Top Trade Ideas for the Week of March 18, 2013: The Rest

Written By: DragonFly Capital

Here are the Rest of the Top 10:

Beam, Ticker: $ BEAM
beam

Beam, $ BEAM, went from being a possible short to a break out higher to end last week. The Measured move out of the Diamond Continuation takes it to 69. It has a rising and bullish Relative Strength Index (RSI) and a Moving Average Convergence Divergence indicator (MACD) that is moving back higher on the signal line to support further upside.

Baker Hughes, Ticker: $ BHI
bhi

Baker Hughes, $ BHI, broke up through the neckline of an Inverse head and Shoulders on Friday. The Price Objective takes to at least 55.70. It has support for continued movement higher from a bullish and rising RSI and a MACD that is moving higher on both the signal line and the histogram.

Corning, Ticker: $ GLW
glw

Corning, $ GLW, is back at resistance at 13.00 from a higher low. It moved up to it Friday on better volume and has support for continued upside from a rising and bullish RSI and a MACD that is also rising, There is also a small Inverse head and Shoulders that would trigger through that resistance with a Price Objective of at least 14.30.

Morgan Stanley, Ticker: $ MS
ms

Diamonds are supposed to be rare but Morgan Stanley, $ MS, is also in one and on the verge of a break out higher. A continued up move would target a price of 30.25. The RSI is rising and bullish and the MACD is starting to turn back higher. Both of those continuing would support further upside price action.

Vertex Pharmaceuticals, Ticker: $ VRTX
vrtx

Vertex Pharmaceuticals, $ VRTX, is building a bull flag after a move higher out of the base at 46. A break of the flag higher carries a target of 58.50. The RSI is bullish and hugging the technically overbought level with a MACD that is rising on the signal line, both supporting continued upside movement.

Up Next: Bonus Idea

The Best

If you like what you see sign up for more ideas and deeper analysis using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits feed and on chartly.

After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Saturday which, heading into next week the equity markets are becoming mixed. Outside influencers see Gold continuing to hold a range with an upside bias for any break out while Crude Oil slowly grinds higher. The US Dollar Index looks ready to pullback in the uptrend while US Treasuries are biased lower. The Shanghai Composite and Emerging Markets are biased to the downside in the near term. Volatility looks to remain non-existent keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. Their chats are a mixed bag with the IWM the strong est followed by the QQQ building potential energy and the SPY perhaps ready to pullback or consolidate. If the US Dollar Index and Treasuries continue lower this will be a big tailwind for Equities. Use this information as you prepare for the coming week and trad’em well.

Join the Dragonfly Capital Views Premium Membership

These trade ideas are one piece of the Premium Service, which is complemented by weekly trend analysis, daily earnings plays and access for personalized analysis. Sign up here to get deeper analysis and nearly 50 trade ideas every week.

Dragonfly Capital Views Performance Through March 2013 Expiry

The post Top Trade Ideas for the Week of March 18, 2013: The Rest appeared first on Dragonfly Capital.

Dragonfly Capital

Leica digital cameras tested by DxO

DxO has published a test of three very costly Leica digital rangefinder cameras, heirs to the legendary M-series of film cameras.  The results of the objective test are not pretty: “these cameras offer the worst image quality DxOMark have tested on a full frame sensor, with the exception of the 10-year-old Canon EOS 1Ds.”

The CCD sensors in these Leicas turn in numbers that are more like those of a point-and-shoot Sony RX100 and far behind the disposably-priced-by-comparison Sony NEX cameras.

Either the objective tests are missing a lot of what is important to the human eye or humans who praise the results from these Leicas in non-blind tests are highly suggestible.

Philip Greenspun’s Weblog

The Weekend Trader – Chronicles Book Update

The Chronicles of a Million Dollar Trader book progress continues as we work through the current-editing stage and finalize the edited manuscript, after which will come reviewing final page proofs. (And yes, that’s a pic of the stack of pages being refined.)

Trading and writing a blog (sometimes daily or multiple times a day) for four years seems simple in comparison as I could often use creative shorthand and no external editor was involved. Writing a professional edition that will forever stand the test of time is clearly another level!

For those of you who thought I had some degree of writing skill over the past 10+ years, think again as they’d likely flunk any editor’s grammar test. And then there’s the issue of the proper legal adjective(s) to define Jon Corzine!

Continued thanks to the entire team at Wiley including Laura, Judy, Tula, Alex, and Melissa for helping me through the process and ensuring the final product will due justice to its inspiration, Reminiscences of a Stock Operator. With their help, I feel confident we’ll achieve our goal of adding a unique and fresh perspective in terms of full accounting, disclosure and transparency which was less than optimal in Lefevre’s otherwise classic work.

