Bear Mountain Bull

It’s time again for a little BMB R&R, especially with the market behaving as bizarrely as it’s been. Maybe if we stop watching it start to behave a little better…

Posting will be very light and variable over the course of this week, but we’ll put up an open thread each market day for our readers to comment on the day’s market activity or to post any interesting links they might run across.

Check the space below for whatever the latest might be during this ‘off’ time, and please visit the various sites in the ‘Links’ and ‘Regular Stops’ for up-to-date market news and analysis.

BMB will be back in full swing by next weekend.

I don’t watch many NBA games, and I most certainly don’t watch their silly All-Star game.

But I might change my mind if I could watch this special 3D edition…

John Mauldin is back from Africa, and his column returns to more discussions on the goings-on in this country. He discusses the outlook for gold, the ‘whys’ of the inverted yield curve, and sticks to his belief that the changes in the housing market will push the US into mild recession. Then again, he could be wrong:

The subprime mortgage market is going to be a scandal by the end of this year, as these loans have been packaged and sold as investment-grade bonds by numerous investment banks, mostly to European and Asian institutions. Some of these Collateralized Debt Obligations, or CDOs, are going to default and there is going to be a major wave of lawsuits.

So, will there be a recession? I still think so, and I think the culprit is going to be the housing market, which is going to trigger a slowdown in consumer spending, the first such slowdown since 1991. If Fisher is right and the housing market is getting ready to take off, then I am going to be not just wrong, but really wrong. We’ll see.

Trying to chase real estate is no different than trying to chase hot stocks - you can’t afford to be the last one in. There won’t be anyplace for you to sit down when the music stops.

Like the owners late flippers of these houses for sale on Delavan Circle in the Sacramento area:

• Sold on 2006-06-26 for $933,500 - Now asking $1,100,000 $799,000 $699,000
• Sold on 2006-08-25 for $918,500 - Now asking $995,000 $699,000
• Sold on 2006-09-14 for $805,000 - Now asking $879,990 $829,990 $665,888

Looking at the charts of the sectors SPDRs, there just isn’t a lot to complain about at the moment. Materials are on a roll, and the hot Utilities have taken a breather, but that’s hardly of major concern just yet.

Health Care and the Discretionaries have flattened out just slightly, as is evidenced by their 20-day moving average (blue line).

Tech stocks remain rather choppy, and the Energies are trying to decide whether they’re just pulling back or rolling back over.

The numbers after another (ho-hum) record breaking week:

Charts courtesy of StockCharts.com