Birchtree's Account Talk

[Birchtree]

Re: Birchtree's account talk

The 0.0% m/m reading on the November core consumption price deflator (CPD) probably doesn't erase Lacker's fears on inflation, but it's certainly a step in the right direction. He's no longer a voting member anyway. The dramatic increase in adjusted monetary reserves is the really big news.

http://www.strategasrp.com/pdf/er061222.pdf

 

[rokid]

Re: Birchtree's account talk

Birch,

Merry Christmas and a Happy New Year. May your daughter remain safe, do her duty with honor, and come home to you whole in body and spirit. ---Rokid

 

[Birchtree]

Re: Birchtree's account talk

Thankyou kindly sir. Your input is appreciated.

 

[Birchtree]

Re: Birchtree's account talk

My thinking is that the 20 week cycle that was due around 12/12 is now applying its pressure and will help to work off the overbought condition of the market. The fortunate thing for the bulls is that any price top and ensuing pull back is not going to generate too much in the way of price decay, especially with the high MCSUM readings (+922.69), as well as the very low volatility readings. The logical conclusion will probably be a simple trading range during any corrective phase that may occur at this juncture. We are churning now and it is difficult for price to decline to begin to trend, The MCSUM is going to have to be closer to the zero line. During all bull trends you will see sharp and short corrections to keep the leaders from participating. The large distance of the MCSUM from the zero line gives me confidence. I'll be buying next week on Thursday and Friday. The latest short interest readings still represents the second highest on record for the NYSE. In terms of sentiment, valuation, breadth, and momentum, we are still not close to even an intermediate term top in the stock market yet.

 

[fabijo]

Re: Birchtree's account talk

In terms of sentiment, valuation, breadth, and momentum, we are still not close to even an intermediate term top in the stock market yet.

That would be a beautiful thing.

 

[Birchtree]

Re: Birchtree's account talk

The odds of remaining long and profitable for the three months following a +1200 A/D MCSUM breach are historically favorable. The current breach occurred on 12/1/06. The NYSE weekly composite A/D MCSUM is currently at +1363 and is still rising. Before a serious price decline begins, the weekly A/D MCSUM is already declining - not happening yet. The Utility index will probably place a new all-time high soon. When that happens again, we are essentially safe for another 3-4 months. Staying long until 2010 my friends.

Also, the Dow Theory wouldn't officially turn bearish unless the DJIA were to close below its' June low of 10,706.14, thereby confirming the weakness in the DTA. Until that happens the Dow Theory remains on a buy signal. I'm still looking for the epicenter of the 3 of 3 structure. Maybe soon.

 

[Oldcoin]

Re: Birchtree's account talk

Welcome Back

 

[Birchtree]

Re: Birchtree's account talk

Just completed my daily buys: MRD, NAV, TRA, CPO, TWX, CEN, CPC, CLK, CR, MOT, AVA, GBX, FLO, CBI, LFB, VHI, RKT, GWR, MWV, TWIN, and MOS. Got a few nickles left for one more run tomorrow. Nothing wrong with buying on the top.

 

[Birchtree]

Re: Birchtree's account talk

I've got 17 more trades to do, but unfortunately they will have to wait until I have the money to pay for them. I apparently over spent myself yesterday. For the year I did manage to make 304 trades of which 90% were purchases. So you can say I bought all the way up. And now I'm in deep up to my eyebrows - ready to go where ever the market takes me in 2007. I'm looking to make at least $500,000 before the end of 2007. The tugboat did not take me to $100,000 gain but it was close enough. We'll nail it before the end of January. I'll need another $2.00 gain for 2007 plus DCA and I'll pull down the $100,000 to $120,000 mark. I plan to take a few dollars off the table as we progress through the year - I call it insurance. I enjoy my buy and hold technique and I have no reason yet to become a shooter - so steady we go. If we get a Primary wave 3 of 3 I'll be set. Bring on 1995.

 

[mayday]

Re: Birchtree's account talk

I've got 17 more trades to do, but unfortunately they will have to wait until I have the money to pay for them. I apparently over spent myself yesterday. For the year I did manage to make 304 trades of which 90% were purchases. So you can say I bought all the way up. And now I'm in deep up to my eyebrows - ready to go where ever the market takes me in 2007. I'm looking to make at least $500,000 before the end of 2007. The tugboat did not take me to $100,000 gain but it was close enough. We'll nail it before the end of January. I'll need another $2.00 gain for 2007 plus DCA and I'll pull down the $100,000 to $120,000 mark. I plan to take a few dollars off the table as we progress through the year - I call it insurance. I enjoy my buy and hold technique and I have no reason yet to become a shooter - so steady we go. If we get a Primary wave 3 of 3 I'll be set. Bring on 1995.

May this year bring Joy in every endeavour Birch Live long and prosper Happy New Year my optimistic friend.

 

[Birchtree]

Re: Birchtree's account talk

From TWSJ by Eleanor Laise, 12/20/06 titled: Bullish View Emerges on U.S. Stocks.