Don Miller’s S&P Trading Tank

An Extended Vacation in Cyprus

Written By: DragonFly Capital

Everyone spouting that the retail depositor was thought to be sacrosanct has clearly forgotten the mood 4 years ago when intelligent people were taking all of their money out of banks, in the US. In a crisis all bets are off. All rules can be broken.

Cyprus-beach-600x450

Are our memories really that short? I was trading equity swaps at BNP Paribas at the time, or should I say pretending too, since all credit had dried up at any cost. Markets had been in turmoil, Bear Stearns had been bailed out by JP Morgan for $ 2 a share and Lehman Brothers was next. You have heard the joke how fast do you need to run to get away from a lion? Faster than your friend. The marketplace that was acting like a massive herd of lions chasing to maul the next weakest prey running away lining up Merrill Lynch, Morgan Stanley, Bank of America, Citigroup and even Goldman Sachs. There was panic clearly. I heard every possibility and every far out scheme. The most bizarre was that we would quickly turn into a zombie state so if you did not have gold bars to store wealth, a massive protective fence and lots of ammunition you would end up in a bread line like in the 1930′s. And among that panic was a growing number of supposedly intelligent people that were speculating that the Federal Government might take the drastic step of nationalizing the banking system. This gained credibility and fed on itself to the point where those supposedly intelligent people were taking all of their money out of the banks. Not just the amount to get down to the insured deposit level. But all of it. Sure you are saying that is because their bank might fail. But they did not put it in another bank. They thought the whole system was toast. 100% levy. Who was comfortable with the thought that when all the dust had settled that the little guy would be the winner? That is not how America operates. The little guy has no lobbying base. The main difference with today’s crisis, recognizing the failed liquidity of the Cyprus banks, is that we here in the US believe that the Cypriots and those with money there had no idea that a crisis was brewing because of the soothing words of their EU friends and would just sit on the beach and shrug when it happens. Do you really believe that? Have you read this from January 26th?

I do not espouse to know what is going on there or the implications for the world markets and economy with certainty. Yes the world is increasingly intertwined but we just brushed aside an $ 85 billion hit in the US right? I find it odd that some can be so certain that the markets will react with the EU down 3-4%, S&P down 1.5-2.0%, US 30 yr bond 3.05%( -15bp), Italy/Spain 10 yr +15 bps. They may be right. They may be wrong. But take it in for a moment that if they are worried these moves will impact their investment positions then they were clearly wrong about what would happen before Friday. Before this weekend the idea of an extended holiday in Cyprus would bring to mind the picture above. Please keep it real.

The post An Extended Vacation in Cyprus appeared first on Dragonfly Capital.

Dragonfly Capital

Same-Sex Marriage In Illinois? No Basis for Objection

by Linda Beale (op-ed)

Same-Sex Marriage In Illinois? No Basis for Objection

In the US today, 9 states and the District of Colombia have legalized same-sex marriages and 9 states (counting Colorado, where the legislature passed a civil union bill on March 13) have legalized some form of civil union or domestic partnership for same-sex couples. Now one of the civil union states–where same-sex couples have everything that married couples have except for the stigma of not being permitted to call their union a marriage–is on the verge of recognizing the hatefulness of that stigma and enacting a same-sex marriage statute.  Illinois’s Senate has passed the legislation.  Illinois’s House executive committee has said it supports it.  and Illinois’s governor has said he will sign it.  See Geoffrey R. Stone,Same-Sex Marriage in Illinois–Now is the Time, Huffington Post (The Blog), Mar. 15, 2013.

As Stone points out, we have come a long way in a few short years, with a majority of Americans now supporting the concept of same-sex marriage.

[W]e have changed as a society. We have come to understand that people around us — good, kind, decent, loving people — are themselves gays and lesbians. And with that awareness of individual gays and lesbians, the social view of homosexuals generally has gradually changed.

Further, any state that has created an “in all but the name” civil union equivalent of same-sex marriage has recognized the injustice of not permitting same-sex couples to have the kind of legal, committed relationship that different-sex couples can have.  But that difference–in all but name–is not insignificant.

As Stone notes:

Imagine if African-Americans could enter into civil unions but not marriages. Imagine if Catholics could legally enter into civil unions but not marriages. Imagine if mixed-race couples could enter into civil unions but not marriages. The insult, the indignity, the discrimination would be apparent to all. The same is true for same-sex couples.

And there really isn’t a good argument for refusing to remove this last indignity for same-sex
couples.  Most of the arguments against gay marriage are along the following lines–we have to uphold traditional (meaning different-sex) marriage; we want to encourage traditional marriage to encourage procreation and cprovide the “right” environment for children; we want to further the traditional “moral values” of society, etc.  These arguments don’t hold water as far as the well-being of children or the needs of society are concerned or even whether there is a relationship between refusing marriage to same-sex couples and accomplishing those goals.  They frequently amount to arguments from the religious views of those who cling to conservative religious perspectives of homosexuality as bad and same-sex marriage as prohibited by God.  Stone makes the point the following way.

