First of Many Jolts to the BULL

Investor’s first read – Daily edge before the open
DJIA: 19,971
S&P 500: 2,280
Nasdaq Comp.:5,613
Russell 2000:1,352
Tuesday, January 31, 2017 9:09 a.m.
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Yes, some doubts are creeping in as President Trump rushes to assure the people who elected him that he will fulfill campaign promises.
Politics aside, the heavy handed manner in which the Trump administration has gone about that mission is beginning to unsettle the market, which is comprised of Democrats, moderates, unaffiliateds, Libertarians, Republicans, as well as extremists.
While the market rise since the elections has been driven by hopes for corporate tax relief, deregulation and a lot of new spending, “confidence” drives stability, and right now, investors are beginning to worry that the Trump administration will destabilize everything here and abroad.
Nothing is more unsettling than disarray at the top.
There are 207 weeks left in this administration’s term, it should take its time implementing policy making sure it is lawful, fair and effective. Anything short of that limits the Street’s confidence.
Let’s not forget the Obama bull market was up 240% when the Trump gang took over, adding another 8% for a total gain of 248% for a bull that’s close to 8 years old ! This is the longest lasting bull market in 60 years. Only the 304% gain in the 1990 – 1998 bull market beats it.
Bottom line: While the potential is there for it to top all bull markets for both length and appreciation, it is vulnerable if its surroundings are destabilized.
Odds are the Street will bet of a higher market, drooling over the prospect of Nirvana where corporations are taxed at 15%, repatriated money held abroad to evade taxes is brought home and taxed 10%, protective regulations are lifted, and the government goes on a spending spree.
This is classic bull market stuff destined for the classic bear market in time.
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Support: DJIA:;S&P 500:; Nasdaq Comp.:
RESISTANCE “today”:DJIA:;S&P 500:; Nasdaq Comp.:
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ISSUES TO CONSIDER
– the prospect of big corporate tax cuts, deregulation, a big spend on the military and the infrastructure and the restructuring of long-standing trade agreements.
-the uncertainties of the repeal of Obamacare
-talk of privatization of Medicare and Social Security
-possible undermining of NATO and the European Union
-a trade war of sorts.
-lifting of sanctions on Russia for its incursion in the Crimea and actions in Syria, adding to questions already breached.
-continued internal polarization of America and the possible extension of such to other countries.
-intense economic stimulation by the Trump/Republican Congress stands to trigger a rebound of inflationary pressures forcing the Fed to bump interest rates sooner than expected.
-an increasing erosion of investor confidence in President Trump
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POLITICAL/STOCK MARKET
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Rape and pillage, and if they get a chance a coup d’etat of sorts where “all” checks and balances disappear.
That would please the alt-right …….as long as they run the show. Careful what you guys (and Kellyanne) wish for. There are still a lot of real Americans out here, and we are digging our cleats in for “the fight.”
All Trump’s executive orders are to please his base. Trump’s illegal ban on citizens entering the U.S. from mostly muslim countries of Iran, Iraq, Libya, Somalia, Sudan, Syria, and Yemen gives the impression he is fulfilling one his campaign promise, or so is the puffery that accompanies his actions. Others include: the weakening of Obamacare, withdrawing from the Trans-Pacific Partnership, reinstatement of a ban on international abortion counselling, freeze on government hiring, advance of construction of the Keystone XL pipeline and Dakota Access, pledge to build a wall, a massive cut in regulations whereby any new regulation must be accompanied by the elimination of two regulations under the Office of Management and Budget (the two-out, one-in policy). While all of the above will encounter resistance, the latter is insane, a nightmare.
Trivia question of the day. Who issued the least executive orders per year over the last 120 years ?
While the Trump administration has done some stupid things since January 20, they are masters of manipulation and the mining of people’s preferences, and they have no respect for humanity, our Constitution, the meaning of the Bill of Rights.
IMHO, there is an element in this administration that wants total power, and will gut whatever they have to to gain it – they are “The Enemy Within.”
Tactics involve demonizing the press. That’s not new, Nixon did it all the time before and after Watergate. Trump and Nixon tend toward paranoia, both needed constant caressing of their ego. While Nixon craved acceptance by the upper crust, he was not outwardly a racist,
The Trump administration is all about the alt-right gaining total control of our governance. This is more about who they think we are than who we are. Watch your back. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Corporate earnings (update)
Factset now sees Q4 earnings for the S&P 500 up 3.4% vs. a Dec.31 est. of 3.0%.. Earnings for 2017 are expected to increase 11.4%. Currently, the P/E based on earnings 12 months out is 16.9 x, which compares with a 10-year average P/E of 14.4 and a 5-year P/E of 15.1.
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MY TECHNICAL ANALYSIS of the 30 DJIA Companies: (UPDATE)
On occasion, I technically analyze each of the 30 DJIA stocks for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
As of January 27, 2017, a reasonable risk is 20,013 a more extreme risk is 19,947 Near-term upside potential is 20,288.
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 STATUS OF MARKET: bullish
 OPPORTUNITY: RISK: Selective opportunity ! Risk is reality at some point
 CASH RESERVE: 25% – 35%.
 KEY FACTORS: Speculative fever driven by expectations of tax cuts, lifting of regs., and lots of money dumped on economy.
////////////////////////////////////////////////////////////////////////////////////////////////
Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
…………………………………………………………………….
George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

