Tea leaves, cont.

Markets in general in deflationary trends. Todays ruling by the Supremes is a victory for the Dems and a loss for the Anarchists. So todays move down in the stock markets is being blamed on the ruling. I doubt the connection, but politics is rampant.

If there is a connections between the general deflationary bias to the markets and the ruling on Obamacare it must be the realization that somehow as a nation we will have to take care of our aging citizens. The fact is that the demographic trend is for an aging population. And the debate over how to pay for, or not pay for, healthcare is the result of that demographic trend.

To my eyes the debate is about taking care of our parents, grandparents, and ultimately OURSELVES as we get older. Or leaving their care and wellbeing to "the markets", and shareholders preferences. And of course we know where the desires of shareholders lie!

But I would point out the difference between a shareholder and a stakeholder. While many of us are shareholders in the stock or bond markets, all of us are stakeholders in the outcome of the provision of healthcare in this country. If you are young you may not feel like you get anything out of a provision that requires you to buy insurance. But with a little luck you will get old. And as the young turn old the moneys that were "saved" by insurance premiums are returned. This may be a hard concept to grasp. But the money that pays for the bills today, in lieu of debt, is a credit to the future. If we had payed our bills in the past the country would not be in the precarious position it is today. The booms would have been attenuated or would not have happened, so the "growth" wouldn't have happened. But the dollar would have retained it's value and we would not be in debt. So todays tax is tomorrows credit.

Enough of that.
The subject of todays post was supposed to be: " Why I read charts".
So here it is. In past posts I gave notice when I thought I saw significant days of selling or buying and significant volume associated with those days. Time passes and then the significance of those days becomes apparent. Here are some charts with notes. As far as the HOG thing goes we will have to wait and see if it is indeed a prediction for the fate of the smallcaps. But the whole demographic thing ties in there! And that explains the general trend of the bond market. (Note: as soon as I take notice of a trend there will be a violent countertrend move!LOL)

I am not impressed with the selloff today. Nor with the volume in the bonds. (TLT) We may see a sharp rally. Even if Europe dissapoints this weekend.... But.
Control risk. Cut your losses short. Let your winners run. And trade with the trend.(dont listen to bottompickers like me!!)
gh