Here is a small quote from a book I am currently using as a reference
for the 1974 - 1991 18 year real estate cycle. It sort of jumped out
at me. The quote is describing the banking deregulation that went on
after 1980 in a Reagan led US economy, but i think you will see its
relevance to today at the end.
"Deregulation was not new to Texans. They had significantly liberalized
regulations for state chartered banks in 1972 and again in 1981. In
addition, banking had for years been done differently in Texas. Typical
features of the state banking business included risk-taking, wheeling
and dealing, and domination by an old-boy network that had close ties to
the most powerful Texas politicians. When oil prices went from $7.64
per barrel in 1975 to $34.50 per barrel in 1981, the Texas economy
boomed, building permits quadrupled, and Texans thought they were
You might note that is 30 years ago, and banks fueled a feeding frenzy
on the ever increasing real estate prices, based on an oil price that
seemed to be going only one way - up. It did of course turn
eventually. A repeat is underway currently you can be sure.
These emails are sent as an extension of classes so that participants
can see the Gann stuff as it unfolds in front of you. Here is a stock
to do just that:
bso has made what looks like a high, Sept 8. This gives you the date
to be watching for December, 90 degrees later, as a high, and sell point
as the stock goes ex div. (See also how this relates to prior
Decembers). Now we watch for a good buying signal - break of sideways
move next month say, or good date for a low 30 degrees from sept 8 say,
or whatever else develops. Just watch how the pattern unfolds, and
strategise from there. The stock tops out every June and December, 180
degrees apart. Do not hold for the dividend.
I hope you have all managed to study the price overbalance on jbm, Aug
16 down to Aug 19. This was one of Gann's greatest insights into the
behaviour of markets. A retracement to the mid point usually takes
place after this. May and September are low months for this stock. All
good gann stuff. The longer term (weekly and monthly) trend is still
up however. In a perfect world, it would be nice to see Rinker, rin, do
something similar in about two year's time, to tell us that US building
activity is leveling out, (the market should see this via earnings, and
price it in beforehand) in time for US land prices to do the same a year
after that, then ready itself for the inevitable bust after that. Mere
speculation so to speak at present, we will have to see what develops.
Money looks to me like it is starting to flow back into bio tech stocks
after quite a drought and down or sideways moves, and recently, some
overbalances to the upside. Reviewing a list of such stocks would be
useful at this time - see what you think yourself and act accordingly.
(bno, bit, cmq, eif, ept, mbp, to name a few of interest).
These stocks are spec's though, not investments. And there is also a
lot of rubbish in this sector, so don't let that fool you either. And
of course we continue to ignore any stocks with prices still below their
moving averages. Perhaps confirming the revival however, may is back in
the new highs list...
't force trades when the stock you are charting - jum - goes
listless. Watch and wait, and follow something else meantime.
Have the property developers now had their larger time frame (monthly)
mid point retracements, with 2001 as the base ?
eg, twd, vwd, alz
more trend up in my view, but slowly
Some very interesting writing out of the US the past week as we
commemorate the 48th month of 9/11.
See also in the same paper the article "Taking stock of the forever war"
by Mark Danner. This perhaps gives us a reason why melb gets a
reference as the new target. (Should I come back ?)
See also the Washington Post, "9/11 and counting" Read them with
counting dates in mind.
The commemoration for 60 months will be much larger and more noticeable
than this one just gone. 5 years. Gann picked this up as operative for
stocks as well.
As to the New Orleans events:
You will recall that I have been suggesting for some years that the US
real estate cycle has to run approximately 18 years and that events will
happen to make that so. Now the building of temporary shelter cities
will take place, (awarded in no-bid contracts to big donors to past Bush
campaigns I might add) then the rebuilding of New Orleans itself. Good
signs of a peak in the making. The Fed will have to accommodate this by
not lifting interest rates too much, the last thing they want this year
or next is a rate induced slowdown.
Meanwhile, the looting of the state by companies like Halliburton goes
on. Anyone like a peace activist trying to bring it to a halt is
arrested under new anti-terror laws. What are we really being protected
and finally, a golf lesson:
I saw a report the other day, despite the use of balls that fly farther
than ever before, materials making irons lighter and easier to swing,
ergonomically engineered putters to strike and roll the ball more
precisely than before, more and better maintained gold courses,
instruction more affordable and more plentiful than ever, larger woods
(now metal as well) with even bigger alleged 'sweet' spots, and now even
a better tee redesigned to allow the ball to soar longer and straighter,
the average score for all golfers playing 18 holes has not changed. For
hackers like you and me that average remains around 100, as it has for
Say the pros: "We are all still walking a round of golf with the same
mental demons" Traders can relate to that one. "A 4 foot putt to win
remains exactly that, 4 very long feet..." As any golfer will tell you.