Today's King Report:
Small and midcap stocks were the last vestige of hope for bulls. As investors liquidated OTC stocks and larger cap stocks, they
fled to the small and midcaps. Of course, it takes less money to move those stocks. Yesterday, the wheels blew off the bull cart.
The capitulation is gaining momentum.
DJ’s reports “commercial paper outstanding plummeted in June”, which signals no recover in business investment. May’s $14.7B
rise was obliterated by June’s $38.7B collapse. Morgan Stanley avers “the persistent declines short-term borrowing run contrary
to the notion of a vibrant recovery process.” We noted a few weeks ago that C&I loans had collapsed at an unprecedented rate.
They continue to fall. There can be no recovery until they increase, unless business can generate a substantial increase in profits
with current capitalization. The Cubs are more likely to win the World Series.
Today – Expected economic data: jobless 385k; ISM Non-manufacturing 58.2; May factory orders 0.5. Futures are up moderately
overnight. Operators will try to orchestrate a rally for the 4th, especially with reduced attendance. The media has avidly publicized
terrorist warnings for the 4th, so some wise guys, figuring the odds are against an attack, will carefully get long for an anticipated
relief rally after the 4th.
The media is remiss in explaining that Senator Frank Church and Congressman Otis Pike’s Foreign Intelligence Surveillance Act
(FISA), signed by, yikes! Jimmy Carter, severely handicapped US intelligence agencies in interdicting terrorism because it prohibits
surveillance and info collection on certain groups. Slick further encumbered US intel by expanding the law in 1995 to prohibit
searches of group members if there was no probable cause to suspect a crime had been committed. So much for prevention! Since it
is the 4th, we won’t speculate if the media is shielding the above because they all belong to the political party that is closely
aligned with elite media ideology.
A survey by HMO consultant Milliman USA says HMO premiums “will rise an average 17%” with certain regions of the US
having even higher increases. Good thing inflation is contained.
The Japan Times reports, according to the Finance Ministry, “Japanese monetary authorities have spent more than 3 trillion yen
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