A Crisis of Injustice

I see the media pumping the wire with warnings of a fiscal cliff we all know very well will be legislated away. I ask, what of the unemployment cliff and the forgotten folks falling off of it every single day?

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

Weekly Jobless Claims was reported effectively unchanged for the latest covered period, but unchanged is synonymous with stagnant, which will lead to a spoiling, as I just reported. The total number of Americans receiving a benefit of some sort, including through the extension program, rose 71,724 to 5.89 million. I wish to remind my loyal readers that this figure has been improving over recent months by attrition as much as economic growth. I expect that a great number of long-term unemployed Americans are simply falling off the unemployment cliff when their benefits run out.

Where do these people go for help after they stop receiving benefits, and what of the 4%+ of Americans who were unemployed before the crisis began? Those people couldn’t find work any better than the people qualifying for the extension program, but they were left to fend for themselves. Those people were the first to foreclosure by Wells Fargo (NYSE: WFC) and friends, and the first to be sued for their debt defaults against our later bailed out banks. Why weren’t they rescued like Bank of America (NYSE: BAC) and Merrill Lynch, or J.P. Morgan Chase (NYSE: JPM) and Bear Stearns. When AIG (NYSE: AIG) and General Motors (NYSE: GM) got handouts, those folks had their cars repossessed and their lives lost without insurance to even cover the cost of their funerals. Instead of sending them checks big enough to cover their trouble, the Bush Administration blindly sent insignificant gifts out to all Americans, rich or poor.

And today, while no longer wanted by most peddlers of Visa (NYSE: V) and MasterCard (NYSE: MA), the likes of Capital One Financial Corporation (NYSE: COF) are luring them back in with 0% interest rates that convert to 23% a few months later. Warren Buffet, of Berkshire Hathaway (NYSE: BRK-B, NYSE: BRK-A), says he’s not sure what he would do if he were poor and had a family to feed. He does not judge those less fortunate than himself, or less gifted in business. So when they rob Wal-Mart (NYSE: WMT) for lack of better sense to sack Saks (NYSE: SKS), they get arrested. As they survive on welfare, the crooks at the rating agencies (based on Representative Kucinich’s description), who rated mortgage-backed securities investment grade deep into the real estate bubble, the bumblers at those firms who effectively ruined millions of lives through that aforementioned negligence, suffered not one arrest. Instead, our jails will fill further with the customers of their business partners, as the assets of Citigroup (NYSE: C), Morgan Stanley (NYSE: MS), Goldman Sachs (NYSE: GS) and the rest of the banks that are even bigger now than they were when they were too big to fail fill with the shadow inventory of what use to be homes filled with families.

It’s getting worse dear friends, not better. Kicking the can down the road is more like pushing the snowball up the hill. It will roll back down and smother us all. Please follow me as I seek to do more to level the playing field, and to serve justice and the true American way, the one our forefathers envisioned.



Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Greece, Greeks and Greek Soccer Should Demand More

The Greek crisis and the performance of the Greek national soccer team inspired this editorial opinion piece perhaps long overdue.

As I watched Greece’s pivotal soccer match versus its political prodder Germany, a quarter-final game for the 2012 UEFA European Cup, I could not help but notice the similarities of the Greek team’s approach to Greece’s efforts to mitigate its financial crisis.

I renounced my ethnicity more than once during the course of Greece’s attempt at Euro 2012, and pleaded tearfully with the Lord to just give us this if not anything else. I knew divine intervention would be necessary, and just asked for a few crossbar and goalpost saves to assist our embattled goalie and bombarded defense. Alas, it was not to be, as the third ranked Germans overwhelmed the still improving Greek soccer program (ranked 15 by FIFA).

Despite the advancements of the Greeks over the years, I still found myself frustrated with the strategy employed and the execution of play on the field. I’m not a passive follower of soccer, having walked on to my NCAA Division I college soccer program, and having played and coached competitive sports all my life. My critical mind and discerning vision is neither limited to economic and securities analysis, or at least I like to think so. Thus, I noted the many issues that constrained my ancestral ethnic team against the advanced play of the Germans. In that same regard, I see why Greece has struggled economically speaking.

A Few Similarities between Greece and the Greek National Team:

• Each are led by foreigners who cannot fully understand Greek nature nor Greek potential
• Each employ a defeatist strategy, defensively postured to endure not conquer
• Each often regress to selfish though passionate flails at scoring
• When not stressed, the Greeks and Greece act lackadaisically and passively
• Each fails to notice risks effectively

With all due respect to Greece’s excellent coach, Fernando Santos, and to Greece’s questionable European economic advisors, the view from the outside inward inherently falls short of producing adequate understanding. Only a Greek can truly know the strengths and weaknesses of the Greeks, and therefore, only a Greek can structure a system that will play to those strengths and weaknesses. That leads me to the second and third points.

The last two coaches of Greek soccer have employed defensive schemes. It’s because of a lack of confidence in the skill and potential of Greek players. This, in turn, is because of the long-term history of Greek soccer, which has fallen well short of the results of its rivals in Germany, France, Spain, Italy, England, the Netherlands and Portugal. Obviously, the development of league play has helped those nations to better their domestic talent. As more Greek players fine tune their craft in the advanced leagues of Europe, Greece will benefit as well.

The same lagged development applies to the problems with Greece, which was stymied by the West’s abandonment of it to Ottoman domination for centuries. After the world wars of the last century, Greece was stripped barren and left to grow as best it could without the fertile support of the West. Therefore, its culture strayed for survival’s sake, away from its brilliance of ancient times.

You see, the survivalist’s mantra is often a selfish one, born out of necessity. The survivor trusts in what he controls only and strives to the utmost to make his own way. Thus, perhaps the Greek businessmen of today, while creating thriving businesses, micromanage them and rarely scale to optimal potential. The Greek economy is thus dysfunctional, because Greek businesses do not feed one another fluidly. I’m sorry to say that I believe for the most part, the only time a Greek helps another Greek is when his hand is greased. It’s not enough to win the trust of a business partner or to act for the sake of good faith. In this, maybe Greeks are just the same as everyone else.

