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Quote of the Day

Thursday, April 19, 2012

April 19, 2012 -- "The greatest threat to our Constitution is our own ignorance of it." Jacob Roecker, author.


I show the VIX below, often referred to as "the fear index." The VIX tends to rise as investors' fears rise regarding coming events in the market. Note the long decline of the VIX during 2010 as investors were increasingly complacent. Then in March the VIX shot up as the stock market crumbled. Again in July the VIX surged to over 47 as the market sank into a vicious bear market.


Starting in August the VIX headed down again as investors' nerves settled down. The VIX hit a low in April. But the latest reading is a sudden surge above the 50-day MA. This suggest that investors are getting a bit nervous again, and that some rocky weather may lie ahead. I think hat the dividing line for the VIX is around 25. If the VIX climbs above 25 I take it as a sign of forthcoming trouble. The latest VIX is around 18.23 -- basic complacency, but the complacency has probably dropped as low as it's going to go. "After the calm comes the storm."




Car business -- Volkswagen aims to be the world's biggest seller of cars by 2018. Their division, Audi, has decided to go into performance motorcycles business and is about to buy Ducati. One of the principal owners of Ducati (do you believe this?) is Hospitals of Ontario Pension Plan.


Ford's CEO has admitted that batteries make up one-third of the cost of their electric cars. The batteries cost $12 to $15 thousand a piece for the type of car (the Focus) that Ford sells for around $22,000. Ford says its Focus can go up to 70 miles on a single charge. It takes about 3.5 hours to charge their batteries on a 240 volt wall charger.




My PTI was down 6 at 6382. The moving average at 6370, so my PTI is bullish by 12.


The Dow was down 66.65 to 12964.10.


Transports were down 74.89 to 5228.72.


Utilities were down 1.55 to 456.51.


NASDAQ was down 23.89 to 3007.56.


S&P 500 was down 5.64 to 1385.14


There were 1246 advances and 1766 declines on the NYSE.


There were 72 new highs and 41 new lows.


Total Volume on the NYSE and associated exchanges was 4.1 billion.


Bonds: Yield on the 10 year T-note was 1.968. Yield on the long T-bond was 3.121. Yield of the 91 day T-bill was 0.071%.


Dollar Index was up 0.02 at 79.56. Euro was up 0.06 at 131.36. Yen was down 0.34 at 122.83. Currency Prices as of 1 PM Pacific Time.

June gold was up 1.80 to 1641.40. May silver was up 0.29 to 31.79.


June light crude was down 0.40 to 102.72.


My Most Active Stocks Index was down 5 at 299.


The Big Money Breadth Index was down 8 at 1024.


CRB Commodity Index was down 0.15 at 299.30.


The VIX down 0.42 at 18.22.


Permanent Portfolio Fund (PRPFX) was down 0.11 to 48.23 (previous day closing). YTD Return: 4.64%.


Late Notes -- A nervous Dow bounced around during most of the day. An hour before the close the Dow was down 113, but then came the "end of the session fooler." A very late rally took the Dow back to the minus 60s, with the Trannies down about 74.


And the story continues, neither the bulls nor the bears have any real conviction about the market trend, and the proof lies in the erratic vacillations of the market.


Today -- advancing issues on the NYSE was 1246 while declining issues were 1766. A poor performance on the part of breadth. 72 new highs and 41 new lows. Not impressive either. One of these days we'll get some harmony from this market, but which way the harmony flows is still an open question.


As for my PTI, it's been floating around like the market. But for the record, we got a minus 6 for the PTI today. I must say this is a most unusual period. It's not often that I've seen a market this "unsure" and this confused.