Dow average rises and so does the media BS!

Media outlets like CNN and others are making a big whoop de do about how the Dow Jones industrial averages oth are rising into the positive territory for the first time this year. Sounds good doesn't it? That what the Obama administration would love you to believe. But, before you take those numbers at face value remember the both Citigroup and General Motors were knocked off the Dow Jones list recently. How could it not go up with those pieces of crap stocks not in the average anymore. File this news in the Hello Suckers file for now.

What does this mean?

"President Bush and congressional leaders moved closer to agreeing on a compromise economic rescue package yesterday, fending off fresh protests from both the right and the left as they rushed to respond to a cascading series of economic troubles and to head off a potential recession." -Washington Post

I was boarding the Amtrak train at Union Station in Washington yesterday. When I looked up and saw a rainbow in the late afternoon sun. Is it just a coincidence that this rainbow appears after the Federal Reserve lowers the interest rates. Speaking of pots of money at the end of the rainbow. Here is another money quote:
" As markets roiled from a sharp sell-off around the world and the Federal Reserve cut interest rates at home, Bush met with House and Senate leaders to work out a package of tax breaks for consumers and businesses. In an important concession to Democrats, Treasury Secretary Henry M. Paulson Jr. signaled that he is open to including breaks even for those who pay little to no income taxes. "
I just hope that the Democrats and Bush mean that they will make sure that this money they want to give to people "who pay little of no income tax" will be Americans and not illegal immigrants who will send this money off to Mexico and other countries instead of it being spent here in the United States for our economy.

Blood on the floor

"Stock markets around the world plummeted yesterday as a financial crisis that began in the market for U.S. home mortgages spread to almost all corners of the globe."-Washington Post

Welcome to the global economy. The ripples from the Wall Street ponzi scheme known as the sub prime market has turned into a big wave that threatens to clear the beach. I hope that most of us investors survive and those bankers who came up with the idea of giving $650,000 home loans to illegal immigrants making $18,000 dollars per year and other bad risks get swept out to sea and never return.

First we kill the Day Traders.

As many middle class tax payers head off to work and take another non employer pay cut due to the increased price of gasoline in their commute. Some of the more intellectually curious among them may be asking the question why have prices risen so fast? There may be an answer in today's Washington Post. Here are the money quotes:

"In the past 10 weeks, the price of crude oil has shot up $25 a barrel, closing at $95.93 in New York on Friday, near an all-time inflation-adjusted peak. Unlike earlier spikes in oil prices, which came on the heels of war in the Middle East, this latest ascent does not appear to be linked to any one conflict or to any physical shortage.
Instead, traders who treat oil like any other commodity are widely thought to be driving prices upward, bolstered by a weak dollar and money flowing out of stock markets and other investment vehicles. "

To paraphrase William Shakespeare "First we kill the Day Traders" or at least cut their fiber, high speed cable and phone lines.

A whole lotta shaking goin on!

You can almost hear the sound of shaking newspapers all over the country as the financial workers read things like this in the Washington Post:

"The turmoil in the U.S. credit markets turned global Thursday, prompting central banks in Europe and the United States to pump more than $150 billion into the financial system to keep it operating smoothly."

Looks like the financial Homer Simpsons forgot that if you give loans to people who have extremely low credit ratings, illegal immigrants and others who are barely able to make payments that maybe it might just be a house of cards. You can almost hear them say "Doh!" as they sit in their offices in Manhattan looking at the numbers. Like Homer Simpson these "masters of the universe" are coming to the realization that they are not as smart as they think they are and are looking for someone to save their butts:
"U.S. stocks suffered their second-worst decline of the year as the cost of borrowing for corporations continued to rise and some investors urged policymakers to help."

Been there done that. It was called the "savings and Loan Bailout". Not with my tax dollars you don't.

Memo: To my mutual fund managers

Skip lunch today and make sure the portfolio you manage comes out ok. This is why I am paying those fees remember? As for me I will be taking Warren's advice. That is Warren Zevon not Buffet:

"I think it's important not to get sidetracked from the immediate goal of having a really pleasant afternoon."
=

Stock Market wisdom

Stock Sell-Off in China Hits Wall Street Dow Tumbles 3.3% in Biggest Loss Since '03

-Washington Post headline

IF A LITTLE DOES NOT GO, MUCH CASH WILL NOT COME

-CHINESE PROVERB