to tackle this epidemic in West Africa," the official added.

       http://news.yahoo.com/white-house-seeking-reverse-ny-njs-ebola-quarantine-191850958.html

        Oh, I know. Paul is a libertarian because he believes restaurant owners have the right to refuse service to black customers if that's their preference. 

         UPDATE: I wonder what Ralph Nader would have to say about that.

         http://theweek.com/article/index/260813/ralph-nader-wants-liberals-to-back-rand-paul-dont-do-it

      

Don't Think Jim Cramer Can Move the Market? Tell it to Pal Alto Networks

      The stock was up today and then began to sell during his call to sell the stock. He has long been a booster of the company and its stock but now says its time to ring the register. By the end of his call the stock was down $4.50 in after hours.

     http://finance.yahoo.com/video/cramer-time-sell-palo-alto-221500708.html

    I've talked about my love and admiration for Cramer in the past.

    http://diaryofarepublicanhater.blogspot.com/2014/10/jim-cramer-declares-his-cheklist-met.html

    Jon Stewart admonished Cramer a few years ago that he needs him on his show to 'protect me from the hedge fund Jim Cramer.' I disagree-I know it's the 'hedge fund Jim Cramer' who knows how to make real money. So I loved that youtube video that showed him talking like a hedge fund manager.

     I love this Jim Cramer as much as a Jon Stewart hates it.

     http://www.youtube.com/watch?v=gMShFx5rThI

      At the end of the day the stock market is not a rational adding machine. I don't think it either can or should be made so. 

       More vintage Cramer

        http://brotherwatchblog.wordpress.com/2014/10/16/orwell-ebola-isis-and-immigration/

         https://www.youtube.com/watch?v=TaKnDMv6ceg

        As to the market-I've raised my white flag. I got just one thing to say to the bulls: you win. If you can't beat em join em. I did win on my one short on Amazon and now I'm ready to go long again. 

       http://diaryofarepublicanhater.blogspot.com/2014/10/yesterdays-caterpillar-earnings-as.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+DiaryOfARepublicanHater+%28Diary+of+a+Republican+Hater%29

       Of course, this may be a moment of 'famous last words'-the minute I get behind the bulls they fail me and it tanks again. I see that the technical guy, Carter, on Fast Money thinks we're actually at some very difficult technical levels. On a technical basis what he says makes sense. However, I do think on a fundamental basis the fact that we had new Ebola headlines and oil drop and still rally might suggest we're out of the woods-though Cramer himself says that if we go under $80 on oil the market could sell off again.

      Oh well. I got my head lobbed off staying bearish too long, hopefully I haven't time this perfectly wrong again.

       At the very least I can say this. I may be long but I'm in the two safest places to go in the market right now-Apple and Alibaba. I bought 25 shares in BABA and 20 Nov 14  $104 calls in Apple. Even should the market fall 200 points on Monday, I should be pretty insulated. Apple pretty limited down side even during the correction as did Alibaba. Now BABA is finally above it's opening price on its IPO day and Apple has just broken out above long term resistance at $103 after its big earnings beat.

 

Scott Sumner on What Would Falsify Rational Expectations

     You have to admit that RE is very resilient. No matter what might seem to question it, it always turns out that according at least to its proponents like Sumner or Noahpinion, it turns out to be a feature not a bug. 

    "The EMH is approximately true; indeed it’s almost impossible for me to imagine any other model of financial markets.  But it’s not precisely true, again, just as you’d expect.  After all, if the EMH were perfectly true then no one would have any incentive to estimate fundamental values.  We know people are imperfect and hence that any real world human institution, including markets, will be at least slightly imperfect.

       http://www.themoneyillusion.com/?paged=3

       Smith, who Sumner calls his 'Doppelganger' puts it this way:

       "Now, the analogy between the EMH and Newton’s Laws is far from perfect. Newton’s Laws are wrong in a finite set of ways, under conditions that are predictable and well-known. The EMH, in contrast, is wrong in an infinite number of ways, and the set of the most important ways in which it’s wrong is constantly changing, as old anomalies are traded away and new ones crop up. Also, the EMH is actually a family of hypotheses, since you need a model of risk to specify it properly."

       "But like Newton’s Laws, the EMH is deep and fundamental. If you went through a wormhole and visited an advanced alien civilization, what would they think about financial markets? Chances are, they wouldn’t use the Capital Asset Pricing Model, or the Fama-French 3-Factor Model, or the Shiller CAPE. But I bet they would have some version of the Efficient Market Hypothesis."

       So what could call it into question? Is it unfalsfiable? Sumner says no:

    "Commenters often present me with market anomalies, which supposedly “prove” the efficient markets hypothesis is wrong.    I always respond that they’re just engaging in data mining.  They retort that no theory that can’t be disproved is worth anything.  But the EMH can be disproved.  The tests have been done, and it passes.  Sort of."

     "Finance professors have done many different tests of the EMH, and I’d guess 90% of the published tests (but only 5% of the actual tests) show that the EMH is wrong.  (Yes, I’m pulling these numbers out of thin air, but you get the point.)  They’ve found January effects, small stock effects and value stock effects.  They’ve found the market does better when P/E ratios are low.  They found the market does worse on rainy days (a study published in the AER!).  Of course you’d expect to find 5 anomalies for every 100 tests you do, and for the most part you only get published if you find an anomaly, and finance professors have a lot of computer power, so . ."

       http://www.themoneyillusion.com/?p=6872

       Sumner isn't impressed by Warren Buffett-all those returns are just lucky. Interstingly, both Sumner and Buffett hold a dim view of hedge funds. 

