An Extraordinary Admission Of Failure!

Hello traders everywhere! Adam Hewison here, co-founder of MarketClub with your 1 p.m. market update for Wednesday, the 10th of August.

We have had an extraordinary admission of failure!

Yesterday, the chairman of the Federal Reserve, Ben Bernanke, acknowledged in what was perhaps the most stunning statement ever by a sitting chairman of the Fed... That the economy was not doing as well as they had predicted.

Duh Ben, welcome to the real world!

In our comments yesterday before the chairman spoke, we hoped that the Fed wouldn't do anything stupid like announce QE3 or that they will be dropping money from helicopters. Instead, the United States has just played its cards out to the world, saying that we are not going to be raising interest rates until.........let me guess 2013, after the elections.

What the chairman's statement really meant to many traders, myself included, is that the US economy is not even halfway good. It is in the toilet! The Fed also stated in a very subtle way, that there is not going to be another huge bailout for the economy. That can only mean one thing in my mind, and that is the equity markets are going to continue to erode for the balance of 2011 and for most of 2012.

I suspect that we have seen a minor bottom in the equity markets as they have churned back and forth trying to stabilize after there disastrous losses in the past 12 days.

Everyone is euphoric about the price of crude oil coming down, but I suspect this is just going to be a correction in what will be a bull market when inflation kicks in. Other commodity markets are, in my opinion, getting closer and closer to making a bottom. I would pay particular attention to the Reuters/Jefferies CRB commodity index that we talk about every day on this blog.

Here's what I think is going to happen in the next few days: I think we will see more choppy, irrational and erratic market behavior that will rule the day. I think that investors who haven't been using a structured approach, like our "Trade Triangle" technology, are going to be scared to death at what is happening to their investment and will find them selves without a rudder in these tumultuous financial seas. Only by having a game plan in place, can you survive what I believe is going to happen in the future.

In a nutshell, the balance of 2011 and 2012, will be more about capital preservation and less about growth. The good news is, with our "Trade Triangle" technology we will continue to find winning trades and you will come out ahead of the game.
So let's go to the 6 major markets we track every day and see how we can create and maintain your wealth in 2011.

S&P 500
Monthly Trade Triangles for Long-Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short-Term Trends = Negative
Combined Strength of Trend Score = - 90

Chances are we reached an interim low point yesterday. The Fibonacci retracement zone has been satisfied and this market is in a heavily oversold condition. Continue to see choppy action overall for this index.
Monthly Trade Triangles for Long-Term Trends = Positive
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short-Term Trends = Negative
Combined Strength of Trend Score = - 60

Intermediate term traders should be on the sidelines and out of silver at the present time. Our -60 Chart Analysis Score indicates more two-way market and a trading range.

Monthly Trade Triangles for Long-Term Trends = Positive
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short-Term Trends = Positive
Combined Strength of Trend Score = + 100

Short term, intermediate-term, and long-term traders should all remain long gold. We would use our Trade Triangles for exit points should they give signals. Is $1800 the next stop for gold?

Monthly Trade Triangles for Long-Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short-Term Trends = Negative
Combined Strength of Trend Score = - 100

Yesterday the crude oil market looked like we have put in the bottom in this market for the time being. We would not be surprised to see further two-way action and a further reflex rally.

Monthly Trade Triangles for Long-Term Trends = Positive
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short-Term Trends = Negative
Combined Strength of Trend Score = + 60

The dollar index continues to remain in a broad trading range. The index remains below its 200 day moving average while our longer-term Trade Triangle remains positive.

Monthly Trade Triangles for Long-Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Negative
Daily Trade Triangles for Short-Term Trends = Negative
Combined Strength of Trend Score = - 100

The trend for the REUTERS/JEFFERIES CRB COMMODITY INDEX remains negative. We want to watch this index very closely in the next 2 weeks, as we feel we're very close to making a major cycle low in commodity prices.

As always, we rely on our market proven Trade Triangle technology for catching the big moves.

Give us a call today at 877–219–1482 for more information about our personal coaching program.

This is Adam Hewison for MarketClub and I'll see you tomorrow, right here at 1pm. Have a great trading day!

Every success,
Adam Hewison
President of
Co-founder of

31 thoughts on “An Extraordinary Admission Of Failure!

  1. Everybody pays taxes, the rich pay less, because thay can afford to.
    Demand - You will only make a product if their is demand for it and you can sell it profitably.

    So where is that demand or why isn't it their.

    Good point about the cycle of wealth and the stock market makes it easy for them - They have all these lovely
    pension funds they can rob.

  2. and I second that, Harry. Miserab is right. We were the world's largest creditor nation before Reagan; after George-the-Lesser we became the world's greatest debtor.
    So, how many jobs bills has the GOP put on the floor? zero
    How many GOP bills on the floor to recall more efficient light bulbs? One.
    How many bills to limit abortion? I lost count.
    Any effort to bring offshore projects back? zero.
    So where is the GOP's "creat jobs" effort they bitch about constantly? Their delay tactics by their own Tea Party holding them hostage created the down grade. Isn't our economic problem their doing?
    Doesn a balanced budget need reveue as well as cuts? Reagan cut taxes to the super wealthy and 7 years later the economy tanked. BGeorge-the-Lessor cut taxes to the super wealthy again and 8 years later the economny tanked. That lost revenue under Republicans to benefit their masters is one of the main reasons we are failing.
    How has Mitch MCConnel suceeded to "defeat this president" at any cost? quite well. The country be damned. the Republican Party first; country second. I swear the GOP marches to the directions of Limbaugh and the Koch Brothers.
    The Dems have their problems, but the people of the US of A does come first, not second.

  3. Why would any business want to expand or hire with this president in power? Think about it, it's very simple. If I produce a product that gives me a profit of $100 and I get to keep $100 then I will do all that I can to produce more of that product. I will hire workers, build factories, invest in my business. When I do this I provide jobs for people who also buy things. If I produce a product that gives me a profit of $100 dollars and I'm taxed at 50% then I only have $50 dollars to invest. This means I cannot hire as many people so wouldn't it be wise for me to invest my money where I am taxed the least? You don't stop for gas at the gas station that is consistently higher than all of the other gas stations, why should I?

    How can the American consumer base increase and have more purchasing power when you suggest that we impose even greater taxes on the people who create the jobs that will give the American consumer more purchasing power?

    The job creators have and will continue to flip the bird to the politicians in Washington and State governments who think they will stay and pay higher and higher taxes in all of their forms.

    The problem is the that we live in a world of ignorance. We are ignorant because we believe that the people who are in business are better off than we are and that they have gotten there by ill-gotten means which means that it's ok to take their money.

    Tax the rich until there are no more rich to tax, then everyone is equally poor, sounds like a Cuban Nightmare.

  4. Tristan,

    In my opinion, the Crash has begun and all bets are off.... Welcome to the "new day" of inverse and precious metals markets investing..... My point was that we have a LOT farther to go to the downside... My bet, the market will again bottom when Glass-Steagall (or the same thing under a different name because most of the incumbents that voted the removal are still in office) is finally made law again and Banking, Brokerage and Finance are again finally separated again...

    Good insightful article on the whole mess: "Mr. Weill Goes To Washington" by Bill Moyers of PBS in 2002... I'm told that Cheney was so mad that he tried to get Federal Funding for PBS withdrawn.... In my opinion it was prophetic and another example of how cooped the current media is, that NONE of them did such an insightful article about how important G.S. was and what a huge mistake it was to remove it...


  5. Hi,

    I know Adam has some strong views about politics and in general my guess is people don't mind hearing them - but that is all that is being offered recently. Little solid advice on entry and exit points for markets and ZERO videos. What is going on Market Club??


  6. I would first, like to suggest that everyone go back and read Jesse Carr's contribution..... Nice to know that there are some clear eyes out there that haven't given into the Gobbles/Rove/Orwell like drivel being handed out daily now that the media has once again been monopolized under the Conservative Ultra Wealthy ownership as in the 1920's. Incidentally we can thank Ronny for removing those regulations on media ownership also.....

    My contribution is to suggest that we are once again in the grips of a Conservative take over as in the late 1920's and the outcome is going to be the same Crash and Depression.... I would like to suggest that all that attend this site consider becoming familiar with the economic cycle theory of Kondrotiev from the 1920's..... His theory simply put, was that about every 40-70 years, the Ultra Wealthy Conservatives, thruogh their incredible power, convince the comfortable voters that they have a better way. Then once elected they remove the regulations on media ownership and finances and at great profit to themselves cause the markets to go parabolic and set up a "perfect storm" condition by doing everything possible to further enrich themselves (deficits and tax cuts) in the name of unbelievable greed, ethics lost and short term profits.... Kondrotiev's theory stated that the outcome was always the same, Crash and Depression....... Then the badly damaged voters turn them out of office and elect liberals that bring back the badly needed regulations and good economy times return until those that had suffered the last Depression are dead and the story goes cold and... It then it happens all over again.


    1920=1932, a period of Conservative Domination brought the "Roaring Twenties", then the Crash of 1929 and then the Depression....

    1932 - 1980, a period of Liberal domination, saw the greatest increase in economic and manufacturing development and the greatest increase in the middle class and the greatest increase in the standard of living for the average American in the history of this great nation......

    1980-Present, brought the "Republican Revolution". During that period we have gotten GATT, NAFTA, media ownership deregulation and financial deregulation (most importantly the removal of Glass-Steagall in 1999). Glass-Steagall, in 1934,for those unaware, brought the bottom of the stock market crash within four months to becoming law.... Since 1980, manufacturing, the economy, the middle class and the standard of living for the average American have all fallen. The only groups better off since 1980 are the Ultra Wealth Conservatives.


  7. most of the comments here seem to center on USA
    but i beg you to look at the big pizza and in particular Italy

    Once it goes all bets are off because the EU doesnt have a printing machine

    once this goes then its every one for themselves

    good luck

  8. Everybody says demand is the problem, as in there isn't any.
    Question is tho', how do you create sustainable real demand as opposed to artificial (QE type) demand.
    Ben is discovering that his analysis of the Great Depression and how to solve it was maybe a bit too simplistic.

    So the real Questions again.
    What is real demand (as it's there but on hold at the moment) and how do you initiate it.
    Construction, for example is real demand, but only if.
    1. You haven't overproduced it and
    2. It's affordable
    Gold is not real demand (unless for industrial use) so the price of gold is a fraud.
    And a lot of people are going to get burned when this little home truth comes home to roost.
    All you need is, dare I say it, a little bit of "uncertainty" about the value of gold and well
    we all know where uncertainty has got us.

  9. hi ,adam ur tgt of gold was 1650$,i booked profit there ,now it is 1790$...i missed it because ur videos r not there

  10. The market has many bargains at this time.
    Buy eroded good stocks and make money.
    Buy US Steel at around 28. Expect minimum fifteen points in one year (very low conservative estimate). Realistic estimate for this stock to be around fifty five
    in one year.

  11. Miserab seems like an accurate name. Cut the military, increase taxes, punish business and spend a shit load more money. That's a great plan. Right out of the marxist playbook. Sad, pathetic and moronic. If the goal is a depression, civil unrest and 50% unemployment, your plan would be spot on.





  13. Adam, you say we may have reached an interim low point yesterday in s&p,what do you need to see to get back in? green monthly,weekly? thanks (btw, I was looking at your promo to try for 30 days but was turned off by the fact that I would have to telephone to cancel, I assume I would be arm-twisted to stay on- why can't people cancel by email?)

  14. Well said. I never did get why Reagan was such a "Great American", single-handedly responsible for the falling of the Berlin Wall and the end of the Soviet Union; (I say it was images on cable TV of freedom in the west.) Nor did I get why he needed to have an airport named after him (the regulating body of which his Tea Party fans squeezed to save $60 million in small airport subsidies while losing $200 million in uncollected tax revenue to make another one of their knife "points".) Reagan lied to Congress, subverted the Constitution, and bankrupted the country. Was that American enough?

    Yes, he effectively bully-pulpited his preference for supply-side economics, through which prosperity would ostensibly trickle down to the middle class. AND he wasn't afraid of a little taxation. He was a lovable guy, had a nice tone of voice, and was more charismatic in persuasion than most (Obama could use some of that toughness.) Reagan as a man was refreshing in his time, especially his positivism about America. He was the President of the United States, and a lot of Democrats honored the fact that, in tough times, he represented them too. It is unfortunate that Tea Party idiot-logues are not large enough of mind to grasp this concept.

    But Reagan did not really see some of the complexities in the bigger picture, either economically or politically. His de-regulation left banks able to bring us to the disaster we face today. Remember the half-trillion dollar Savings and Loan bailout? Wouldn't that be about a trillion or two in today's dollars? Did the de-regulation create enough wealth for the country to make it worth that kind of meltdown, similar to the one we have today? Has anyone monetized the resulting level of anxiety, distrust and confusion? How is that equation looking these days?

    Reagan policy was the beginning of the end of the middle class, which traditionally had the numbers and the income to float a healthy economy through its volume purchases of basic goods. The super-rich have not invested in creating jobs here, but traded them for corporate savings exporting jobs overseas. We don't manufacture anything here anymore, because so many people happily go to college and text and facebook their way to low paying service sector jobs. Forty years ago some of these people would have gone to a variety of technical schools and maintained vigor and intelligence in our manufacturing sector. But no, everyone wanted to follow Reagan's 80's ideal of money and the American dream of "leisure for its own sake". Fine. The Chinese will be happy to invigorate THEIR manufacturing sector, take our lumber and scrap metal and sell it back to us, value added.

    Our economy will not be resuscitated by the super rich's purchases of jets, yachts, and tastelessly oversized mansions. Republicans laughed as GHW Bush I handed the reins to Clinton because he had no money to work with. But Clinton knew that investors needed to feel confident in order to invest at home, and he prioritized paying down the deficit in any way possible, as quickly as possible. This instilled confidence in the investor's circle and everywhere else, and he left GW Bush with a huge surplus. Due to W's short sightedness in engaging two unpaid-for wars and an unfunded prescription drug program; and his small-minded anti government-regulation policies, which led to our financial meltdown through corrupt banking procedures, we are in a terrible mess. The Tea Party, (wasn't there once a party called the Know Nothings, [No, Nothings?]) via its hostage-taking of the Congress, and its subsequent refusal to adopt the more meaningful Obama/Boehner $4+ trillion spending reduction package in order simply to bring down their "enemy" the President of the United States, has just given us a huge tax increase in the form of degraded credit with higher borrowing costs, and a multi-trillion dollar loss in the markets in the span of a week. Was that how the Tea Party wanted the rich to pay their fair share of taxes?

    1. Ragedmaximus,

      As soon as we work through some technical issues we will have the videos back on the Blog.

      Thank you for your patience.


  15. We need to induce business to repatriate offshore profits.

    We need to reward domestic job creation and penalize moving jobs offshore.

    We need an infrastructure bank.

    We need to increase revenue.

    High frequency trading and short selling should be banned.

    Amen, and God bless America!

  16. MISERAB,

    It's evident your name is derived from "MISERABle". Keep telling yourself that only government can save us, and that evil corporations and the wealthy are at the root of the problem. C'mon Tea Party! Real Americans will be there to dramatically increase your number in November. The "miserables" can always move to Greece, Portugal, or some other socialist country where they can share somebody else's wealth!

  17. I'm not sure about a "market bottom" here, but your thoughts to conserve capital as a primary goal is commendable. In fact, I think this should always be the primary goal... and it doesn't have to work against the other goals of capital appreciation, etc.

    1. Christine,

      As soon as we work through some technical issues we will have the videos back on the Blog.

      Thank you for your patience.


    1. Leandre,

      As soon as we work through some technical issues we will have the videos back on the Blog.

      Thank you for your patience.


  18. There is no "admission of failure." There are a lot of reasons why the economy is not doing as well as it could, not the least of which is the fact that business "leaders" (aka corporate thugs) are holding onto the cash they are reaping and not expanding business or hiring. Outsourcing continues without abatement and many are ignorant of the fact that Nancy Pelosi got some small incentives for business not to outsource passed by the Democratic House that were killed by the corporatists in the Senate. Why don't they know this? Because you have to read and look for this kind of item - the corporate media on the boob tube isn't going to report it.

    Low interest rates will continue, and in the wake of the disastrous Satan Sandwich that the dysfunctional Congress vomited forth last week, some kind of QE3 is going to be necessary, though it might go under another name, which is no problem since we are already conditioned to criminals being called "businessmen" and fascists, "conservative." Of course the sane, sensible way to address the problem: tax increases on the well-to-do, along with cuts in miliary spending and huge increases in investment in our infrastructure which has been crumbling for thee decades thanks to the rise of right fraudonomics, is not politically feasible at this time - i.e. the right wing is strangling America to death.

    Business? Big business is doing okay, but if the American consumer base continues to become impoverished, it can't continue much longer. The markets are totally dominated by speculation in the short term anyway, so "investors" (by that I mean people who are seeking long term growth or income) who have to think long term bu live in the here and now are justifiably concerned, if not scared. America's death spiral, started under raygun in 1981, has not been slowed or abated.

  19. The Market had been basking in the sun of ARTIFICIAL sunshine provided by The Federal Reserve for 2-1/2 years. This is usually the maximum length of time for a secondary (cyclical bullish) leg in a primary (bear) market. (The converse is true for a cyclical bearish leg in a primary bull market). Now it is time to the SECULAR BEAR MARKET of 2008. The FUNDAMENTALS do not support the market levels reached two weeks ago. The point and figure chart for the INDU in today gives a BEARISH price projection of 8500.00. THAT is a much more realistic price level than 12600.

    In March, 2009 the DJIA hit 6469.95; in March, 2011 the DJIA hit 12876.00, almost exactly 2 years later. That is an increase in the DJIA OF 6406.05 points purchased with $3 trillion added to the National Debt by The Federal Reserve to protect and benefit Wall Street and The Wealthy's holdings at the expense of Main Street. Now it is their turn to "DRAW DOWN and suck it in!".

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