In a nation committed to the separation of church and state, the government can never deny rights to some in order to appease the religious beliefs of others. During the civil rights struggle, for example, segregationists frequently invoked biblical authority for the separation of the races. The Rev. James E. Burks of Bayview Baptist Church in Norfolk, Virginia, for example, insisted that God had separated the races and that “when man sets aside the plain teachings” of the Bible and “disregards the boundary lines God Himself has drawn, man assumes a prerogative that belongs to God alone.” Similarly, discrimination against women was often justified by reference to “divine ordinance.” Such arguments have no place in the American constitutional system.

I understand and respect the strong and sincere feelings of those who think that the marriage of same-sex couples is incompatible with their religious beliefs. But they cannot legitimately or with a proper respect for the American system of law and justice attempt to impose those beliefs on those who disagree. They have every right not to marry a person of the same-sex and they have every right not to officiate at the marriage of a same-sex couple, but they have no right — no right — to attempt to prevent the government from recognizing such marriages because they offend their religious beliefs.

In my view, we Americans are too often afraid to address these points of religious bigotry, perhaps from a long association of religious groups with the struggle FOR civil rights and our knowledge that not all religions join in this charade (see link to article below, for example), perhaps from the long connection of religious leadership in communities with the communities’ political and social leadership.  People don’t like to stand out, to fail to conform to the views of those around them, so where these fundamentalist religious views dominate, people may find it hard to go against them.  Perhaps it is also because we so often  misunderstand our own Constitutional protections–for rights to bear arms, for rights to avoid unreasonable searches, and especially for the free exercise of religion. Religious liberty protections are intended to ensure that no person is denied the right to exercise his/her religious views, so long as those religious views don’t cause real harm to others. But the Free Exercise Clause is not meant to protect religious institutions by allowing them to impose narrow dogmas on society in order that  their leaders and practitioners avoid the “offense” of others’  differing religious views.

Aside:  This is one reason that I think the Supreme Court’s ruling in the ministerial exception is wrong, the Tax Code provisions excluding certain income of ministers from taxation is wrong, having a federal “faith-based organizations” office is wrong, as is the concept recently in the news in connection with Obamacare that Catholic institutions shouldn’t have to provide the same health care–including abortion and birth control coverage–to all its employees who want it as other entities must do. ]
The Free Exercise Clause protects each American as an individual to provide that person the liberty to exercise his/her faith as s/he sees it (or not).   But not to impose his/her views on others.

cross posted with ataxingmatter


Angry Bear

STTG Market Recap Mar 15, 2013

The Dow’s winning streak finally came to an end Friday as the DJIA suffered its first loss of the month, albeit a minor one of 0.17%.  Meanwhile the S&P 500 and NASDAQ dropped 0.16% and 0.30%.  It was a quiet session as the market seems to be in a bit of a zombie mode.  The only major economic reports were consumer prices (the highest in 3 years) and a consumer confidence report.  Both were not what the market wanted – the only thing in theory that would slow down the Fed other than a return to good employment numbers is high inflation.  That said a lot of the increase was due to gasoline hikes and the Fed tends to ignore food and energy and focus on what is called core inflation.  And the consumer confidence numbers came in quite low versus expectations (and the lowest since Dec 11); that said this figure normally does not mean much to the market other than for a few hours.

The indexes remain in their ascending channel – nothing new here.

The Fed announced the second part of its “stress test” on the banks and a few names turned out big winners, one has been Wells Fargo (WFC) which has made a major move for such a large company.

Wells Fargo raised its quarterly dividend to 30 cents a share from 25 cents and said it had received Federal Reserve approval for “a proposed increase in common stock repurchase activity for 2013 compared with 2012,” when the company’s share repurchases totaled $ 4.0 billion.

Apple (AAPL) jumped over the $ 440 level which has been resistance for the month of March; while the intermediate term chart is quite broken in the near term this might be of some significance.

For those looking for a Investor’s Business Daily “cup and handle” type of setup, real estate company Realogy (RLGY) – parent company of Century21 and Coldwell Banker, appears to be breaking out of one Friday.

Last, some interesting data points from SentimenTrader as sentiment readings remain at extremes – granted, they have been so for many weeks now.

This week has brought out some additional optimistic sentiment among several longer-term gauges.  Among them are two surveys focused on investment newsletters, from Investor’s Intelligence and Hulbert Financial Digest.  According to I.I., of those expressing an opinion, 73% of letters expect the stock market to rise going forward, the highest proportion in nearly two years.