There’s plenty of passion in Greece, for life and for the good fight when a challenge avails. Challenge, in fact, brings out the best in Greeks. But without a challenge, I feel we fall into a trap of relaxation and lackadaisical play. It’s hard not to be this way when you have lived long enough in Greece, which for me is pure paradise. When it comes to managing a nation, though, there had better be no loss of focus. Perhaps it’s the same lulling life that led Greek government managers to underestimate risk when they undertook too many projects for their bleak budget to handle, piling on debt to manage it all. Once the economy came under pressure, capital dried up and Greece was left in crisis. That’s not to mention the lies the government told to get into the euro-zone and to keep its debt issues hidden.

What I would like to see from Greece and the Greek team moving forward is a hatred for losing. The team and Greek politicians and business managers should hate losing so much to make it intolerable. This intolerance should drive the necessary energy for winning, to lead players and managers to learn how to win and to approach their training and business and government operation with a fire for victory. I think it’s this competitive spirit that drives success in the United States, Germany and China today.

And the defeatist attitude needs to be reversed. Greeks are just as athletic, intelligent and creative as any Spaniard, German or other European. There’s no reason why the team shouldn’t be able to go head to head with its competition.

I also have a pet peeve with regard to cheating and lying, including the sort the Greek team (and other teams) employ to draw penalty or win some minor battle. It’s a lie when you fake an injury on the field of play, and the law on cheating and lying is plainly clear and applies to soccer as well as to life. If our players would fight through tough plays, like I know they can, I’m certain they would do better than they do by generating bad karma through lies on the fair field of play. Likewise, corporate and government corruption globally and corruption generally in Greece disgusts me. We should be better than that, based on the dictum of our faith, period! Once again, this is not a Greek problem, but a societal problem globally. Practicing false expertise while in actuality cheating and lying is also without excuse, especially when one judges others from that position. This again is a societal flaw, not a Greek one, but I would like to see us (people) rise above it.

There’s no reason why the Greek nation cannot lead Europe once again. But for that to happen, the nation must digest the reality of the situation together. The Greek citizenry must continue to push its politicians to do the right thing, or be replaced, even by newcomers. Perhaps, finally, the legacy of certain family dynasties garnering unwarranted levels of respect in Greece has ended. Leadership must be earned on a daily basis for it not to become complacent, and it should be regardless of last name or the legacy of ancestors.

You know, Nike (NYSE: NKE) had that great slogan, “Just do it,” and the old owner of the Oakland Raiders, Al Davis, use to say, “Just win baby!” It’s a simple message, but it’s true through the goal mouth. When victory is your goal, you find creative ways to make it happen when conventional methods do not work. Fervor and vigor - who has got it? That team or nation will be the victor nine times out of ten, unless the game clock stops first, because it will work hardest to make it be.

It’s the responsibility of the Greek government now to be creative, to find ways to create an expanding budget surplus and to create income opportunities for Greek citizens. It’s also the Greek government’s responsibility to raise its voice to the referee when treatment is unfair, and to that I refer to the IMF and EU, which are overstressing Greece. Granted, Greece dug its own grave, but the EU need not push the nation into it now, especially after leading it into the cemetery in the first place.

Whether it be with regards to Greece, the Greek citizenry or the Greek national soccer club, victory is going to take will, effort and creativity. Enough words like these have been written though. Now is the time for action and success or failure, and the respective fallout due to each. For Greece, I wish only the best, but I also demand the best of all Greeks.

See also Greece vs. Germany - A Game for Pride.

Editor's Note: This article should interest investors in National Bank of Greece (NYSE: NBG), Hellenic Telecommunications (NYSE: OTE), Coca-Cola HBC (NYSE: CCH), Teekay Corp. (NYSE: TK), Navios Maritime Holdings (NYSE: NM), Navios Maritime Acquisition (NYSE: NNA), Navios Maritime Partners L.P. (NYSE: NMM), Tsakos Energy Navigation Ltd. (NYSE: TNP), Overseas Shipholding Group (NYSE: OSG), International Shipholding (NYSE: ISH), Excel Maritime Carriers (NYSE: EXM), Safe Bulkers (NYSE: SB), Claymore/Delta Global Shipping ETF (NYSE: SEA), Genco Shipping & Trading (NYSE: GNK), Diana Shipping (NYSE: DSX), Danaos (NYSE: DAC), Tsakos Energy Navigation (NYSE: TNP), Ship Finance Int'l (NYSE: SFL), Nordic American Tanker (NYSE: NAT), Seaspan (NYSE: SSW), General Maritime (NYSE: GMR), DHT Maritime (NYSE: DHT), Brunswick (NYSE: BC), Marine Products Corp. (NYSE: MPX), DryShips (Nasdaq: DRYS), Top Ships (Nasdaq: TOPS), Eagle Bulk Shipping (Nasdaq: EGLE), Sino-Global Shipping (Nasdaq: SINO), Paragon Shipping (Nasdaq: PRGN), K-SEA Transportation Partners (NYSE: KSP), Euroseas (Nasdaq: ESEA), Star Bulk Carriers (Nasdaq: SBLK), Omega Navigation (Nasdaq: ONAV), Knightsbridge Tankers Ltd. (Nasdaq: VLCCF), TBS Int'l (Nasdaq: TBSI), Golar LNG (Nasdaq: GLNG), Claymore/Delta Global Shipping (Nasdaq: XSEAX), American Commercial Lines (Nasdaq: ACLI), Deutsche Bank (NYSE: DB), ITA (Nasdaq: ITUB), Banco Santander (NYSE: STD), Westpac Banking (NYSE: WBK), UBS (NYSE: UBS), Lloyd’s Banking Group (NYSE: LYG), Barclay’s (NYSE: BCS), Credit Suisse (NYSE: CS), Allied Irish Banks (NYSE: AIB), Banco Latinamerican (NYSE: BLX), Bank of America (NYSE: BAC), Citigroup (NYSE: C), Goldman Sachs (NYSE: GS), JP Morgan (NYSE: JPM), Morgan Stanley (NYSE: MS), European Equity Fund (NYSE: EEA), Vanguard European Stock Index (Nasdaq: VEURX), Powershares FTSE RAFI Europe (NYSE: PEF), Europe 2001 (NYSE: EKH), S&P Emerging Europe (NYSE: GUR), Ultrashort MSCI Europe (NYSE: EPV), Vanguard Europe Pacific (NYSE: VEA), Wisdomtree Europe SmallCap (NYSE: DFE), Wisdom Tree Europe Total Div (NYSE: DEB), iShares S&P Europe 350 (NYSE: IEV), Morgan Stanley Eastern Europe (NYSE: RNE), DWS Europe Equity A (Nasdaq: SERAX), DWS Europe Equity B (Nasdaq: SERBX), Fidelity Europe (Nasdaq: FEUFX), Fidelity Europe (Nasdaq: FIEUX), ICON Europe A (Nasdaq: IERAX), Pioneer Europe Fund (Nasdaq: PBEUX), ProFunds Europe 30 (Nasdaq: UEPIX), Putnam Europe A (Nasdaq: PEUGX), Rydex Europe 1.25x (Nasdaq: RYAEX).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Greece vs. Germany - A Game for Pride

