-- Posted Thursday, 22 December 2011 | | Disqus

[Although I'm taking Friday off and no trading touts will be posted for that day, there will be a Hidden Pivot demonstration in the morning that is open to everyone. The online session is slated to begin at 11 a.m. EST and will focus on year-end technicals for some of the most popular trading vehicles. Come prepared to trade if the opportunity should present itself, and to ask any questions you may have about the Hidden Pivot Method. Click here to register for the event. RA]

U.S. markets appear to be trudging wearily toward the finish line as 2011 draws to a close.  With seven more trading days to go, the broad averages went flat yesterday after uncorking one of the biggest rallies of the year the previous day. Gold and silver futures did likewise, running up sharply into the wee hours before succumbing to the pull of gravity.  Both ended the day little changed. We have our doubts that stocks have merely paused to regain strength for another big thrust. More likely is that Tuesday’s price explosion was driven mainly by panicky shorts caught off guard by news that Spain’s latest debt auction had gone reasonably well, and that housing construction in the U.S. upticked. On Wednesday, the shorts seem to have reconsidered and returned to complacency.  For our part, we doubt that any observer, even the shills who appear on the business channels, could actually have believed the statistics were meaningful.

As it happens, the rise in construction came mainly from a surge in multi-family dwellings. No question, the rental market driving this trend is hot relative to an economy that has shown few other signs of life. And although this bullish trend is likely to have legs, providing CPR to the industry, the reasons do not exactly augur strength in the economy.  To the contrary, rentals are being driven mainly by would-be buyers of homes who are unable to come up with a downpayment or to secure a mortgage. There is also a presumably large group of people who regard buying a home in a still-falling market as risky. This is a big change from just five years ago, when owning a home was seen as money in the bank – money in a super high-interest account, actually. Now, it is deflationary mindset that is suppressing real estate prices. If you can imagine the housing market coming roaring back, or even growing moderately over the next several years, we’d like to hear how you think this will happen. Even the most bullish readers who frequent the Rick’s Picks forum have not tried to make the case for real estate leading the economy back to health. That would imply the creation of huge new amounts of mortgage debt – an occurrence that would seem to lie beyond imaginable reality.

Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indication of future results, so let the buyer beware. There is a substantial risk of loss in futures and option trading, and even experts can, and sometimes do, lose their proverbial shirts.  Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2011, Rick Ackerman. All Rights Reserved.www.rickackerman.com

-- Posted Thursday, 22 December 2011 | Digg This Article | Source: GoldSeek.com

comments powered by Disqus
Previous Articles by Rick Ackerman

© 1995 - 2019

Live GoldSeek Visitor Map | Disclaimer