A hammer is simple, cheap, easy to use, effective, and reliable. But you can no more paint with it than you can make money owning stocks on the way down. 

True genius resides in the capacity for evaluation of uncertain, hazardous and conflicting information.

-- Winston Churchill

Chartz and Table Zup.

Click onna charts below....
What the charts are and what it suggests to me latter this weekend...

OK, it's later....

The first chart is of banks Bank of America, Citibank,and Wells Fargo, mortgage originator Countrywide Financial, and full service financial/broker E Trade Financial.

What we're lookin' at is the kick in the crotch of the subprime/credit crunch of May and August.

Countrywide and E Trade are drowning in mortgage debt. Citibank is bowed under way too much mortgage debt and some other credit issues. Bank of America screwed up a good thing by buying a sizeable chunk of Countrywide a coupla months ago, effectively buying into the mortgage disaster. Wells Fargo, a bank that is well run and is currently not deeply involved in the mortgage crisis, is none the less operating in an industry under the strain of mortgage debt. All of these banks, even Wells Fargo, are NOT able to operate as freely as in the past. There is a credit crunch goin' on and it'll cramp the style of the survivors. A recession is looking more likely by the day.

The second chart is of Ginne May and Freddie Mac, the Government Sponsored Entities (GSE) that purchase, package, sell and guarantee timely payment of principal and interest on federally guaranteed mortgages and loans. These charts show that the market thinks something very bad is about to happen to these private mortgage insurers/corporations. Think of a currently healthy insurer doing a lot of business in Florida and Louisiana during the beginning of an expected to be horrible hurricane season. The market says Incoming!!!!

The third chart is of the two bond funds currently available to 342's 401a plan. Note how well they track together until August, about the time that the smart money figured that the game was up in mortgages. The US government bonds appreciated after August as money moved into them, driving up prices. The nongovernment (more corporate and mortgage securities) fixed income fund fell as people bailed out. This is a trend that may affect fixed income securites in the pension funds, Health and Welfare Trust Fund, and the Apprenticeship Trust Fund. in other words; your money. Stay tooned.

I've been rethinking my 401a strategy. I gotta fair grip on how to play it. But there are some bigger fish to fry and everything in due course...o'course. Read about it here; Check out my asset allocation tables, chartz, and maintain a high degree of toonosity.

See ya at the track.
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