Sunday, May 23, 2010

Alan Grayson Introduces "The War Is Making You Poor Act" in Congress

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This Makes More Sense Than Congress Has

Congressman Alan Grayson (Democrat - Florida) has actually bothered to do the math on the wars in Afghanistan and Iraq.  Stop the funding of these wars and the first $35,000 earned by every American can be tax free - no federal income taxes! Plus, the USA federal budget deficit and debt are no worse off than before!  You want economic stimulus in the USA economy?  Try reducing federal income taxes and require the government to pay for wars out of the existing military budget!  If Congress and the Administration want to continue wars in Afghanistan and Iraq, then they can pay with the existing military budget.  Stop using a "Chinese Credit Card" to pay for USA Wars!

Summary of Representative Grayson's legislation below, after the video.





Summary

The War Is Making You Poor Act (HR 5353) has 3 main provisions:
1) Existing wars in Afghanistan and Iraq must be funded with current proposed military budget of $549 billion.   The additional, supplemental $159 billion requested for the "emergency wars" in Afghanistan and Iraq would not be approved.
2) The 90% of the $159 billion not spent on the "emergency wars" in Afghanistan and Iraq is then used to make the first $35,000 of every American's income tax free - $70,000 for married couples.
3) The remaining 10% of the $159 billion is not spent at all, so is a reduction of the USA federal deficit and debt.

Facts:
1) Proposed USA military budget is $549 billion.
2) An additional $159 billion has been requested for the wars in Afghanistan and Iraq.
3) Total USA military spending is as much as the rest of the world combined.
4) Second largest military spending in the world are our NATO Allies in Europe, obviously not a threat to USA.
5) Largest military spending in world that is possible threat is China, USA outspends China over 5 to 1 on military.
6) Next threat to USA would be Russia, USA outspends almost 10 to 1 on military.
7) Almost 1/3 (33%) of Americans do not make more than $35,000, would be excused from income taxes
8) Reduces federal deficit by $16 billion.


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Saturday, May 22, 2010

Let's Fix Financial Reform: Dylan Ratigan

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Financial System Reform: How You Can Ensure An Effective Political Solution

You may not know it, but Dylan Ratigan is trying to protect you and me and the future of America.  A mighty battle is being waged in Congress over financial system reform.  On one side is Wall Street and their Congressional supporters.  They are trying to compromise the financial regulatory reform bill, call it reform in name only, sell this faux reform to the public, and go back to business as usual - massive profits and bonuses for both the Banksters and Politicians.  On the other side are the true reformers who represent the USA Taxpayers and future generations of Americans.  I have summarized what Dylan Ratigan said below the video.

Below: Dylan Ratigan provides a checklist for financial reform and explains what real financial reform is, and how Americans can make this a reality.



Video Summary: Amendments to Support!  Take Action! These 4 amendments are in your and your childrens' best interests.  These 4 sponsors are truly representatives of Americans on financial reform.

Rating Agencies Amendment by Senator Al Franken (Democrat-Minnesota)
Eliminates conflict of interest between rating agencies (S&P, Moody's, Fitch) and Wall Street (Goldman Sachs, JP Morgan, Morgan Stanley, Bank of America, Citigroup, et. al.)

Capital Requirements Amendment by Senator Susan Collins (Republican-Maine)
Requires Wall Street to have higher capital requirements, that is, maintain larger reserves.

Audit The Federal Reserve Bank Amendment by Representative Ron Paul (Republican-Texas)
Requires more transparency for the Fed and disclose where USA Taxpayer money was disbursed.

Derivatives Regulation by Senator Blanche Lincoln (Democrat-Arkansas)
Banking and derivatives do not mix, period.  Either be a bank or brokerage or be regulated tightly.

Editorial by James Grant (Washington Post) mentioned by Dylan Ratigan at end of video
The best financial reform? Let the bankers fail

About Me: I have over 30 years financial system experience, including CFO of a life insurance company, external bank & credit union auditor and consultant, and have even trained bank and credit union staff and regulatory examiners in policies, procedures, and compliance.  The financial system has changed dramatically over my career.  The system is rigged for the large financial institutions through buying the politicians through huge contributions and lobbying.  Want to see which politicians are being paid off and who is paying them off?  Go to http://www.OpenSecrets.org/.  Keep in mind OpenSecrets.org only knows what is technically legal for politicians to report as contributions from Wall Street Banksters, Big Oil, et. al.


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Saturday, May 15, 2010

Jon Stewart: Wall Street Banksters!