         "Here’s another article showing the efficiency of markets:

Warren Buffett made a friendly bet four years ago that funds that invest in hedge funds for their clients couldn’t beat the stock market over a decade. So far he’s winning.

The 81-year-old Buffett, who is chairman of the holding companyBerkshire Hathaway Inc. (BRK/A), ended last year neck and neck with the Protégé funds as the Vanguard fund climbed by 2.1 percent and the Protégé hedge funds lost an estimated 3.75 percent.

The first two months of this year pushed the Vanguard fund ahead as stocks returned 9 percent, more than twice the gains of hedge funds.

      "If you do the math the performance gap is around 10%, even larger than four years of the 1.25% annual expense ratio for mutual funds that invest in hedge funds. They’d have been better off throwing darts."

        However, Sumner takes a dim view of Buffett as well. 

        "But before Buffett gets too cocky, he might want to consider the final sentence of the article:

Berkshire Hathaway shares have slumped almost 17 percent since the end of 2007."

    "Ouch! Three years ago I argued that even if markets were perfectly efficient, they would look inefficient. That’s because for every 1,000,000 investors you’d expect one guy to outperform the market for 20 consecutive years. The masses would call that lucky guy a genius, even if he was just an average bloke from Nebraska."

     "I predicted that after the lucky guy became the richest investor on Wall Street, his returns would no longer look so impressive. So far I appear to be right. That doesn’t mean the EMH is precisely true (it’s not), but I’m having more and more trouble finding any useful anti-EMH models for investors."

        So to disprove RE what would Buffett have to do-outperform every single year? Seems like a rather stacked deck. He says that RE could only be approximately true not precisely so or there'd be no incentive to estimate fundamentals. However, if the odds are this long of beating the market where is the incentive? Is it really no different than buying a lottery ticket? I don't buy that. 

        

        

    

Yesterday's Caterpillar Earnings as the Market's Alamo?

     So it looks. I've been bearish during October but and while it worked pretty well for me the first few weeks the wheels came off of the strategy in last week. Listen, I have to give credit where credit is due and give Jim Cramer credit-he has turned out to be exactly right.

      http://diaryofarepublicanhater.blogspot.com/2014/10/jim-cramer-declares-his-cheklist-met.html

       His checklist did hold up very well. True we can't be 100 percent sure the bottom is in as the indexes remain under some key technical levels. We'll see if there's resistance here-there was no resistance at other levels during the rally.

       That's kind of the strange aspect of both this correction and subsequent rally-technical levels didn't give any resistance on the way down-S&P easily fell through 1905, 1875, 1850, all the way under 1820.

       However, it rallied back just as seamlessly. Cramer was right in what he said yesterday regarding Caterpillar. It was the last stand of the bears-I should know as I was short with some puts and-the bears were flushed out.

      As he pointed out, CAT's report may not have been that great-arguably while the bottom line looks impressive-a $.40 cent beat-much of it was done via buybacks and price cutting measures. It wasn't a testament to an improving China picture. Still, the stock rallied because it was oversold. As Cramer pointed out at $110 it might have sold off but at $94 it's a different story.

       So at this point, I don't think you can fight the bulls. Yes, we have a new Ebola scare today with that NYC doctor, Dr. Craig Spencer, contracting it. This hits close to home for me as a New Yorker-though I don't live in the city but Long Island.  So it gets closer and closer. To be sure he contracted it when working with Ebola patients in Guinea.

       From what I've heard so far it seems that NY has handled this pretty well-it was well prepared with a few hospitals reserved for Ebola patients and there hasn't been lots of panic. Certainly it's been better than Texas though this is a low bar.  Dr. Kent Brantly says New York has apparently 'done everything right to contain this case.'

       http://www.today.com/video/today/56292247#56292247

      The market has similarly not panicked too much. The futures are down this morning but only marginally. We do have oil down again so we'll see what impact that might have.

       Today should start well for me as I finally got a short right-Amazon. I got 7 puts for Amazon at $297.50, October 31 and should be in very good shape. It really couldn't have come at a better time as I had taken some tough losses staying too long in shorts on CAT and Gilead. Knowing when to say when is not one of my talents.

      I had everything in my account on this Amazon move. If I had gotten this wrong I'd be out of the market. Now I have recovered and am close to even again. Amazing how much can ride on one move. That's what I love about the market.

      Once I get out of AMZN this morning I will plow a bunch of cash into Alibaba (BABA). While it is widely seen as ushering in the top of the market before the 10% correction, it has performed very well during the selloff never falling below $84 and then finished at $94 yesterday-which is above where it opened on day of its IPO. After that some Apple calls. It broke out of its long term resistance of $103 yesterday. For awhile the stock seemed stuck in the $97-$102 range following its anticlimactic release of IPhone 6-for the stock it was anticlimactic.

       After its earnings beat on Wednesday and its breakout yesterday I think it should be able to rally at least to $110.
   

     

Jim Cramer Declares His Checklist Met and that We've hit an Investable Bottom

     I told you in previous posts that his bearishness the last few weeks kind of validated my own bearishness-it helped my conviction. It's just that Cramer is so rarely bearish so when he makes bearish sounds you have to sit up and listen.

   http://diaryofarepublicanhater.blogspot.com/2014/10/if-fundamentals-of-us-economy-are.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+DiaryOfARepublicanHater+%28Diary+of+a+Republican+Hater%29

    He had given us a 10 point checklist on Mad Money that had to be met. He's now declared them met or at least mostly met and that we're now at an investable bottom. So as he soldiified my bearish conviction has he now softened it with his declaration that bearishness is over?

