June 2009

"Intaxication:  Euphoria at getting a refund from the IRS, which lasts until you realize it was your money to start with. "

~From a Washington Post word contest 

The Professional Opinion

DJIA Index: 8500.33

Bob's economic indicators for the market going forward are still in positive territory and he thinks the markets are set to go higher into next year.  He sees recovering earnings, low interest rates and low inflation (for the near future) as the driving force behind higher stock prices going into 2010.

The recovery process will be nothing spectacular to due housing sector weakness, high unemployment and the fact that consumers are actually starting to save more money.  Real GDP is expected to range from 2-3% going into 2010 but the financial sector needs to lead the way in any kind of meaningful recovery.  Progress has been made in that regard.

The index of leading economic indicators actually ticked up a solid point last month and it is expected to show further improvement.
That, coupled with the Michigan index of Consumer Sentiment reaching an eight month high, indicates a slow but steady economic recovery.

Inflation is not an issue at this time.  The fed is going to have to be intelligent about removing excess liquidity from the market in order to keep future inflation under control.  

Well, now we are in a secular bear megatrend with a series of bullish and bearish cycles thrown into the mix.  Assuming that we are now in the beginnings of a cyclical bull market within the secular bear megatrend, this is supposed to mean that there is substantial room for gains going forward.  (I am not so sure about all these trends myself...)

Fed Policy

The Three Month LIBOR continues to decline.  The lower it goes, the more confidence there is in lending from bank to bank.  This is a positive sign.

Interest rates on the lowest rated bonds continues to decline, another good sign - almost 570 points from 2 months ago.

Bank stress tests went well enough.  Agencies who are supposed to provide banking and lending oversight need to actually do their jobs going forward so we don't have another economic crisis like this last one.

The Fed is continuing to do everything it can to promote an economic recovery.

DIA, IWV, SPY and VTI are all rated buy during periods of weakness.


Stay fully invested and add to your positions during periods of weakness.

Washoe Valley

Washoe Valley, Nevada

Personal Portfolio
YTD Return
Boy, if I wouldn't have been for Bank of America and GE, May would have really been a bang-up month.

I gave some more thought on commodities and decided to take a position in oil,  SU and PGH in particular.

My reasoning for these to is that they are on the North American continent and not as easily subject to nationalization, like that of the type practiced by one of our community organizer's new found best friends -  Hugo Chavez.

I added a bit more to Sprint after paying a visit to one of their 'Boost' stores and coming away fairly impressed.  This is the same company that a few months ago was delivering text messages the day after they were sent.  Apparently most of the bugs have been worked out and that is a good thing for those who are into texting.  

The plan is quite popular and if the Palm Pre is a hit.................


Personal Portfolio

The portfolio is working out rather well, all in all.  I'm beating the pants off Bob's portfolio this time around.  I ended up selling CLWR on a pretty good up tick and decided to add another energy component to the mix.  
This time around I opted for a Canadian energy trust fund - Pengrowth Energy Trust (PGH).  


I bought this for a couple reasons, the main being the potential for stock price appreciation going forward.  The other reason is I am finding it preferable to look at energy stocks based in North America and not elsewhere.  

One caveat to this is that Canada holds back 15% of the dividend as a foreign tax, which from all accounts I have heard cannot be gotten back.  If this was in a taxable account, you could claim the foreign tax paid as a tax deduction.  Not so in a tax exempt account.

This will be interesting.  I think it may just end up being worth it.

I'm up 64% from the lows registered in February of this year and 21% for the year, so I think I will just sit back and watch for the next month,  and see what the Palm Pre does for Sprint.  

Something Worth Digesting - and all the way from Russia:

Stanislav Mishin  - 
originally appears on his blog, Mat Rodina

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It must be said, that like the breaking of a great dam, the American decent into Marxism is happening with breath taking speed, against the back drop of a passive, hapless sheeple, excuse me dear reader, I meant people.

True, the situation has been well prepared on and off for the past century, especially the past twenty years. The initial testing grounds was conducted upon our Holy Russia and a bloody test it was. But we Russians would not just roll over and give up our freedoms and our souls, no matter how much money Wall Street poured into the fists of the Marxists.

Those lessons were taken and used to properly prepare the American populace for the surrender of their freedoms and souls, to the whims of their elites and betters.

First, the population was dumbed down through a politicized and substandard education system based on pop culture, rather then the classics. Americans know more about their favorite TV dramas then the drama in DC that directly affects their lives. They care more for their "right" to choke down a McDonalds burger or a BurgerKing burger than for their constitutional rights. Then they turn around and lecture us about our rights and about our "democracy". Pride blind the foolish.

Then their faith in God was destroyed, until their churches, all tens of thousands of different "branches and denominations" were for the most part little more then Sunday circuses and their televangelists and top protestant mega preachers were more then happy to sell out their souls and flocks to be on the "winning" side of one pseudo Marxist politician or another. Their flocks may complain, but when explained that they would be on the "winning" side, their flocks were ever so quick to reject Christ in hopes for earthly power. Even our Holy Orthodox churches are scandalously liberalized in America.

