Regarding Monday's Greek 'decision.' The yield on one-year paper in Greece now yields nearly 630%. The rise in yield today was the largest on record. Greece is obviously already bankrupt.





On Bloomberg: "Workplace auditor finds 'tons of issues' at Apple manufacturer."





I would not be surprised if the shares of ASPS more than doubled in the next 12 to 18 months. Free cash flow will be almost $6.30 a share. Why can't the shares trade at 15x free cash flow? ASPS may be the stock of the decade. BTW, it's doubled in 2 years.





Core CPI is currently rising at the quickest pace in almost three and a half years.

The core and headline January CPI rose by 0.2%, which was in line with expectations.

Many market players didn't want to do much ahead of the long weekend, with the possibility of more news coming out of Greece while the market is closed Monday.

But the old adage about not shorting a dull market came to life and the market held up. The bulls may not have wanted to do a lot of buying, but they did more than enough to keep the bears from gaining traction.

Once again, underlying support is remarkably strong, and one mild dip was well bought. There wasn't a lot of major strength, and Nasdaq breadth was even, but the price action could not be faulted.

Dow 13,000 talk is heating up again. I expect to hear that kind of chatter as the market tops; it's a sign of overconfidence and complacency.

On the other hand, it has been very easy to make bearish arguments for quite a while, even though they haven't mattered. Until there is an actual change in the price action, the arguments are irrelevant, even dangerous.

On Tuesday morning, we'll likely be reacting to Greece one way or another. Some sort of deal will give the market short-term support, but in the long run, we know that it is a matter of time before Greece is in trouble again.

I suspect that Europe will eventually be the catalyst for a market turn, but they are doing a good job of kicking the can down the road and preventing the overanxious bears from gaining a foothold.

Today's tweet of the day is again from Hedgeye's Keith McCullough: "Evolve or whine."






Housing continues to show signs of recovery as the NAHB confidence index rose to 29 (consensus was 26), the best reading in four and a half years and substantially above the recent six-month average of only 20. This index has risen for six consecutive months, a feat not accomplished in 16 years.

After the sudden drop in AAPL and an intraday reversal of the indices yesterday, many market players quickly became bearish. After all, the market has been extended and hasn't corrected for quite some time, so didn't it make sense to anticipate more profit-taking in the near term?

What the bears failed to appreciate was that the dip-buyers weren't ready to go away. They have had great success for a very long time, so when we had slightly decent economic numbers and then news that Greece was going to be saved (yet again), they piled in and just kept pushing. The bears, who felt so confident last night, were forced to reverse course suddenly and yet another straight-up move was under way.

It is almost comical that the market keeps responding to news about Greece when everyone knows it's just a matter of time before it defaults. Greece is just a convenient excuse for dip-buyers to do what they are already inclined to do. When the market really does have a change in character, the news will be viewed in a much different way.

So here we are, right back where we were a couple of days ago. We had a brief hiccup that helped to create a little negativity and, in the ironic way the market works, that helped to propel the move to the upside today.

It was a solid day for the bulls, with decent volume and close to-3-to-1 positive breadth. It is amazing how fast we can regain upside momentum.

The FOMC minutes were a nonevent -- nothing of note regarding QE, inflation, interest rates or the economy.






Dallas Fed head Fisher calls QE3 a 'fantasy of Wall Street.'






High-end and luxury retailers could be excellent shorts in slowing domestic and European economies.






More Greece headlines on tape:

* "Some of Greece's Euro Zone Creditors Mulling Possible Bailout Curtailment"
* "Bridging Loan Possible to Help Greece Pay March Bond Redemption"
* "New Arrangement Would Delay Full Bailout Until After April Greek Elections"
* "Possible New Greek Plan Hasn't Been Proposed or Detailed, Support Uncertain."






The European leaders can't change the fact the Greece is bankrupt.

I continue to believe that the optimism surrounding Greece is misplaced.

Greece is bankrupt, and almost nothing the European leaders can do will change it.

Today the yield on the two-year Greek note rose to above 200% for the first time in history.






From the Financial Times:

Sounds like European governments are moving to delay any decision until March 2, another two weeks beyond Monday's Eurogroup meeting. A working document distributed last week says the governments will try and force through the PSI debt swap (expected to be announced tomorrow) before committing any more money. Both Lazard and Cleary Gottlieb advised the officials that PSI without Troika pushing through the second bail out would mean take up could suffer (forcing CACs?) and that bond holders would have weeks of uncertainty. As the article ends, "In its legal advice, Cleary Gottleib said it would be legal to scupper the debt swap even after the invitation went out, but it warned against it...Each sovereign restructuring is unique and sets a precedent," says the legal note. "The adverse reputational consequences (for [Greece] as well as the rest of the EU) of launching a transaction that fails as a result of their collective failure to meet the conditions should be assessed very carefully."

