The real unemployment rate is 12%. The official unemployment rate is under 5%. The real rate includes workers who are part-time, or marginally attached, and discouraged workers, all true definitions that the government really has, and monitors. But, instead, we track the “official” rate. When the true rate of 12% is analyzed we can begin to see what the economy really is. If we are able to also track the percentage of American workers earning minimum wage we can begin to see the real effect on the American economy, and how much of the wealth is “with the few.” The former Clinton administration led the “twisting” of unemployment numbers, and this was also led carefully by Greenspan.
Opacity is a Scrabbles word, but becoming much more real to economists as they analyze the collateralized debt obligations (CDO’s) around financial institutions. CDO’s have opacity, where their hyper-technical securities were fraught with dishonest labeling, or inflated values.
These false facts also hold true with the Gross Domestic Product (GDP) and many economists now argue that the recessions of 1991 and 2001 were much longer and deeper than reported. In fact, there were downturns/recession in 1985 and 1995 that weren’t even counted because of how facts were manipulated, and in 2008 we continue to watch the government argue whether we are really even in a recession.
So, if the real numbers show unemployment from 9 to 12%, an inflation rate that is really 7 to 10%, concerned voters and citizens should be considering WHY this data is not accurately reflected to us. Some economists rightly believe that the government re-calculation and suppression of this key data could hugely affect us.
For every dollar of income earned the average German saves 10% of it. For every dollar of income earned in the U.S., it appears we buy a $7500.00 plasma screen TV.
Floyd thinks credit card debt will be our next "exposure" of fraud, and be more long lasting on its effects on our financial institutions. It will be hard to get the FEDS to be our enforcers, however, as they are doing really well with the FEDS own credit card, our U.S. Treasury.
Also, a number of responses for poor trader “S” that is leaving us, one which I think articulates well how we trade:
"Floyd, I'm a structural engineer with a masters degree, I work full time in an office.
My rules for trading:
I read your update 3 or 4 times before I open my real time charts.
I do my OEX and Dow Pivot, Support and Resistance levels, then put all the information on the charts especially the Dow Projections.
I know what the PF chart levels are.
I have a watch list of quotes that include the recommended option the opposite and few others around the recommended.
I do not buy first thing in the morning, for obvious reasons, usually wait till after 10:30.
I put multiple buy orders at different levels starting small at the 1 line and larger at the 2 and 3 lines.
When filled I look to sell quick, depending on how large of a trading range the market is moving in.
I've made profit from scalping $0.50 and $1.00.
I used to look to make money on the entire move, now I just take profits from a small part of the move.
As soon as my buy orders are filled,
1/3 to 1/2 sell $1.00, another partial at 20%, and a smaller partial for a homerun, subject to change depending on market conditions and my tightness of my sphincter (sp).
Since employing my 50 cent and dollar profit taking I've notice a more calmer trading day, and a larger trading account. I have 2 accounts and since I've been with your service, I've had my ass handed to me in December and January and made it all back and more in Feb, March and now April. One account is a rollover IRA, is up 40% since the end of February when I started trading it. The other account is a smaller account that up 100% since February.
One last thing, if I haven't had a chance to look over everything, I DON'T TRADE!!!!!! I Don't Chase!!! Keep up the good work. Regards,” B
Positions could have been taken yesterday on the May640P, at 7.70.
The May 630C was not available at best buy for a new position, but remains open, hitting a high of 21.20
Straddle traders in advance of the FEDS babbles today and tomorrow...remember, it may be necessary for a larger second buy on both positions, and QUICK sell orders put in for tight profits.
And for a bit more fun, an email from Trader B on the trades 4/28:
"Floyd: Waited till this afternoon to trade the OEYQH.
buy filled 100 @ 7.9 time 3:06pm, multiple orders
sell filled 75 @ 8.5 time 3:30pm
sell filled 25 @ 8.9 time 3:54pm
$7k in less than an hour. Nice way to start the week."
Lastly a note from trader RA…
“In the May 640p @ 7.90 out @ 8.80. Quick 11% in 1 hr! Figured take the profit and run. Why stay in overnight with FOMC babble tomorrow. 10 in a row!”
For traders wanting clarification on our alerts, here's step #2:
2. Study the market conditions (News, economic calendar events, price of oil, gold…are all catalysts that lead the OEX and DJIA directionally.)
Upcoming Events/News: http://www.bloomberg.com/markets/ecalendar/index.html
(Stocks react to news irrationally. Each morning, study the news.)
Futures: http://bloomberg.com/markets/stocks/futures.html
(Futures help you gain a “read” on market sentiment and how the market will open. Use futures, in addition to reading the tape (9:32 and 9:35 am close of Dow reading) and the pivot point for that day)
Studying Fibonnaci:
Fibonnaci lines help us draw a retracement, the support or resistance areas where prices are likely to stop and reverse back to the direction of the trend. These areas can be 61.8%, 50%, and 38.2% from the nearest high of 100% or from the nearest low of 0%
Fib advocates see that any percentages above 100% are either extensions or projections of the likely price targets. Fib lines are drawn from the recent high and low, retracing back 50%, and proceeding to a projection of 127.2% and 161.9% from the 50% line.
Floyd's Question of the Day: There are 20% of Americans that continue to think Bush is doing a good job. Why? :)
The tax rebates are on their way. The economy will burst out now and all is well:)
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