Reassured by relatively stable interest rates and moderate inflation, money managers are increasungly bullish on U.S. stocks, according to a survey set to be released today. More money managers see upside in domestic market, according to Russell survey. Despite stock market's strong recent gains, 37% of managers say that U.S. stocks are undervalued, according to Russell Investment Group's quarterly Investment Manager Outlook survey. That is up from 35% three months ago, and the brightest domestic-equity outlook recorded in the survey's 21/2 year history.

Russell Investment Group, a subsidiary of Northwestern Mutual Life Insurance Co., researches and selects money managers for investors, and it managed more than $181 billion in assets as of Sept. 30. The firm also markets the Russell stock market indexes. The survey was conducted between Nov. 27 and Dec. 5, and asked representatives from 87 money management firms about their outlook on various asset classes and market sectors.

With the Federal Reserve holding the key federal-funds taeget rate steady for nearly six months, many managers foresee a long period of low and stable interest rates, which can help produce steady growth in corporate earnings and the overall economy. Eight out of 10 managers surveyed said that U.S. stocks will gain ground next year. Nearly one-third believe that those gains will amount to 10% or more. The 10-year annualized return of the Russell 3000 Index, a broad measure of the U.S. stock market, is 8.8% through Dec. 18.

The bulls are running and managers don't anticipate a sharp economic slowdown or a sharp uptick in inflation. While managers last quarter were cautiously bullish, this quarter looks a little less cautious.

The managers are boosting their expectations for U.S. stocks at a time when some broad market indexes already are reaching multiyear highs. Finally rewarded (here comes the Birchtree propaganda-he's so shameless) for their longstanding support of U.S. large-cap growth stocks, surveyed managers boosted their expectations for this asset class. Major market indexes in recent months have signaled a long-awaited shift to "growth" stocks, or those whose earnings are growing faster than the market average, from "value" stocks, or those that appear underpriced relative to their earnings or assets.

Some 77% of managers liked the prospects for large-cap growth stocks in the fourth quarter, up from 58% three months ago. Large-cap growth has been out of favor for so long that it's the cheapest part of the market right now......With the dollar weakening against major foreign currencies, managers raised their outlook on foreign stocks. Sixty-one percent liked the prospects for developed-market foreign stocks, up from 52% last quarter. A weak dollar generally magnifies returns from overseas investments. Snort.

 

[post]

Re: Birchtree's account talk

Birch,

The only problem I see with this is that everyone is on the bandwagon. 17 money managers were asked what kind of year we are going to have in '07 and they were all Bullish. Is this not a negative indicator

 

[Birchtree]

Re: Birchtree's account talk

I would say that 90% of the time it pays to be a contrarian - then there are those times you have to go with the flow and not fight the tape. The more people that pile on the more money the early birds can make - the general public is still not bullish, only less bearish. But they are on the way and you'll feel the ground shake. I'm riding the train until October, 2010 - then I turn into a shooter. I will buy some insurance in preparation for the first blind side that I know will slap me hard - it's all in the game. I usually get drilled to the tune of approximately $34,000 - but it's only temporary and the better pricing for DCA is the redeemer. In January '06 my outside account pulled down $84,000. I'd like to do better than that for January '07, we'll see.

 

[Birchtree]

Re: Birchtree's account talk

From Don Hays of Hays Advisory: Corporations last year recognized the unprecedented bargains being laid at their feet, and made over $400 billion of cash take overs of U.S. corporations. Besides that, they bought back $600 billion of their own stock. There has never been anything like this in the history of the U.S. stock market. We now have a 3% reduction of stock available for purchase today in relation to the supply only one yeatr ago. I put a lid on this year, a year where good traditional investors have underperformed, with the excitement that tells me that the 16.7% gain in stock values since June 14th of 2006 is the start (only the start) of something very big, and very good.

Dennis - permabull #1

 

[airlift]

Re: Birchtree's account talk

Happy, Healthy, and Prosperous New Year, Birch!

From Don Hays of Hays Advisory: Corporations last year recognized the unprecedented bargains being laid at their feet, and made over $400 billion of cash take overs of U.S. corporations. Besides that, they bought back $600 billion of their own stock. There has never been anything like this in the history of the U.S. stock market. We now have a 3% reduction of stock available for purchase today in relation to the supply only one yeatr ago. I put a lid on this year, a year where good traditional investors have underperformed, with the excitement that tells me that the 16.7% gain in stock values since June 14th of 2006 is the start (only the start) of something very big, and very good.

Dennis - permabull #1

 

[Birchtree]

Re: Birchtree's account talk

A few choice words from Malcolm Berko on finding a money manager - from the Gainesville Sun dated January 1, 2007. Titled How to select the right stock broker for you.

Here are some important caveats. Brokers in their 20s, 30s, and 40s don't have the financial or emotional maturity to provide the investment advice that you need.