Hulbert Financial Digest uses a different methodology, but they still show extreme optimism.  That firm shows that nearly 68% of respondents expect a rising market.  That’s also the highest in two years, and close to the highest dating back to 1997.
When we combine those two, the average Bull Ratio comes out to 70%.  That’s one of the very highest readings in 16 years. All of the other weeks that match the current reading are highlighted in the chart above.  The S&P 500’s returns in the weeks and months following them are shown in the table below.

Original post: STTG Market Recap Mar 15, 2013


Stock Trading To Go

SPY Trends and Influencers March 16, 2013

Written By: DragonFly Capital

Last week’s review of the macro market indicators suggested, heading into the March Options Expiration Week that the equity markets were feeling a bit euphoric. Elsewhere Gold ($ GLD) looked to continue to consolidate with a downward bias while Crude Oil ($ USO) slowly decided if it wanted to move back higher. The US Dollar Index ($ UUP) seemed strong like a lion while US Treasuries ($ TLT) played the part of the lamb. The Shanghai Composite ($ SSEC) was set up to continue to trend lower in the longer scale uptrend while Emerging Markets ($ EEM) consolidated with a bias to the upside. Volatility ($ VIX) looked to remain very low keeping the bias higher for the equity index ETF’s $ SPY, $ IWM and $ QQQ, despite the strong moves higher recently. A reversal in US Treasuries could derail the Equity rally and it would not be a surprise if the SPY and IWM consolidated or pulled back a bit in their trends higher.

The week played out with Gold consolidating but with an upward drift while Crude Oil continued its drift higher. The US Dollar finally met some resistance in its move higher while Treasuries consolidated their move lower. The Shanghai Composite moved lower before bouncing to wend the week while Emerging Markets gave up their gains, breaking lower. Unhappy with its life as a teenager Volatility moved lower to become a pre-teen. The Equity Index ETF’s SPY and IWM continued higher with the QQQ stuck under resistance, perhaps holding everything back. What does this mean for the coming week? Lets look at some charts.

As always you can see details of individual charts and more on my StockTwits feed and on chartly.)

SPY Daily, $ SPY
spy d
SPY Weekly, $ SPY
spy w

The SPY nudged higher Monday and then consolidated all week. There was a bump Thursday that could have been related to moving to ex-dividend before it pulled back to that zone Friday. There are some cracks in the daily chart that suggest a pause or pullback. The Relative Strength Index (RSI) is pulling back from the technically overbought area with a Moving Average Convergence DIveregence indicator (MACD) that is rising but nearing extreme levels on the signal line and the histogram is starting to fade. Looking out at the weekly chart the move higher over the rising wedge is continuing but with a RSI that is now technically overbought. It can run higher but caution is advised here. The MACD on this timeframe is also getting to extreme levels on the signal line but the histogram is growing. Cautiously positive. There is support lower at 155 and 153.25 followed by 150. Resistance is now at 156.80 and then the all time high at 157.52 before a Measured Move higher to 159 followed by 177. Continued Upside with a Chance of a Short Term Pullback.

Heading into next week the equity markets are becoming mixed. Outside influencers see Gold continuing to hold a range with an upside bias for any break out while Crude Oil slowly grinds higher. The US Dollar Index looks ready to pullback in the uptrend while US Treasuries are biased lower. The Shanghai Composite and Emerging Markets are biased to the downside in the near term. Volatility looks to remain non-existent keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. Their chats are a mixed bag with the IWM the strong est followed by the QQQ building potential energy and the SPY perhaps ready to pullback or consolidate. If the US Dollar Index and Treasuries continue lower this will be a big tailwind for Equities. Use this information as you prepare for the coming week and trad’em well.

Use this information as you prepare for the coming week and trade’m well.

Join the Premium Users and you can view the Full Version with 20 detailed charts and analysis: Macro Week in Review/Preview March 15, 2013

The post SPY Trends and Influencers March 16, 2013 appeared first on Dragonfly Capital.

Dragonfly Capital

How to get an unrestricted gun permit in Boston: go to law school

A friend of mine who lives on Beacon Hill recently upgraded his gun permit, notoriously hard to get from the Boston Police Department, to be almost completely unrestricted. He can’t buy and carry a machine gun but otherwise he can walk around with a high-capacity pistol any time and more or less any place except some college campuses that ban guns.

How did he do it? “It turns out the legislators didn’t want their laws against gun ownership to apply to them. Nearly all of them are lawyers so they set it up so that if you have  bar association card you can get an unrestricted permit. They thought it would look bad if they exempted only legislators.”

Philip Greenspun’s Weblog

Video Review of the Indexes 10-21-2012

Here’s a rundown of the major averages as they currently stand, along with the key levels they’re dealing with as we head into a brand new week of trading.  The trading week begins here for me, knowing the impact the indexes will have on how individual names move.

