Money Matters Newsletter

Bloomberg News-The benchmark index for U.S. stock options climbed the most in nine weeks as equities tumbled on a World Bank report that the global recession will be deeper than expected. Europe’s VStoxx Index surged the most since November.

Bloomberg News- Executives at U.S. companies are taking advantage of the biggest stock-market rally in 71 years to sell their shares at the fastest pace since credit markets started to seize up two years ago. 

Marc's Notes:

The Dow continues its slide off its recent high 8,000's to end up in the mid 8,300's and investors are beginning to wonder if they been led down another dead end by CNBC and the other financial news medias. After all, weren't you told the "green shoots" were sprouting and new growth was just around the corner?  Humm.... Fooled Again!

Why am I so pessimistic? I'm not really. I am OPTIMISTIC about making money where and when we can. I am just pessimistic when I look at the economic figures I am seeing. You don't need a weather man to know which way the wind blows.

Foreclosures are accelerating, un-employment is rising, the worlds 8th largest economy may be about to default and meanwhile the FEDS throw money willy nilly to everyone but YOU. Who can be optimistic about that? 

Marc's Notes:

The markets continue their sideways motion despite a host of market moving news items emerging on the media.

Fed Express reported terrible sales. If FEX ain't shipping, boxes aren’t moving, therefore the "recovery" ain't happening.

Negative figures coming out of Washington contradict "spin" coming from Manhattan.

Are we or are we not in a recovery.

"We are not" says Money Matters Host Marc Cuniberti.

The consolidation of the stock market and failure to continue any significant rally reflects anemic economic figures. Mortgage rates are spiking as the FEDS cannot control the bond traders or world interest rates. The FEDS are trying to get rates to drop, yet they are rising. Humm.. What's going on here?

June 10 (Bloomberg) -- Treasuries fell, pushing 10-year yields to the highest level since October, as the government sold $19 billion of the securities and Russia said it may switch some reserves from U.S. debt.

Marc's Notes:
Interest rates on US debt continue to soar in an unprecedented rise on US GOVT debt.

This does not bode well for Obama's Plan. The rock and the hard place I keep mentioning is here and the FEDS and you and I are caught between it. As the FEDS bailout every Tom, Dick and Harry, we are finding out what every other banana republic has found out before us.

You cant print money forever without consequences and our luck may be running out. I dont care who you are, you cant run printing presses with disregard and get away with it. History is rife with example of ruined economies who have tried it. Not ONE has been successful. The death knell to unbridled money creation is RISING interest rates. It always has been so.

Marc's Notes:

For 3 years now I’ve have been advising clients to keep a good portion of their money safe and out of the market in government short term bond funds and bank cds.
Those that followed that advice have kept their money out of the market and as a result kept their money. I advised offsetting the risk of a US dollar devaluation eating into your bank cd purchasing power by holding funds that rise with interest rates. Interest rates rise as a result of excessive money printing by a government hell bent on bailing out firm after firm for their reckless behavior. With the bailouts now going into the trillions, our forecast of rising interest rates is coming true and long term rates are rising at an alarming rate. This recent rise in rates threatens the continued use of public funds as the more rates rise, the more debt the government will have to issue, the higher rates will go.

Marc's Notes:

US COMPTROLLER GENERAL (ret) and head of the Peter G Peterson Foundation appeared live by phone from Washington DC today on MONEY MATTERS and what a show it was. David Walker pulled no punches and told us like it is and it wasnt pretty. Well spoken and serious, this was from a man who aguably is the  most knowledgeable about our economic and financial condition. Speaking of trillions of dollars worth of debt and of the little concern by our politicians, he did provide us with some guidance on what needs to be done and how all of us can help.

Marc's Notes:
GM filed bankruptcy today and the market loved it. Go figure.

It will cost taxpayers 40 billion or so to do the filing and YOU and I will pay. Oh well, more money down the rat hole. You are watching your beloved country spiral into socialism. Most of the bailout monies to go the bankers, the unions, the CEO's and overseas investors.
Read the GM notes on its plans.

 
May 26 (Bloomberg) -- Home prices in 20 major metropolitan areas fell more than forecast in March as foreclosures surged, threatening to extend the housing slump.

The S&P/Case-Shiller home-price index decreased 18.7 percent from March 2008, matching the drop in the year ended in February. The measure declined 19 percent in January, the most since data began in 2001.

NEW YORK (CNNMoney.com) -- The Obama administration announced Thursday that it has invested $7.5 billion in GMAC, aiming to prop up the troubled lender and boost its ability to make loans to Chrysler dealers and customers.
Marc's Notes:

More bailouts. I could have posted a dozen more articles here saying the same thing but why bother. You know whats going on out there. Money to all who ask!