The character of the action changed a bit today as the bears put up their best fight in a long time. The dip-buyers spiked us up to recent highs twice during the day but were turned back rather vigorously both times. We even went out at the lows as the market ignored more yammering from the European finance ministers, who are obviously hoping to keep their comedy show running for a few more months.

What was most notable about the action today was that AAPL, the holiest of the holy in the land of dip-buyers, reversed hard and went out at its lows. Apple had been up for 10 straight days and acted like it would never go down again. It has been anointed the greatest stock in the history of mankind, and it is guaranteed to upset the market beast that punishes anyone who gets too cocky.

The big question for us to contemplate now is whether the recent back-and-forth action is a signal that we are building a significant top or just healthy consolidation which will eventually set us up for further upside.

I don't know the answer to that question, but I'm leaning toward the defensive side. Maybe with Apple finally being knocked down, the indices will be more reflective of the action in individual stocks.

Some I would buy, given they are at certain levels:

* Charming Shoppes (CHRS), under $4.50
* Colgate-Palmolive (CL), under $85
* Clorox (CLX), under $65
* Cohen & Steers (CNS), under $31
* Dell (DELL), under $16
* eBay (EBAY), under $30
* E*Trade (ETFC), under $9.10*
* Ford (F), under $12
* iShares FTSE/Xinhua China 25 Index Fund (FXI), under $37.50
* General Motors (GM), under $24
* Goldman Sachs (GS), under $105
* Hewlett-Packard (HPQ), under $26.50
* International Flavors & Fragrances (IFF), under $57*
* KKR Financial (KFN), under $9.10
* Legg Mason (LM), under $26
* Lincoln National (LNC), under $22.50
* MetLife (MET), under $35
* MGIC Investment (MTG), under $4.10
* Och-Ziff (OZM), under $8.75
* Pitney Bowes (PBI), under $18.50*
* PepsiCo (PEP), under $64*
* Procter & Gamble (PG), under $63
* PNC Financial (PNC), under $55
* Prudential (PRU), under $56
* Schwab (SCHW), under $12
* ProShares UltraShort 20+ Year Treasury (TBT), under $19*
* T. Rowe Price (TROW), under $58
* Waddell & Reed (WDR), under $28
* XL Group (XL), under $18.50
* Exxon Mobil (XOM), under $78

*Eligible to buy at current levels






All Things Digital has tweeted that talks on Yahoo!'s (YHOO) sale of its Alibaba stake have broken down. Stock's getting hit; YHOO's a graveyard.






The sooner Greece declares bankrupcy, the sooner the market can move on fundamentals, not macro risk.

Headlines crossed today, reporting that Greece's Prime Minister says that a Euro Group meeting will take place in Brussels tomorrow.

More mumbo jumbo as Greece is hopelessly bankrupt.

The sooner they declare, the sooner the market can move on fundamentals not macro risk.






In a Q&A session at the 2006 Berkshire Hathaway (BRK.A/BRK.B) annual meeting, Charlie Munger, Berkshire's vice chairman, was asked about Dr. Siegel's theories.

Munger said, "I think Jeremy Siegel is demented."

Buffett, clearly embarrassed, added "Well he's a very nice guy."

Munger continued, "He may well be a very nice guy, but he's comparing apples to elephants in trying to make accurate projections about the future."






"What the wise man does in the beginning, the fool does in the end."

-- Warren Buffett






The combined market capitalization of Google (GOOG) at $200 billion and Microsoft at $257 billion is less than Apple's capitalization at $475 billion.

The combined market capitalization of each of Apple's key vendor rivals -- Samsung, Nokia (NOK) HTC, Motorola Mobility (MMI), Research In Motion (RIMM), Sony (SNE) and LG -- stands at $235 billion (less than half Apple's capitalization).

The 17 brands that make up Apple's smartphone competition have a total market capitalization that falls about $100 billion short of Apple's current equity value.






No one deserves this level of adulation -- no one.