Greece vs. Germany

From the very moment Greece was issued aid by its European partners, its harshest critic and most stern policeman has been Germany. The Germans, you see, are budget minded and perennially profitable. Thus, the nation’s austere populace wonders aloud why they should pay for Greek negligence.

Greeks on the streets of Athens and Greek-Americans in New York City counter with arguments about the infinite contributions of the Greek culture to society, the foundation upon which modern day Germany stands. Greeks will neither shy from reminding embarrassed Germans about the tonnage of gold and ancient relics stolen away during World War II, not to mention 10% of the Hellenic Republic’s population sacrificed in its impossible defense against the Nazis. That was one of the largest percentage losses by an Ally during the war, though did not compare to the atrocities suffered by the Jewish people.

So, in retrospect, perhaps it’s not too much to ask Germany for a little slack today, so that Greece might stand on its feet again. However, after the Greeks voted to endure continued austerity for the sake of remaining in the euro-zone, and to honor their debts to the EU and IMF, German Chancellor Angela Merkel only reiterated a strict stance for hard days for Greece. Others in Italy and Spain, where the taste of Greece’s pain is almost familiar, called for an extension of the time line for Greece to pay back its debt. Such grace would allow Greece to more gradually employ necessary measures in a means that might not overburden its economy and its people.

Much insult and injury has been delivered by each party in this family argument, but on Friday the nations will each get a chance to vent in a very competitive and direct manner. Greece faces Germany, you see, in the quarterfinals of the UEFA European Championship. To the winner goes the pride.

Picking the Winner

Greece does not match up well against Germany today in many regards, but if a comparison were made taking into account the course of history, well then we would have a different favorite. Let’s have some fun then picking a winner between Greece and Germany in this marquee matchup…

Category	Greece	Germany
FIFA World Soccer Ranking	15	3
Population	10.8 Million	81.9 Mln.
GDP Global Rank	#35	#4
Most Millionaires
Military Size	#29	#30
Contributions to Humanity
History
Passion
Most Euro Victories	1	3
Most Recent Euro Victory	2004	1996
Best Story If Victorious

**    Data by Wikipedia, except millionaires list which was published by Bloomberg Businessweek, and “Passion,” “History,” and “Best Story If Victorious,” which were determined by your very biased author.

Greece does not have a whole lot going on these days, save soup kitchens and suicides. Its population is much smaller than Germany’s, but its military is larger including reserves. Greece’s economy cannot compare to the cornerstone of Europe, which is Germany. As far as publicly traded companies, well, that is part of the problem. Greece’s industrial base is much less important than Germany’s, with Greece’s focus on tourism, agriculture and shipping. Take note though that the domicile of Greece’s significant shipping industry is not formally within Greece, and so not one company makes the list below.

The National Bank of Greece (NYSE: NBG) trades in penny stock territory at $1.76 per share in New York, though it’s still sporting a market capitalization of $1.68 billion. Germany’s best known bank is Deutsche Bank (NYSE: DB), trading upward of $35 per share, valuing the company at $32.7 billion. Germany’s largest companies are in fact on the tip of the tongue of most Americans, while Greek firms are generally not known except by Greek-American stock nerds like your Wall Street Greek.

Germany’s Largest Companies Notable to Americans:

• Allianz Worldwide (OTC: AZSEY)
• Daimler-Chrysler (OTC: DDAIF)
• Deutsche Bank (NYSE: DB)
• Siemens (NYSE: SI)
• Munich Re (MUV2.F)
• BMW Group (BMW.DE)
• Volkswagen (OTC: VLKPY)
• BASF (OTC: BASFY)
• Commerzbank (OTC: CRZBY)
• Bayer (OTC: BAYRY)
• ThyssenKrupp (OTC: TYEKF)
• SAP (NYSE: SAP)

For Greece, it’s a different story:

• National Bank of Greece (NYSE: NBG)
• Alpha Bank A.E. (OTC: ALBKY)
• Agricultural Bank of Greece (ATE.AT)
• Viohalco S.A. (BIOX.AT)
• Bank of Cyprus (BOC.AT)
• Coca-Cola Hellenic Bottling Co. (NYSE: CCH)
• Ellaktor S.A. (ELTEX.AT)
• Hellenic Petroleum (ELPE.AT)
• EFG Eurobank Ergasias S.A. (OTC: EGFEY)
• Hellenic Telecommunications (OTC: HLTOY)
• INTRALOT S.A. (OTC: IRLTY)
• Marfin Financial Group (OTC: MRFGY)
• Marfin Investment Group (MIG.AT)
• Motor Oil Corinth Refineries (MOH.AT)
• Mytilineos Holdings (MYTIL.AT)
• OPAP SA (OTC: GOFPY)
• Public Power Corp. (PPC.AT)
• Titan Cement (TITK.AT)
• Piraeus Bank (TPEIR.AT)
• TT Hellenic Postbank SA (TT.AT)

It’s a list of never heard of names for most of you.