Confidence Waning

Investor’s first read – Daily edge before the open
DJIA: 20,093
S&P 500: 2,294
Nasdaq Comp.:5,560
Russell 2000:1,370
Monday, January 30, 2017 9:13 a.m.
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Looks like a downer at the then. The key here is, how eager are investors to buy on a pullback ?
Has his first week in office increased or decreased consumer and investor confidence, the real driver of stock prices.
I think it is too early to tell with the intermediate-to-long-term picture. Short-term, we can get a correction.
Again, I remind readers, the market will march to the drumbeat of Trump’s promises – corporate and selective tax cuts, deregulation, and a big spend on infrastructure and the military, assuming Congressional approval.
Any sign that one, two or all of these won’t happen within 18 months and the market will have rto find a new comfort level at lower prices.
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Support: DJIA:20,017 ;S&P 500:2,287; Nasdaq Comp.:5,641
RESISTANCE “today”:DJIA:20,136;S&P 500:2,299; Nasdaq Comp.:5,071
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ISSUES TO CONSIDER
– the prospect of big corporate tax cuts, deregulation, a big spend on the military and the infrastructure and the restructuring of long-standing trade agreements.
-the uncertainties of the repeal of Obamacare
-talk of privatization of Medicare and Social Security
-possible undermining of NATO and the European Union
-a trade war of sorts.
-lifting of sanctions on Russia for its incursion in the Crimea and actions in Syria, adding to questions already breached.
-continued internal polarization of America and the possible extension of such to other countries.
-intense economic stimulation by the Trump/Republican Congress stands to trigger a rebound of inflationary pressures forcing the Fed to bump interest rates sooner than expected.
-an increasing erosion of investor confidence in President Trump
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POLITICAL/STOCK MARKET
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Who is going to pay for the Canada/US wall to stop Americans from fleeing President Trump ?
President Trump counselor, Kellyanne Conway recently told protestors to “Get over it, he’s just getting started.”
That’s what a lot of Americans are afraid of.
What matters to the Street is, will his rush to wield a mace to hated programs and his determination to drive wedges between Americans and countries destroy the credibility of his office, alienate Congress and confidence in the future ?
If true, he is off to a good start, and a lot of damage can be done in four years.
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Corporate earnings (update)
Factset now sees Q4 earnings for the S&P 500 up 3.4% vs. a Dec.31 est. of 3.0%.. Earnings for 2017 are expected to increase 11.4%. Currently, the P/E based on earnings 12 months out is 16.9 x, which compares with a 10-year average P/E of 14.4 and a 5-year P/E of 15.1.
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MY TECHNICAL ANALYSIS of the 30 DJIA Companies: (UPDATE)
On occasion, I technically analyze each of the 30 DJIA stocks for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
As of January 27, 2017, a reasonable risk is 20,013 a more extreme risk is 19,947 Near-term upside potential is 20,288.
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 STATUS OF MARKET: bullish
 OPPORTUNITY: RISK: Selective opportunity ! Risk is reality at some point
 CASH RESERVE: 25% – 35%.
 KEY FACTORS: Speculative fever driven by expectations of tax cuts, lifting of regs., and lots of money dumped on economy.
////////////////////////////////////////////////////////////////////////////////////////////////
Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
…………………………………………………………………….
George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

CRASH ! Not the Market – Our Republic !

Investor’s first read – Daily edge before the open
DJIA: 20,100
S&P 500: 2,296
Nasdaq Comp.:5,655
Russell 2000:1,375
Friday, January 27, 2017 9:03 a.m.
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Barring unexpected bad news, this is the final phase of the Obama bull market. It could last a month or a year depending on progress to slash corporate taxes, gut regulations and pass legislation for a big spend on the military and infrastructure.
This phase has the potential to get wild, so long as nothing gets in the way of the tax cuts, dereg., “spend.” With Republican control of the presidency, Congress and shortly the Supreme Court, all systems look like a “GO.”
Today, we should see another attempt to post a new high. A rally failure would indicate the market needs time to digest recent gains.
A lot depends on Republican unity. Campaigning for the mid-term elections begins in 14 months. President Trump decimated the base of the Republican Party during the primaries, en route to re-branding his own version of a Republican Party. Divisiveness is his M.O..
“If” the core of the party wants to survive, it will have to assert itself or risk losing control of the Senate in 2018 and ultimately the House as I doubt the American voter will support a radical right agenda.
This means the rump platform of huge corporate tax cuts, dereg, and big spend is not going to happen in the size Trump wants.
Failure would adversely impact stock prices.
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Support: DJIA:20,046 ;S&P 500:2,291; Nasdaq Comp.:5,640
RESISTANCE “today”:DJIA:20,146;S&P 500:2,303; Nasdaq Comp.:5,668
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ISSUES TO CONSIDER
– the prospect of big corporate tax cuts, deregulation, a big spend on the military and the infrastructure and the restructuring of long-standing trade agreements.
-the uncertainties of the repeal of Obamacare
-talk of privatization of Medicare and Social Security
-possible undermining of NATO and the European Union
-a trade war of sorts.
-lifting of sanctions on Russia for its incursion in the Crimea and actions in Syria, adding to questions already breached.
-continued internal polarization of America and the possible extension of such to other countries.
-intense economic stimulation by the Trump/Republican Congress stands to trigger a rebound of inflationary pressures forcing the Fed to bump interest rates sooner than expected.
-an increasing erosion of investor confidence in President Trump
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POLITICAL/STOCK MARKET
It is disturbing that President Trump cannot accept that he lost the popular vote by 2.9million votes. He insists three-to five million illegals gave Clinton that margin. He offers no proof, but if he claims that often enough, the public will believe it. That’s one reason why he repeats it over and over again. The other is so he can believe it himself. Even top Republicans are appalled. SCARY !
WHAT IS HAPPENING NOW IS HISTORIC. UNFORTUNATELY, OUR CONSTITUTIONAL REPUBLIC IS AT RISK IN A POWER GRAB THAT WILL HAVE ITS GREATEST IMPACT ON FREE SPEECH AND DISSENT. WHAT IS HAPPENING IS UN-AMERICAN, WHICH IS LIKELY TO TRIGGER A GROUNDSWELL OF OPPOSITION TO WHAT IS AN ATTEMPT BY THE ALT-RIGHT TO TAKE OVER EVERY ASPECT OF OUR COUNTRY. TIME TO PAY ATTENTION.
The Alt-Right has been associated with nationalism, racism, xenophobia, which may well be true for some of its followers, but basically they are well to the right of neocons, and America does not want to go there, it isn’t who most of us are.
Some will call the current trend in our government fascist or totalitarianism, autocracy, even corporatocracy, kratocracy, or plutocracy, however, I see it simply as a rush to secure total control through rigging voting districts (gerrymandering) and voter suppression, repeatedly disseminating lies and misinformation often enough so people accept it as the truth, the manipulation of people’s priorities and simply taking advantage of their lack of information and inability to understand what is best for them.
Through these means, elements of the extremist Republican party (Alt-Right) is now capitalizing on President Trump’s out-of-control ego and his preoccupation with legitimacy as President, to quietly lock up control.
One of the keystones of fascism is to discredit, intimidate and ultimately eliminate the effectiveness of the press, excepting that which falls in behind it like FOX News.
Trump’s chief advisor, Stephen Bannon was quoted Thursday as accusing the media of not understanding this country, adding it should keep its mouth shut.
What ? They want to eliminate the 1st Amendment of the U.S. Constitution ……freedom of speech, and the press….and go straight to the 2nd Amendment… right to bear arms…?
Whoa !
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Corporate earnings (update)
Factset now sees Q4 earnings for the S&P 500 up 3.4% vs. a Dec.31 est. of 3.0%.. Earnings for 2017 are expected to increase 11.4%. Currently, the P/E based on earnings 12 months out is 16.9 x, which compares with a 10-year average P/E of 14.4 and a 5-year P/E of 15.1.
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MY TECHNICAL ANALYSIS of the 30 DJIA Companies: (UPDATE)
On occasion, I technically analyze each of the 30 DJIA stocks for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
As of January 6, 2017, a reasonable risk is 19,926 a more extreme risk is 19,879 Near-term upside potential is 20,288.
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 STATUS OF MARKET: bullish
 OPPORTUNITY: RISK: Selective opportunity ! Risk is reality at some point
 CASH RESERVE: 25% – 35%.
 KEY FACTORS: Speculative fever driven by expectations of tax cuts, lifting of regs., and lots of money dumped on economy.
////////////////////////////////////////////////////////////////////////////////////////////////
Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
…………………………………………………………………….
George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

