You folks know the routine here: open thread…discuss whatever topic you like…I’ll post my portfolio results later.

In the meantime, here is a topic to get you started: My 3 favorite “gold” actors/actresses:

1. Jeff Goldblum: I have liked Goldblum ever since he did Tenspeed and Brownshoe with Ben Vereen (remember that one?). Some of his other notable roles: The Fly, Jurassic Park, and Independence Day. But his most unusual role was in Mister Frost, where he played the title character who is arrested as a serial killer and institutionalized. But he isn’t your typical serial killer. One of the eeriest films ever.

2. Whoopi Goldberg: While she may be as liberal as they come, she is also a darned fine actress. As a Trekkie, I loved her in Star Trek: The Next Generation, but she is probably best known for her role in The Color Purple, for which she won a well-deserved Best Actress Academy Award.

3. Goldie Hawn: Goldie first came to fame in Rowan & Martin’s Laugh-In (remember that one?). Not surprisingly, she has made her acting career mostly from comedies, including Private Benjamin, Protocol, and Overboard. While her movies aren’t what I would call classics, they are usually good entertainment for a few hours.

Have a “golden” weekend folks!

PORTFOLIO UPDATE: My portfolio finished the day down 0.05%. In the immortal words of the Black Knight, “It’s just a flesh wound.”

So Plastronneke was talking about a junior silver miner in the comments, and it occurred to me to check out the junior gold miners. So I did what I usually do when checking out a sector/industry: go to the etf holdings. In checking out Market Vectors Junior Gold Miners ETF (GDXJ), I noticed their number one holding was a Canadian company B2gold Corporation (BGLPF in the U.S.).

B2 isn’t strictly a junior gold miner, as they do have some productive mines (and revenue). But they are also developing several others, so they qualify. They currently have mines in production or development in Nicaragua, Namibia, Costa Rica, Columbia, and Uruguay. So there is some risk.

Financially, they are still in the red in their free cash flow, but their operating cash flow is positive, which is a good sign for their mines in development. With the price of gold going up, they should be in a good position to profit.

Because B2 is a somewhat speculative gold miner, I only added a small position at $4.05. If they dip, I might add more.

Both of my holdings, Silver Wheaton (SLW) and Sandstorm Gold (SAND), are flirting with 30% profits today. Am I selling? Nope.

As my dad told me, ask yourself if you would buy them today? If the answer is yes, then you don’t sell.

The key to both of these is their primary commodities, silver and gold. While both have had good runs, are they about to end? Even if they have some profit-taking in the next few months, I will predict that by next March, we will see both of them, gold especially, start a powerful run. With open-ended QE3, that also means open-ended upside for gold.

On the other hand, silver might be limited. I think it will ride gold’s coattails up to the $40-50 range. Beyond that, it is anybody’s guess unless the economy turns around and gives silver an extra industrial demand boost.

Basically, when silver breaks $40, it will be time to look to get out of SLW. On the other hand, SAND is a good play for as long as “Helicopter Ben” keeps pumping dollars. As of the time of this post, SAND is only 3.7% of my portfolio, while SLW is 11.4%. While I would consider both a “buy” here, I have to call SAND a “strong buy”, and I will be looking to add more SAND on any dips in the next few months.

Just for reference, here is how the S&P 500 has done on the last trading day of the most recent quarters:

June 29, 2012: +2.48%
March 30, 2012: +0.36%
December 30, 2011: -0.48%
September 30, 2011: -2.50%

What about previous Septembers?

September 30, 2010: -0.26%
September 30, 2009: -0.28%
September 30, 2008: +5.42%
September 28, 2007: -0.33%
September 29, 2006: -0.22%

Based on the history, I would say it is difficult to draw any conclusions based on this information. But the most probable result will be a small drop, most likely to the 1437-1441 support level. However, we could see a drop as low as the 1430-1433 support level at some point during the day.

If you are playing SPXU today, try to get it as close to yesterday’s close of $37.85 as possible, preferably no more than $38 if you can. In the pre-market, it is currently trading above $38.10, which could still be profitable, but your best bet for a profit in this will be at $38 or less. The futures are pointing to an opening drop, and the longer target price is at 1437, which would make for a 2% profit from yesterday’s SPXU close (SPXU would rise to about $38.63). But at a $38 purchase price, you are “only” making a 1.65% profit. I will take it if I can get it, so I put in a pre-market limit order for SPXU at $38.