It's folly to expect a 30 or 40 year-old to identify with your goals, aspirations, insecurities and feelings. Merrill Lynch has a superb training program, but I'd not be comfortable accepting financial advice from a newly minted 20 or 40-year old or a lad with eight to 10 years' experience.

You want a broker who owns a sizable personal investment portfolio and whose goals are similar to yours. You want a broker who "walks the walk" because there's wisdom in his practiced footsteps. Investment wisdom is the result of lots of experiences - and experience is the result of lots of mistakes. Select a broker who is familiar with the road so he won't have to practice on your dime. Select a broker close to your age so you grow old together.

If the broker to whom you are introduced is younger than 50 and has been in the business less than 15 years, eliminate him from your list and return to the yellow pages and find another brokerage firm manager to interview.

You must be mindful that stockbrokers, like sharks, must remain in motion to stay alive. Stockbrokers are salesmen who make a living by selling you things. So be especially mindful that the success of most brokers is measured by the commission dollars he earns for his firm each month - sadly - not how well your account performs. And that's no bullhockey.

 

[Birchtree]

Re: Birchtree's account talk

From TWSJ dated December 30, 2006, titled Financial Risk: Where Has It Gone. No particular author.

With stockds and bonds reaching new highs and market volatilitry at near record lows, investors (and ayla) are wondering when fear will return to the marketplace. Over the last few years, financial markets have risen steadily without the lurches that have characterized past bull markets. The Dow Jones Industrial Average has gone 912 trading days without a 2% daily decline, the longest such stretch in the history of the Dow, according to a study by Birinyi Associates Inc. Meanwhile, money continues to pour into the riskiest assets - such as high-yield bonds and energing-market investments - and the premiums paid to those who make such risky investments remain near record lows. Will volatility and risk return in 2007? That could be one of the most important questions for investors, and the economy, in the new year. Here's a look at what lies beneath recent trends:

How unusual is recent market activity? One closely watched volatility indicator is the VIX - also known as the "fear gauge", as it is thought to track investor anxiety. The VIX measures volatility by tracking the movements of a range of stock index options. The index fell to 9.39 Dec.15, near its record low of 9.31 set in Dec. 1993. Since it began in 1990. the VIX has only closed below 10 on eight occasions, three of which were in the last two months of this year. Its all-time high was 45.74 in October 1998.

Why is volatility so low right now? The VIX reached a three-year high of 23.81 in June but started falling after the Federal Reserve halted its campaign to raise interest rates. The geopolitical outlook hsas also calmed since the summer, when Israel was at war with Hezbollah guerillas. Oil prices have fallen from $77 in July to about $61 at year's end, while corporate earnings are strong. Some analust also believe the explosion of hedge funds has helped put downward pressure on volatility. Hedge funds are thought to use derivatives and other financial products to disperse risks more broadly across the financial marketplace.

When will fear return? I'll let ayla answer that question.

 

[Birchtree]

Re: Birchtree's account talk

From TWSJ Dec. 30, '06. by Robert Powell titled: Weekend Investor.

Some choice words from Sam Stovall, Chief Investment Strategist at Standard & Poors.

Mr. Stovall, for instance, predicts that financial stocks, the fifth-best performing sector with a gain of 16.3% in 2006, and industrial stocks, the eigth-best performing sector with a gain of 11.4%, will rise to the top of the sector list in 2007. And consumer staples, the seventh-best performing sector of 2006 with a gain of 12.2%, and utilities, the fourth-best performing sector with a gain of 17.5%, will fall from favor in 2007.

There are several reasons why the sectors will rotate ever so slightly in 2007. One factor is history. Mr. Stovall said the S&P 500 has risen on average 18% in the third year of the four-year presidential cycle since 1945. By contrast, the S&P 500 has gained just an average 9% per year for all four-year presidential cycles during that time period. History is never gospel, Mr. Stovall wrote in his recent newsletter. But based on the magnitude and frequencies of advances during the third year of presidents' terms in office, it looks like a very seasoned guide.

Other factors to consider include the economy and the Federal Reserve. Mr. Stovall predicts the economy will land softly and the Fed will begin a new rate-cutting program in 2007. And if past is prelude, those rate cuts ought to lead to dramatic stock gains in the short-term. Indeed, Mr. Stovall said investors generally get a 2-for-1 deal when "interest rates go on sale." He sais investors tend to get 12 months' worth of stock-market gains in only a six-month period during a rate-cutting cycle.

Since Japanese production is in a firm uptrend, if coming data show workers' income and consumer spending - two major weak spots in Japan - are improving, Japan's central bank may raise rates in January from the current level of 0.25%.

 

[Birchtree]

Re: Birchtree's account talk

So who wants to play with magic?

http://www.magicformulainvesting.com

 

[Birchtree]

Re: Birchtree's account talk

Chaos has never been my forte. Boy, I'm glad I'm past the juvenile stage of having to obsess over $0.34. Such a fear of loss they all have. All wrongs are eventually righted - relax little kinematics.