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Saturday, May 8, 2010

May 8, 2010, Bob Brinker's Moneytalk: Summary, Excerpts and Commentary

SUNDAY UPDATE: I was celebrating Mother's Day with my family Sunday, so did not hear any of Bob Brinker's Moneytalk. A big thank you to those who heard the program and sent their comments about it!!!

Posted May 8, 2010....Bob Brinker hosted Moneytalk this weekend.

GREECE AND THE US ECONOMY: Brinker said: "We are going to talk about what is happening in Greece and Euroland, which of course has been at the heart of the stock market trepidation that we have seen. But the reality is the crisis, in my opinion, is not going to derail the United States economic recovery."

STOCK MARKET: Brinker said:
"If I'm right about this, the crisis in Greece is not going to derail the United States economic recovery, then it's not going to derail the United States bull market that we have been in since March 2009. Remember this started at S&P 676, right now it's setting in around 1110. It's had a tremendous run, but it's 8.7% below it's recovery high in this second correction of 2010.....

.....Remember we had a correction in January and February. It lasted three weeks and it was 8.1% in the S&P 500. A lot of people saw that correction and said the world is coming to an end, run for the hills. They were wrong. Now we've seen an 8.7% correction to date that has been in process for the last couple of weeks since late April which has been against the backdrop of what's been happening in Greece and in Europe, and we getting those same screams from these people who are panicking and saying run for the hills, it's all over. Well, that's their opinion, that is not my opinion.....

.....I do not believe that the crisis in Greece is going to derail the United States economic recovery. And as a consequence of that belief, I do not believe that the crisis in Greece is going to produce a bear market in the United States. Bear markets are defined as losses in the major indexes, such as the S&P 500, in excess of 20% on a closing basis."

Honey EC: Brinker's model portfolios are fully invested (as they have been since March, 2003) and he is again recommending dollar-cost-averaging. May 5, 2010, Marketimer, Brinker said: "We expect the S&P 500 Index to make additional progress into the upper-1200's to low-1300's range going forward." Remember that Brinker was fully invested for a 50%+ market decline in 2008-2009. His model portfolio I lost over 50% during that time. Brinker's balanced portfolio III, which is for retirees, lost 23.9% in the bear market that ended March, 2009 and is still underwater.

Brinker discussed the Thursday stock market 1000-point drop and 700-point bounce back extensively today. He called it "bizarre," a "casino," "absurd," etc. He said the "circuit breaker methodology" clearly did not work and something needs to be done to restore confidence in the market.

There were a few callers who had stop loss orders in place and got hurt. Brinker does not recommend stop losses and called them "dangerous."

"The new jobs report that came out on Friday is the best new jobs report we've seen in four years.....Private payrolls advanced 231,000 in the month of April and were upwardly revised in March to 174,000.....That's sounds pretty good, but can you tell me why the unemployment rate went up? Yes, as we've said on the broadcast, the unemployment rate is going to be really stubborn and remains so at 9.9...up from 9.7. And the reason is because hundreds of thousands are coming into the workforce because they see the economy turning around."

Core inflation at 1.1%.

Honey EC:
Brinker, as usual, took every opportunity to bash big spending in Washington, but during his guest-speaker interview he made what I consider his lowest cheap-shot demagogue against the Tea Party in general and Sarah Palin in particular....

Yo, Mr. Brinker, out of all the names you could have bashed today, you chose Sarah Palin to cheap shot. Why is that, SIR? Are you not aware that Governor Palin was fiscally very conservative when she was Governor of Alaska? Are you not aware that she has not been responsible for one DIME that was spent in Washington DC? What is it about women in politics that sticks so firmly in your craw?

Bob Brinker's Saturday guest-speaker was John Steele Gordon:

Moneytalk To Go is Available on Demand Totally Free at KGO810 radio for seven days after broadcast. The three hours of the programs are archived Saturday and Sunday 1-4pm. To download the programs and listen later, just choose the day, right click on each hour that you want and use "Save Link as." KGO Moneytalk Archives [Link] If you want to call KGO and complain about (or praise) Bob Brinker's Moneytalk, here are the numbers: Comments line: 415-216-1052....Listener services: 415-216-1050. Here is the KGO email address -- cut-and-paste it into your email compose window:

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