"Leave it to the Government... Really?" Article

I have pasted below an article by Gary Kaltbaum about his view about what is going on with the markets. I respect his opinions immensely, and so I am honored to be able to paste a copy of the article he wrote earlier today below. -Yechiel

"Congratulations to President Obama for winning the election. I wish him the best of luck as we move forward. What? He isn't? But ABC, CBS, NBC said... covered... oh, never mind!

I really wish I could write just about the technical condition of the market but the miscreants continue to be ethically challenged... and that's being nice.

Merrill Lynch (MER) is now pulling a Lehman Brothers (LEH). Last week, MER reported a measly $5 billion loss but said it did not need to raise capital. Whoops... here comes more financial castration of existing shareholders as MER confesses to billions of more "stuff!"

Here is your latest Paulson "wheel of money" giveaway to destroy our currency and save the miscreants.A look at what the bill would do:

- Give the Treasury Department the power to extend Fannie Mae and Freddie Mac an unspecified line of credit and to buy their stock, if necessary, to prop up the mortgage companies. Yes... let's give Michael Jackson a couple of more kids to babysit! OK, that was harsh.

- Allow qualified homeowners facing foreclosure to apply for lower fixed-rate, 30-year mortgages backed by loan guarantees from the Federal Housing Administration. The original lenders would have to agree to take a loss on their loans. FOR THE HUNDREDTH TIME... THIS DOES NOTHING FOR ANYBODY. Most of these people have no equity and are sitting in a depreciating asset. This continues to be nothing more than rent with debt!

- Create an independent regulator to oversee Fannie Mae and Freddie Mac. The regulator could establish minimum capital requirements for the two companies and limits on their portfolios. It would also have approval power over the pay packages of Fannie Mae and Freddie Mac executives. Oh joy... another regulator who will do nothing more than take a darvocet, a swig of whiskey and do nothing until the problems are already out of hand.

- Provide $3.9 billion in grants to communities with the highest foreclosure rates to buy foreclosed and abandoned properties. And then what do the communities do with those depreciating properties?

- Give about $15 billion in housing tax breaks, including a credit of up to $7,500 for first-time home buyers who bought homes between April 9, 2008, and July 1, 2009. And why do these people deserve this?

- Put a cap of $625,500 on the loans Fannie Mae and Freddie Mac can buy in certain high-priced areas, and a cap in other areas of up to 15 percent above the median home price. Terrific!

- Count any federal infusion for the mortgage giants under t he debt limit, essentially capping how much the government could spend to stabilize the companies without further approval from Congress. As of Tuesday, the national debt that counts toward the limit stood at about $9.5 trillion, roughly $360 billion below the statutory ceiling. "Capping how much the government can spend? Who they trying to kid?

These programs on top of the wildly popular SIV (see ENRON) and all the other nonsense. Needless to say, you know where I stand on all this... and sitting here still amazed this nonsense is going on.

Do not get me started on this short selling laugher. Just a clear manipulation of the markets. Read my past reports. The SEC will definitely definitely definitely extend the time limit on the new short selling rules. Good timing. Enabled MERRILL to raise capital at higher prices...but that is just a coincidence.

Not much has changed. The market's nascent rally hit a wall at logical resistance as many names,especially FINANCIALS) rallied into the declining 50 day moving average and failed so far. I continue to have many problems in this continued bear market. The most important being the clear lack of leadership. As I have mentioned, MEDICALS(especially BIOTECHS) are showing great relative strength but not much more. COMMODITIES just recently topped out leaving not much. If there is any one characteristic of a bull market it is how much leadership the market exhibits. It just ain't happening. But t here is much more.

All major indices remain below short and long-term moving averages.

WORLD MARKETS continue to go for the ride.

The market has still not experienced a follow through day...the most important characteristic that shows up at a start of a new bull move.

Too much embracing of every up day. I am amazed at every up day gets all the bottom callers off their seat even though it is the hundredth time they have called a bottom.

FINANCIALS are still acting poorly. YES... I know they had a bog move off the lows...but hearken back to one of the most important characteristics of a bear market. Bear market rallies are sharp, quick, get people talking, make you feel good, suck you in...and bury you soon after. Bear market sectors usually get the biggest pops. Just remember how strong the bear market rallies were for TECH in 2000-2003.

Shorter term, anything can happen. But again, that is the trees. The forest is everything else...and it is not pretty. I continue to be defensive and only looking for short opportunities as markets rally into logical resistance areas. Markets can bounce higher but I do not believe this bear has used up its last breath.

Disclaimer: The opinions expressed herein are those of the writer and may not reflect those of Wunderlich Securities, Inc. or any of its affiliates. The information herein has been obtained from sources believed to be reliable, but we can not assure its accuracy or completeness. Neither the information or any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.

-- Gary Kaltbaum is an investment advisor with over 18 years experience, and a Fox News Channel Business Contributor. Gary is the author of The Investors Edge. Mr. Kaltbaum is also the host of the nationally syndicated radio show "Investors Edge" on over 50 radio stations. Gary is also editor and publisher of "Gary Kaltbaum's Trendwatch"... a weekly and monthly technical analysis research report for the institutional investor. If you would like a free trial to Gary's Daily Market Alerts click here or call 888.484.8220 ext. 1."