The final collapse has come with the election of Barack Obama. His speed in the past three months has been truly impressive. His spending and money printing has been a record setting, not just in America's short history but in the world. If this keeps up for more then another year, and there is no sign that it will not, America at best will resemble the Wiemar Republic and at worst Zimbabwe.

These past two weeks have been the most breath taking of all. First came the announcement of a planned redesign of the American Byzantine tax system, by the very thieves who used it to bankroll their thefts, loses and swindles of hundreds of billions of dollars. These make our Russian oligarchs look little more then ordinary street thugs, in comparison. Yes, the Americans have beat our own thieves in the shear volumes. Should we congratulate them?
These men, of course, are not an elected panel but made up of appointees picked from the very financial oligarchs and their henchmen who are now gorging themselves on trillions of American dollars, in one bailout after another. They are also usurping the rights, duties and powers of the American congress (parliament). Again, congress has put up little more then a whimper to their masters.

Then came Barack Obama's command that GM's (General Motor) president step down from leadership of his company. That is correct, dear reader, in the land of "pure" free markets, the American president now has the power, the self given power, to fire CEOs and we can assume other employees of private companies, at will. Come hither, go dither, the centurion commands his minions.

So it should be no surprise, that the American president has followed this up with a "bold" move of declaring that he and another group of unelected, chosen stooges will now redesign the entire automotive industry and will even be the guarantee of automobile policies. I am sure that if given the chance, they would happily try and redesign it for the whole of the world, too. Prime Minister Putin, less then two months ago, warned Obama and UK's Blair, not to follow the path to Marxism, it only leads to disaster. Apparently, even though we suffered 70 years of this Western sponsored horror show, we know nothing, as foolish, drunken Russians, so let our "wise" Anglo-Saxon fools find out the folly of their own pride.

Again, the American public has taken this with barely a whimper...but a "freeman" whimper.

So, should it be any surprise to discover that the Democratically controlled Congress of America is working on passing a new regulation that would give the American Treasury department the power to set "fair" maximum salaries, evaluate performance and control how private companies give out pay raises and bonuses? Senator Barney Franks, a social pervert basking in his homosexuality (of course, amongst the modern, enlightened American societal norm, as well as that of the general West, homosexuality is not only not a looked down upon life choice, but is often praised as a virtue) and his Marxist enlightenment, has led this effort. He stresses that this only affects companies that receive government monies, but it is retroactive and taken to a logical extreme, this would include any company or industry that has ever received a tax break or incentive.

The Russian owners of American companies and industries should look thoughtfully at this and the option of closing their facilities down and fleeing the land of the Red as fast as possible. In other words, divest while there is still value left.

The proud American will go down into his slavery without a fight, beating his chest and proclaiming to the world, how free he really is. The world will only snicker.

Stanislav Mishin

The article has been reprinted with the kind permission from the author and originally appears on his blog, Mat Rodina

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New Addition to the Fold

We lost our female Catahoula this spring at 13 years of age.  Our male, who is her dad is still plugging along at 14, despite going deaf and regular bouts with malignant tummy tumors. His name is TC, originally short for Teeth & Claws.  In his advanced age, TC is now short for Tumor Control.

We decided the next time around the prospective dog was going to have several prerequisites:

1. More hair and little to no presence of the Merle gene.
2. Non shedder.
3. Can be protective and a bit formidable if need be (Cairn Terriers don't fit the bill here).
4. At least medium sized - 50 to 70 pounds.
5. IQ high up on the canine intelligence scale (Cairn Terriers don't fit the bill here either).
6. Veterinarian Approved for Climate, Health and Personality.

I compiled a list of half a dozen or so breeds and presented it to the local Vet. He took about ten seconds and pronounced the Standard Poodle as reasonably bullet proof, highly intelligent, large enough to be a deterrent and a non shedder (poodles have hair, not fur - I did not know that).

The downside was the cost of grooming and some problems with stomach torsion.

The other downside to this is my opinion of the breed in general and it is specifically confined to the little teacup and slightly larger old, almost always white football dogs with the gray circles around the eyes, tear streaks down past their noses and temperaments paralleling those of dachshunds.

I am sure you have seen them - walk by an expensive full sized car and get startled out of your skin by a pint sized Mike Tyson wannabe, held by a little old man or lady who just can't quite seem to figure out why their darling is going nuts yapping at you, an innocent passerby. Makes me wish as a minimum I carried mace. 

That wouldn't be a problem if owners would actually take the time to adequately socialize their dogs.

Then there was the paperboy episode in the summer many moons ago when I was walking up a long flight of stairs to an apartment when another door opened and one of those football dogs darted in and grabbed my ankle, drawing blood and bruising the hell out of my Achilles tendon.  I back-kicked the little *@*#$ off the stairs.  Lady called the cops, someone called my mom, dog didn't have proof of vaccination, I had to get shots,  lady wanted to take dog to the vet,  cops called animal control to quarantine dog.......a fun filled afternoon.

To this day my opinion of poodles in general is slightly 'colored' and it will be cold day in hell before I ever own a white one.

Pictured here is the end result of a month or so of further research.

We shall see.