Clearly, economically speaking, Greece is a second class citizen. Much of this is because of the great brain drain that occurred for Greece after Ottoman rule and during the dark days following World War II. Whether because of communism and civil war, or for survival’s sake, a great many Greeks left Greece and are now domiciled across the globe. Greeks are leaving again today for their own survival, and are being welcomed across the globe by their brethren. It’s unfortunate that sometimes they never return.

As far as soccer goes, there’s a beautiful fairness in play. On any given day, any given team can beat any other team. That is because it will not be 80 million against 10 million on Friday; GDP nor personal wealth will matter when the national teams meet on the pitch. What will matter is passion and pride, two factors which run richly in Greeks. Yet, the Greek team is overmatched, as is clear by the FIFA rankings and by the play of both teams through the tournament thus far. But, these two teams have not met yet. Germany is a strong soccer squad, and just like its culture, it succeeds through science and scheme. For Greece, though, the game itself often determines how well the team plays. When Greece met with host Poland in the first round, it seemed to have compassion for the lesser rival, and the result was a tie. Against the Czech Republic, perhaps the Greek team recalled its important victory en route to its magical 2004 triumph, and so a loss resulted. When it came to Russia, winning was critical to the Greek team, and so they played to their full potential. Beating Germany is more than critical; it is a national necessity.

Editor's Note: This article should interest investors in National Bank of Greece (NYSE: NBG), Hellenic Telecommunications (NYSE: OTE), Coca-Cola HBC (NYSE: CCH), Teekay Corp. (NYSE: TK), Navios Maritime Holdings (NYSE: NM), Navios Maritime Acquisition (NYSE: NNA), Navios Maritime Partners L.P. (NYSE: NMM), Tsakos Energy Navigation Ltd. (NYSE: TNP), Overseas Shipholding Group (NYSE: OSG), International Shipholding (NYSE: ISH), Excel Maritime Carriers (NYSE: EXM), Safe Bulkers (NYSE: SB), Claymore/Delta Global Shipping ETF (NYSE: SEA), Genco Shipping & Trading (NYSE: GNK), Diana Shipping (NYSE: DSX), Danaos (NYSE: DAC), Tsakos Energy Navigation (NYSE: TNP), Ship Finance Int'l (NYSE: SFL), Nordic American Tanker (NYSE: NAT), Seaspan (NYSE: SSW), General Maritime (NYSE: GMR), DHT Maritime (NYSE: DHT), Brunswick (NYSE: BC), Marine Products Corp. (NYSE: MPX), DryShips (Nasdaq: DRYS), Top Ships (Nasdaq: TOPS), Eagle Bulk Shipping (Nasdaq: EGLE), Sino-Global Shipping (Nasdaq: SINO), Paragon Shipping (Nasdaq: PRGN), K-SEA Transportation Partners (NYSE: KSP), Euroseas (Nasdaq: ESEA), Star Bulk Carriers (Nasdaq: SBLK), Omega Navigation (Nasdaq: ONAV), Knightsbridge Tankers Ltd. (Nasdaq: VLCCF), TBS Int'l (Nasdaq: TBSI), Golar LNG (Nasdaq: GLNG), Claymore/Delta Global Shipping (Nasdaq: XSEAX), American Commercial Lines (Nasdaq: ACLI), Deutsche Bank (NYSE: DB), ITA (Nasdaq: ITUB), Banco Santander (NYSE: STD), Westpac Banking (NYSE: WBK), UBS (NYSE: UBS), Lloyd’s Banking Group (NYSE: LYG), Barclay’s (NYSE: BCS), Credit Suisse (NYSE: CS), Allied Irish Banks (NYSE: AIB), Banco Latinamerican (NYSE: BLX), Bank of America (NYSE: BAC), Citigroup (NYSE: C), Goldman Sachs (NYSE: GS), JP Morgan (NYSE: JPM), Morgan Stanley (NYSE: MS), European Equity Fund (NYSE: EEA), Vanguard European Stock Index (Nasdaq: VEURX), Powershares FTSE RAFI Europe (NYSE: PEF), Europe 2001 (NYSE: EKH), S&P Emerging Europe (NYSE: GUR), Ultrashort MSCI Europe (NYSE: EPV), Vanguard Europe Pacific (NYSE: VEA), Wisdomtree Europe SmallCap (NYSE: DFE), Wisdom Tree Europe Total Div (NYSE: DEB), iShares S&P Europe 350 (NYSE: IEV), Morgan Stanley Eastern Europe (NYSE: RNE), DWS Europe Equity A (Nasdaq: SERAX), DWS Europe Equity B (Nasdaq: SERBX), Fidelity Europe (Nasdaq: FEUFX), Fidelity Europe (Nasdaq: FIEUX), ICON Europe A (Nasdaq: IERAX), Pioneer Europe Fund (Nasdaq: PBEUX), ProFunds Europe 30 (Nasdaq: UEPIX), Putnam Europe A (Nasdaq: PEUGX), Rydex Europe 1.25x (Nasdaq: RYAEX).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Buy Stocks as PIIGS will Escape Slaughter!

With the Greek elections, the second of the sort, due this weekend, bond investors have been leading the PIIGS to slaughter this week. Rising bond yields in Spain forced the pivotal European nation to seek assistance last weekend, which in turn drew a downgrade by Moody’s (NYSE: MCO) this morning. The threshold to the ultimate disaster may soon be breached, with Italian bond yields rising sharply today. But, never fear dear readers and panicked investors, because the Greek result seems set up for a relief rally. So, please be sure to read this report full through.