    Not really. To be sure-I wasn't bearish because he was, just found it a compelling hint that I might be on the right track. Cramer is a congenital bull-at least since he started his tv show. In the old days at his hedge fund, you know it was different. Remember that time when that video of him talking about deliberately buying up the futures in the premarket then selling it all to drag down the market when it opened? Did Jon Stewart every savage him on that one.

    http://www.huffingtonpost.com/news/jon-stewart-jim-cramer-interview/

    http://www.thewire.com/business/2011/05/jim-cramers-still-bitter-2009-spat-jon-stewart/37699/

    Here was Cramer on his hedge fund days.

    http://www.youtube.com/watch?v=gMShFx5rThI

     Let me just be clear: I think Jim got a raw deal there. However, this is why I'm hearing his declaration of victory of all things bullish, I'm not really listening to it.

    Cramer has to be bullish on his show. His post hedge fund personal requires him to be what he himself refers to in the YouTube video above a 'moron Long.' It's the nature of the beast. The public doesn't understand the market too well and the idea of shorting a stock-of making money off it dropping sounds-well, evil. Again, remember the way Stewart spit his righteous indignation all over Cramer's face during that interview.

    So I don't really hold it against him for not telling us everything he knows on Mad Money. Much of what he says on the show is the God's honest Truth. However, if he's committed any sin, it's the sin of omission. Out of necessity.

    Listen, if you notice CNBC, very few like to be bearish publicly on that network. Even Fast Money where we have short term traders who know perfectly well that you can make money just as easily on the short as the long side don't like to talk to much about the short side. The entire network is totally biased to the long side.

    What isn't commonly appreciated about bias, is just because you may be biased doesn't mean you're wrong. That's one answer I have to those who complain about the title of my blog.

     CNBC may be biased but the bias doesn't hurt as much as it could. How much could it hurt? It would hurt a lot more if the network was congenitally bearish-as the fact is that over Keyues' Long Run, the market itself has a very strong bullish bias. Think about it. Since the Nasdaq driven bear market of 2000-2002 after the Internet boom-bubble of the nineties, the Dow and S&P have been up 10 of the last 11 years. Of course, the one down year-2008 was a doozy.

      Still, the market usually goes up, for every 8 years, 5 to 6 of the years will be up years. So bulls have a built in advantage. Permabears then are less reliable than permabulls-they're going to be wrong  more often. I'm no Sumner fan as you know, but he's right in what he's said about those who predicted 10 of the last 7 recessions.

       I try then not to be biased to either the bull or the bear side-though I realize that usually it will be a bull market. I was very bearish in 2008 and made some money buying puts in the financials-of course, I'm not great at knowing when to say when. Since the March, 2009 rally, I haven't bean bearish since. I am still for now.

       Cramer claims that most of his list was met today but he graded with something of a curve. Even the items most plausible like number 1-getting Ebola under control is pretty premature. By under control he means the news flow-as he said on his show tonight, the only way to get control of the disease itself is by developing drugs that will cure it.

       It's not impossible that he's right and that we've gotten control of the news flow now. Obama gave a great 'fireside chat' with Chris Mathews Thursday night and has now named an 'Ebola Czar.' Still, it could be that we've gotten control of the headlines but it also could be that we haven't .The trouble is that we're already dealing with an Ebola crisis. By the WHO failing to contain it in a few African villages as it did in the past, this means that a simple quarantine will not solve the problem. We have an epidemic in 3 West African countries and it needs to be defeated there. With such stakes, how can we be so certain that there will be no more terrible headlines to jar the market? There was a health professional on CNBC Thursday morning who seems to think that while we won't have an epidemic in the US we will have the spectre of /30 or 40 cases in a major city'-if that's the case there will certainly be more headlines that will cause everyone to panic.

    Arguably number 2 has come to fruition: we did see all stocks get hit on Wednesday-all the bulls including Cramer are calling this the 'whoosh' moment. I remember in 2008 there were many days that it was believed we had the 'whoosh' moment only to see that there would be others.

    Number 3 is plausible-we did have 'specs' hit hard with Netflix losing 25% of it's value on it's disappointing subscription levels. Still, there could still be more. What about Amazon going lower? What about Google getting hit? The trouble here is the trouble in all of his list: many of his items have shown some progress but he seems a little premature declaring victory. I mean take number 4-oil has to find its footing.

    On Thursday after touching $80, oil rallied a little. Cramer now declares it stabilized but , again, surely he's heard of a dead cat bounce. Indeed, oil actually weakened considerably today after rallying early to basically flat. How then can we be so sure that it's found a footing? Yet he declares that if oil is sold off again it will find a buyer. It just seems too early and with very little to declare this footing: I mean one rally of a dollar followed by a day it ended basically unchanged?

    Nowhere is his case weaker though than on technicals. stabilizing. His case rested on the Vix falling sharply, It did fall $3.21 though that was a $1.60 above it's low for the day. I mean one day down in the Vix is enough to declare the technicals benign?

    To me there are a lot of things that suggest otherwise. Again, look at how weak oil was today. Bond yields again fell today after rallying of it's dip beneath 2 percent on Wednesday. Also the small caps fell of again today after rallying all week. A lot of bulls have been arguing this shows we're at a bottom and that the small caps are the place to be, but it could just as soon be a relief rally which today suggests it was as the Russell lagged today. It seems to me these bulls are forgetting that we're at the wrong part of the economic and market cycle for the small caps-this is at the beginning of a recovery and a new bull market. Our bull market is 5 years old.

     Then you have what is in many ways the worst performance of all: the S&P. For weeks the bulls had been prophesying that the S&P would bottom at it's 100 day moving average of 1905 and then bounce up like a jack in the box. I had my doubts, but even I was shocked in how the S&P fell right through the floor of 1905 with no bounce at all. It fell through that floor early in the week and never looked back. It then breached the next support level of 1875 without a look back and at the bottom on Wednesday was only about 17 points away from 1800  Even after today's 'biggest rally of the year'-the S&P never came close to threatening 1905-it never even got to 1900-and it finished at 1884-which is puts it another huge rally just to get to 1905.