I believe that the stock market will do better in 2008 than it did in 2007, when it chalked up a 5.5% return, the fifth year in a row that the market went up. Year-ahead forecasts for the market are notoriously difficult, but I believe that a 10% to 12% gain is possible, on the heels of a recovering financial sector. Financial stocks plummeted about 20% last year, and this was the reason why the market had a mediocre year. Outside of financials, the S&P 500 Index had double digit returns. A revival of financial stocks would spur good market gains this year.
-- Dr. Jeremy Siegel, "Outlook for 2008"

Over the past few weeks -- in a cover story by Gene Epstein in Barron's ("Enter The Bull"), in flattering words of endorsement from Jim Cramer on "Mad Money" and on Real Money, on CNBC's "Street Signs" and in an appearance on "Fast Money" -- Wharton Professor Dr. Jeremy Siegel has been heralded for his wisdom and forecasts.

History shows that the media has a penchant for untimely anointments -- the names are well known by all of us. Think Dr. Nouriel Roubini and his very incorrect view on stocks and of the economy since the generational low in 2009, or Meredith Whitney's wrong-footed view on municipals over the past 18 months.

I recognize that Roubini correctly forecasted the demise of the world's economy and the consequences of the mushrooming of the derivative market in 2007-08, and Meredith Whitney correctly predicted the demise of the domestic banking industry during the same time frame. And I also recognize that Siegel, along with many other pundits, expressed caution toward the sky-high technology multiples in late 1999 and early 2000.

But quite frankly, the streets of Wall Street are paved with geniuses who have made one great call in a row.

I don't mean this to be an ad hominem attack on Siegel (or on the others), but frankly I don't get the media's adulation, continued preoccupation and almost deification of these wags and their views.

Dr. Siegel comes off as a very nice person, but he is an academic who has been bullish at some very wrong times. Importantly, his theories regarding equities for the long term have been wildly off, as bonds have outperformed stocks for one, five, 10, 30 and 40 years, which, according to his investment thesis, is impossible.

His view on the fixed-income market also has been manifestly incorrect over the last two years. Dr. Siegel's Wall Street Journal op-ed, "The Great American Bond Bubble" was wrong in its conclusion back in August 2010.

In a Wall Street Journal column back in July 2009 -- "Does Stock-Market Data Really Go Back 200 Years?" -- Jason Zweig even questioned whether Dr. Siegel's data were compromised:

There is just one problem with tracing stock performance all the way back to 1802: It isn't really valid. Prof. Siegel based his early numbers on data first gathered decades ago by two economists, Walter Buckingham Smith and Arthur Harrison Cole.

For the years 1802 through 1820, Profs. Smith and Cole collected prices on three dozen banking, insurance, transportation and other stocks — but ended up including only seven, all banks, in their stock-market index. Through 1845, they tracked 19 insurance stocks, but rejected 95% of them, adding only one to their index. For 1834 onward, they added a maximum of 27 railroad stocks.

To be a good measure of stock returns, an index should be comprehensive (by including many stocks) and representative (by including the stocks commonly held by investors). The Smith and Cole indexes are neither, as the professors signaled in their 1935 book, "Fluctuations in American Business." They cherry-picked their indexes by throwing out any stock that didn't survive for the whole period, whose share prices were too hard to find or whose returns seemed "inflexible," "erratic," or "non-typical."

-- Jason Zweig, Wall Street Journal "Does Stock-Market Data Really Go Back 200 Years?"

As The Big Picture's Barry Ritholtz put it (in reaction to the above Wall Street Journal column):

Thus, Siegel's basis for Stocks for the Long Run [2] exclude 97% of all the stocks in the early history of the US market by cherry picking winners, ignoring survivorship bias, and engaging in data smoothing.

Oops.

What did this do to the results? As you would imagine, it juiced them significantly. The era of 1802-1870 ended up with a much bigger dividend yield then it should have had. Siegel originally started at 5.0%, but over ensuing versions, that crept up to 6.4%. The net impact was to raise the average annual real returns during the first half of the 19th century from 5.7% to 7.0%.

If you artificially raise the initial returns in the early part of the data series, then the final annual returns become much higher. As Zweig sardonically notes, "Another emperor of the late bull market, it seems, has turned out to have no clothes.

To summarize, as Bill King has put it, "Permabull Jeremy Siegel, who has been not just wrong but magnificently wrong, is forecasting DJIA 15k."

As it is said, "Beware of false prophets of the past."

Typically, light-volume pullbacks within an uptrend are healthy. They allow stocks to migrate into stronger hands as short-term holders take profits, and they allow big funds to accumulate at lower prices. As long as the pullbacks are contained, they make it more likely for further upside.