Run time is 7:24.

(Direct video link is here for those interested in embedding it elsewhere to share).

Trade Like a Bandit!

Jeff White
Take a trial to our Stock Pick Service to get our trades.


TheStockBandit.net

Top Trade Ideas for the Week of March 11, 2013: The Rest

Written By: DragonFly Capital

Here are the Rest of the Top 10:

Bank of New York Mellon, Ticker: $ BK
bk

Bank of New York Mellon, $ BK, is breaking higher over resistance at 28.25 after moving p off of the 50 day Simple Moving Average (SMA). It has support for a move higher from a rising and bullish Relative Strength Index (RSI) and a Moving Average Convergence Divergence indicator (MACD) that is turning up and just crossed to positive on the histogram. Both support further upside.

Cerner, Ticker: $ CERN
cern

Cerner, $ CERN, is consolidating the move higher from the 20 day SMA in an ascending triangle under 93. The Measured Move higher over the triangle takes it to 95 and then 101. The bullish RSI and the rising MACD support further upside movement.

Cummins, Ticker: $ CMI
cmi

Cummins, $ CMI, fell back from consolidation to the 50 day SMA before rising back to the at level. It has a rising and bullish RSI and a MACD that is curling up on the signal line and positive on the histogram to support more upside.

Edwards Lifesciences, Ticker: $ EW
ew

Edwards Lifesciences, $ EW, consolidated a move lower at 85 before rising to end last week. Now at resistance it has a RSI that is rising and bullish and a MACD that is moving back higher on the signal line and positive on the histogram to support further upside. A move over 95 sends it into the gap higher.

Ford, Ticker: $ F
f

Ford, $ F, pulled back from a top in January and bottomed at 12.102 weeks ago. Now rising again it is nearing the 50 day SMA and resistance with support for a move higher from a rising and bullish RSI and a MACD that rolling back higher on the signal line and positive on the histogram.

Up Next: Bonus Idea

The Best

If you like what you see sign up for more ideas and deeper analysis using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits feed and on chartly.

After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Saturday which, heading into the March Options Expiration Week sees the equity markets feeling a bit euphoric. Elsewhere Gold looks to continue to consolidate with a downward bias while Crude Oil slowly decides if it wants to move back higher. The US Dollar Index seems strong like a lion while US Treasuries play the part of the lamb. The Shanghai Composite is set up to continue to trend lower in the longer scale uptrend while Emerging Markets consolidate with a bias to the upside. Volatility looks to remain very low keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ, despite the strong moves higher recently. A reversal in US Treasuries could derail the Equity rally and it would not be a surprise if the SPY and IWM consolidated or pulled back a bit in their trends higher. Use this information as you prepare for the coming week and trad’em well.

Join the Dragonfly Capital Views Premium Membership

These trade ideas are one piece of the Premium Service, which is complemented by weekly trend analysis, daily earnings plays and access for personalized analysis. Sign up here to get deeper analysis and nearly 50 trade ideas every week.

Dragonfly Capital Views Performance Through February 2013 Expiry

The post Top Trade Ideas for the Week of March 11, 2013: The Rest appeared first on Dragonfly Capital.

Dragonfly Capital

… to Hold “Untouchable” Fraudsters Accountable

By Jeff McCord, The Investor Advocate

Take Lincoln’s Approach to Hold “Untouchable” Fraudsters Accountable

Within recent months, two media events captured the attention of many Americans: the premier of the Spielberg movie “Lincoln” showcasing the 19th century federal government’s ability to end our nation’s crime against humanity; and, the airing of the PBS Frontline series (“The Untouchables”) showcasing the inability of the twenty-first century federal government to prosecute those responsible for our nation’s largest financial crime spree.

Now, the public watches mindless budgetary slashing of federal regulatory agencies – already underfunded and understaffed – charged with enforcing civil and voting rights and financial laws. And this “sequestration” proceeds at a time of widespread attempts to suppress people of color’s ability to cast ballots in federal elections, and financial fraud and abuse robbing and cutting the savings and assets of tens of millions of Americans.

Half Billion Dollars to be Cut from Fed Investor Protection, Law Enforcement

Aside from federal civil and voting rights programs, investment law enforcement agencies and commissions on the chopping block include the Securities and Exchange Commission (a possible $ 115 million reduction), Commodity Futures Trading Commission ($ 17 million), federal courts ($ 384 million at risk), Public Accounting Oversight Board ($ 18 million) and the Securities Investor Protection Corporation ($ 23 million). In sum, $ 557 million could be cut from investor protection programs, barring Congressional intervention. For more, see Appendix A of the Office of Management and Budget report issued September 15, as required by The Sequestration Transparency Act of 2012

In this environment of federal inaction and cut-backs, it has never been more important for private citizens and investors to be given the legal tools and authority to protect themselves.