    That's a terrible technical performance which suggests that 1905 is probably resistance now already. It's quite plausible that the S&P will test 1800 again before it tests 1905.

    Then we have the worst indicator of all: this was the biggest rally of 2014. Remember: the biggest rallies are always in bear markets.

    UPDATE: Any discussion of Cramer is remiss without his great 'They know nothing' rant.

     http://brotherwatchblog.wordpress.com/2014/10/16/orwell-ebola-isis-and-immigration/

     It's right up there with the Rick Santelli rant-that started the Tea Party. 

After Seeing the House Ebola Hearings, I Can See Why GOP is Favored in 2014

      It''s now obvious that all important problems in the world wouldn't be here if it weren't for Obama. I sure hope the polls that show a GOP Senate next year are right! You really want the same people running the House running the Senate .

      The House GOP has solved the Ebola threat: a travel ban. That is the only thing we need to do based on their questions to the medical professionals today. Never mind what the disease is, how it's caught, and what we need to do to tamp down on it. Let's just ban people from Africa from coming to the US. The Ebola problem will be solved.

       They predictably don't much care about the humanitarian crisis in West Africa. Who cares about that? The GOP cares about Ebola for two reasons.
 
      1). As applies to every question. the main interest is to the extent that somehow Ebola's very existence is all Obama's fault

      2). As a bonus, the content of this fault is that he won't ban all planes from West Africa.
 
      I mean the GOP has always wanted an excuse to ban any more blacks in this country and now they have a ready made excuse.

       Listen, I'm not saying that there isn't some concern that's legitimate about flights from these countries though I doubt a total restriction is the answer but, I am struck watching this hearing-how little interest there was in anything but flight bans from House Republicans. I see why everyone thinks things will be better when they take over the Senate, if they do it.

       As for Ebola itself, the worry is that this is different than previous cases of Ebola. Then it was always relegated to a few villages where they could be quarantined and the disease killed off. This time it's now reached epidemic levels in 3 West African countries.

      The CDC understandably doesn't want to be alarmist and create a panic, but understating the threat too much is counterproductive. A medical expert on CNBC this morning, .Scott Gottlick, suggested that while we certainly won't have an Ebola epidemic in America, we could see 30 or 40 cases in one country. If this is the case the CDC needs to be careful not to squander it's credibility by being overly sanguine.

       P.S. No, Ebola is not going to define Obama's presidency. Talk about GOP wishful thinking.

        http://talkingpointsmemo.com/dc/is-ebola-obamas-katrina-no

        Seriously, how can anyone want conservatives in charge when they say things like this?

        http://talkingpointsmemo.com/livewire/ann-coulter-medical-treatment-ebola-victims

Unemployment Claims Fall to 264,000, Lowest Since April, 2000; Markets Tank

     To me that says it all about this market. Have no doubt about this: this is a great Macro number. There was just an economist, Richard Bernstein, on CNBC who complained that this was a great number and a leading indicator to boot which shows that some very good things are coming.

     As an economist he knows what he's talking about and he is right that it's a great number and that claims are considered a leading indicator. However, what he doesn't get is that this doesn't matter for the market right now. He said that the number clearly shows that the economy is getting better and that's all the market cares about.

     He knows his economics but not necessarily his markets. The market doesn't care about that right now. It's not looking to weekly jobless claims. It's no surprise to me that it sold this. It ultimately sold 245,000 new jobs on nonfarm payrolls after initially rising.

      The market is worried about global growth-everything but the US economy. It's the drop in oil and the rest of the commodities, a Europe in danger of a triple dip and a slower China and disappointing Japan.

     It also doesn't help that this is the best number since April, 2000-as that was at the start of a sharp 2 year bear market correction after the Internet bubble. This is now the second time we've heard about a number being the best since 2000. Sumner was citing some such stat last week. Actually it looks like he may right:

     "The 4-week moving average of layoffs came out today at 287,750.  Total civilian employment in September was 146,600,000.  The ratio of the two, i.e. the chance of being laid [off---ouch that might have been my most embarrassing mistake ever] during a given week if you had a job, was below 2 in 1000.  That’s only happened once before in all of American history–April 2000.  (We don’t have data going all the way back, but the ratio was considerably higher in the booming 1960s, and I’m confident layoffs were much more common in earlier decades for which we don’t have data.  (“Gilded Age” bosses could lay off workers whenever they wanted.) And it seems very likely that we will soon break the April 2000 record, maybe this month."

 
     http://diaryofarepublicanhater.blogspot.com/2014/10/can-you-have-bear-market-without.html

     He'll love that. However even if he's right-this number may have pushed the moving average beneath that, April 2000 is not a great reference point. That was the beginning of a sharp 3 year bear market. Dennis Cartman thinks this is the start of a prolonged bear market-defined as a drop of at least 20% from a market peak. Currently we're getting close to a S&P 'correction'-a 10% drop from the top. Cartman:

      "The selloff in global markets is set to continue as a bear market takes hold "for a long period of time," according to widely followed investor Dennis Gartman, who warned investors not to go long on stocks."

     "This is the start of a bear market," Gartman, the founder of the closely watched Gartman Letter, told CNBC Europe's "Squawk Box" on Thursday. 