Rape and Pillage

Investor’s first read – Daily edge before the open
DJIA: 20,068
S&P 500: 2,298
Nasdaq Comp.:5,656
Russell 2000:1,382
Thursday, January 26, 2017 9:03 a.m.
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TECHNICAL
Two days ago, the S&P 500 and Nasdaq Comp. moved up to new highs, starting a new upleg in the market. The DJIA hit new highs yesterday and the Russell 2000 cold follow suit today.
Barring unexpected bad news, this is the final phase of the Obama bull market. It could last a month or a year depending on progress to slash corporate taxes, gut regulations and pass legislation for a big spend on the military and infrastructure.
This phase has the potential to get wild, so long as nothing gets in the way of the tax cuts, dereg., “spend.” With Republican control of the presidency, Congress and shortly the Supreme Court, all systems look like a “GO.”
The last two quarters of 2016 featured a rebound in corporate profits after a year of flat-to-down earnings.(see below: ”Corporate earnings”). A return to profitability stands to continue this year, though a continued strong U.S. dollar may slow its rise.
Currently, the S&P 500 is over-priced at 16.9 times projected 12 months earnings vs. a 5-year average of 15.1. The Street isn’t concerned, so long as it gets the goodies noted above.
As noted in the past, late-stage bull markets tend to enter a highly speculative phase where price/earnings ratios are meaningless, where investors believe the party will last forever and are driven to load up on stocks, even leverage positions in riskier and riskier stocks.
It is important to note that this new stimulus comes on top of a solid but slow growing economic base. The danger is expectations can lead to a speculative blow off that leads to a bear market.
If you slash corporate taxes, gut regulations, many imposed to guard against a 2008-2009 meltdown, and spend a trillion dollars, you won’t have any firepower to bail the country (world) out of a crushing recession.
What I see in the early days of the Trump administration a rush to widen the gap between the corporate elite and the working man/woman, ironically the people who narrowly elected a very dangerous man to the Presidency. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
ISSUES TO CONSIDER
– the prospect of big corporate tax cuts, deregulation, a big spend on the military and the infrastructure and the restructuring of long-standing trade agreements.
-the uncertainties of the repeal of Obamacare this computer sucks wind so
-talk of privatization of Medicare and Social Security
-possible undermining of NATO and the European Union
-a trade war of sorts.
-lifting of sanctions on Russia for its incursion in the Crimea and actions in Syria, adding to questions already breached.
-continued internal polarization of America and the possible extension of such to other countries.
-intense economic stimulation by the Trump/Republican Congress stands to trigger a rebound of inflationary pressures forcing the Fed to bump interest rates sooner than expected.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
RESISTANCE “today”:DJIA:20,078;S&P 500:2,298; Nasdaq Comp.:5,643
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POLITICAL/STOCK MARKET
Cutting corporate taxes to 15% stands to reduce Federal government revenues by upwards of $800 billion. So, what if the “big” spend runs upwards of another $800 billion, where are the cuts going to come from to avert a significant increase in the national debt ?
Most likely from social programs that the lower income people have come to rely on. Aren’t they the ones who voted for Trump ?
Does withdrawal from TPP open the door for China to fill the void we abandon ? China thinks so.
If we sever ties with the United Nations, what doors are we opening for our adversaries ?
What about creating 25 million jobs in the U.S. ? Sounds great when campaigning for office, but where will these jobs come from ?
Automation is sinking its deadly talons into the existing job force, which is great for business bottom lines, but eliminating jobs. Robots are manufacturing robots, computers can now fillet a fish. Oil rigs are increasingly being automated. Nabors Inds., the world’s largest offshore driller, tells Bloomberg it will cut workers at each well to five from 20 via automation.
THIS is the real jobs crisis. Companies benefit, yet much of their spare cash goes into repurchase of stock, not training employees. This is the crisis Trump should be addressing.
It is disturbing that President Trump cannot accept that he lost the popular vote by 2.9million votes. He insists three-to five million illegals gave Clinton that margin. He offers no proof, but if he claims that often enough, the public will believe it. That’s one reason why he repeats it over and over again. The other is so he can believe it himself. Even top Republicans are appalled. SCARY !
WHAT IS HAPPENING NOW IS HISTORIC. UNFORTUNATELY, OUR CONSTITUTIONAL REPUBLIC IS AT RISK IN A POWER GRAB THAT WILL HAVE ITS GREATEST IMPACT ON FREE SPEECH AND DISSENT. WHAT IS HAPPENING IS UN-AMERICAN, WHICH IS LIKELY TO TRIGGER A GROUNDSWELL OF OPPOSITION TO WHAT IS AN ATTEMPT BY THE ALT-RIGHT TO TAKE OVER EVERY ASPECT OF OUR COUNTRY. TIME TO PAY ATTENTION.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Corporate earnings (update)
Factset now sees Q4 earnings for the S&P 500 up 3.4% vs. a Dec.31 est. of 3.0%.. Earnings for 2017 are expected to increase 11.4%. Currently, the P/E based on earnings 12 months out is 16.9 x, which compares with a 10-year average P/E of 14.4 and a 5-year P/E of 15.1.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>.
MY TECHNICAL ANALYSIS of the 30 DJIA Companies: (UPDATE)
On occasion, I technically analyze each of the 30 DJIA stocks for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
As of January 6, 2017, a reasonable risk is 19,926 a more extreme risk is 19,879 Near-term upside potential is 20,288.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
 STATUS OF MARKET: bullish
 OPPORTUNITY: RISK: Selective opportunity ! Risk is reality at some point
 CASH RESERVE: 25% – 35%.
 KEY FACTORS: Speculative fever driven by expectations of tax cuts, lifting of regs., and lots of money dumped on economy.
////////////////////////////////////////////////////////////////////////////////////////////////
Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
…………………………………………………………………….
George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

