Underwater Mortgage? This might help.

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Here's the link to the website. youwalkaway.com

Here's what Bailout recipient Morgan Stanley is doing: Morgan Stanley walks away from 5 office towers.

Have you recieved a bailout yet? Didn't think so. But you're supposed to keep paying like a good little sheeple.
This is a link to the most recent (and quite belated) efforts to actually help us peasants and not the banks. You'll need to be at least 20% overvalued on your home and stop making payments to qualify. Easy enough.
Government plan to help homeowners

And a recent one from the hometown..
Should you walk away?<

The common thread is a complete lack of cooperation or proactive modification on the part of the banks. For those naive honest enough to still be honoring their obligations and doing what we've done for generations in this country, you have to ask why there are different standards for our financial oligarchs than for us peasants. Unfortunately no one will even return your call until you're at least three payments behind.

Wilshire 5k...trouble ahead.

This is the weekly chart of the Wilshire 5000, which includes 5000 component stocks and as such is the broadest snapshot of the US stock market. The top horizontal line is the 62% fibonacci retrace level of the 2007 bear market, which is of vital importace in large movements. Follow along that line and you'll see the Wilshire has bounced along it several times the past decade, making it an important support / resistance zone as well. Now follow the arrows from top to bottom. The top area is the current price level of the Wilshire at 12229, a mere 214 points from the retrace line (it's already up 153 so far this week). The middle area is pointing to MACD. This should be above it's zero line when prices are rising, and below it when they are falling. Prices are still rising but this is negative...a bearish divergence. The bottom arrow is pointing to stochastics, which visually do three things..when the blue crosses the red you get a sell signal, which we've had. When they're above the midline you're in an uptrend, which we are. When they approach the very top of the window or the very bottom, it's an indication of extreme overbought or oversold, meaning things are too giddy or pessimistic. It's not often you get this many indicators to line up. Throw in the fact the Wilshire will have rallied 80% or so from the March bottom without a meaningful correction (greater than 10%) and there's a very high probability the bears will probe short and the bulls will take money off the table..at the same time. Setting us up for the long awaited correction. Game on.

"YOU CAN'T HAAAAANDLE THE TRUTH!"

Apparently not all the judges are bought and paid for. Time to find out some long overdue details about just who got the goodies and why. Court Rules Fed must disclose bank bailout records.
For the record, I believe the Fed's concern is not that the public sees astronomical sums of money being channeled to a priveleged and connected few that won the hallowed "Too Big to Fail" designation, like GMAC. I believe their concern is that it will become common knowledge that our entire banking system was and still is bankrupt. When you use 30 and 40 to 1 leverage, in a fractional reserve banking system that at best requires a mere 10% of the money being lent to be actual reserves, you're open to some rather serious losses, should the bets ever go against you. The general mark-to-market accounting principles were changed, under intense congressional pressure, to hide the severity of the losses. We now use "mark -to -make-believe" where banks value assets at what they "believe" they are worth, if sold in an "orderly" way. Think I'm making that up? Click HERE. The losses are still there. The FED has printed 1.2 trillion dollars to buy mortgage-backed securities for the last year and prop up housing prices. Why? Wouldn't lower prices spur demand and let us get through this faster? Sure it would. So you have go back to the whole leverage bomb that went off in 2008. Banks cannot have everyone ask for their money back at once because it doesn't exist..fractional reserves remember? The system works because people don't do that...usually. But if you're leveraged at 40x that amount, like Citigroup was, then it takes 40x LESS losses than before to have the same effect..which is insolvency in a hurry. And which exists now, despite all the shennanigans. The FED is dutifully taking all that toxic crap from the bank's balance sheet and moving it to...yours the taxpayer's. Freeing the banks to get back to the vital business of speculating in the stock market, raping consumers with 29% interest rates on credit card balances they can no longer pay off, paying obscene bonuses because with all the rule changes the balance sheet looks GREAT! and of course lobbying congress not to change anything. Which is why I expect the FED to fight this all the way to the supreme court. And probably win, as they're persuaded it might not be in the country's best interest to be seen as Bernie Madoff wanna-be's by the rest of the world. Even if we are.

Follow up...I wrote that a month ago. Now this. Banks threaten to go to supreme court to prevent bailout disclosure *Sigh* I need to get paid for being right...

We're not alone...

Many people I speak to regarding construction, jobs and the future are universally pessimistic down here on Main St. If the old adage "misery loves company" is true, then you might be somewhat surprised to learn how global this recession really is. Click below to see how Europe and particularly Spain is doing. You might see some similarities to us and realize "across the pond" is a lot closer than it used to be. We gotta buckle up and git er done. This has a long way to go, and there is no quick fix. Recognition of the dramatic spending cuts at the government level necessary to put us back on a sustainable growth path is vital. Unfortunately the prevailing plan seems to be we can "spend our way out of this". We spent our way INTO this boys and girls.

Europe's bruised economies

Stupid in America

This is a video on education in America, union-style. It's actually from three years ago. The more recent post is underneath it. Grab some Pepto-Bismol or Rolaids you'll be compelled to use soon and watch.


After getting suitably pissed off about public employee unions sucking the life out of America you'll need a pick-me-up. I've got just the thing..click over to MISH's blog HERE
and check out his favorite new badass Governor Chris Christie of New Jersey. He's getting it done...more power to you Christie and bravo. Let's hope the independents can keep you in over the union's objections.

Shorts on the run!

As someone with the misfortune of knowing the structural and fundamental challenges facing our economy, I've lost quite a bit trying to short this market. Rules like "Don't fight the Fed" aren't written for no reason. There is an inherent upside bias when the printing presses are running flat out, as well as some serious whup-ass being doled out on a technical level to the "non-believers" out there. Cory Rosenbloom has an excellent summation of the clockwork precision with which the liquidity-assisted bulls have systematically destroyed the bears the last year, especially after textbook "sell" signals and other presumably safe entry points for reversals. They've been anything but. Read and learn...and since we've broken 1151 on SP "Everyone back in the pool!! It's all good!". The trend is your friend..until the bend.
Bear Traps abound

A ray of hope...

I must admit I'm feeling downright positive (shaddup!) after seeing this. Zero Hedge sums it up well and I encourage you to go HERE and read Senator Ted Kaufman's open letter to the president regarding Wall St reform and the necessity of rule of law applying equally to all. We need 99 more like this but the fact we have even one is encouraging.