There's another Martenson Report ready. I meant to have it posted and sent on Friday, but a technical snafu intervened and I was out of contact at Rowe so there it sat in the outbox...
In the last report, I cautioned that stocks and bonds were falling together, and that this was a bad sign. Like clockwork, and in a pattern I now just call "Monday," there was a sustained campaign of buying in the stock futures pits by "somebody" with very deep pockets at the beginning of the week of February 2, 2009. However, I make the claim below that such price supporting behavior, if that's what it is, has an eventual date with failure and then move onto a list of banks that seem to be signaling that trouble is coming.
[quote=Jarhett]Where is the analysis of JPM???
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Jarhett,
It didn’t make it in, there were too many other rich targets…here’s one view of it. I am keeping a close eye on it because of the derivative exposure but will not be too worried until/unless it takes out the January lows.
I will note that there’s a divergence between the stock price and the MACD as indicated by the blue lines that are sloping towards each other and would not be at all surprised to see the January lows revisited over the next couple of weeks.
It looks like most of the charts are dated Feb 5th. I was just wondering if today’s cliff dive in the market changes any of the charts? Shouldn’t they look even worse?
Is there direct evidence or past history elsewhere on hidden market intervention by the Fed? Or does everyone know it but no one talks about it? Wouldn’t it have to show up on their balance sheet, or could the Fed have extra books too?
Is there a reason why banks seem to always be taken over by the FDIC on Friday nights? Is it because they don’t want the news of a bank failure(s) to affect the markets too much, or it just makes sense from a practical standpoint that it’s the end of the week? Otherwise, what’s the difference between a bank being insolvent on a Tuesday or a Friday?
[quote=joemanc]Is there a reason why banks seem to always be taken over by the FDIC on Friday nights? Is it because they don’t want the news of a bank failure(s) to affect the markets too much, or it just makes sense from a practical standpoint that it’s the end of the week? Otherwise, what’s the difference between a bank being insolvent on a Tuesday or a Friday?
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joemanc,
From what I’ve heard, you’re pretty much on target with your first reason. They do it on Friday nights with the intent of minimal disruption and also having time to take over the bank and then reopen the bank on Monday morning under new ownership so that the average customer can continue to access their funds.
Mind you, this is only what I’ve seen on the news. There may be some hidden agenda that I’m not aware of.
The JPM chart is for sure not so happy looking, the overall trend for the stock is definitely down. And if you look at MACD on the weekly chart (which I have noticed seems to be good for longer term trend analysis), the bearish trend is clearly still in place. But at least with JPM you have substantial, clean bounces off the lows. With STI, or COF, or some of your other targets, the rebounds are weak or nonexistent, and their trends downward are much, much steeper.
You can get a sense of how a financial stock compares with "the industry" by comparing the stock with XLF - a "banks + insurance companies" ETF.
Chris uses stockcharts.com to provide the graphs in his reports. They have a free "chart school" which I have found to be incredibly useful to me in analysis of market activity. I would have avoided much of my '08 losses had I understood how to use technical indicators like MACD in conjunction with weekly charts. And it also helps me a great deal to understand what actions I should take for my own portfolio given Chris’s warnings.
I have a question regarding this statement toward the end of the Report: "Remember, it’s not possible for an insolvent country to borrow money from an insolvent financial system in order to bailout insolvent institutions."
Although I do not doubt this statement, is this more fully explained in detail elsewhere on the site or perhaps in a previous report? I would like more information on this subject. Thanks.
