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Mark's Market Blog

9-11-10: Governments Look Bad.

By Mark Lawrence

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The markets were slightly up in mixed trading over the week, exhibiting, to my eyes, topping behavior. I expect the markets to drop a bit early this coming week, just because they're so overbought, then likely rise at the end of the week for "triple witching day," the day when stock options, stock futures, and index options all close for the quarter. After that I expect the markets to go down because 1) nothing has changed, we should still be range-bound between about S&P 1030 and 1130 and we're very close to the top; and 2) sentiment has turned highly bullish, which is almost always a bearish indicator.

S&P 500 March 22 2010 to September 10 2010

A few months ago, all eyes were on the PIIGS - Portugal, Ireland, Italy, Greece, Spain - as they appeared to be about to crash due to excessive government debt. Then the European Bank announced their $1T bailout fund, and all was right with the world again. So, how's that going today, this trillion dollar gain of kick the can down the road? Um, well, it seems there's some potholes in that road. CDS rates, the cost of insuring the PIIGS government bonds, are raising again. Last time it was Greece and Spain leading, this time it's Portugal and Ireland. The issue of excessive government debt is by no means behind us.

EU Sovereign CDS rates, June 2010 to September 2010

In the continuing story of Bell, CA, ex-city manager Rizzo is now found to be due a $600,000 per year retirement from nearly bankrupt Calpers. Plus cost of living increases. Calpers is "investigating." Rizzo is 56, so the way to bet is he lives another 22 years, roughly a $16M payout at this point. Personally, I think Rizzo should get this money: he's earned it by bringing to very public attention the corruption and unfairness of our public employee pay / retirement system. We need a poster boy for this problem, and he's my guy.

The 20 Richest (Western) People Of All Time in 2010 dollars*

RankName $BillionCountry YearSource of money
20 Carlos Slim $62 Mexico 2008Mobil phones, Telecoms
19 Warren Buffett $63 USA 2008Investments
18 Sam Walton $65 USA 1992Walmart
17 Marshall Field $66 USA 1906Retail store chain Marshall Field and Co
16 Stephen Van Rensselaer $69 USA 1835Inheritance, marriage
15 Jay Gould $71 USA 1890Railroad baron and gold speculator
14 Henry Duke of Lancaster $78 UK 1360Inheritance, marriage
13 Frederick Weyerhaeuser $79 USA 1910Weyerhaeuser Company, timber
12 A.T. Stewart $89 USA 1875Retail and Wholesale Business
11 John of Gaunt $101 UK 2008Ruled England as regent to Richard II
10 Stephen Girard $105 USA 1830Shipping, banking business
9 Richard Fitzalan,
10th Earl of Arundel
$108 UK 1370The Earl of Arundel, Inheritance
8 John Jacob Astor $121 USA 1840Fur trading, real estate and opium
7 William de Warenne $134 UK 1085Reward for defending William the Conqueror
6 Bill Gates $136 USA 1999Microsoft
5 Alan Rufus $149 UK 1085Reward for defending William the Conqueror
4 Cornelius Vanderbilt $185 USA 1870Railroads, shipping
3 William The Conqueror $209 UK 1085Conquest of UK
2 Andrew Carnegie $309 USA 1915U.S. Steel
1 John D. Rockefeller $336 USA 1935Standard Oil

*Note that China was the world's largest economy for a couple millennium, but no Chinese are on this list. We much be suspicious.

I bought a new camera recently. I do this every few years, and several of my friends like me to keep them informed as I do a bunch of research first and get good prices on great cameras. I bought a Canon T1i 15mp body, $540 at Central Digital or Shop Digital. There's a Canon T1i package which includes an 18-55mm lens, but the 18-55mm lens is junk. I then bought a Sigma 17-70mm lens used on EBay, $315. New about $435. I also recommend the Tamron 17-50mm lens, about $400 new, the Canon 15-85mm lens, about $700, or the Canon 24-105mm lens, about $950. The 24-105 is the best lens in this group, but the others are quite close. My camera has my favorite features: it's a PhD ("Push Here, Dummy"), and takes great photos. Enormously better than the compact Kodak and Nikon cameras I had been using. My total price was about $860, which is about $10 less than I would have paid at Sam's club for the same camera with the junk 18-55mm lens.

Picture with Kodak compact 10mp cameraPicture with Canon DSLR 15mp camera

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