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Thrilling Thursday Finish – 1,565 THEN Bust!

Posted on the 28 March 2013 by Phil's Stock World @philstockworld

Bye bye love 
bye bye sweet caress 
Hello emptiness 
I feel like I could die - All that Jazz

It's been a great rally, let's take tomorrow off! 

Actually, most of the World is taking tomorrow off in honor of my 50th Birthday and, as my daughter gleefully pointed out to me this morning – I've already had 50 years, my birthday simply marks the end of my 50th and the beginning of my 51st – so, too late to whine about it now

Cypriots are already halfway through their own economic catastrophe and they are not whining about it either as relatively small and orderly lines formed as banks, causing a Bank of Cyprus branch manager to comment: "Customers reacted fantastically, we expected much more people."  We didn't.  As I said to our Members yesterday:

Thrilling Thursday Finish – 1,565 THEN Bust!

They've got armed army guys outside each Cyprus bank and they're opening tomorrow so, essentially, everyone expects mass riots in Cyprus.  Of course, it's hard to have a good mass riot when a whole country has just 1M people.  There are 45 KINDS of banks listed in Cyprus so figure, conservatively, 1,000 branches is 1,000 people per branch but, on the other hand, if 1M people went to BAC on the same day and asked for $10,000 in cash, BAC would have to shut down their doors as well – there simply isn't that much cash around so the wildcard is how panicked are the average Cypriots?  

Thrilling Thursday Finish – 1,565 THEN Bust!And, of course, today is the last day of the quarter and so, despite all the REALLY BAD economic news we've been getting everywhere (just this morning, Japanese Retail Sales were down 2.3% and the Hang Seng dropped 2.8% in a session) – we're still going to hit that 1,565 mark on the S&P.

That way, all the Financial Institutions can print it up in their brochures and begin calling you next week to tell you you'd better put all your money in the market before you miss another fantastic quarter – or whatever the pitch is these days to get you to give them your money and charge you for playing with it.  

As Dave Fry notes above, that S&P chart is the only one you need to see in this fake, Fake, FAKE end-of-quarter rally.  Unfortunately, the more they push the market up to paint the tape today – the more our chances are of having a correction next week.  

Still, our Big Chart keeps us from getting too bearish until we begin to fail all those lovely support lines that our indexes have masterfully held this week – no matter what negatives were thrown at them each day.  Our focus shorts, at the moment, are mostly in the energy sector as we think oil breaks after this weekend but, as I've noted since 3/7, it's the Dow that seems toppiest to us and we're ignoring today but we'll see if that 14,400 line holds up next week – that's the key line for the bulls.  

Thrilling Thursday Finish – 1,565 THEN Bust!Here's a fun fact for Good Friday – one of the main charges against Jesus was "opposing taxes to Caesar," which the Romans were a lot more upset about than who's son he was.  Unfortunately, since the year 34, our leaders have really slacked off on crucifying tax dodgers – as noted by this great World Bank Paper on the Flows of Illicit Funds from Developing Countries – which is essentially a road-map for how the rich steal from the poor in the modern World

This, of course, leads to massive income disparities and makes the poor even poorer and the rich even richer and Yves Smith sums up my week of bitching about this issue very nicely with here "How Billionaires Get Rich and Destroy the Rest of Us" in which she notes:

“Free trade” is a bipartisan, hands-across-the-aisle screwage of American incomes and wealth. It’s the necessary cornerstone of both left-wing and right-wing economic policy. Period.

…Corporations aren’t actors per se, they are machines by which wealth is vacuumed from workers and consumers into the hands and pockets of the corps’ true owners, the CEO and capital class. As we’ve said before:  Modern corporations serve one function only — to make the CEO class obscenely rich.

…The looting of global wealth into the hands of the capital and CEO class is a simple two-step process: Corps use free trade to loot the world. CEOs then loot the corps and live higher and better than the kings and presidents they control.

Let's keep that in mind as we contemplate this Holiday Weekend – Jesus may have spoken out against unfair taxes but that was because they were being taken from the poor.  Howver, Jesus took a lash to the bankers and drove them from the temple – the only time in his brief life he was ever so angry that he was driven to violence – and this was a guy who chatted with Satan!  

Have a happy holiday, 

- Phil

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