Final Phase of Obama’s Bull Market

Investor’s first read – Daily edge before the open
DJIA: 19,812
S&P 500: 2,280
Nasdaq Comp.:5,600
Russell 2000:1,369
Wednesday, January 25, 2017 9:03 a.m.
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TECHNICAL
The S&P 500 and Nasdaq Comp. moved up to new highs, starting a new upleg in the market. The DJIA and Russell 2000 lag behind but have positive patterns.
The market is tracking the blow-off I referred to yesterday that can push to much higher levels.
As long as the Street expects a big tax cut, deregulation and a big increase in spending the market has legs, barring a major new negative, or sudden evidence that Congress will push back on Trump’s planned stimulus.
The last two quarters of 2016 featured a rebound in corporate profits after a year of flat-to-down earnings.(see below: ”Corporate earnings”). A return to profitability stands to continue this year, though a continued strong U.S. dollar may slow its rise.
Currently, the S&P 500 is over-priced at 16.9 times projected 12 months earnings vs. a 5-year average of 15.1. The Street isn’t concerned, so long as it gets the goodies noted above.
As noted in the past, late-stage bull markets tend to enter a highly speculative phase where price/earnings ratios are meaningless, where investors believe the party will last forever and are driven to load up on stocks, even leverage positions in riskier and riskier stocks.
Making money becomes easier. Tips make the rounds at a faster clip, and people who rarely buy individual stocks begin to buy aggressively, as they hit the “I can’t stand it anymore” point and make the plunge.
Often, the less you know about the fundamentals of investing, the more money you can make.
This continues until something triggers a reversal, or the BIG money pulls the plug. Investors see the first correction as a “gift,” and load up even more. At that point, the hook is set, leading to their demise.
No sweat ! We aren’t there yet. With the promise of massive tax cuts, deregulation and a big spend, the Street is only beginning to ramp up their speculative juices.
What I said here about tops will be forgotten by 4 p.m. today, but I will remind readers along the way when it is the last thing they want to hear. They will hate me for raining on their parade, and hate me more if I am right – the perils of what I do.
Let’s not get ahead of the curve. Yes, unexpected bad news can stop the market in its tracks, but that can happen at any time. At times, it did happen during this bull market’s 242% rise, but the bull shook it off and continued to rise. This is the final phase. It can last 3 months 9 months, a year – don’t know at this time. I have written about it often, but it always seemed out of reach.

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
ISSUES TO CONSIDER
– the prospect of big corporate tax cuts, deregulation, a big spend on the military and the infrastructure and the restructuring of long-standing trade agreements.
-the uncertainties of the repeal of Obamacare this computer sucks wind so
-talk of privatization of Medicare and Social Security
-possible undermining of NATO and the European Union
-a trade war of sorts.
-lifting of sanctions on Russia for its incursion in the Crimea and actions in Syria, adding to questions already breached.
-continued internal polarization of America and the possible extension of such to other countries.
-intense economic stimulation by the Trump/Republican Congress stands to trigger a rebound of inflationary pressures forcing the Fed to bump interest rates sooner than expected.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
RESISTANCE “today”:DJIA:20,078;S&P 500:2,298; Nasdaq Comp.:5,643
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
POLITICAL/STOCK MARKET
Cutting corporate taxes to 15% stands to reduce Federal government revenues by upwards of $800 billion. So, what if the “big” spend runs upwards of another $800 billion, where are the cuts going to come from to avert a significant increase in the national debt ?
Most likely from social programs that the lower income people have come to rely on. Aren’t they the ones who voted for Trump ?
Does withdrawal from TPP open the door for China to fill the void we abandon ? China thinks so.
If we sever ties with the United Nations, what doors are we opening for our adversaries ?
What about creating 25 million jobs in the U.S. ? Sounds great when campaigning for office, but where will these jobs come from ?
Automation is sinking its deadly talons into the existing job force, which is great for business bottom lines, but eliminating jobs. Robots are manufacturing robots, computers can now fillet a fish. Oil rigs are increasingly being automated. Nabors Inds., the world’s largest offshore driller, tells Bloomberg it will cut workers at each well to five from 20 via automation.
THIS is the real jobs crisis. Companies benefit, yet much of their spare cash goes into repurchase of stock, not training employees. This is the crisis Trump should be addressing.
It is disturbing that President Trump cannot accept that he lost the popular vote by 2.9million votes. He insists three-to five million illegals gave Clinton that margin. He offers no proof, but if he claims that often enough, the public will believe it. That’s one reason why he repeats it over and over again. The other is so he can believe it himself. Even top Republicans are appalled. SCARY !
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Corporate earnings (update)
Factset now sees Q4 earnings for the S&P 500 up 3.4% vs. a Dec.31 est. of 3.0%.. Earnings for 2017 are expected to increase 11.4%. Currently, the P/E based on earnings 12 months out is 16.9 x, which compares with a 10-year average P/E of 14.4 and a 5-year P/E of 15.1.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>.
MY TECHNICAL ANALYSIS of the 30 DJIA Companies: (UPDATE)
On occasion, I technically analyze each of the 30 DJIA stocks for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
As of January 6, 2017, a reasonable risk is 19,926 a more extreme risk is 19,879 Near-term upside potential is 20,288.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
 STATUS OF MARKET: bullish
 OPPORTUNITY: RISK: Selective opportunity ! Risk is reality at some point
 CASH RESERVE: 25% – 35%.
 KEY FACTORS: Speculative fever driven by expectations of tax cuts, lifting of regs., and lots of money dumped on economy.
////////////////////////////////////////////////////////////////////////////////////////////////
Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
…………………………………………………………………….
George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