      "You stay in cash and you stay in short term bonds and you don't move out, this is a very difficult period of time and I'm afraid - and I don't like to think about it – but this might be the very beginnings of a bear market that could last some period of time," he warned.

     http://www.cnbc.com/id/102092358

      I''m not going to predict how long this correction lasts. My sense is that it's going to go on at least for now-probably at least the rest of October as all the funds have their years finish October 31. Some argue that the market won't bottom until the election. I don't know if Cartman is right or wrong. I know that over the last 5 years the permabears have been permawrong. Still sometimes to quote Rogoff and Reinhart 'it's different this time.'

     I think we have to admit that bulls have become pretty spoiled. We had a terrible bear market in 2008 that saw the market drop from 14,000 on the Dow in November, 2007 to 6500 in March 2009. Yet, overall, since the 3 year bear market of 2000-2002, the market has been up 11 of the last 12 years since. Yet the minute we have 3 weeks of rough selling the bulls act like this is an absurd overreaction.

     However, I won't try to predict this .That's because I'm really not sure. I mean I take Bernstein's point. That claim number was great. Still is it a leading indicator? The last time we had a number like this-in April, 2000-it wasn't a leading but a lagging indicator. Right now the numbers show a preitty good US economy with a weakening global economy. I guess we again get a test of 'bifurcaton'-how long can we have a decent economy surrounded by a troubled world economy?

   Maybe we can continue. Maybe in time we can even save the world economy as has been hoped. On the other hand the US economy is hardly living in a vacuum these days. A weakened Europe and Asia hurts nultinationals which is a sizable part of the US economy. If oil keeps dropping maybe that kills of that nascent fracking industry-though you can argue that all the oil suddenly found in the US enables is a good supply side story that will bring down prices for good reasons-an oil price cut is said to be a 'tax cut.' 

    Time will tell. I know that for now if you're trying to make money, it's on the down side. My only bullish position is now in Alibaba. I believe in Jack Ma. I think this stock has performed very well. It's IPO may be sited as a top, maybe rightly, but just the same, it's performed very well itself since then falling just 7% from it's opening price. My guess is when the market does come back-could be a month, could be three months, could be six months, this will be something you'll be happy to be in. 

    

If the Fundamentals of the US Economy are Strong Why Has the Market Dropped 430 Points?

     I don't mean this sarcastically-it might seem that my point is that of course they aren't strong in view of this move but that's not necessarily my point. The fundamentals of the US economy may well be strong-unlike when John McCain said this during the election in 2008.

     What we can say clearly is that if the fundamentals of the US economy are strong the technicals of the US stock market are very weak. Today the S&P just fell through 1850 with little argument today. After the huge drop early in the day it did rally a little to about 1854 but it has since fallen even further now at 1827.

    The trouble for the market is that the fundamentals of the US economy don't matter anymore, not right now. The thing that has to be understood is that there is a difference between a rising bull market and a falling bear market. This market is not technically in a bear market yet-defined as a 20% drop from the highs-but it has certainly has acted like a bear market in the last few weeks.

   On CNBC a lot of fund managers come on and declare that 'you should be buying when there is blood in the streets.' It makes me think of Keynes scornful dismissal of talk of how in the long run everything will be fine.

    There will be a bottom but is it yet? There is reason for doubts. I note that Jim Cramer is bearish-that's as big a bearish sign as I need. The fund managers always point out that the fundamentals of the US economy are fine failing to note that this is not why the market is selling off-it's about the global slowdown-the slowdown in Europe, the weakness in Germany, the toll the Russian sanctions are taking on Europe-both on Russia but also Europe. Meanwhile, China is not nearly as strong as it was in 2008.

     Today you had everything tanking-the S&P new lows, oil under $80, the 10 Year Treasury seeing it's yield fall under 2%.  So when you hear about the US economy being decent, the selloff is not about the US economy. I don't know what will happen long term. Just right now this is where the market is. There will be a buyable bottom but I don't think we're there yet.

      One question is whether or not you can have a bear market in equities but no recession.

       http://diaryofarepublicanhater.blogspot.com/2014/10/can-you-have-bear-market-without.html

        It seems that in 1987 we definitely did. Right now the US economy does look pretty good. However, there are even here some worries. What about what slower worldwide growth does the the multinationals, what about the bite of a strong dollar, etc.

       

27-0: Giants, Eli Manning Make Eagles Look Like Nostradamus

       It seems the Giants have given up the Rex Ryan strategy-and not a moment too soon. Last week they and the Eagles talked a very big game and one team backed it up to the hilt and one team didn't do anything right after putting on its cleats.

      The Eagles specifically called out Manning and recalled all the times they had beaten him in the past and they made good. I can't think of any game he and the entire offense ever looked that bad. It really was a perfectly horrible night when you add in Victor Cruz's injury. He will be gone this year and God only knows if he'll ever play at the same level.

      The only good sign is the Giants have clearly learnt their lesson. No more playing the game in the papers. No more Rex Ryan-who always wins the game in the papers and then loses it come Sunday.

      It's just amazing how much a team can change week to week in the NFL. Off Sunday night the Eagles look like the best team to ever play the game-at half time Coughlin groused that 'this isn't the 85 Bears we're playing'-but it might as well have been as the offense was incapable of doing anything the whole game.

     If the Jets' 31-0 loss at San Diego a couple of weeks ago is the worst performance by a team all year-at least by an offense; maybe Tampa gave the worst defense in its 56-14 loss to the Falcons in week 3-this game by the Giants was a close second.

    Some teams can come back from this. The Pats certainly did from their 27 point loss to the Chiefs 3 weeks ago. The Bengals were a lot less impressive following their 26 point loss to the Patriots. Often this is the kind of game that really tests a team, tests a quarterback.