Relative tickers include SPDR S&P 500 (NYSE: SPY), Vanguard MSCI Europe ETF (NYSE: VGK), iShares MSCI Spain Index (NYSE: EWP), iShares MSCI Italy Index (NYSE: EWI), Global X FTSE Greece 20 ETF (NYSE: GREK), National Bank of Greece (NYSE: NBG), Coca-Cola Hellenic (NYSE: CCH), Hellenic Telecommunications (OTC: HLTOY) and Marfin Investment (MIG.AT).

Buy Stocks Now

Spain’s sovereign debt rating was cut to one level above junk today, to Baa3, from A3. Moody’s said Spanish risk was heightened due to the risk of a Greek exit from the euro zone, and resulting full catastrophe. This is of course the market’s worst nightmare, because if debt costs increase across Europe’s most indebted nations, it might force the EU’s leading backers (aka Germany and France) to re-evaluate whether it’s worthwhile for them to continue carrying their cross. Thus, it could be the end of the euro-zone as we know it, or worse yet, the end of Europe’s united economy. That’s why stocks have been on the downslide up until now.

Wall Street is bothered by the Spanish 10-year bond rate above 7% today, up markedly from yesterday. If Spain cannot borrow at manageable cost, it will be in need of the same sort of rescue Greece keeps receiving. The problem here is of course that the Spanish economy is much more significant than the Greek feta foray version. Spain represents the world’s 12th largest economy in fact, but the disease would likely spread from there, which is terrifying Brussels today.

Italy is even more important than Greece or Spain, and while Italian 10-year bond costs hardly moved today, the nation’s just issued debt was sold at much higher cost. Italian 3-year bond yields were up more than a percentage point, while 7-year bonds almost reached a point higher as well. This is the worst case scenario that the world has sought to mitigate since the Greek crisis began. As a result, European shares were lower Thursday morning, with the Euro STOXX 50 Price EUR down 0.3% nearing the day’s close; but that was a bit better than the start of the day.

In fact, the Vanguard MSCI Europe ETF (NYSE: VGK), iShares MSCI Spain Index (NYSE: EWP) and the iShares MSCI Italy Index (NYSE: EWI) are each markedly higher Thursday. Even the Global X FTSE Greece 20 ETF (NYSE: GREK) is up 9.5%. Heck, the National Bank of Greece (NYSE: NBG), Coca-Cola Hellenic (NYSE: CCH), Hellenic Telecommunications (OTC: HLTOY) and Marfin Investment (MIG.AT) were all higher by large margin. So what gives then?

A bit of interesting news reached the wire over the past couple days, but it was largely overlooked by the market. The head of the disruptive Greek political coalition, Syriza, Alexis Tsipras, said that he would not lead Greece out of the euro zone. Well, that would seem to defuse the ticking time bomb, because the market’s greatest concern has been that Greek political change might change the course for Greece with regard to its European monetary ties. That’s exactly what speculative smart money is betting against today, sending these shares in what would seem counterintuitive direction, which is higher. That’s the direction I would advise aggressive investors to take as well to participate in what should be a super relief rally. I think the same is in store for the S&P 500, with the SPDR S&P 500 (NYSE: SPY) off 5.7% since the start of May. Guess what: it’s up Thursday morning and I’m looking for much more over the coming hours and days.

This is a forecast that runs against the tide, so I’m out on a limb. Give an unbiased strategist some respect for the guts to make such a call, and credit if my forecast proves true. Follow our blog for more insight and actionable advice.

Article should interest investors in SPDR Dow Jones Industrial Average (NYSE: DIA), SPDR S&P 500 (NYSE: SPY), PowerShares QQQ Trust (Nasdaq: QQQ), ProShares Short Dow 30 (NYSE: DOG), ProShares Ultra Short S&P 500 (NYSE: SDS), ProShares Ultra QQQ (NYSE: QLD), NYSE Euronext (NYSE: NYX), The NASDAQ OMX Group (Nasdaq: NDAQ), Intercontinental Exchange (NYSE: ICE), E*Trade Financial (Nasdaq: ETFC), Charles Schwab (Nasdaq: SCHW), Asset Acceptance Capital (Nasdaq: AACC), Affiliated Managers (NYSE: AMG), Ameriprise Financial (NYSE: AMP), TD Ameritrade (Nasdaq: AMTD), BGC Partners (Nasdaq: BGCP), Bank of New York Mellon (NYSE: BK), BlackRock (NYSE: BLK), CIT Group (NYSE: CIT), Calamos Asset Management (Nasdaq: CLMS), CME Group (NYSE: CME), Cohn & Steers (NYSE: CNS), Cowen Group (Nasdaq: COWN), Diamond Hill Investment (Nasdaq: DHIL), Dollar Financial (Nasdaq: DLLR), Duff & Phelps (Nasdaq: DUF), Encore Capital (Nasdaq: ECPG), Edelman Financial (Nasdaq: EF), Equifax (NYSE: EFX), Epoch (Nasdaq: EPHC), Evercore Partners (NYSE: EVR), EXCorp. (Nasdaq: EZPW), FBR Capital Markets (Nasdaq: FBCM), First Cash Financial (Nasdaq: FCFS), Federated Investors (NYSE: FII), First Marblehead (NYSE: FMD), Fidelity National Financial (NYSE: FNF), Financial Engines (Nasdaq: FNGN), FXCM (Nasdaq: FXCM), Gamco Investors (NYSE: GBL), GAIN Capital (Nasdaq: GCAP), Green Dot (Nasdaq: GDOT), GFI Group (Nasdaq: GFIG), Greenhill (NYSE: GHL), Gleacher (Nasdaq: GLCH), Goldman Sachs (NYSE: GS), Interactive Brokers (Nasdaq: IBKR), INTL FCStone (Nasdaq: INTL), Intersections (Nasdaq: INTX), Investment Technology (NYSE: ITG), Invesco (NYSE: IVZ), Jefferies (NYSE: JEF), JMP Group (NYSE: JMP), Janus Capital (NYSE: JNS), KBW (NYSE: KBW), Knight Capital (NYSE: KCG), Lazard (NYSE: LAZ), Legg Mason (NYSE: LM), LPL Investment (Nasdaq: LPLA), Ladenburg Thalmann (AMEX: LTS), Mastercard (NYSE: MA), Moody’s (NYSE: MCO), MF Global (NYSE: MF), Moneygram (NYSE: MGI), MarketAxess (Nasdaq: MKTX), Marlin Business Services (Nasdaq: MRLN), Morgan Stanley (NYSE: MS), MSCI (Nasdaq: MSCI), MGIC Investment (NYSE: MTG), NewStar Financial (Nasdaq: NEWS), National Financial Partners (NYSE: NFP), Nelnet (NYSE: NNI), Northern Trust (Nasdaq: NTRS), NetSpend (Nasdaq: NTSP), Ocwen Financial (NYSE: OCN), Oppenheimer (NYSE: OPY), optionsXpress (Nasdaq: OXPS), PICO (Nasdaq: PICO), Piper Jaffray (NYSE: PJC), PMI Group (NYSE: PMI), Penson Worldwide (Nasdaq: PNSN), Portfolio Recovery (Nasdaq: PRAA), Raymond James (NYSE: RJF), SEI Investments (Nasdaq: SEIC), Stifel Financial (NYSE: SF), Safeguard Scientifics (NYSE: SFE), State Street (NYSE: STT), SWS (NYSE: SWS), T. Rowe Price (Nasdaq: TROW), Visa (NYSE: V) and Virtus Investment Partners (Nasdaq: VRTS).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Get Out of Bonds!