Easy Does It ! Cash Reserve 30%

Investor’s first read – Daily edge before the open
DJIA: 19,827
S&P 500: 2,271
Nasdaq Comp.: 5,555
Russell 2000:1,351
Monday January 23, 2017 9:09 a.m.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
If the Trump administration focuses on tax cuts, deregulation and the “big spend,” stocks will go higher. Unfortunately, no one knows what this gang will do. Their first order of business was to repeal ACA without a replacement.
Next is the prospect of a trade war with China along with major adjustments to NAFTA.
What does that mean ?
I have no idea except it spells UNCERTAINTY, which based on what we have seen from Donald Trump, will be the trademark of his administration. This will be a one-way street, a private party and the angry middle American is not invited. A trade war can only mean he/she stand to pay more for the basics as tariffs are slapped on imported goods.
Will these goods then be manufactured here ? Will ease-of-entry jobs suddenly become available ? Will Trump create 25 million new jobs ?
“No” to all the above.
Will a Trump recession become the 10th recession under a Republican president out of the last 11 recessions ? The lone Democrat recession came under Carter (6 mos.)
“YES !”
The question is, when ?
Most likely not this year.
Why then raise cash ?
This depends on how nimble an investor is and their tolerance for risk. Based on all the corporate perks promised, the market can go higher. Obviously lower corporate taxes would positively increase valuations. Deregulation would help some industries, as would a big spend on the military and infrastructure.
There will be a lot of uncertainty in the interim, and that spells “risk.”
It also spells “opportunity” for investors with cash to invest on pullbacks.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
ISSUES TO CONSIDER
– the prospect of big corporate tax cuts, deregulation, a big spend on the military and the infrastructure and the restructuring of long-standing trade agreements.
-the uncertainties of the repeal of Obamacare this computer sucks wind so
-talk of privatization of Medicare and Social Security
-possible undermining of NATO and the European Union
-a trade war of sorts.
-lifting of sanctions on Russia for its incursion in the Crimea and actions in Syria, adding to questions already breached.
-continued internal polarization of America and the possible extension of such to other countries.
-intense economic stimulation by the Trump/Republican Congress stands to trigger a rebound of inflationary pressures forcing the Fed to bump interest rates sooner than expected.
TECHNICAL
As long as the Street perceives the possibility of major corporate tax cuts and the big spend,” it will expect higher prices. It is possible we will see a speculative blow-off at much higher levels. It is the sizzle, not the steak, that is driving stock prices.
If the Street sees the folly of this administration and risk of extreme overreach, it will hit the exits.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
SUPPORT “today”: DJIA: 19,742;S&P:2,262; Nasdaq Comp.:5,535
RESISTANCE “today”:DJIA:19,878;S&P 500:2,276; Nasdaq Comp.:5,573
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
POLITICAL/STOCK MARKET
From all I have read, heard and seen about President Trump, I can only conclude that he will destabilize (not unite) America and in so doing ultimately undermine the soundness of our economy, resulting in a devastating bear market.
President Trump was a mistake for which we will pay dearly as a nation that needs uniting, but won’t get it from this administration which thrives on divisiveness.
This is not about helping the middle class and people who are victims of technological change, automation and corporate decisions to grease the bottom line, it is about amassing untethered power by a political element, whose policies put it well onto the warning track in right field.
I don’t think Trump is emotionally capable of handling the job, and clearly, he does not have the experience needed to cope with the pressure, criticism and crises that go with it. That spells “HIGH RISK” for investors and that must be taken seriously regardless of party affiliation.
I am every bit as concerned for our future as American, its economy and stock market as I was on August 19, 2007 when I wrote:

Perfect Storm Looms
The perfect storm in our financial markets is looming.
….It will take a heroic international effort to avert a meltdown of huge magnitude…
….Trading in everything may have to be stopped until some sort of sanity is restored
….This can get real ugly. No one has a handle on the leverage amassed in derivatives
….No one has a true handle on how precarious the situation out there is, and that uncertainty feeds on itself, prompting increased selling…With few buyers, stocks tank.
…Only when a cauldron of fear begins to boil, do you have a market that is reasonably safe to invest in.

George Brooks
August 19, 2007
This time we are faced with a president who is unpredictable, with zero tolerance for criticism, who is divisive and by his own behavior bigoted, intolerant, and unstable.
Congress is not conservative, it is radically extreme. It is determined to “Starve the Beast,” a term used to define the goals of neoconservatives for years. They are now in position to have their way. Essentially they seek to slash taxes to the point that it forces huge cuts in government expenditures, namely education, Social Security, Medicare, social services.
Why would anyone want to do this to fellow Americans ?
Simple, they want it all for themselves.

