Monday, December 14, 2009

Here we go again

The market held up throughout the day as a result of the Dubai bailout -- again note the irony that the bailout of a pending disaster has pushed the markets to new highs while the initial crisis barely dented the market.

These are again important technical levels and if the market can break higher by 1% or so there are many reasons to believe it could power higher another 4 or 5% in a week (option expiration and short covering). The market remains wildly detached from reality so you have to analyze the market like a weatherman predicting the humidity inside the New Orleans Superdome --- look at factors beyond fundamentals (electricity rates, a/c failure rates, etc) rather than simply measuring the humidity outside of the building. The stock market has been a game of green and red letters flashing across a screen for the past decade, but this latest move really defies logic.

However, uber-bull Abby Joseph Cohen who was bullish through the dotcom crash, the housing crash and every rally in between (what is it they say about a broken clock being right twice a day??) has emerged as bullish on equities. The contrarians are having a field day with this because it means the rally is just about over when she decides to pile on....

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I know people don't like to hear stories like this, but this is coming to a school district near you in 2010.... From the great state of Pennsylvania

"School districts and the state will pay 70% more next year for teachers' retirement. And the increases are expected to worsen."

The Public School Employees' Retirement System trustees on Friday approved an employer contribution rate of 8.22 percent for the 2010-11 budget year, a 12-year high for the system and a 72 percent jump from the 4.78 percent contribution rate in place now.

That means taxpayers will have to spend $1.1 billion next school year for teachers' pensions, or almost $500 million more than this year."

NYS is looking at a similar situation and although their investment performance has improved in 2009 as the spokesperson for the pension fund said " At this point, the fund cannot realistically earn its way out of the projected rate spike."

These are the sort of grim statistics that Gov. Paterson is dealing with every day and I applaud his honesty. Unfortunately, no one wants to hear the truth they'd rather hear that it's all cotton candy and candy apples for breakfast, lunch and dinner.

There is an indication that pension costs and property tax hikes needed to cover those costs are exempt in PA from needing voter approval. Does anyone know if this is the case in NYS? I think it would be pretty hard for everyone to swallow another 5% tax hike in NNY, but it may be coming.



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This was filed under "examples of extreme laziness".... Only Nike would have the b@!!$ to pull this one off..... Printed in Hong Kong, but FOLDED in CHINA.

No wonder they are becoming the dominant economic power in the world. They've got mad origami skills.





As you are helping Santa wrap presents for the little ones this year do a little private survey - percentage of gifts mfg'd in China. We're running north of 80% right now and that's just because we have a bunch of books that were printed in the US.

Cheers!

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