In reading a passage from Dennis Gartman (author of âThe Gartman Letterâ), I was left somewhat speechless (for once in my life). Gartman noted that the CEO of Bank of America (BAC) accused Fed Chairman Bernanke of being directly involved in the withholding of information from BAC shareholders as well as the American tax paying citizenry regarding BACâs merger with Merrill Lynch. He further noted that if there is the slightest iota of truth to CEO Lewisâs claims, Chairman Bernanke would immediately become not only a political but an economic liability as heâd lose all credibility. Thus, if this storm cloud turns into a full-fledged hurricane, it could have dire consequences for the U.S. In the immediate-term, the problem would be exactly what it is we are seeing- a decline of the U.S. dollar relative to other currencies over the last few days. Some people are blaming the fall on things like the swine flu, but that makes no sense as that is a worldwide issue. Thus, it is entirely plausible that there is more to this than meets the eye. Forget whether one believes the job that Bernanke is doing is good or bad; the issue is one of credibilityâ¦would anyone be able to trust any Chairman of the Federal Reserve ever again? Furthermore, should Bernanke leave, it is prudent to assume that a new chairman would be put into office with beliefs more associated with President Obama than Chairman Bernanke. Keeping politics out of this, a development such as that would likely be another catalyst for a dollar decline because everything suggested by Obama involves massive use of the paper dollar so more dollars would make each dollar worth a little less. For equities, it is the last thing anyone needs. The markets have recovered nicely, but it is fragile. Thus the daily epiphany: this is one more burgeoning crisis to watch (or one that may well dissipate if Lewis gets a vote of confidence by the BAC board imminently). As we approach the warmth of May and exit stress tests and earnings season into the middle of next month, the markets will seek something else to follow thus political rumors may start to begin to circulate that much more about the futures of people like CEO Lewis and Chairman Bernanke. Markets throughout the world rallied overnight as fears dissipated re the swine flu and hope sprung eternal again in the banking sector as stocks in Hong Kong and Europe rallied 1% to 2% across the board. The GDP came out terrible this morning (down 6.1%, much worse than expected) yet the futures shook it off; this is a very bullish sign. With banks up notably state-side, look for an upside bias as the markets have had every opportunity to sell off earlier this week and did not. It will likely be quiet again except among the myriad of companies reporting, but a definite bias to the upside all else equal. Iâll also note that if I prove to be wrong today, Iâll likely be very very wrong since all the signs seem to be so good this morning so as always, have a thought about what should be, but trade what you see. Reiterating- Please understand that if the ideas do not get to the hoped for set-ups cited below, more often than not, one should not blindly trade the symbol next to said idea. If the whole story is not there - If something is good, assume either a short thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specifiedIf something is bad, assume either a buy thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specified- Good- The following stocks have good news and/or a strong technical pattern DNDN- very positive drug results BMY, FO, YUM- on âMad Moneyâ last night WFC, BAC, PNC- late upgrade on bank stocks discussed yesterday evening on âFast Moneyâ LIFE- good earnings DWA- good earnings PSYS- good earnings CBI- good earnings MPWR- good earnings VRTX- closed near a high EFUT- closed near a high WBSN- decent earnings COG- good earnings RRC- good earnings FCN- good earnings GS- good earnings HES- good earnings JNY- great earnings SLAB- good earnings SVVS- good earnings TWX- good earnings WXS- good earnings WYN- good earnings ABX- good earnings MHS- good earnings NYB- good earnings Q- good earnings Bad-The following stocks have bad news and/or a weak technical pattern ETFC- horrible revenue guidance SSW- closed on its low after poor earnings guidance VFC- bad earnings TXT- bad earnings and doing a share offering BWLD- bad earnings PNRA- bad earnings TRMB- poor earnings TSS- bad earnings JEC- closed on a low MAS- closed near a low FDP- closed near a low AET- terrible earnings ROC- bad earnings ROK- bad earnings MT- bad earnings WMI- bad earnings SAP- bad earnings X- share offering at 25.50 Earnings: WED APR 29 BEFORE ABX AEP AET AFL AMG AMT ARW ASCA AVA BDC BHI CETV CNP ENDP EOC EWBC FCN GD GT HES HST IACI JNY MCO MDP MHS MPS MT MWV NJR NVE NYB PX Q RAI RCI RGS ROC ROK ROL SEE SLAB SO SPW STR SVVS TEL TXT TWC TWX WMI WXS WYE WYN WED APR 29 AFTER AEM AIZ AKAM AMKR ANH ARRS AVB BEZ BMR BXP CAI CAVM CBG CBL CBT CCI CDNS CLF CNQR CTXS CVD DNB DPL DRC DRIV DST DTE EFII ESRX ESS FLEX FLS FORM FSLR FTI GMR GNK HAR HIW ITRI ITC JDSU KEX LPS MANT MOH NTRI O OI OII OKE ORLY OSIP PLD PLXS RE RNR RYL SAP SBUX SKX SPN STM TCO TER TRN TTEK UNM URI V VAR VARI WGL WLL WLT WSH Good luck today. Erik R. Kolodny
Arthritis. Let's hope neither of us gets it; without it, I cannot put my thoughts down and clarify my battle plan for the trading day while hopefully helping others as well. Wishing you luck nazzdack; hopefully, you can use your spare time attacking me to do something more productive in time.