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Corporate earnings (update)
Factset now sees Q4 earnings for the S&P 500 up 3.4% vs. a Dec.31 est. of 3.0%.. Earnings for 2017 are expected to increase 11.4%. Currently, the P/E based on earnings 12 months out is 16.9 x, which compares with a 10-year average P/E of 14.4 and a 5-year P/E of 15.1.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>.
MY TECHNICAL ANALYSIS of the 30 DJIA Companies: (UPDATE)
On occasion, I technically analyze each of the 30 DJIA stocks for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
As of January 6, 2017, a reasonable risk is 19,926 a more extreme risk is 19,879 Near-term upside potential is 20,288.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
 STATUS OF MARKET: bullish
 OPPORTUNITY: RISK: Selective opportunity ! Risk is reality at some point
 CASH RESERVE: 25% – 35%.
 KEY FACTORS: Speculative fever driven by expectations of tax cuts, lifting of regs., and lots of money dumped on economy.
////////////////////////////////////////////////////////////////////////////////////////////////
Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
…………………………………………………………………….
George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

Show and Tell Time

Investor’s first read – Daily edge before the open
DJIA: 19,732
S&P 500: 2,263
Nasdaq Comp.5,540:
Russell 2000:1,345
Friday, January 20, 2017 9:11 a.m.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Eight years ago Barack Obama was sworn in as the 44th President of the United States facing a global meltdown, the worst recession. bear market since the 1930s.
Donald Trump will be sworn in as the 45th President of the United States tomorrow blessed with a stable economic recovery and stock market that has risen 241% from its bear market bottom.
LOOKING AHEAD – CONSIDERATIONS
The inauguration of Donald Trump on Friday presents the Street and American citizens with a full plate of considerations, including:
– the prospect of big corporate tax cuts, deregulation, a big spend on the military and the infrastructure and the restructuring of long-standing trade agreements.
-the uncertainties of the repeal of Obamacare
-talk of privatization of Medicare and Social Security
-possible undermining of NATO and the European Union
-a trade war of sorts.
-lifting of sanctions on Russia for its incursion in the Crimea and actions in Syria, adding to questions already breached.
-continued internal polarization of America and the possible extension of such to other countries.
-intense economic stimulation by the Trump/Republican Congress stands to trigger a rebound of inflationary pressures forcing the Fed to bump interest rates sooner than expected.
TECHNICAL
The bulls need a couple of big days here to set a positive tone for the legitimacy of the Trump presidency and the future of a Republican Congress.
Having lost the popular vote by 2.9 million votes (48.2% to 46.1%), Trump is under pressure to establish legitimacy.
How this will play out has a lot to do with investor confidence, ergo the direction of the stock market.
That will play out shortly, perhaps in a matter of days.
I expect a rally through Trump’s inauguration speech, then a moment of truth. There is no party affiliation when it comes to making money.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
SUPPORT “today”: DJIA: 19,621;S&P:2,251; Nasdaq Comp.:5,519
RESISTANCE “today”:DJIA:18,814;S&P 500:2,269; Nasdaq Comp.:5,556
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
POLITICAL/STOCK MARKET
We are heading into the ugliest domestic and international era of the past 70 years, the Republican Controlled Congress’ rape and pillage of efforts during the last 8 years to define that we are a people of decency, compassion, mutual respect, and optimism. So much of the market’s stability depends on confidence, he does not breed it, he undermines it, and that can hurt investors.
There is a chance, not huge, but enough to take seriously, that our nation is coming apart at the seams, that divisiveness will trump cooperation, civility will yield to incivility, progress will yield to more gridlock, and demonstrations will cross the line to bloody violence..
Until last week, I steered clear of politics in my posts. I strongly think President-elect Trump is a major “risk” factor and that has to be addressed.
He is both predictable and unpredictable. Predictable in the fact he cannot tolerate criticism or opposition without rejection and retaliation . Unpredictable in that no one (including himself) knows what he will do under the kind of serious situations that confront a president every day.
The President-elect should busy himself with more important things than tweeting a counter attack on anyone who confronts him.
This behavior has persisted since he began his campaign and is truly scary. As President, such inability to ignore criticism suggests a skin too thin for this job.
As I have said before, I think Donald Trump is a big mistake, and when you make big mistakes, you pay a price, and that could be injurious to investors.
It’s one thing to run a company where you have employees who will do as they are told, or get fired. That is not how the office of the Presidency works.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Corporate earnings (update)
Factset now sees Q4 earnings for the S&P 500 up 3.0%. On Sept. 30, its projection was for a decline of 5.2%. Growth rates in 10 of 11 sectors have been reduced since Sept. 30. The growth rate for all of 2016 is est. at +2.2%. Earnings for 2017 are expected to increase 11.5%. Currently, the P/E based on 12 months out is 17.1x, which compares with a 10-year average P/E of 14.4 and a 5-year P/E of 15.1.
FYI: There was some missed estimates in 2016, Q3 in particular where earnings growth surprised the Street. Along with a firming economy, this was a contributor to the year year-end rally in addition to promises of tax cuts, dereg., and a big spend..
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>.
MY TECHNICAL ANALYSIS of the 30 DJIA Companies: (UPDATE)
On occasion, I technically analyze each of the 30 DJIA stocks for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
As of January 6, 2017, a reasonable risk is 19,926 a more extreme risk is 19,879 Near-term upside potential is 20,288.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
A TIMELY WARNING 10 YEARS AGO
I wrote the following in 2007 as I became increasingly aware of “risk.” I was not aware of how disastrous the subprime mortgage/housing bubble situation had gotten, just appalled how extreme the use of derivatives had become. As most of you know the bear market/recession that followed took us to the brink of a total meltdown. I am again concerned for the market, not so much about derivatives but the Trump presidency.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Perfect Storm Looms
The perfect storm in our financial markets is looming.
….It will take a heroic international effort to avert a meltdown of huge magnitude…
….Trading in everything may have to be stopped until some sort of sanity is restored
….This can get real ugly. No one has a handle on the leverage amassed in derivatives
….No one has a true handle on how precarious the situation out there is, and that uncertainty feeds on itself, prompting increased selling…With few buyers, stocks tank.
…Only when a cauldron of fear begins to boil, do you have a market that is reasonably safe to invest in.

