9 DAYS - 1000+ DROP, 7 DAYS - 800+ RISE

In the last sixteen or so days of trading, the DJX dropped 1,000 points-plus and then did an about face and moved back up on an 800 point rise.

This is not a game for the retail trader - they will lose out. You need a professional trader - someone who has the best interests of you at heart not that of the high frequency traders or institutional traders who play with your money up and down and make dollars every day while your account goes no where year after year .

With the Feds reporting at 2PM today expect a sell off to start - they will reiterate that growth will be slow - which for those who may not be able to read the fine print - this means that your standard of living is going to go down as credit gets more expensive and lending from banks becomes more difficult.

If you noticed the shift today on CNBC, you will see that in the last six days, the momentum of all bullish pundits coming on announcing that we have seen the bottom and all things are going up, and now today with a very slight pull back so far, the mood has changed from buoyant optimism to that of concerned optimism vacillating toward convinced pessimism.

Should we begin a descent downward, watch for very convinced pessimism to come out in full flare, very little buoyant optimism.

Remember though the market is cheap according to 1980 standards, they can always get cheaper. The value of stocks is also based on perception. If you assign little to no importance to the stock market, and thereby stocks, because you, the individual investor, in the end, never can benefit, the stock market will go down. As a reference, take a look at the housing bubble. At some point, someone said that housing is overvalued, way overvalued, and now mortgage rates are at a 50 year low.

I always wanted to see what it might be like to live in the 60's and now I am getting a chance.

A double dip, I am not sure, extreme volatility, beware - no doubt the truer course of this market.

European Banks' Upcoming Stress Tests and Its Real Purpose

Like our American Counterparts Stress Tests more than a year ago, this week begins the feared bank stress tests for the European banks. If the results are anything like the American banks’ stress test, then one can be assured that the results will be fixed to give the false impression that banks are far more stable than they actually are. The banks have lied to us from the beginning and there is no reason whatsoever for them to tell the retail investor the truth now.

We all know the results before the test has already begun. Every European bank will pass with flying colors and this will push money managers to invest or else potentially lose their job as the tests will continue to prop up of the economy continues. Such inflow of money could cause another move to the upside giving retail investors an opportunity to get out of the market at a higher price.

We all know that the banks are harboring terrible deficits, that housing is about ready to double dip, and the consumer is strained.

The purpose of the banks stress test is not for the benefit of giving the consumer the suspended belief that the economy is sound, but to push the market up, so that the bank’s proprietary trading desks can sell their positions at a better gain before the market starts to descend again so that they can increase their cash reserves while the investor loses more of their own. This is the reason for the European Bank Stress Test. Beware!

Happy 234th Birthday to USA

GASLAND Trailer 2010

We recently saw the documentary GASLAND, and were shocked. Run and see it now. It's not just the Gulf. In the meantime, watch the trailer...

Birds of the Gulf

I can't get these images out of my head.

Comments From Barron's Letter to the Editor

My letter to the editor received a lot of feedback from friends and colleagues. To read the letter to the editor on Barron's website, click here.

• They stand to loose a lot if they don't pump the stock. It is a shame we have to be so polite and not call a spade a spade.
• Blake, I couldn't agree with you more. Whether it's BP, or airline stocks after a crash, or mining stocks after a cave-in, it's simply despicable to take advantage of the suffering of others to make a buck. Bravo.
• I think it is a great commentary. I think your point is a valid one, and of course the other guys are going to tout the stick...THEY OWN IT!!!!
• Your viewpoint is right on target. There certainly appears to be some self-dealing and BP stock despite their protestations to the contrary. Good for you for pointing this out which they clearly took issue with.
• Congrats on the article. Interesting article and perspective. Raises question of whether one should focus on "socially responsible" investing or investing for profit.
  
• A letter that compels a response from the authors of the underlying piece is a success! Well done.
• I agree. F BP. They deserve to go bankrupt, and candidly, I hope they do.

Why Buying this Pariah is a Bad Thing

Buying a Pariah

To the Editor:

The June 21 Other Voices essay by Whitney Tilson and Glenn Tongue ("Buying Into a Pariah") looks like a horrific example of self-interest. Their reasons to buy BP are flawed, outside of the socially reprehensible idea of buying it at all.

They say BP stock is extraordinarily cheap. So what? The stock is cheap because the company has created one of the largest environmental disasters in modern history. There is no reason why BP can't get even cheaper, or even go bankrupt.

The authors seem to believe that, like some of our banks, BP is simply too big to fail, and that American taxpayers should be grateful that they can pay claims on this unprecedented disaster. BP isn't too big to fail. There are plenty of other oil companies, as well as alternative energy resources.

The authors' T2 Partners fund owns quite a lot of shares in BP and now needs to make up ground to get back to even. Tilson talked on TV about buying BP when the price was about 35. The authors should have told readers the amount of shares and at what prices they invested in BP. They also should acknowledge that this disaster is unlike any of the ones before.

K. Blake Golding
New York

Whitney Tilson and Glenn Tongue reply: We did not write, nor do we believe, that BP is too big to fail, in the sense that if its losses rise, it will be bailed out.

We believe the company is profitable enough to earn its way out of trouble in all but the very worst-case scenarios. We first purchased BP in the mid-30s and have continued to add to our position as it has fallen.