Friday, February 6, 2009
(Cont'd from above)...

Jim (cont'd):    First, the Federal Reserve Bank… the Fed is committed to making things better… and that is huge… at this stage the Fed is simply unrelenting and cannot be fought… at this weeks Fed meeting Bernanke rolled out the the machine guns, the quad 50’s… they are unleashing a full scale monetary policy artillery barrage… I tell you I saw Stalin pipe organs go katoosh, and rockets… they are sticking to the Malcolm X playbook… they will do whatever it takes… by any means necessary… including creating loans for pretty much every entity in the world…. at least anyone who needs one… and they are going mortgage rates down so housing can bottom… that is really important… they have got to get back on that case.

Second, whatever reservations we have about the stimulus package in the United States… other countries have created their own stimulus worldwide… and some of it is catching on… I don’t want you to think Pelosi pork… I want you to think Moo-Shoo pork… it is even causing some investors to take some risks… betting that the money will eventually create some opportunities… and in this environment for most people that is really going out on a limb.

Third, the Baltic Freight Index has turned… okay, an obscure index that I follow that measures world wide trade… but it fell off a cliff last year.. now it is soaring back because of Chinese demand… commodities all went positive this week that hasn’t been positive for a long time… nickel has turned… that means that steel… weakest steel, is, uh uses nickel to become stainless… steel is turning… copper has turned with prices up 10.9% just this week.. and 15.5% year to date… how is that for a factoid… copper is a great measure of world demand… it is used to build homes and apartments… talk about two morbid industries… oil has bottomed… this matters when oil was in free fall we had to conclude that we were heading into a depression not just a serious recession… now with oil prices stabilizing a depression seems less likely… think of oil as a reverse thermometer for determining the health of the global economy.. with higher prices indicating that patient is improving… or at least off life support.

Fourth, China… China… is the most powerful economy in the world after us… and its market is en fuego… like you wouldn’t believe… the Chinese communists are masters of capitalism… and they can work off the inventory in just about anything… I mean do you know what I am talking… I am talking about pork fried coal… sweet and sour steel… kung po copper…. General Tso’s aluminum… not to mention grains and even consumer goods… the Chinese market soared 4% last night alone… it is up 20% for the year… it is forecasting a huge turn by these capitalist communists rotors… I say… pass me the Pu Pu platter… I am buying.

Fifth, we got really horrible news from both Cisco (CSCO*) and State Street Corp. (STT)… I mean it was really scary… Cisco said that there was dramatic decline ahead…. thank you John Chambers, the companies CEO… and how about the vicious dividend cut… from once pristine State Street… so what happened to the stocks… both of them had monster moves higher… if you are a short seller… this kind of thing makes you … well let’s just say, I want to be a diplomat, wet yourself with panic… although admittedly that does make the pants-ing the shorts got from these two stocks a little more bearable… you know what I say, break out the Depends… if you can’t make money shorting a company that massively lowered it growth forecast or one that cut its dividend… then we have either gone way too low… or the market has a fundamental shift.

Sixth, Wal-Mart has indicated that people seem to be alive and well and people are spending… the alleged Wal-Mart shortfall that we had before this month was devastating… cause it said that the whole nations business has been shut down… the frightening scenario is no longer in play after the great number we saw this week, the consistently good number from Wal-Mart… hey Wal-Mart the stock is moving up too… I am liking that stock for my charitable trust, ActionAlertsPlus.com, I have a phrase here in Cramerica… like the GM of old… what is good for Wal-Mart is good for America.

The seventh reason that things are better now than they were seven days ago…. we got to hear this week from the housing market… housing sales are booming in areas where prices have come down wholesale… when you add in the $15,000 tax credit for home buyers announced last night from the Senate… remember we had our friend, buddy pal Ken Conrad on he said that he would put that in the bill… I think you are going to see a bottom in housing this year… just like somebody called it.

Number eight… the hedge funds are done selling… they seem to have recovered… the endless pressure on the market from hedge funds gone wildly… dancing to the tune of Marley's redemption song… ahead of his time… I mean how long can they kill our hedge funds profits… know that period seems to be over… we got a new song for the hedge funds… rest em on vibrations yeah positive.

Number nine… this market at last has leadership… it is the old four horseman of tech… Apple, Amazon, Google, and Research In Motion… which are exploding higher and dragging the Nasdaq along with them… when you get good leadership you can go pretty far… we have it now.

The tenth reason I think this rally has legs… the transports… wow how boring…but they are my major indicator of return in the economy… and they bottomed this week when UPS reported a number… didn’t look that good… but said that things aren’t totally falling apart… that is an important signal that we have gotten too gloomy… I should have bought UPS for my charitable trust… hey, investors aren’t buying it believe me… they are buying Fed Ex and the rails… that is my favorite tell of all.

Here is the bottom line...

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The Bottom Line!:     No we are not yet in the land of a 1000 bull dances… but I think we may have left Jellystone National Park for a while… a lot of the bad news is behind us… and things are better now than they were a week ago… with multiple positives that we did not have before… that is why we rallied today… it is why I think that the rally is not done… pending Tim Geithner not screwing things up… I think we have another rally next week.

I think most of the bad news could be behind us - I like stocks going into next week...     Anyway, I think a lot of the bad news is now behind us… I think this market rally has a bit of some legs… and I think it is time to think like Rosta-man… I think the vibrations are positive.

[verbatim recap]

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Jim went on after this segment to take questions from callers, and responded with his comments...

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Q:    About that jobless number that they released today, do you feel accurately reflects the truth, considering that it only includes the jobless and does not include the full-timers that have been reduced to part-time?...

Jim:    First of all I think you are absolutely right…it is not all inclusive… but remember it is apples to apples… so it may not be any good this time but it is the same as last time and last time and last time… and it was the worst in 16 years… it does show that things even after… after the revisions it wasn’t as bad as I thought it was going to be… but it is consistent with what I would say is the garden variety depression that I am trying to avoid here.

[verbatim recap]

[end of segment]

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