Mario Cavolo: Speaker, Market Advisory, Radio Host

There is no substitute for the daily hours and hours of studying, researching and watching the markets. While it is analytical, you also develop a feel for it that's hard to explain, "get in the groove" so to speak. That's just when the market will make a fool of you. With those caveats in mind, if you are long stocks right now, you're basically out of your mind. WHY would you be long stocks right now? The markets are correcting downward lead by the China/HK markets because valuations after this past year's rise are too high relative to overall economic health. As you may know, the stock markets anticipate the economic situation by around six months. In other words, if the stock market is rising for a few months as it did last year, it is doing so anticipating, we could say hoping, that the economic fundamentals will follow over the course of the next six months or so. The other rule to remember is that the stock markets and other asset classes like commodities & gold will generally go up when interest rates go down. Simple. If you want to understand the markets, you must look at and understand the correlations between the asset classes- global stocks (Euro, U.S., China/HK/Japan), gold, oil, and currencies. If you only watch one or two of them, you are at a big disadvantage. How can you possibly understand stock and gold movements if you don't understand the connection to the EUR/USD and AUD/JPY movements? Beyond that, there are the agricultural commodities to consider.

Next Page- Global Market Review

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Apologies for last week's technical difficulties; we are back this week at the regularly scheduled time - Tuesday 8pm Beijing Time / Monday 8pm PST. Enjoy listening with our radio show player on the right or check out the Grassroots Talks Radio website and player at the links below

Back to back on Monday evening starting at 8pm til 10pm PST / Tuesday Noon - 2pm Beijing time

Grassroots Talks Money with Mario Cavolo - Monday 8pm EST / Noon Beijing time (+15 hours)
Grassroots Talks Health with Mario Cavolo - Monday 9pm EST / 1pm Beijing time (+15 hours)
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...this just in by Peter Brimelow at MarketWatch, its good to see intelligent, insightful observations worth their salt in this article...pay attention. However, I beg to differ on the China "crash" idea, while it certainly is going to be a wild ride.

Remember Mario's China Caveat: Unlike the U.S. and the rest of the world, China and her citizens have the CASH CASH CASH. They CAN afford to stimulus spend for several more years in the face of any nasty black swan events that are sure to come along and send the markets reeling. Meanwhile, I am deeply disturbed by the recent ( I mean THIS month) property price spikes that have everyone scratching their heads except the greedy bankers, real estate developers and govt leaders who are all at the same party orchestrating it and making themselves fat...the rest of the citizens of Chinese society who can no longer afford a home have been screwed American style...this too much too fast real estate hyper-inflation is big-time screwing up what is otherwise this century's impressive story of a country's growth and expansion; there is going to be a nasty backlash within two years max...Cheers, Mario

Brimelow's article excerpt with Richard Russel & Byron King on next page...

Here is MarketClub's New Crude Oil Video Again, these are outstanding, brief and to the point videos by Adam Hewison. In this video he clearly points out out an important cycle to watch on the crude oil chart and how you can take advantage of it in your trading. As always the videos are free to watch and there are no registration requirements. But please do comment on this video if you find it interesting and informative.

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Sorry to report we had a fairly major computer equipment blowup early this morning in the radio station room at our Grassroots Talks office in Los Angeles. Should be back on line within a couple of days and in the meanwhile enjoy the 24 hour music stream and we'll catch you on line same time next week...Cheers, Mario

"If the globe is ready to do the exit strategy, China is ready," he said. "A lot of global coordination is required."

That amazingly lucid and sane quote comes from People's Bank of China deputy governor Zhu Min, stated at the World Economic Forum's annual meeting this past Saturday.

What, to be more exact, was he really saying? Referring to today' s MarketWatch article, "China has resisted criticism from the United States, Europe and others that the yuan's peg to the dollar unfairly undercuts exporters outside of China."

So in other words, he said that China's RMB/USD peg is a strategic stimulus policy by China, no different than other country's strategic stimulus policies such as printing trillions of dollars by the United States to finance the financial industry bailout and provide stimulus to their economy.

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The 104 nuclear reactors in operation in 31 states provide only 20 percent of the nation's electricity. But they are responsible for 70 percent of the power from non-greenhouse gas producing sources, including wind, solar and hydroelectric dam.

He's (Obama) now calling for a new generation of nuclear power plants.

This is incredible. Today there are 104 nuclear power plants in the United States and nuclear power currently provides 20 percent of the nation's electricity. Wow! I thought it was more like 2%, not 20%. China recently announced a more aggressive nuclear energy program with plans to build 50 more nuclear energy plants.

From the article:

President Barack Obama is endorsing nuclear energy like never before, trying to win over Republicans and moderate Democrats on climate and energy legislation. Obama singled out nuclear power in his State of the Union address, and his spending plan for the next budget year is expected to include billions more dollars in federal guarantees for new nuclear reactors. This emphasis reflects both the political difficulties of passing a climate bill in an election year and a shift from his once cautious embrace of nuclear energy.

Especially considering the incredible damage to our planet with oil as our main energy source, it seems clear enough that the future of earthly existence has plenty of other options to keep the lights on without making any more oil companies and Saudi princes richer than they already are.

AP Newswire Article at INO

Cheers, Mario

Information in this article comes from sources believed to be reliable. Mario Cavolo does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. The author may or may not hold positions in issues referred to in this article. No representations are to be taken as advice or recommendation by the author to buy or sell any asset. Copyright ? 2010, Mario Cavolo. All Rights Reserved.