      I should say that Manning's words Monday on the Giants being true to Cruz and giving him the kind of effort he would have been proud of was great. I have to point out that Manning has been here before and come back. I must admit that in this game he and the offense looked about as bad as a QB and an offense can look in the NFL. Still, Eli is the man to come back from a terrible performance. I still remember the first Super Bowl year for him and the Giants back in 2007.

      I always remember a home game against Minnesota in November that year, though. It's hard for a QB to look worse than Eli did that day. He threw 4 interceptions, including three pick 6s-interceptions returned for TDs. The 4th interception was run back to the Giants' 6th yard line and run in on the very next play so that's really 4 pick 6s; I mean that's literally 4 TDs for the other team as the Giants lost 41-13 at home-the margin of defeat was his 4 TDs for the other team.

     Yet what's notable is that he shook it off. He and the team rallied to beat the Bears in Chicago the next week and the Eagles in Philly the next week. After the nightmare game the Giants with him at the helm to win 3 of their next 4 games to clinch a playoff birth-which they would of course ride all the way to a Super Bowl victory-an unthinkable win over the 18-0 Patriots.

     So he and his team have been here before. There could be life after 0-27 to the Eagles. Whether there will be is yet to be determined. He'll start to answer this question in Dallas-certainly doesn't get any easier.

     P.S. The question also is whether Philly was an aberration. It's unreal how night and day he and the offense looked Sunday night in Philly and how he and they looked 2 weeks ago on a Monday night in Washington. Did the Eagles somehow figure out the West Coast offense? After the game they explained that they came in with the expressed purpose of taking away his time-he had so much of it in the 3 straight wins. They did this by covering all his receivers so he had nowhere to get rid of the ball. Of course a big part of the problem was their lack of a running game. Philly's plan worked so seamlessly because there was no running game. Part of this was no doubt the loss of Rashad Jennings. We'll see if the Giants have some answers for this Sunday as Jennings won't be back in Dallas.

    http://www.nj.com/giants/index.ssf/2014/10/rashad_jennings_out_for_giants_game_sunday_in_dallas_return_expected_after_bye_week.html

   Andrew Williams' first start was rough to say the least. However, even before Jennings went down he had a couple of good games where he lead the team in rushing so who knows? That goes for this entire league. 

2014 Not Looking Like a Wave Election for the GOP

     The GOP always runs based on the past. Every Presidential election for them is 1980 all over again-so they run on exactly the same themes every 4 years. Every Congressional election is 1994 and now 2010.

      The case for a 'wave election' this year is slight indeed. At this point the GOP does have an edge in likely voters but only 2 percent: 46-44.  That's hardly a GOP wave. It does seem that expectations are that the GOP will retake the Senate though this not because of any wave but just because unfortunately, there are a lot more Democratic seats up for election than Republican seats.

      I don't even want to think about a GOP Senate the last few years. However, 2016 should be a lot better as that will be when all those 2010 Tea Party candidates come up for re-election. Still the GOP taking the Senate is not a done deal. It's not a wave-this is 2012 not 2014. Americans polled give the GOP a slight advantage in retaking the Senate and that's probably about right.

     http://www.gallup.com/poll/178271/slim-majority-expect-republicans-win-senate.aspx

     Everything points to the idea that the Dems-and the independent candidate that will likely canvas with the Dems-will end up with 48 to 51 seats in the Senate. So there are four likely numbers-48,49,50,51-and 2 out of 4 will allow the Dems to keep the Senate.

     Even the National Review knows there's no wave election.

     http://www.nationalreview.com/article/388403/no-wave-gop-maggie-gallagher

     As NR points out, the GOP is using the Romney strategy this year: run against Obamacare run against Obama-the public will vote for the GOP as they want anyone but Obama.  That they learned nothing from their 2012 loss but are still doing exactly the same thing again-and are even thinking of having Romney run again in 2016 shows a party that has learned nothing.

   They have even convinced themselves now that they don't need immigration reform and are simply ignoring the coming demographic problems because right now thanks to gerrymandering they have a lock on the House. At some point reality will come to the GOP. That this party takes pride in never learning anything and running every campaign as if it's a GOP wave election means that the reality check will be particularly cruel when it does hit.

    By the way, one Republican who impressed me this morning was Glen Hubbard on CNBC's Morning Squawk with Joe Kiernan-Mr. Strident Conservative, himself. Hubbard through some mud in Scott Sumner's eyes by arguing that there's nothing much more the Fed can do now but that what we do need is some fiscal stimulus .

   Kiernan did point out accurately that the GOP and Dems differ sharply on what they call fiscal stimulus. The GOP wants cut regulations and cut the corporate tax rate, the Dems want infrastructure projects. Hubbard seems to think that if there is worry about the economy, both sides would come to the table-remember that Hubbard was one of Romney's major economic advisers in 2012.

    So maybe his optimism is hopeful-I'm basing on this on the premise that he obviously knows lots of Republicans and maybe he knows that at least some of them can be reasonable-he certainly sounded reasonable this morning though less so in 2012 when he and Greg Mankiw blessed the Romney campaigns strange budget plan that would cut taxes and cut the deficit at the same time.

    Hubbard argued that they could agree to some kind of infrastructure projects while doing tax cuts for the poor. I've never thought you can make much money assuming the GOP will be reasonable but maybe he knows better than I would. 

The Market Signs Not Looking Good for the Bulls

     My bear case I drew after the market went up 275 on a very good nonfarm payroll number a couple of Fridays ago has been borne out.

      http://diaryofarepublicanhater.blogspot.com/2014/10/was-todays-275-point-dow-rally-another.html

       http://diaryofarepublicanhater.blogspot.com/2014/10/can-you-have-bear-market-without.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+DiaryOfARepublicanHater+%28Diary+of+a+Republican+Hater%29

        I still wonder if you can have a bear market without a recession. It's a logical possibility obviously, but have we ever had one? I guess the 1987 market crash was one case. We literally fell into a bear market in one day's huge 20% sell off.