Shakespeare wrote in Hamlet, “Neither a borrower nor a lender be.” With long-term rates repressed artificially by the Federal Reserve to historically low levels, I want to modify this phrase to “Neither a lender but a borrower be.” Clearly a bubble has formed as conservative and risk adverse capital has fled to the “safety” of US Treasury Bonds. The decision for bonds is not whether to exit the market, but when.

Relative tickers include Federated Investors (NYSE: FII), Barclay's (NYSE: BCS), T. Rowe Price (Nasdaq: TROW), State Street (NYSE: STT), BlackRock (NYSE: BLK) and J.P. Morgan Chase (NYSE: JPM).

Sell Bonds

I have had the privilege of interviewing Charles Nenner when in mid- 2011 he forecast the bottoming of the CPI in April 2012 and the bottoming of the PPI in October 2012, heralding the end of the deflationary cycle of 30 years which began in the Volcker years of 1981-1982. The 1975-1979 timeframe exhibited the final stages of inflation with a “blow-off” era of double-digit inflation. Perhaps 2012 will exhibit the final deflationary dip this summer. According to Charles Nenner, in late 2012 the inflationary cycle starts again, and will be active for the next 30 years, when bond rates are so low there is very little room left to drop lower; the path of least resistance is up. Charles Nenner, in recent interviews, has again reiterated his call that long-term bonds will bottom this summer. This does not bode well for the stock and bond market. Furthermore, Lakshman Achuthan of The Economic Cycle Research Institute has again re-affirmed ECRI's call for an imminent recession, coinciding with the regularly published concerns of our Editor-in-Chief, Markos Kaminis; this also does not bode well for stocks. Typically, a recession kills inflation, which by combining both forecasts would indicate more immediate deflation and a slow building into an extended inflationary period. Interestingly, the array of ECRI indicators shows an uptick in the Housing Index.

If bond rates are bottoming and inflation is beginning, asset allocation will become paramount to protecting and growing wealth. The onset of a recession should drive rates down; an attempt by the Federal Reserve to stimulate the economy once again with QE3 may drive rates lower yet, for a very short-term. This window presents an enormous opportunity, perhaps a generational buying opportunity to purchase Real Estate at still discounted pricing to capture historically repressed and artificially low long-term rates; it’s an irresistible package. Mortgages in the US are typically obtained with an interest rate fixed for the entire length of the loan and amortized fully over a 15 or 30 year term. This will be an enormous advantage to a family or an investor in the coming years should rates return to 5% to 7% or higher.

Initially, should the US enter a recession, the cash flow generated by the rental income would mitigate reduced earnings from stock dividends and any bonds still held. A recession would reduce new construction and further exacerbate a tightening housing market, balancing the rental market between declining personal income from a weakening job market and the need for basic shelter. The income stream generated by rental property should remain viable, with possibly a little downward pressure; more so if the economic downturn turns vicious, but still producing a dependable monthly revenue source several basis points above US Treasury Rates.

There is a strong possibility we could endure a very vicious economic slowdown. As our chief here at Wall Street Greek has warned regularly will happen, and as Lakshman Achuthan has indicated in several of his interviews, an “event or black swan” can turn a mild recession into something worse. In order to protect one's wealth and future, personal debt costs need to be reduced, reserves need to be expanded to withstand a two-year slowdown, and any underwater or non-cash flowing properties need to be reviewed for liquidation via the short sale process to reduce the income and fiscal drag from these negative properties.

Qualified investors should start to position for the recovery that will certainly follow the slowdown, and accumulate quality properties that have the potential to grow in both value and increase revenue. A slowdown will bring properties held by weaker investors to the market, perhaps at very attractive pricing. Going forward, pricing may soften as higher mortgage rates depress affordability and dampen demand. The offset will be rising rents, as supply is further curtailed spiraling into shortages; higher rates brings higher mortgage and housing payments which evolves into higher rent. Currently, a package of both discounted pricing and historically low and repressed fixed mortgage rates present an appealing mixture. Further, the US Leading Home Index of ECRI has been trending positively against a back drop of declining indicators, forecasting a possible bottom in the devastated U.S. housing market. ECRI has a stellar record of forecasting inflection points and trends. As devastated as housing has been, it may be the safer asset to protect and grow wealth in the coming years.

With Treasury Bonds in a possible bubble, a prudent investor should consider capturing gains on a large portion of his fixed income portfolio. Furthermore, he should move capital into rental properties capable of maintaining current income and growing forward earnings, which is extremely important in a deflationary environment, but also important for hedging in an inflationary environment. Accumulating investment properties with dependable monthly income as well as offering potential for asset growth should be considered and reviewed with your adviser. The risk to a bond portfolio may soon be much, much, greater than ever anticipated. Thus, it’s time to get out of bonds.