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Wall Street Banksters made money trading the markets every trading day in the first quarter, the first three months, of 2010.  Market goes up, down, sideways - Goldman Sachs, JP Morgan, Citigroup, Bank of America made money that day.  Didn't matter.


And where did some of this trading, investment money come from?  From the USA taxpayers!  "The big banks make money by taking the bailout money we gave them and lending it back to the government with interest."



The Daily Show With Jon StewartMon - Thurs 11p / 10c
Hoarders
www.thedailyshow.com
Daily Show Full EpisodesPolitical HumorTea Party


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Wednesday, May 12, 2010

S&P 500 Financials Sector: XLF Update

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XLF Overview
XLF is up +5.17% for the week, down -1.79% for the month, up +10.21% for the year, and up +153.51% since the March 9, 2009 market bottom. XLF has held up relatively well in this current market pullback and the memorable Flash Crash Thursday, May 7.  Financial sector quarterly earnings have been encouraging.  The USA federal investigations into Goldman Sachs, JP Morgan, and Morgan Stanley have weighed on this sector.  The suspicion surrounding the Flash Crash have also tainted the sector to some extent.

XLF ETF & Portfolio Holdings
The XLF is a financials ETF designed to represent the financial sector of the S&P 500, which is 16.60% of the S&P 500. See the XLF Financials portfolio holdings here. This is a very popular and liquid ETF.

XLF Daily Chart
Below is the XLF daily chart for 2010.

Noteworthy XLF Closing Prices on Daily Chart below:
Current Close 15.87 (Highest yellow horizontal line)
2010 YTD 4-14-10 High 17.05
YE 12-31-09 14.40
10 Month EMA 14.99 (Lowest yellow horizontal line)


XLF: Holding Up Surprisingly Well




Intermediate-Term Trend
The intermediate-term signal, the comparison of the 25 day and 50 day simple moving averages, signalled a bull market for the XLF on March 15, which remains intact. That is, the 25d sma is greater than the 50d sma.

Resistance
The current closing price, the higher yellow horizontal line, has pulled back.  There are multiple levels of recent resistance above.  The benchmark price of 16.00 has a lot of price interaction as both short term and long term resistance.  The peaks of 15.92 on March 17 and 16.02 on March 29 could act as recent resistance.

Support
There are multiple levels of support below, including the peak of 15.73 on October 14, 2009.  XLF is now in the October and early November 2008 dramatic sideways trading.

Moving Averages
XLF plunged through the 25d, 50d, and 100d simple moving averages last week.  XLF did remain above the 200d sma and has so since July 13, 2009.  XLF still remains below the 25d and 50d sma's, which reflects the current price weakness.  

Uptrend Line
The uptrend line, a rate of price ascent, is from the March 6. 2009 closing low of 6.18 up through the February 8, 2010 closing low of 13.66. The February 8 closing low was the bottom of the previous 2010 pullback. XLF regained this uptrend line on Monday, which is encouraging.

Downtrend Line
The downtrend line, a rate of price descent, is from the June 1, 2007 all-time closing high of 38.02 down through the April 14, 2010 closing high of 17.05, the peak YTD closing high so far.  XLF is below this trendline.

Relative Strength Index (RSI)
RSI 14 day = 41.54 is leaning oversold, but has bounced up from the low of 31.99 on May 7
RSI 28 day = 49.42 is reasonable and has bounced up from the low of 42.46 on May 7
The RSIs are towards the oversold range..

MACD (12,26,9)
The MACD has been bearish since April 19, in the aftermath of the Goldman Sachs Friday sell off.

Long-Term Trend
The lower yellow horizontal line is the 10 month exponential moving average from the monthly chart, which I have overlayed on this daily chart. That is the line in the sand, so to speak, for the long term signal of a bear market. The XLF is above this signal at the current close, the higher yellow horizontal line.

Conclusion
Overall, I remain bullish on XLF in 2010.  XLF has had a Goldman Sachs Selloff on April 19, a Greece/EU Crisis, a Flash Crash Blame, and an overall suspicion that the financial system is corrupt.  In the wake of all this, XLF has held above the 200d sma and is now above the 100d sma.  The RSIs are leaning oversold reasonable and the MACD is flipped to bearish during this pullback.  However, Q1 revenues, earnings, and outlook have been good, certainly better than last year. XLF is in position to continue upwards.  The intermediate term trend and long term trend remain bullish.

Disclosure
We have no investment position in XLF or any of the stocks in the portfolio holdings.


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Seeking Alpha