         I don't see too many bull signs for the market at this point. I have no problem admitting to you that a big part of validating my bear case for was the fact that Jim Cramer has gone bearish. I was bearish but I found real confirmation in him-as he's anything sooner than a permabear; indeed, you have to give him credit here for proving that he's not a permabull. 

          The technicals have been terrible. The market bulls-like for instance most of the traders on Fast Money-were all telling us that the market would test 1905 on the S&P and bottom there. I wasn't convinced, but even I was shocked that it just went through the 1905 floor without a whimper. The next technical level is 1875 but it fell through that floor pretty easily as well, falling 13 points beneath it on Monday and yesterday's failed hiccup of a rally let the S&P at just 1877. Yesterday's market started out trying to rally sharply but by day's end it looked less like a rally than a cry for help.

          Today the market is down again, certainly not helped by a new headline about another Ebola victim in Dallas-another healthcare worker.

          http://www.cnbc.com/id/102078869?trknav=homestack:topnews:2

          Based on the way the futures look, the S&P could test 1850 today.

           Bank earnings have been pretty good-Citi had a blowout quarter; still the fact that it closed operations in 11 markets worldwide is another worry; bear in mind that big worry that's been sinking the market is about global growth-rather than US growth which at present  continues to look very healthy.

            We also have oil free falling again. This may be a good thing for consumers and businesses that use oil or who's customers use oil but it's not a good thing for the equity market-according to Jim Cramer a lot of the funds out there use computer programs that automatically sell the S&P when oil prices fall. It appears that at least a lot of the oil companies will really begin to feel the pain if prices drop beneath $80-and Western Texas Crude is right down at $80 this morning.

            So when does the market hit bottom? One big tell is when Cramer says we've hit it. I know there's been lots of pieces that knock him for getting individual stock picks wrong-who can forget the way Jon Stewart savaged him?

            Yet, here, I find him very credible-as he so clearly always wants to be bullish and as the market has acted just like he's said it will during this selloff.

            He's surely right that the market can't really rally until some kind of bottom is found in the commodities space.

            As for oil prices-the conventional wisdom-at least the conventional market wisdom-is that it will magically bottom at $80 just as this same wisdom told us the S&P would magically bottom at 1905.  Who knows-maybe low oil prices could be the new normal? Everyone thinks that OPEC at some point will have to cut production but there are a lot more divisions in OPEC than in the past and the Saudis don't seem worried at this level. Now with Iran cutting prices for Asian customers maybe it won't snap back as quickly as presumed.

            Remember that we had two decades of bargain basement oil in the 80s and 90s and we had very strong economic growth in that period.

            If the oil drop is supply rather than demand based it could be a good thing long term The worry is that all that new oil found in the US won't be drilled for if prices fall too low.

           

       

Can You Have a Bear Market Without a Recession?

     I think so. Don't get me wrong-we're not in a bear market in equities, at least not yet, but you never know, it depends on how long this selloff goes one for. Sumner had some comments about today's unemployment claims number. The number was pretty good-only 281,000 claims compared with 294,000 expected.

     "The 4-week moving average of layoffs came out today at 287,750.  Total civilian employment in September was 146,600,000.  The ratio of the two, i.e. the chance of being laid [off---ouch that might have been my most embarrassing mistake ever] during a given week if you had a job, was below 2 in 1000.  That’s only happened once before in all of American history–April 2000.  (We don’t have data going all the way back, but the ratio was considerably higher in the booming 1960s, and I’m confident layoffs were much more common in earlier decades for which we don’t have data.  (“Gilded Age” bosses could lay off workers whenever they wanted.) And it seems very likely that we will soon break the April 2000 record, maybe this month."

     http://www.themoneyillusion.com/?p=27758

     If this is true it doesn't necessarily bode well. April, 2000 was the beginning of the Internet crash. This l4 week moving average correlates with what has proven to be a rather nasty market correction. How long will it go on for? I've debated this previously. You have to admit that the title of my post yesterday was rather prescient. 

    http://diaryofarepublicanhater.blogspot.com/2014/10/was-todays-275-point-dow-rally-another.html

     Yes, Yesterday's 275 point rally was another false flag just like last Friday's. I'm now convinced that we're in correction territory. Note that a 'market correction' is not necessarily a 'bear market', though a correction can lead to a full scaled bear market-a fall of at least 20% on the Dow or S&P-or NASDAQ or any market. 

     With the market in some at least short term trouble are we in danger of a recession? Based on numbers like the layoff number it would seem clearly not, ditto, the recent 4.6% GDP number or the 245,000 nonfarm payroll jobs added in September. Based on the numbers it would seem that-unlike when McCain said it in 2008-that 'the fundamentals of the US economy are strong.'

     What's worrying the market now though isn't the US economy but rather the rest of the world. The EU particularly. Meanwhile China is a lot weaker than it was in 2008 so it's much more squarely on us to save the world's economy than it was then. 

     As I said in my post last night, I take it very seriously that Jim Cramer is very bearish about the market right now. Today he said outright that the market won't get better until the pain in the commodity space ends. I've now decided not to take any more long positions in the market until then-except for Alibaba (BABA). It has really actually behaved very well since it's IPO. Yes, I like countless others made the mistake of buying at the open-I got in at $94.50, I find it very impressive that it bottom4d out at a little under $86. It's now been rallying the last 4 or 5 days and actually touched 90 briefly today. 