That is what saw today. But a late spike caught the bears leaning the wrong way after several failed intraday bounces. We had a decent recovery and ended up with just mild losses. The perma-bulls love that the bears are so inept, but it makes for dangerous conditions when there is so little fear.

Disinterest is what really kills a market, and you have to wonder what is going on as volume on the NYSE continues to descend to levels not seen in a very long time.

You would think that a market that has been trending up for weeks and is close to its highs would be generating increased interest, but we seem to be going in the opposite direction, which makes the persistent bids seem more manipulative than indicative of real accumulation.

Ultimately, price action is what matters and it is hard to argue with a market that closed the way this one did today. We had a number of failed bounces and looked ripe for the weak finish, but the dip-buyers wouldn't stand for it. I suspect that the computers had something to do with the energetic close, but it just goes to show that you really have to be careful fighting this market.

One To Watch

TROX manufactures titanium dioxide and is one of five companies with the technology to produce it via the chloride method, which is cost-efficient and environmentally friendly. Tronox recently announced a merger with a division of Exxaro Resources [EXX.South Africa], a South African company that mines titanium dioxide feedstock. This will make Tronox vertically integrated. The acquired business has a 1.5-million-ton stockpile of ilmenite, the feedstock, which is in tight supply.

Tronox hit a high of $165 last year. Shares have backed off due to market turmoil, mixed feelings about the acquisition and uncertainty regarding the economy. Most important, sales of titanium dioxide were slow in the fourth quarter. Investors didn't understand this was a seasonally weak period. Insiders have been buying shares at Kronos Worldwide [KRO], a Tronox competitor, which adds credence to the buy idea on TROX.

Tronox came out of bankruptcy court last year. Why did the company go broke?

It was spun out of Kerr-McGee with a lot of environmental liabilities and debt. Then the financial crisis hit. But there have been positive surprises since 2011. Tronox has tax-loss carryforwards that are worth about $30 a share. And the company has incredible earnings power, in the range of $20 to $30 a share. Analyst had guessed it was around $12 a share. Some think it is overearning because of the tight supply situation, but even using an 11 multiple of the prior estimate and adding the tax assets and the next 12 months' free cash flow gets you a target price of more than $190 a share. If earnings continue to grow at the current rate, they might be sustainably closer to $20, which gives you a $250 stock.

Moodys, that forward-looking thoughtful ratings agency, has reduced the debt ratings of six European countries including Italy, Spain and Portugal and has revised its outlook on the U.K.'s and France's top Aaa rating to "negative."






A rumor has it that Saudi tanks have approached the Jordanian border, giving a 72-hour ultimatum to Syria.






Today's tweet of the Day is from Hedge Eyes' "Keithy" Keith McCullough: "It appears to me that the old broken glass/economic growth model of Keynes has met its burning buildings #Greece."

The Greece deal is really no deal but rather a slow-motion train wreck to bankruptcy.






Why have all the Cassandras been wrong? Because they ignored the power of central banks to cause credit spreads to narrow. The outcome is reflected in market movements and in certain sectors....

The European Central Bank's ingenious concept of a three-year, 1% loan via LTRO (long-term refinancing operation) worked. It was successful because it allowed the banks to buy their own debt at a higher yield than 1%, book the difference in yield as income, and mark up the value of their own bonds to par. That process functioned as a mechanical way for there to be an addition to the bank's capital. The ECB used a creative way to solve a portion of its eurozone and the Europe-wide banking crisis....

We have replaced meltdown of the type we saw after Lehman/AIG with "melt-up" of the type we have been seeing since March 2009. We have shifted from collapsing leverage and failure at the institutional level to central bank intervention of unprecedented size....

We are going through huge transitional times. Never before have we seen coordinated, global central bank activity of this order or magnitude. By the end of this year, the G4 central banks will have expanded their balance sheets approximately threefold during the financial crisis. The negative and inflationary results of this activity may appear in the future. That remains to be seen. For the present, this is a very bullish construction for asset prices and equities in particular.

-- David Kotok, Cumberland Advisors (Feb. 11, 2012)

The bears had a good opportunity to build on Friday's weak action by selling the gap-up open, but they failed miserably once again. There was a brief dip in the first hour or so of trading, but the buyers didn't wait long, and they walked us back up the rest of the day.