The S&P 500 levels to watch today:

UPSIDE: 1449 (September 20th’s low), 1450 (September 27th’s high), 1452 (September 24th’s low), 1454 (10 day moving average), 1456-1461 (8 data points), 1463-1465 (4 data points), 1467 (September 21st’s high), 1474 (September 14th’s high), and 1482 (top of the Bollinger Bands).
LAST CLOSE: 1447
DOWNSIDE: 1437-1441 (7 data points including the 20 day moving average), 1435 (September 13th’s low), 1430-1433 (5 data points), 1426 (August’s high), 1422 (April’s high), 1415 (May’s high), 1410 (50 day moving average), 1403-1409 (4 data points), and 1396-1401 (3 data points, including the bottom of the Bollinger Bands).

UPDATE 8:19 am EST: As you can tell, this was written early in the morning. At this point, the S&P futures are pointing to 1434. I would ignore SPXU now, and actually take a look at UPRO as a play for later. If the S&P 500 ends up in the 1430-1433 range, UPRO would be the play, and look for a rise up to the 1437-1441 range later today.

If you ever need a good reason to check what an etf is holding before you buy it, consider the Market Vectors Preferred Securities ex Financials ETF (PFXF). In theory, this is a great idea for an etf, because preferred stock etf’s tend to hold a lot of bank preferred stocks. If you don’t want to hold bank preferred stocks, what do you do? Buy PFXF! Until you look at the holdings, and see General Motors’ preferred shares are almost 10% of the etf. Maybe AIG isn’t so bad after all…

CNBC: Spain Reveals Sweeping Budget Cuts to Fight Crisis

It looks like Spain is close to getting it:

Spain announced a crisis budget for 2013 based mostly on spending cuts on Thursday in what many see as an effort to pre-empt the likely conditions of an international bailout.

Ministry budgets were slashed by 8.9 percent for next year and public sector wages frozen for a third year as Prime Minister Mariano Rajoy battles to trim one of the euro zone’s biggest deficits.

“This is a crisis budget aimed at emerging from the crisis … In this budget there is a larger adjustment of spending than revenue,” Deputy Prime Minister Soraya Saenz de Santamaria told a news conference after a marathon six-hour cabinet meeting.

…The central government sees budget savings of 13 billion euros in 2013, with spending down 7.3 percent — not including social security and interest payments — and income rising 4 percent thanks to a 15 percent leap in value-added tax take.

Now for the bad news:

The budget goes to parliament on Saturday and debates could last weeks. The country’s 17 autonomous regions still must present budgets and find an additional 5 billion euros in adjustments to meet overall public deficit reduction goals.

I am reminded of an old saying: A camel is just a horse built by a committee. I have a feeling the budget won’t be quite as pretty when the 17 regions are done with it…

Seriously, you can cut the spending now, or you can cut it later after the bond markets kick you to the curb. But using tax increases as an excuse to avoid budget cutting will only speed up the need for budget cuts sooner, as tax increases will weaken your economy and reduce your revenue.

However, I shouldn’t be so quick to praise Spain…
Bloomberg: Rajoy Makes 1st Raid on Reserve to Pay for Higher Pensions

There is always a catch with politicians, isn’t there?

Spanish Prime Minister Mariano Rajoy will raid for the first time a decade-old pension reserve fund that invests in government debt to pay for an increase in retirement payments.

The Cabinet agreed to use 3 billion euros ($3.9 billion) from the 67 billion-euro reserve, financing a rise in pensions announced yesterday, a month before regional elections. Retirees will get a 1 percent increase in 2013 and may be compensated for above-forecast inflation.

Their budget is a mess, and they decide to give retirees a 1% increase next year? Really? Time for the bear…

Bloomberg: Hollande Readies Tax-Raising Budget in Bid to Cut French Deficit

Maybe I should have saved the bear for French President Francois Hollande?

President Francois Hollande will begin making good on his deficit-cutting promises today in France’s first Socialist budget in a decade, with a blueprint weighted toward tax increases and a minimum of spending cuts.

Hollande has promised to raise taxes by 20 billion euros ($26 billion) next year, including a levy of 75 percent on incomes over 1 million euros, as he squeezes more out of the wealthy and big companies. He aims to reduce the deficit to 3 percent of output from 4.5 percent in 2012.

…France’s economy has failed to grow in four of the past five quarters. In the third quarter of last year, the only one to show an advance, the gain was 0.3 percent. Hollande’s government currently predicts growth of 0.8 percent next year.

