Crash Market Stocks - Financial Tips On Making Money In The Stock Market

After what looked to be a strong rebound in the markets yesterday, red trading continued on for Tuesday, as consumer sentiment begins to weaken once more. Analysts were hoping for the consumer confidence numbers to continue to increase into September, however, they have begun to trace back as we saw from today's released study. It was the positive performance of this number which sparked so much buying in the first place, but as I have always warned, sustainability is the key.

With consumer confidence numbers weakening, investors are worried for the upcoming unemployment data that gets released later on this week. Sure, the rate of job losses has consistently been decreasing the past few months, but we are still experiencing very high amounts of monthly job losses that will eventually take its toll. Speaking of job losses, one important element to keep in mind is taxes. In recent months, we have seen record amounts of government spending. Coupled with that, we have also seen a record amount of job losses which in turn will directly effect tax dollars. The amount of tax revenue received for the government has to be at record low levels, which is not good when you consider just how much debt spending is being done. This will be a problem that will carry into our children's generation to deal with the national debt.

Nike reported better than expected earnings today after the close, so markets could easily find there way back into the green tomorrow. However, the big question everyone is waiting for is the job losses released this Friday. UUP has been looking like a great buy as the dollar is beginning to rebound. In my opinion, as deflationary pressures continue to mount, the dollar should perform quite well. DRV is the new Direxion 3x inverse Real estate ETF. It has definitely been on the radar for me, as I believe we are near this turn in the market. Real estate is on the top of the list for next sectors to suffer, as property owners have been bunkering up the past 9 months for the storm that lies ahead. Indeed the opportunity is coming soon. Happy Trading.

Well, what started out looking to be another mild, green trading day (the recent trend), the market faced some serious selling pressure going into close, which brought the Dow down 82 points Wednesday. More importantly, in my opinion, was the rather significant increase in volume compared to recent days past, which has been a big concern for me as of late.

One thing is for sure, history shows us that stocks and bonds tend to run as an "inverse relationship." However, as of lately, we have seen the phenomenon of both stocks and bonds running in the green. The idea is very perplexing when breaking down the fundamentals of each of the investment strategies. Bonds are looked upon as a more conservative play and get more attention during "distressed" times where speculation grows in the stock market. Stocks tend to flourish when economic outlook is strong and people are looking towards riskier investments for larger potential returns. These conditions tend to rarely coexist, so to see success with both instruments brings many questions.

My first belief is manipulation. Readers of this site know of my strong belief in market manipulation. I believe there has been billions, if not trillions, of government funds thrown into the market throughout the past several months. On top of that, we know that The Fed continues to be, by far, the #1 buyer of US Treasuries and has been very active in buying them lately, despite the record amount of debt the US Treasury has been issuing. On top of that, stocks continue to rise, despite record amounts of insider trading, which is usually coupled with a downward trend in the market. With this government intervention, we are seeing both markets get love.

With manipulation, another factor that is contributing to this phenomenon is the weakening dollar. Considering the dollar is very appealing to foreign investors, we are seeing a lot of shorting of the dollar, due to increased concern of its weakness. As The Fed is expected to keep interest rates at basically 0% during the upcoming meeting, some feel the strength of the dollar remains at risk. Usually, such a result would also bring down gold and other commodities, but that relationship has also been terminated.

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It is evident that the market is moving at very abnormal levels. I do not expect this to continue for long. By the way, the last time we saw such a phenomenon in the stock market was during the early 90's, which was during one of the worst real estate recessions since the Great Depression. We also so that time period followed by a spike in interest rates. Indeed I see those same problems heading right for us. Happy Trading.

After a pretty solid week of green trading, this week opened up on the red side, having the Dow close down 41 points today. We have seen blips in this rally before and, at times, looks pointing to a turn around, only to result in a continuing rally in the markets. Can today be the beginning of this long, overdue turn around? It might be, as there are plenty of burdens weighing heavily on the economy. However, I am still on guard against further ruthless buying.

Another 100 point rally ended with the Dow today as surely many are buying into Bernanke's belief of an recession that is now over. Indeed, no one can deny how impressive it has been to see the market rally for so long and I congratulate those who have made some significant money off riding it up. I, unfortunately, have not been able to pull the trigger and will not be able until I see a stabilization of certain very critical areas of the economy. Don't get me wrong, my ultimate hope is for as quick a recover as possible, but despite such recent strong performance from Wall Street, I still strongly believe we are not finished with scary times.

As I have said before, a critical influencer in the economy is the movement and prices of homes. This summer, for many markets, housing sales have gone up a bit as have new home sales. Some have taken this as the sign that the residential crash is over. For me, there are things to consider when evaluating the housing market. First, the season. Everyone knows that Spring and Summer are hot home buying months. It's convenience for families to move in between school years and the weather is hot and warm. So to see a month to month change in home purchases is not all that surprising. However, year over year, we remain significantly lower.

Another big influence, especially on new home sales is the $8,000 tax credit. It is estimated that over 1/3 of all the new home buyers are using the $8000 credit. In fact, since its creation in January, there has been a consistent gain in new home sales. Home builders now worry that due to the program's November expiration, new home sales will considerably drop. They may be right.

In addition to the tax credit, is the mass amount of Freddie and Fannie debt that the US Treasury is purchasing. Conforming home loans are some of the only loans available in the market for most banks. This is because the US Treasury has been purchasing all Freddie and Fannie conforming loans. As a result, we have seen record mortgage interest rates, which have reached below 4.5%. It is estimated that a total of $2.3 billion has been saved from mortgage rate savings. Per household, that comes out to about an average of $110 per month. The problem is the government cannot buy these loans forever and plans to stop at the beginning of next year.

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As I have said before, the big question is: can this economy stand on its own two feet? A recovering stock market is a great story and wonderful to see, but unfortunately, it has no fundamental tie to the actual progression of the economy. Sustainability is always the key. Happy Trading.