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US Market Update! 13-07-2010

US Market Update! 13-07-2010. F or another week, the Weekly Leading Index hit a fresh new low , dropping to it's most recent reading of -8.3 on Friday.

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US Market Update! 13-07-2010

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  1. US Market Update! 13-07-2010 • For another week, the Weekly Leading Index hit a fresh new low, dropping to it's most recent reading of -8.3 on Friday. • Confidence? http://www.wtop.com/?sid=630962&nid=111 In the face of the Weekly Leading Index absolutely falling off a cliff this year? Are they talking about the same planet that we are on? • Not only is the weekly leading index falling faster than it did even in 2008, it's falling at an unprecedented rate that has never before been seen in this index, since its inception in the 1960's. • Additionally, the Baltic Dry Index, which measures shipping prices, has collapsed by more than 50% in the past five weeks. • The economy is literally going into a freefall, and the media is telling us the stock market is rallying on "confidence in a recovery.“ • The truth is: The stock market rallied on a typical short squeeze, and not some new surge of investors who are "confident in recovery." • The volume in last week's rally was abysmal. There was NO public participation.  • When this short squeeze runs its course, we'll see the market sell off again. The next move down will be quite a robust bout of selling.What will the media tell us about the recovery when that happens?

  2. US Market Update! 15-07-2010 • What is the Baltic Dry Index (BDI). • The BDI is a measurement of shipping rates. Wikivest calls it "one of the purest leading indicators of economic activity." You can read more of what they say about it here...http://www.wikinvest.com/index/Baltic_Dry_Index_-_BDI_(BALDRY) • The reason it is such a good leading indicator is because it is directly tied to economic activity. • It measures the demand to move raw materials and other precursors to production, thus it is very forward looking. • When there is an increase in shipping, prices get bid up. When there is a decrease in overall shipping, shipping prices get more competitive and the BDI falls. • This indicator is therefore very sensitive to changes in the economy. What has it been doing lately? • “Crashing!” • At the end of May the BDI was at 4200. Since then, it has fallen 32 days in a row, the longest losing streak in 9 years, and closed down another 3.26% yesterday to 1840. • A drop of 56% in 6 weeks, if that's not a crash, I don't know what is. • Both the BDI and the Weekly Leading Index (WLI) tell us the economy is near free fall. • The stock market is attempting to ignore reality. • The warnings signals are getting louder and louder. • Are you prepared to benefit no matter what the market does?

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