Lincoln Knew How to Deter Fraud: Hit Wrongdoers in their Pocket Books

During the Civil War, Lincoln adroitly dealt with rampant fraud by Union Army contractors by empowering ordinary citizens with knowledge of the crimes to take civil action against wrongdoers on behalf of the government and themselves. Often called the “Lincoln Law,” the federal False Claims Act was modernized in 1987, with Republican Senator Charles Grassley leading the effort. Since then, whistleblowers acting under its authority and protection have recovered more than $ 40 billion of taxpayer money otherwise lost to fraud and abuse against federal and state governments.

Nine billion dollars was recovered by citizens blowing the whistle during just one year (2012). Compare that with the Securities and Exchange Commission’s total of only $ 2.6 billion in funds recovered for investors from financial wrongdoers during the past three years during which people on “Main Street” have become painfully aware of their being fleeced by Wall Street.

What’s good for the taxpaying public would also be good for the investing public whose own personal funds are on the line. Although the withering federal government portion of the nation’s GDP (7 percent in 2012) is surprisingly close to the financial services industry’s contribution (5 percent), citizens can take very effective action against thieving federal contractors, but remain vulnerable against those who rob them of their homes, savings and investments.

Private Class Actions Recovered Three Times More for Investors than SEC
True, citizens can and do band together into class action lawsuits to take action against financial robber barons and such civil actions have won $ 7.9 billion from wrongdoers in the past three years – three times the amount the SEC recovered during the same period. (See: here)

But, the class action remedy has been under an unremitting attack by corporate and financial lobbyists for almost two decades and has been trimmed and nearly hobbled by Congress and the Courts, with some notable exceptions, during the very period that may best fit Lincoln’s prophesied “era of corruption”:

“I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country….corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed.”

Corporations and Lincoln

So, where are we to turn to recover some of the wealth wrongfully “aggregated” from the many by the hands of the few?

Restore Private Accountability for Aiders and Abettors of Investment Fraud

Certainly, securities class action lawsuits filed by pension funds, retirement plans and individuals against corporate and financial wrongdoers will continue to recover investor losses and nip at the heels of Lincoln’s “money power.” Private class actions could accomplish more to deter fraud and recover investor losses if Congress would overturn a misguided Supreme Court decision by restoring private liability for those who knowingly aid and abet securities fraud.

One early version of the Dodd Frank legislation would have done just that. Banking and accounting industry lobbying, however, killed that provision. Restoring accountability for aiders and abettors is a no-brainer that Congress can still accomplish.
Fortunately, the final Dodd Frank Act did provide an opening for authorizing a “Lincoln Law” providing financial whistleblowers with the policing power to help hold Wall Street accountable and recover ill-gotten gains.

SEC Takes “No Further Action” on Majority of Whistleblower Leads

Congress provided for a “whistleblower” program within the Securities and Exchange Commission enabling people with inside information to contact the Commission. Those providing leads retain anonymity and can win monetary rewards. Despite receiving more than 3,000 leads in 2012, however, only one whistleblower has won an award ($ 50,000, an amount only equal to an annual bonus for a relatively low level Wall Street employee).

In any event, the SEC takes “no further action” on 69 percent of whistleblower complaints, according to a recent report by the SEC’s Inspector General. The most common leads reported to the SEC relate to fraud and abuse in areas of systemic wrongdoing largely responsible for the financial meltdown: corporate disclosures and financial statements (18.2%); public offerings (15.5%); and, market manipulation (15.2%).

Powerful Senators (and the Public) Frustrated

The comments of two frustrated Senators during a 2010 hearing demonstrate that some powerful Members of Congress do understand what the public understands: big financial services malefactors are virtually “untouchable”:

Sen. Carl Levin (D-Michigan): “I believe in a free market. But if it’s going to be truly free, it cannot be designed for just a few people. It must be free of deception. It’s got to be free of conflicts of interest. It needs a cop on the beat, and it’s got to get back on Wall Street.”

Sen. Charles Grassley (R-Iowa): “If heads don’t roll, nobody makes any changes. I’m disappointed that in all of the wrongdoing that went on and all the fraud that went on, that there wasn’t an effort to go after bigger fish than the evidence shows they [federal government] went after.”

Transcripts PBS

Well, heads haven’t rolled Senator Grassley and, Senator Levin, there is still no effective cop on the Wall Street beat.

Congress Should Trust and Empower Lincoln’s “People”

Now, its time for Lincoln’s “government of the people, by the people and for the people” to actually empower the people.

First, Congress should restore the right of people to hold accountable those who knowingly aid and abet frauds that rob them.