Article should interest investors in SPDR Dow Jones Industrial Average (NYSE: DIA), SPDR S&P 500 (NYSE: SPY), PowerShares QQQ Trust (Nasdaq: QQQ), ProShares Short Dow 30 (NYSE: DOG), ProShares Ultra Short S&P 500 (NYSE: SDS), ProShares Ultra QQQ (NYSE: QLD), NYSE Euronext (NYSE: NYX), The NASDAQ OMX Group (Nasdaq: NDAQ), Intercontinental Exchange (NYSE: ICE), E*Trade Financial (Nasdaq: ETFC), Charles Schwab (Nasdaq: SCHW), Asset Acceptance Capital (Nasdaq: AACC), Affiliated Managers (NYSE: AMG), Ameriprise Financial (NYSE: AMP), TD Ameritrade (Nasdaq: AMTD), BGC Partners (Nasdaq: BGCP), Bank of New York Mellon (NYSE: BK), BlackRock (NYSE: BLK), CIT Group (NYSE: CIT), Calamos Asset Management (Nasdaq: CLMS), CME Group (NYSE: CME), Cohn & Steers (NYSE: CNS), Cowen Group (Nasdaq: COWN), Diamond Hill Investment (Nasdaq: DHIL), Dollar Financial (Nasdaq: DLLR), Duff & Phelps (Nasdaq: DUF), Encore Capital (Nasdaq: ECPG), Edelman Financial (Nasdaq: EF), Equifax (NYSE: EFX), Epoch (Nasdaq: EPHC), Evercore Partners (NYSE: EVR), EXCorp. (Nasdaq: EZPW), FBR Capital Markets (Nasdaq: FBCM), First Cash Financial (Nasdaq: FCFS), Federated Investors (NYSE: FII), First Marblehead (NYSE: FMD), Fidelity National Financial (NYSE: FNF), Financial Engines (Nasdaq: FNGN), FXCM (Nasdaq: FXCM), Gamco Investors (NYSE: GBL), GAIN Capital (Nasdaq: GCAP), Green Dot (Nasdaq: GDOT), GFI Group (Nasdaq: GFIG), Greenhill (NYSE: GHL), Gleacher (Nasdaq: GLCH), Goldman Sachs (NYSE: GS), Interactive Brokers (Nasdaq: IBKR), INTL FCStone (Nasdaq: INTL), Intersections (Nasdaq: INTX), Investment Technology (NYSE: ITG), Invesco (NYSE: IVZ), Jefferies (NYSE: JEF), JMP Group (NYSE: JMP), Janus Capital (NYSE: JNS), KBW (NYSE: KBW), Knight Capital (NYSE: KCG), Lazard (NYSE: LAZ), Legg Mason (NYSE: LM), LPL Investment (Nasdaq: LPLA), Ladenburg Thalmann (AMEX: LTS), Mastercard (NYSE: MA), Moody’s (NYSE: MCO), MF Global (NYSE: MF), Moneygram (NYSE: MGI), MarketAxess (Nasdaq: MKTX), Marlin Business Services (Nasdaq: MRLN), Morgan Stanley (NYSE: MS), MSCI (Nasdaq: MSCI), MGIC Investment (NYSE: MTG), NewStar Financial (Nasdaq: NEWS), National Financial Partners (NYSE: NFP), Nelnet (NYSE: NNI), Northern Trust (Nasdaq: NTRS), NetSpend (Nasdaq: NTSP), Ocwen Financial (NYSE: OCN), Oppenheimer (NYSE: OPY), optionsXpress (Nasdaq: OXPS), PICO (Nasdaq: PICO), Piper Jaffray (NYSE: PJC), PMI Group (NYSE: PMI), Penson Worldwide (Nasdaq: PNSN), Portfolio Recovery (Nasdaq: PRAA), Raymond James (NYSE: RJF), SEI Investments (Nasdaq: SEIC), Stifel Financial (NYSE: SF), Safeguard Scientifics (NYSE: SFE), State Street (NYSE: STT), SWS (NYSE: SWS), T. Rowe Price (Nasdaq: TROW), Visa (NYSE: V) and Virtus Investment Partners (Nasdaq: VRTS).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Buy Oil Here

Oil prices took a nosedive since the start of May on concern regarding global economic growth. The demand side of the equation has thus been penalized just as reserve supplies of domestic resources (mostly natural gas) have also been on the increase. So, suddenly petroleum prices turned on a determined path of decline. The United States Oil (NYSE: USO) and the iPath S&P GSCI Crude Oil TR Index ETN (NYSE: OIL) are off roughly 20% each since their May 1st cliff’s edge. However, I warn, the same factors that took oil and its distillates higher before the latest slide have not subsided and will again soon spur oil and gasoline prices higher once more. Thus, investors may benefit from dollar cost averaging petroleum relative buys from this point. The shares of Exxon Mobil (NYSE: XOM) and ConocoPhillips (NYSE: COP) are each up sharply today after following the downdraft of oil prices since the start of May, but the ground they might retrace is vast.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

The Oil Price Blame Game

President Obama recently raised the issue about speculators’ possibly playing a role in driving unwarranted price change in commodities, namely in oil prices. It’s a popular topic these near-election days, as petroleum distillate prices reach into the pocketbook of most voting Americans. Namely, gasoline prices have been bothering Americans most, and according to many polls, our countrymen believe the President and Congress can do something about the price of gas. A low hanging fruit, the GOP has of course highlighted the issue as a cause of concern about President Obama and his prioritizing of the environment (they say irrelevantly) over energy, pointing to debate about the Keystone Pipeline. So, it would seem, the President struck back, targeting that mysterious factor which is hard to pinpoint and a favorite pincushion of the 99% of late - Wall Street.