George Brooks – August 19, 2007
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
 STATUS OF MARKET: bullish
 OPPORTUNITY: RISK: Selective opportunity ! Risk is reality at some point
 CASH RESERVE: 25% – 35%.
 KEY FACTORS: Speculative fever driven by expectations of tax cuts, lifting of regs., and lots of money dumped on economy.
////////////////////////////////////////////////////////////////////////////////////////////////
Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
…………………………………………………………………….
George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

U.S. at a Crossroads Like Never Before

Investor’s first read – Daily edge before the open
DJIA: 19,804
S&P 500: 2,271
Nasdaq Comp.:5,555
Russell 2000:1,358
Thursday, January 19, 2017 9:01 a.m.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Eight years ago Barack Obama was sworn in as the 44th President of the United States facing a global meltdown, the worst recession. bear market since the 1930s.
Donald Trump will be sworn in as the 45th President of the United States tomorrow blessed with a stable economic recovery and stock market that has risen 241% from its bear market bottom.
This time next week we will have a good idea which path he decides to take, one of respect for our time-tested institutions and people of various religious, ethnic, moral and political beliefs, or
the tone he set campaigning for the office – offensive, disrespectful, divisive, and unpredictable marred by rants against anyone who does not agree with him and take him to task for his blunders.
President-elect Trump’s approval rating (40%) is the lowest of any incoming president in decades.
Little is expected from his inaugural address, and in many quarters, his presidency. There is little to stop him and the Republican Congress from doing anything they please.
For some, this looks like a palace coup, with the far right wing gaining the turf they so cherished all these years, yet that may have been what they saw eight years ago when the Democrats controlled all three branches.
Investors must be pragmatic though, setting politics aside and being prepared for an extension of the Obama bull market.
If his inaugural address is impressive, his approval rating will rise from the pits and the stock market as well.
Undoubtedly, Republicans made a bundle over the last eight years, first with his administration’s rescue of a largely Republican “Great Recession” and near global meltdown, then with a 241% bull surge.
Is there a Great Recession II lurking out there ? Don’t know yet, but nine of the last tem recessions have been with Republican in the Oval Office.
Nevertheless, a lot can happen in the interim. Bull markets tend to go to extremes before the party is over. This one has a chance to do that, as well, unless Republican overreach rekindles fears of a country that is so divided, confidence in the future totally evaporates.
LOOKING AHEAD – CONSIDERATIONS
The inauguration of Donald Trump on Friday presents the Street and American citizens with a full plate of considerations, including:
– the prospect of big corporate tax cuts, deregulation, a big spend on the military and the infrastructure and the restructuring of long-standing trade agreements.
-the uncertainties of the repeal of Obamacare
-talk of privatization of Medicare and Social Security
-possible undermining of NATO and the European Union
-a trade war of sorts.
-lifting of sanctions on Russia for its incursion in the Crimea and actions in Syria, adding to questions already breached.
-continued internal polarization of America and the possible extension of such to other countries.
-intense economic stimulation by the Trump/Republican Congress stands to trigger a rebound of inflationary pressures forcing the Fed to bump interest rates sooner than expected.
TECHNICAL
The question today is, will the Street front-run tomorrow’s inauguration ? Will its finality drive home the likelihood of the big corporate tax cut, deregulation and spend, all of which promises higher corporate earnings.
Today, it looks like most of that will be approved in one form or another.

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
SUPPORT “today”: DJIA:19,756 ;S&P:2,266; Nasdaq Comp.:5,544
RESISTANCE “today”:DJIA:19,856;S&P 500:2,278; Nasdaq Comp.:5,571
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
POLITICAL/STOCK MARKET
We are heading into the ugliest domestic and international era of the past 70 years, the Republican Controlled Congress’ rape and pillage of efforts during the last 8 years to define that we are a people of decency, compassion, mutual respect, and optimism. So much of the market’s stability depends on confidence, he does not breed it, he undermines it, and that can hurt investors.
There is a chance, not huge, but enough to take seriously, that our nation is coming apart at the seams, that divisiveness will trump cooperation, civility will yield to incivility, progress will yield to more gridlock, and demonstrations will cross the line to bloody violence..
Until last week, I steered clear of politics in my posts. I strongly think President-elect Trump is a major “risk” factor and that has to be addressed.
He is both predictable and unpredictable. Predictable in the fact he cannot tolerate criticism or opposition without rejection and retaliation . Unpredictable in that no one (including himself) knows what he will do under the kind of serious situations that confront a president every day.
The President-elect should busy himself with more important things than tweeting a counter attack on anyone who confronts him.
This behavior has persisted since he began his campaign and is truly scary. As President, such inability to ignore criticism suggests a skin too thin for this job.
As I have said before, I think Donald Trump is a big mistake, and when you make big mistakes, you pay a price, and that could be injurious to investors.
It’s one thing to run a company where you have employees who will do as they are told, or get fired. That is not how the office of the Presidency works.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Corporate earnings (update)
Factset now sees Q4 earnings for the S&P 500 up 3.0%. On Sept. 30, its projection was for a decline of 5.2%. Growth rates in 10 of 11 sectors have been reduced since Sept. 30. The growth rate for all of 2016 is est. at +2.2%. Earnings for 2017 are expected to increase 11.5%. Currently, the P/E based on 12 months out is 17.1x, which compares with a 10-year average P/E of 14.4 and a 5-year P/E of 15.1.
FYI: There was some missed estimates in 2016, Q3 in particular where earnings growth surprised the Street. Along with a firming economy, this was a contributor to the year year-end rally in addition to promises of tax cuts, dereg., and a big spend..
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>.
MY TECHNICAL ANALYSIS of the 30 DJIA Companies: (UPDATE)
On occasion, I technically analyze each of the 30 DJIA stocks for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
As of January 6, 2017, a reasonable risk is 19,926 a more extreme risk is 19,879 Near-term upside potential is 20,288.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
A TIMELY WARNING 10 YEARS AGO
I wrote the following in 2007 as I became increasingly aware of “risk.” I was not aware of how disastrous the subprime mortgage/housing bubble situation had gotten, just appalled how extreme the use of derivatives had become. As most of you know the bear market/recession that followed took us to the brink of a total meltdown. I am again concerned for the market, not so much about derivatives but the Trump presidency.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Perfect Storm Looms
The perfect storm in our financial markets is looming.
….It will take a heroic international effort to avert a meltdown of huge magnitude…
….Trading in everything may have to be stopped until some sort of sanity is restored
….This can get real ugly. No one has a handle on the leverage amassed in derivatives
….No one has a true handle on how precarious the situation out there is, and that uncertainty feeds on itself, prompting increased selling…With few buyers, stocks tank.
…Only when a cauldron of fear begins to boil, do you have a market that is reasonably safe to invest in.