Next, Congress should enact a real financial “Lincoln Law” empowering whistle blowers with the tools to catch the “big fish” on Wall Street and make them pay back what they have stolen. And, recoveries should be returned to the investors harmed by the underlying fraud and abuse whistleblowers uncover.

The False Claims Act now on the books authorizes treble damages for those who defraud the government, providing a real deterrent. Moreover, the whistleblowers (termed “relators”) who win their civil actions against fraudsters can be awarded up to 30 percent of funds recovered – a powerful incentive for Wall Street managers who know where the bodies are buried to go after big time wrongdoers.

Time for a Financial False Claims Act

A “Financial False Claims Act” should do the same by authorizing Wall Street whistle blowers to take actions independent of often conflicted government regulators against fraud perpetrators “too big to jail.” Such a law could also authorize the government to intervene in support of such civil actions, if they wish to do so. This is how the False Claims Act works.

Unfortunately, worried that a real whistleblower law could complicate the SEC’s program, the Commission’s inspector general has concluded that it is not the time to:

[empower] whistleblowers or other individuals . . . to have a private right of action to bring suit . . . on behalf of the government and themselves, against persons who have committed securities fraud.

SEC audits inspections

If not now, when?


Angry Bear

Anthony Kennedy and Antonin Scalia Say the Confederacy Won the Civil War and the Purpose of the Reconstruction Amendments Was to Reinforce Rather Than Diminish State Sovereignty. (Except on Affirmative Action, the Second Amendment, and Real Estate Property “Takings.”)

Leaving race aside for the moment (did someone mention that the Voting Rights Act has something to do with empowering black voters – who just might, for some strange reason, prefer Democrats?), what the court’s conservatives seem to see in Section 5 is a threat to state sovereignty — the “sovereign dignity” of the states, a phrase Justice Anthony M. Kennedy has used in another federalism context. This theme ran throughout the argument. Justice Scalia referred to Section 5 as imposing “these extraordinary procedures that deny the states sovereign powers which the Constitution preserves to them.” Justice Kennedy asked whether “if Alabama wants to acknowledge the wrongs of its past, is it better off doing that if it’s an independent sovereign or if it’s under the trusteeship of the United States government?”

A Big New Power, Linda Greenhouse, The New York Times, today, discussing the Feb. 26 argument at the Supreme Court in a case challenging the continuing constitutionality of the Voting Rights Act


Just so you know, the main Reconstruction Amendment at issue in Shelby County, Ala. v. Holder, the Voting Rights Act case–the 15th Amendment–provides in full:

Section. 1. The right of citizens of the United States to vote shall not be denied or abridged by the United States or by any State on account of race, color, or previous condition of servitude.

Section. 2. The Congress shall have power to enforce this article by appropriate legislation.


That language in Section 2, giving Congress the “power to enforce this article by appropriate legislation,” is standard Constitutional Amendment language.  It appears also in the other Reconstruction Amendment at issue in Shelby County–the 14th Amendment–a five-section amendment, the two relevant ones which read:

Section. 1. All persons born or naturalized in the United States and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Section. 5. The Congress shall have power to enforce, by appropriate legislation, the provisions of this article.


Section 1, but not Section 5, also, as it happens, is at issue in the other culture-wars blockbuster Supreme Court case this term, Fisher v. The University of Texas, a.k.a., the big affirmative-action-in-state-university-admissions-policy case.  

John Roberts will write the 5-4 opinions in both cases.  In Fisher, he and Kennedy will agree that the Union won the Civil War, and that the three Reconstruction Amendments–the third one, the 13th Amendment, actually being the first of the three; it abolished slavery–did not, after all, flip the Supremacy Clause in Article VI, Clause 2.  It said (and the 5-4 Court majority will confirm in Fisher) still says:

This Constitution, and the Laws of the United States which shall be made in pursuance thereof; and all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the constitution or laws of any state to the contrary notwithstanding.


But Fisher was argued early in the Court’s term, in October, and probably will be decided before Shelby County. So Roberts & Kennedy & Co. will be able to clarify very quickly that–as Kennedy, Thomas and the others routinely and unselfconsciously, and without explanation–say, states are sovereigns.  Not that states have some but not all the attributes of sovereigns; no, that states are sovereigns.  And so, the Supremacy Clause notwithstanding, states need not comply with federal constitutional or statutory law.  Except, of course, on issues important to 1980s-90s Republican White House, Justice Department and judicial appointees.  

These folks have a list, and they are checking off each item on it, even when that means that in the very same Court term they’ll casually flip the Supremacy Clause back and forth. As it will this term.  Christmas will come in May and June this year.  Or at least Santa Claus will.