     I got to say I was really impressed by BABA's owner, Jack Ma. After listening to him I'm thinking that there might ne one stock you can hold for awhile. I like the idea that he's thinking of not just the next 5 or 10 year but the next 1000 years. That's kind of the Asian way I guess but I feel like this company is in very capable hands. 

    http://diaryofarepublicanhater.blogspot.com/2014/09/for-alibaba-jack-ma-is-feature-not-bug.html

     Other than that, short energy, short multinationals, short Caterpillar-which is a multinational. 

      Sumner is, quite out of character no doubt, knocking President Obama. 

       "President Obama may or may not be a good President.  I think he’s been above average on foreign policy.  I’m willing to concede the Obamacare (which I opposed as a missed opportunity) did some good things like the Cadillac tax on health plans and helping the uninsured.  I think the financial reform was a missed chance, but others disagree. I’m disappointed with his record on drugs and civil liberties."

     "But there can’t be any serious question about the fact that he did NOTHING effective to help the economy.  The US recovery is less than the old trend rate of growth.  Has that ever happened before?  The Fed’s been less inept than the ECB—that’s all."

    "And the supply-side?  Even his supporters would admit he did nothing there.  They might disagree with the view that a heavy dose of extra regulation, higher MTRs, and no Keystone pipeline slowed the recovery.  But no one claims those actionssped up the recovery.  And the fracking boom (“drill baby drill”) fell on his lap."

     "Just a few months ago Obama called for an “emergency” unemployment benefit of up to 73 weeks, much longer than during the President Clinton recovery, all because the labor market was doing so poorly nearly 6 years after he was elected.  And now a few months later they are touting their success in creating jobs—unbelievable."

     "It will be interesting to see how many liberals agree with him."

      Well, I don't-I think we would have a much better economy if only we had elected Romney. Then we would not be less than the old trend of growth. So Sumner thinks that the trend of growth is decided by who the President is? I thought that he had bought into Tyler Cowen's Great Stagnation. 

      "The newest talking point of President Obama and his supporters, such as Paul Krugman, is that we are doing better at job creation than other developed countries.  I don’t think we are doing as well as Australia/New Zealand/Canada/Britain, but it’s surely true overall for one very obvious reason.  The eurozone."

     "Let’s examine that Obama/Krugman claim more closely.  Everyone seems to agree that since 2010 the US has done considerably more austerity than the eurozone.  No debate there.  And the huge divergence between the US and the eurozone has occurred since 2011.  The initial recession and initial recovery were quite similar in the US and eurozone."

      "The GOP Congress did exactly the opposite of what Obama wanted on austerity, and the result was that we grew dramatically faster than the eurozone.  That’s Obama’s success?  The big difference was of course monetary policy.  Obama’s comparing us to a region ruled by a central bank that is more incompetent that the central banks of the 1930s (Krugman has some graphs on that point.)"

      "So yes, we are doing better than the eurozone.  Does Obama deserve credit for the fact that our monetary policy was less incompetent than the ECB?  That doesn’t even pass the laugh test.  Even Obama supporter Matt Yglesias says he’s been horrible on monetary policy.  He left multiple seats empty, when he had 60 votes in the Senate in 2009.  He’s doing the same today.  He never appointed a single person to the board who favored the sort of expansionary monetary policy that I favor, that Yglesias favors, that DeLong favors, that Krugman favors, that Christina Romer favors, and that any progressive with half of brain favors.  He almost picked bubblephobe Summers to head the Fed, and had to be stopped by a storm of protest that began here and then spread through the progressive blogosphere.  (Yes, some progressives always opposed him for other reasons; I’m talking about his monetary policy views.)"

      So maybe the GOP doing the exact opposite of what Obama wanted has a little something to do with the slow recovery? As usual, Sumner talks about 'things we all agree on' that haven't really been agreed to by anyone except him-kind of like that bet he won with Krugman. Who actually agrees that we've done more austerity than the EU? Only one person I'm aware of-Sumner. Ok, Mark Sadowski, but he's just an extension of Sumner. 

       Obama deserves credit at the minimum for preventing even more austerity than we otherwise would have. I do think we would have done better with less austerity than we did have. 

     Right now the biggest problem isn't the US, it's the EU. As for the economy, why is it that everyone acts like the economy is owned by Obama alone. Everyone says 'if the economy is weak it hurts the Democrats'-what about the GOP who has occupied the House for 3 damnable years?

      P.S. I love the market but I've never had anywhere near the luck with it-so far, see, I'm always optimistic-I've had in the NFL in my first year betting on games. Tonight was the first night of Week 6 and I had the Colts favored by 3. They sure didn't let me celebrate early as they blew a 24-0 lead and just held off the Texans 33-28 thanks to a late int and a late fumble. 

        Still, with this win I'm now up $4,000 for the year, with 160% gains for the year. Where else are you going to find a yield like that? My record for the year is now 18-5 straight up and more importantly I'm 15-8 against the spread. 

        This weekend I'm taking Denver favored by 8 over the Jets. as well as the Bengals over Carolina by 7 at home over Carolina. Surely, they will come back strong this week after that loss.  Also the Packers by 3 and 1/2 over the Dolphins. If the Packers are the real deal they should be able to win here. I'm thinking about the Browns over the Steelers-in Week 1 the Browns came all the way back from a 24-3 deficit and took the Steelers to overtime before falling 27-24 and the Steelers have been very unimpressive against the two worst teams in the NFL-other than maybe the Raiders-the Bucs and Jaguars. In the two games the Steelers went 1-1 and outscored the opposition by 5 points. 

        The Ravens over Tampa should be a no brainer-amazing that the spread is only 3. Finally the Chargers giving 7 over the Raiders and the Seahawks by points over Dallas.