The same thing happened in Europe when economic lies, excessive debt, corruption and inept governing drove European Union member Greece into catastrophe. The mob of course blamed Wall Street first, namely Goldman Sachs (NYSE: GS), for misleading the soft-hearted sheep leading the country, many of whom were stealing away millions in misappropriated funds, into financial catastrophe. However, as every MBA should know, the market is efficient over the long-term and no unwarranted mispricing can thus last long enough to factor. Still, the vague discussion that will ensue in the coffee shops of Greenwich Village and diners across the heart of the nation will place the blame squarely on the usual suspect, that greedy group of traders and hedge fund honchos on Wall Street.

I think the President is playing unfairly here for political purposes, and it’s just not right. He said he’s going to push to increase regulatory might to stop manipulation. There’s nothing wrong with stopping crooked activity, but this begs to question: Who has gone to jail for rating mortgage backed securities triple-A credits deep into the real estate downturn? Why is the rating model employed by Standard & Poor’s (NYSE: MHP) and Moody’s (NYSE: MCO), where the issuer pays for his rating, still the standard or even in existence? Imagine if a company’s stock were rated “strong buy,” and you owned it into an abysmal loss, and then later found out that it had paid the firm that rated it a service fee? Do you think that’s Kosher? So why is our government finding religion on one issue and losing its faith on a critical one? It’s because of votes and tax revenue of course; I’ll get into this one later.

The President’s pointing to gasoline price gamers forces free market defenders into action. The factors of the price of any security are never singular, and always grammatically in conflict, because there are always many. In this case, let’s start with the most obvious.

What led the latest surge in petroleum prices has been the intensification of the geopolitical concern about Iran, its nuclear program, the West’s issue with it, and the sanctioning effort to stop it. Iran represents an important source of a critical global commodity, and it also could threaten the global distribution of petroleum through the disruption of its flow at the Strait of Hormuz.

This issue, and also the possibility of secret agreements around the issue that have possibly tied many groups and perhaps even some nations (the obvious are Venezuela, Syria, Hezbollah, Hamas; others are too dreadful to discuss) into strategic or military alliance, are of significance. Up until recently, and for some for just a short while longer, Iran represented an important petroleum source. We are talking about the likes of Greece and India, where disruption could have dramatic consequences. Where China really stands on this issue is likely to become better understood as the horrible effects of any disruption play out. In other words, I worry about, and obviously the petroleum market is bothered by, global economic consequences to the engagement of Iran. While that might lessen demand, severe disruption of the important fuel resource would clearly drive prices much higher. So, it would seem that mindful investors, often known as smart money, have also been aware and investing in line with what the President seems to blame speculation for.

Dilution of Fiat Currency
Blame should also fall partly on the Federal Reserve, which while diluting the value of the dollar, lifts the prices of the commodities it is used to value. Sustained low interest rates and quantitative easing serve an expansionary economic purpose. However, the result, in isolation, is also a depreciated currency against commodities like oil and gold. I say in isolation because nascent weakness in the euro and the yen has acted as counterbalancing weight in favor of the dollar.

But what will happen when those counterweights are lifted away or when the dollar pays for the day’s needs? Suddenly the dollar will drop like a rock, spurring hyperinflation and lifting the price of commodities beyond their recent highs. Even if the counterweights are not lifted, the continued dilution of fiat currency value will work against us. As Europe ties itself even closer together, its euro will be more burdened as its economies contract a contagious illness. As economic growth is stymied by misguided and mistimed austerity, even currently manageable debt becomes troubling. Thus, fiat currency globally could become contaminated, lifting the prices of goods, starting with commodities.

Add Oil Here
Any way this plays out, and whichever factor takes the lead, the price of oil will rise again without any defusing action to stop it. Political hijacking of the issue only serves to further cloud the view of the truly dangerous factors causing it. Those real driving factors must be mitigated, before risk is realized. Since I’m near certain they will not be, look for this latest oil price break to prove temporary.

Article interests energy investors including Exxon Mobil (NYSE: XOM), BP (NYSE: BP), PetroChina (NYSE: PTR), Petrobras (NYSE: PZE), Royal Dutch Shell (OTC: RYDAF.PK), Total (NYSE: TOT), Chevron (NYSE: CVX), Repsol (OTC: REPYY.PK), ConocoPhillips (NYSE: COP), Eni SpA (NYSE: E), Sasol (NYSE: SSL), Encana (NYSE: ECA), Suncor (NYSE: SU), Imperial Oil (AMEX: IMO), Statoil (NYSE: STO), Cenovus (NYSE: CVE), Transocean (NYSE: RIG), Penn West Petroleum (NYSE: PWE), Continental Resources (NYSE: CLR), Noble (NYSE: NE), Concho (NYSE: CXO), Diamond Offshore (NYSE: DO), Ensco (NYSE: ESV), Whiting Petroleum (NYSE: WLL), Nabors (NYSE: NBR), Pride International (NYSE: PDE), Helmerich & Payne (NYSE: HP), QEP Resources (NYSE: QEP), Enerplus (NYSE: ERF), Rowan (NYSE: RDC), Cobalt (NYSE: CIE), Patterson UTI (Nasdaq: PTEN), SandRidge (NYSE: SD), Schlumberger (NYSE: SLB), Halliburton (NYSE: HAL), National Oilwell Varco (NYSE: NOV), Baker Hughes (NYSE: BHI), Weatherford International (NYSE: WFT), Cameron (NYSE: CAM), FMC Tech (NYSE: FTI), Oil States International (NYSE: OIS), Superior Energy (NYSE: SPN), Carbo Ceramics (NYSE: CRR), Helix Energy (NYSE: HLX), Pioneer (NYSE: PXD), CNOOC (NYSE: CEO), China Petroleum and Chemical (NYSE: SNP), Ecopetrol (NYSE: EC), Canadian Natural Resources (NYSE: CNQ), Apache (NYSE: APA), Anadarko (NYSE: APC), Devon (NYSE: DVN), EOG (NYSE: EOG), Chesapeake (NYSE: CHK).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.