Federal trusteeships of states are, it will become clear by the end of this Court term, constitutional only when the trusteeship is of a state, such as Texas, whose legislature enacts a statute that butts up against a 1980s-’90s-era rightwing cause célèbre–a bullet point on the list.  Federal trusteeships of states are clearly unconstitutional, however, when the trusteeship is explicitly authorized in the Constitution itself, as it is in Section 2 of the 15th Amendment, but the explicit authorization is itself on the list.  That’s because, then, it turns out, that despite appearances–i.e., the language in the Amendment itself–the purpose of the 15th Amendment was not to make the states’ racial-minority citizens better off vis-à-vis the states, but apparently, as matter of historical fact, the opposite.  

Who knew?  Other than the Republican far-right, that is?  

Not me, and probably not you.  You probably learned, incorrectly, back in U.S. History class that the Reconstruction Amendments were added after the Civil War in order to make the states’ racial minorities better off vis-à-vis the states.  But, then again, you also probably learned that the Confederacy lost the Civil War.  Even those of you who went to upscale suburban schools or to fancy private ones.  Well, those of you who took that class pre-1980s, anyway.  But we’ll soon be disabused of that misconception, in a high-profile Supreme Court 5-4 opinion that will be simply the denouement of a decades-long juggernaut by a bizarre cadre of legal wingnuts who have gained a stranglehold on the American judicial system to deny that the Confederacy did not win the Civil War.  

Sort of like the Tea Party congressional delegation’s decision to deny the result of last November’s election, but with no near-term reversal possible in 2014.  Only an unexpected vacancy on the Court will do that.  

Meanwhile, if Alabama wants to acknowledge the wrongs of its past, it will be better off doing that if it’s an independent sovereign rather than if it’s under the trusteeship of the United States government.  Which is good, since Alabama surely will want to acknowledge the wrongs of its past. (Assuming, of course, that constitutional wrongs were committed in the past, which in this case presumes facts not in evidence at the Supreme Court on the day of the argument in Shelby County.  Including the fact that that Section 1 of the 15th Amendment eliminated the concept that the right to vote is a racial entitlement.)
I suggest a statue.  And as an independent sovereign, which “it”–the intended beneficiary of the 15th Amendment–is better off as, Alabama might decide to erect one.  


But these extraordinary procedures that deny the states sovereign powers which the Constitution preserves to them apply only to extraordinary procedures enacted by Congress.  They do not apply to extraordinary procedures in the Supreme Court.  Such as the one in which the Reconstruction Amendments are rewritten, right along with Civil War and Reconstruction-era history.  

I do have a suggestion for Texas, though, just as I have one for Alabama, since, when Texas, like Alabama, wants to acknowledge the wrongs of its past, it will be better off doing that if it’s an independent sovereign rather than if it’s under the trusteeship of the United States government.  

Again here, I suggest a statue–this one honoring all the white Texas high school seniors who narrowly missed the cut to gain admission to their state’s flagship university since the current state statute and its predecessor statute were enacted.  


Angry Bear

Join Corey Tuesday for a Spotlight On Webinar with TradeStation

I’m excited to announce that I will be presenting a webinar Tuesday March 5 after market close as part of the  “Spotlight On…” series from TradeStation and would like to invite you to join us!

The educational webinar will take place March 5th at 4:30EST / 3:30pm CST and I will discuss my strategies for evening analysis and intraday trading tactics.

All are welcome to attend and you can register directly at the Spotlight On webinar link for Tuesday’s event.

Organizing Your Trading Day, from Game Planning to Day Structure

Corey Rosenbloom, CMT explains how to structure your trading day by assessing specific information, from pre-market activity and the opening gap through the first hour and the remainder of the trading day.

He will also discuss how to develop a game plan in the evening to organize your expectations for the next trading day.

In this session, you will learn:

  • How to create a game plan in the evening to apply on next trading day
  • How to distinguish in real time between a range day or trend day developing for the session
  • The types of trades that work best on trend or range days

These factors are important for creating a context in which to execute your real-time trades (so that we’re not just taking random trades throughout the day).

The Spotlight On Webinar will serve as a reference for how I prepare for each Tuesday morning’s “Morning Market Briefing” at TradeStation and implement the strategies through specific time-markets during the day.

TradeStation offers free access each morning pre-market at 9:00am EST/8:00am CST for 30 minutes of commentary and analysis of what’s shaping up to be in focus from a news and trading standpoint for the trading day ahead.

You do not have to be a TradeStation member to attend the briefings but you do need to register to attend.

Feel free to join me each Tuesday morning to set-up the trading day, along with the other presenters including Linda Raschke, Scott Andrews, Bennett McDowell, John Person, Sam Seiden, John Carter, and Hubert Senters.

Thank you to TradeStation for these opportunities and I look forward to seeing you there!

Corey


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