Not only was the underlying support very impressive, breadth was quite strong, with 4,200 gainers to just 1,400 decliners. Volume was light, but the big-cap momentum favorites were lively, with PCLN, ISRG, AAPL, GOOG, AMZN and BIDU attracting attention. Small-cap oils were the favorite speculative play today, but there was no shortage of green on the screens.

It is extremely tempting to keep trying to call a top in this market, but by now it should be painfully clear that sticking with the trend as long as you can is the way to go.

It' been a long time coming but today we saw the worst action of 2012. We've had only one other bad day this year, Jan. 26, where we sold off all day and closed near the lows. Despite a last-minute spike, we not only sold off and closed near the lows, but it was the biggest point loss of the year.

The big question is whether this is an indication of a major change in market character and an intermediate top, or long overdue profit-taking that will give us a healthier market as we shake out recent excesses. It's been amazingly one-sided for so long that it was inevitable the streak would end.

While it's probably a good idea to lock in gains after the big run, it's premature to conclude that the uptrend is over and a major breakdown will ensue. In fact, it can be argued that this is merely a return to normality and a little downside is healthy. The market needs to shake out overly exuberant bulls now and then to rebuild skepticism and attract new buyers.

Earnings season is basically over and we are heading into a weaker time of the year seasonally. The issues in Europe are not improving, so the bulls will have some headwinds to contend with going forward.

The dip-buyers did their thing for a third straight day but they weren't as enthusiastic. Fortunately for the bulls, AAPL kept us in positive territory. Although the bulls managed minor gains, breadth was slightly negative and we closed a little soft.

The market continues to hold up remarkably well, which may be due in part to so many folks looking for a pullback. Every time it looks like we may finally see a little downside momentum, the dip-buyers jump in and put the squeeze back on. Any bear that feels confident isn't paying attention to the action.

Even if you are bullish and don't expect a top to occur soon, it is a challenge to keep chasing higher and higher. Many bulls are rooting for some downside to get a better opportunity to put cash to work.

The flight to safety continues to buoy fixed income.

The 10-year U.S. note auction came in at 2.02%, 1 basis point below the when-issued yield.

The bid-to-cover at 3.05 was a bit lighter than past auctions, and direct and indirect bidders were in line.






Greece will be resolved (in the fullness of time), but austerity and a lot of heavy lifting lies ahead for the eurozone. This malaise spells weaker-than-expected economic growth ... for years ahead.

Once again, this market showed why intraday weakness shouldn't be trusted. As soon as we breached Tuesday's low, the dip-buyers jumped in and had us back into positive territory by the close.

Strong action in AAPL, GOOG and other big-cap momentum names helped to fuel the bounce, but it was a broad-based recovery and with solid breadth by the finish.

Like yesterday, the bounce had the feel of being driven in large part by algorithmic trading that took advantage of the many market players who are overanxious for a pullback. The inclination is to press the short side when we finally breach an important intraday level, but those bears are immediately squeezed and that helps propel the very fast bounces.

It is the close that counts, and this was another good one. If you really want to play the dark side, wait for a weak finish and some sort of news catalyst to trigger exits.

What we have is a market that the technicians claim is obviously extended but keeps running because dip-buying is working so well. The market loves to stick with a pattern that works until it is obviously broken, and this pattern still works just fine.

DIS beat on the bottom line and missed on the top line. I suspect the top-line sales miss will weigh on the shares tomorrow.






So-so three-year auction.

Yield and bid to cover was fine, but direct and indirect buyers were at the lowest level in three years. Tomorrow's 10-year and Thursday's 30-year will be important tells.






KFN, a KKR-sponsored entity, maintains a portfolio of below-investment-grade corporate loans and debt securities, commercial real estate loans and debt securities and special situations.

The company funds its growth through the issuance of match-funded non-recourse debt in the form of collateralized loan obligations and collateralized debt obligations.

KKR Financial enjoys a strong ROI (rising), a 9% dividend yield (rising, expected 50% growth in dividend distributions) over the last 12 months and trades at a slight discount to book value (rising).

KKR Financial reported core investment income of $0.35 per share compared to consensus of $0.32 a share.

Book value increased 3% sequentially, to $9.41 (buoyed by retained earnings and gains on investments), cash earnings rose from $0.35 per share to $0.39 per share, and net interest income advanced by 4% from third quarter 2011.

There was no loan-loss provision, and the company deployed about $200 million in the period. Return on equity exceeded 18%, well above Street forecasts.

The company distributed $0.26, which included a special dividend of $0.08, again above expectations.

The pro-forma 2012 dividend yield is 9%.