George Brooks – August 19, 2007
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
 STATUS OF MARKET: bullish
 OPPORTUNITY: RISK: Selective opportunity ! Risk is reality at some point
 CASH RESERVE: 25% – 35%.
 KEY FACTORS: Speculative fever driven by expectations of tax cuts, lifting of regs., and lots of money dumped on economy.
////////////////////////////////////////////////////////////////////////////////////////////////
Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
…………………………………………………………………….
George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.

Surprise Inaugural Address ?

Investor’s first read – Daily edge before the open
DJIA: 19,826
S&P 500: 2,267
Nasdaq Comp.:5,538
Russell 2000:1,352
Wednesday, January 18, 2017 8:22 a.m.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
President-elect Trump’s approval rating (40%) is the lowest of any incoming president in decades. He dismisses the polls as inaccurate.
The low rating could help him though, if he gives a surprisingly sane and enlightening inauguration address
The Street should be ready for that possibility, since it would be followed by an increase in ratings and a surge in stock prices. .
which would be followed by a jump in his polls and a rally in the stock market.
If his speech is marred by rants, divisiveness and excuses for his low ratings, the market may need to drop enough to discount the possibility the next four years will be disastrous.
The inauguration of Donald Trump on Friday presents the Street and American citizens with a full plate of considerations, including:
– the prospect of big corporate tax cuts, deregulation, a big spend on the military and the infrastructure and the restructuring of long-standing trade agreements.
-the uncertainties of the repeal of Obamacare
-talk of privatization of Medicare and Social Security
-possible undermining of NATO and the European Union
-a trade war of sorts.
-lifting of sanctions on Russia for its incursion in the Crimea and actions in Syria, adding to questions already breached.
-continued internal polarization of America and the possible extension of such to other countries.
-intense economic stimulation by the Trump/Republican Congress stands to trigger a rebound of inflationary pressures forcing the Fed to bump interest rates sooner than expected.
While the market will be driven by talk of tax cuts and big spending, but these other issues will be a drag. Today, we don’t know which Trump will show up. What kind of Republican is he ? Will he fight with Congress or use it to get his way ?
We won’t have to wait long for an answer.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
SUPPORT “today”: DJIA: 19,776 ;S&P:2,261; Nasdaq Comp.:5,521
RESISTANCE “today”:DJIA:19,868;S&P 500:2,273; Nasdaq Comp.:5,553
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
POLITICAL/STOCK MARKET
We are heading into the ugliest domestic and international era of the past 70 years, the Republican Controlled Congress’ rape and pillage of efforts during the last 8 years to define that we are a people of decency, compassion, mutual respect, and optimism. So much of the market’s stability depends on confidence, he does not breed it, he undermines it, and that can hurt investors.
There is a chance, not huge, but enough to take seriously, that our nation is coming apart at the seams, that divisiveness will trump cooperation, civility will yield to incivility, progress will yield to more gridlock, and demonstrations will cross the line to bloody violence..
Until last week, I steered clear of politics in my posts. I strongly think President-elect Trump is a major “risk” factor and that has to be addressed.
He is both predictable and unpredictable. Predictable in the fact he cannot tolerate criticism or opposition without rejection and retaliation . Unpredictable in that no one (including himself) knows what he will do under the kind of serious situations that confront a president every day.
The President-elect should busy himself with more important things than tweeting a counter attack on anyone who confronts him.
This behavior has persisted since he began his campaign and is truly scary. As President, such inability to ignore criticism suggests a skin too thin for this job.
As I have said before, I think Donald Trump is a big mistake, and when you make big mistakes, you pay a price, and that could be injurious to investors.
It’s one thing to run a company where you have employees who will do as they are told, or get fired. That is not how the office of the Presidency works.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Corporate earnings (update)
Factset now sees Q4 earnings for the S&P 500 up 3.0%. On Sept. 30, its projection was for a decline of 5.2%. Growth rates in 10 of 11 sectors have been reduced since Sept. 30. The growth rate for all of 2016 is est. at +2.2%. Earnings for 2017 are expected to increase 11.5%. Currently, the P/E based on 12 months out is 17.1x, which compares with a 10-year average P/E of 14.4 and a 5-year P/E of 15.1.
FYI: There was some missed estimates in 2016, Q3 in particular where earnings growth surprised the Street. Along with a firming economy, this was a contributor to the year year-end rally in addition to promises of tax cuts, dereg., and a big spend..
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MY TECHNICAL ANALYSIS of the 30 DJIA Companies: (UPDATE)
On occasion, I technically analyze each of the 30 DJIA stocks for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the new DJIA “divisor” (0.14602) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages.
As of January 6, 2017, a reasonable risk is 19,926 a more extreme risk is 19,879 Near-term upside potential is 20,288.
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A TIMELY WARNING 10 YEARS AGO
I wrote the following in 2007 as I became increasingly aware of “risk.” I was not aware of how disastrous the subprime mortgage/housing bubble situation had gotten, just appalled how extreme the use of derivatives had become. As most of you know the bear market/recession that followed took us to the brink of a total meltdown. I am again concerned for the market, not so much about derivatives but the Trump presidency.
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Perfect Storm Looms
The perfect storm in our financial markets is looming.
….It will take a heroic international effort to avert a meltdown of huge magnitude…
….Trading in everything may have to be stopped until some sort of sanity is restored
….This can get real ugly. No one has a handle on the leverage amassed in derivatives
….No one has a true handle on how precarious the situation out there is, and that uncertainty feeds on itself, prompting increased selling…With few buyers, stocks tank.
…Only when a cauldron of fear begins to boil, do you have a market that is reasonably safe to invest in.

George Brooks – August 19, 2007
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 STATUS OF MARKET: bullish
 OPPORTUNITY: RISK: Selective opportunity ! Risk is reality at some point
 CASH RESERVE: 25% – 35%.
 KEY FACTORS: Speculative fever driven by expectations of tax cuts, lifting of regs., and lots of money dumped on economy.
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Note: Source of weekly economic calendar and good recap of indicators: mam.econoday.com.
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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication
Brooks007read@aol.com
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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer. Neither Game-On Analysis, LLC, nor George Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk.