But The Rally Already Came

If you take the intra-day low of around 740 for the S&P on 11/20 and use yesterday's high in the 940s, we've already seen a 27% rally. 27%! That seems like a lot. Did S&P earnings get 27% in the last 6 weeks? Did something in the economy or employment picture get a lot better during that time? As a matter of fact, it didn't. Even ADP, albeit with their "new" formula (i.e. a lot more accurate) for estimating job losses, put December's total around 700k. Combine this with warnings from Alcoa (along with huge job cuts), Intel, and Time Warner, and it's hard to fight reality. Sales of durable goods fell off a cliff. Oil went back over $50 a barrel (briefly). There's war in the Middle East and Russia turned off the gas to all of Europe. These don't ring of bullish events to me.

Paul Farrell pointed out yesterday that we shouldn't be lured in by the new year, new bull sentiment. We've seen this precedent before. Right in the midst of a market swoon, the goons/pundits are paraded out to tell us it's almost over. Quoting market geniuses Crammer, Kudlow and "Sooze" Orman, these are the same people who told you to buy all the way down during the NASDAQ's 80% demise during the tech bust. Like Cronos said, who would listen to these people?

Meanwhile, despite a $700 billion infusion, or is it $2 trillion (we don't know, the Fed isn't telling us anymore who's getting money), banks refuse to lend to each other. Caught in a stalemate, they're each playing a game of last man standing, hoping the other banks will lend to each other while they sit on a pile of cash and wait this recession/depression out. "As the new owner of $172.5 billion of preferred shares and warrants in 208 U.S. financial institutions, the Treasury Department hasn’t succeeded in thawing frozen credit markets, leaving taxpayers propping up an industry that won’t lend to them." Nice work as usual by Paulson and Bernanke. And, going by the records of Obama's appointments, the only change we have to look forward to is the bullet-proof Caddy he'll be escorted in, not new economic thinking.

Earnings kick off next week, or they're supposed to. Seems like companies are lining up to throw up their poor 4th quarter results ahead of schedule and fall on the mercy of the market. They should fall into a canyon. Alcoa had been on a 30% run prior to today, Time Warner 40%. Are you kidding me?

And, kudos to Jason Whitlock, perhaps the only sports writer who has any courage. He concurred with my assessment of Manning and LT, saying that Manning "choked" and that the Chargers are better off with Sproles.

"Manning did nothing on Saturday. Well, he enhanced his reputation as the big-time QB mostly likely to choke in the clutch. His postseason numbers don't lie. His record is 7-8. He's tossed 22 TDs and 17 INTs in January. His completion percentage falls to 56 percent (eight points lower than his career percentage). And in his eight playoff losses, the Colts average 13 points per game... His postseason play is indefensible."

http://www.bloomberg.com/apps/news?pid=20601109&sid=aqLT6v88t.Jo&refer=home

http://www.marketwatch.com/news/story/15-reminders-wall-streets-con/story.aspx?guid=%7B1983C24D%2D6988%2D4645%2DA2F0%2D9422397777F7%7D

http://msn.foxsports.com/nfl/story/9033410/NFL-Truths:-Peyton's-a-choker,-LT-is-done-in-S.D.