According to a Greek official, the government is drafting an agreement on a bailout deal for approval today. Right. And all the Greek tax cheats are announced they are lining up, with cash in hand, at the Greek equivalent of the IRS.....






Investing in the market or in individual securities is always about asking myself the question, What is the risk and reward?

Chasing stocks (in either direction) is not for me, as price is what you pay, and value is what you get.

After the straight-up run we've had recently, many market players have been anticipating at least a minor pullback. It looked like they might have been right when we started the day, but the dip-buyers jumped in and we ended up closing in positive territory near the highs.

The action felt like it was driven by computerized trading, which took advantage of many market players looking for a pause in the action. When we bounced back from this morning's dip, the machines kept pushing and that helped create a short squeeze. Extremely light volume indicates the absence of buying by major institutions.

Typically, an uptrending market doesn't need a major pullback to set up new opportunities. A couple of days of profit-taking will be sufficient to reset a few things, but we just haven't seen that with this market. We become more extended as the dips are snapped up by hungry, underinvested bulls.

There is an old saying that extended markets can become even more extended. That has certainly been the case. It will end one of these days, but even the fortune-tellers don't have a clue when that might be.

Once again, the dip-buyers show how tough they can be. We opened slightly soft, but that proved to be the lows of the day as the market inched slowly back up and closed with minor losses.

Breadth was a bit weaker than indicated, but there was enough speculative action in shippers, small biotechs and large oil services to offset pressure on chips, retail and precious metals.

Just about everyone recognizes that this market could use a rest, but as long as it refuses to let up they are going to keep looking to buy. There was strong action for a market that is tired and technically extended.

I think it is time, again, to expose the BLS' shennanigans to both keep the headline unemployment rate suppressed, and to generate an upward bias in the market courtesy of a "bigger than expected beat" of "expectations." Granted, various semantics experts continue to scratch their heads in attempting to explain a collapsing labor force when even Goldman's Sven Jari Stehn just predicted that it will drop to 63.1% by the end of 2012 (and 62.5% by the end of 2015). Funny, then, that the US will have no unemployment left when the participation rate drops to 58.5%.....And no, the "population soared" argument based on "revised data" doesn't quite cut it when the bulk of said surge not only did not get a job, but was not even counted toward the labor force. The biggest flaw with all these arguments that vainly attempt to defend the US economy - as if it is growing - is that they focus exclusively on the quantity of jobs, doctored or not, and completely ignore the quality.

KFN at $9???






Regarding today's jobs report, here is the downside to the "strong" labor report (that could constrain, though probably not deny, the upward movement in stock prices):

1. Today's outsized REPORTED jobs "gains" eliminates any chance of QE3, which the bullish cabal has expected.
2. A strong labor market, if it in fact exists/continues, will force the Fed to raise the federal funds rate well before the recently announced date of late 2014.
3. A so-called much improving economy raises re-election odds of President Obama. Most consider a Democratic/Obama win in November's presidential contest as not as market-friendly as a Republican (presumably Romney) win.






According to a Washington Post article, Secretary of Defense Leon Panetta believes there is a growing possibility that Israel might attack Iran as early as April.

The Secretary's remarks are in line with a recent lead article in The New York Times Sunday magazine section two weeks ago.

The real issue for risk markets is how will stocks respond to a successful attack? My guess is down on the news but up, in the fullness of time (once it is digested by the markets), as planet Earth is rid of a nuclear Iran.

From there, the issue likely becomes whether Iran retaliates.

Regardless, I believe the greatest risk to the markets is geopolitical, not economic.






Higher stock prices plus lower bond prices equals an ideal setting for life insurance stocks.






F and GM are uniquely positioned to benefit from unleashed pent-up demand for cars, reflecting in part the record 10.8 years average age of the existing car fleet on the road.

The automobile industry, unlike the housing industry, is not burdened by the supply of unsold home inventory.

On Thursday January light vehicle sales rose to 14.2 million units (SAAR). Expectations were for 13.5 million, in line with December.

January's sales represent the best SAAR in three and a half years and were substantially above the fourth quarter 2011's 13.4 million units and suggest that consumer spending on durables will remain firm in first quarter 2012.

The current sales rate of 14.2 million units is still well below the trend line demand of over 16 million units, so there is a lot of runway left for the industry to recover.

This auto sales release and other recently released high-frequency economic statistics call into question the recessionistas' downbeat views and suggest that a self-sustaining economic recovery is in progress.