And Hollande thinks raising taxes is going to help his budget? How long before “PIIGS” becomes “PFIIGS”? I give France a few years before they join the rest of Southern Europe’s problem children, maybe sooner.

Bloomberg: Japan Heads for GDP Contraction as South Korea Weakens

As much as I like South Korea’s potential, and don’t like Japan, both of them are in the same boat:

Japanese and South Korean industrial production fell more than economists estimated last month as slowdowns in China and Europe weighed on exports, building the case for more monetary easing.

Japan’s output fell 1.3 percent from July, the biggest decline in three months, a Trade Ministry report showed in Tokyo today. South Korean production slid 0.7 percent, partly on a strike at Hyundai Motor Co.

Today, you get a special 2-day portfolio summary. 2 for the price of…ok, it’s free, but you get the point…

BAC: 0.05 to 8.98 (0.56%, 12.96% overall)–bought at $7.95
CSCO: 0.13 to 18.80 (0.70%, -1.57% overall)–bought at $19.10
IAU: 0.17 to 17.31 (0.99%, 4.91% overall)–bought at $16.50
LINE: -0.18 to 41.19 (-0.44%, 4.25% overall)–bought at $39.51
NNVC: 0.05 to 0.66 (8.20%, 10.00% overall)–bought at $0.60
RSX: 0.35 to 29.27 (1.21%, -5.31% overall)–bought at $30.91
SAND: 0.50 to 12.69 (4.10%, 24.78% overall)–bought at $10.17
SLW: 1.41 to 39.42 (3.71%, 28.20% overall)–bought at $30.75
YHOO: 0.36 to 16.04 (2.30%, 5.74% overall)–bought at $15.17

OVERALL: +1.06%

For the sake of comparison, here are the three major indexes for the last 2 days:

S&P 500: +0.42%
Nasdaq: +0.61%
Dow: +0.21%

When I look at the S&P 500’s technicals, the one thing that stands out to me is the 50 day moving average (currently at 1409). If we drop below that, I would be very concerned that this correction is severe, since that would already be a 4.4% drop from the last high at 1474. But the key is how the market reacts if it does reach that low: As long as it doesn’t close below the 50 day MA, the S&P should remain bullish, and may even bounce back strongly. The last time the S&P closed below the 50 day MA (when it was trading above it) was in May, and it proceeded to drop below the 200 day moving average within a month, from 1415 to 1266. However, a lot of that was driven by Euro worries. While we still have them, I don’t think we are in as bad a situation as we were back in May (which is not to say the EU won’t collapse. It just won’t be in the next few months).

The S&P 500 levels to watch today:

UPSIDE: 1435 (September 13th’s low), 1437-1439 (5 data points including the 20 day moving average), 1441 (2 data points), 1449 (September 20th’s low), 1452 (September 24th’s low), 1455 (10 day moving average), 1456-1461 (8 data points), 1463-1465 (4 data points), 1467 (September 21st’s high), 1474 (September 14th’s high), and 1481 (top of the Bollinger Bands).
LAST CLOSE: 1433
DOWNSIDE: 1430-1432 (4 data points), 1426 (August’s high), 1422 (April’s high), 1415 (May’s high), 1403-1409 (5 data points, including the 50 day moving average), 1396-1401 (2 data points), and 1393 (bottom of the Bollinger Bands).

Sorry I didn’t post a daily summary yesterday, but I was exhausted by the time I got home last night. Today’s daily summary will be for 2 days.

In economic news today, we get a few important reports at 8:30 am EST today: Third guess on 2nd quarter U.S. GDP, August Durable Goods Orders, and weekly Jobless Claims.

Business Week: Apple Needs to Find Its Exit Strategy From China

Even though the article above uses Apple as an example, the implications of it are far-ranging across all manufacturing sectors. Ultimately, the advantages of using China as a manufacturing source are becoming outweighed by other factors.

The article is a must-read, but the main thing the article neglects to mention: As China exports more and more products, it is creating a negative economic feed-back loop: The more they export, the more inflation they create, which in turn makes it difficult for workers to continue working for “slave” wages. If China isn’t careful, their situation is about to turn VERY ugly.

Politico: Senate conservatives may block sequester solution

If this is the only way to get budget cuts in Washington, so be it:

Not everyone in Washington is so desperate to avoid sequestration.

A handful of Senate conservatives have been gaming out ways to block a deal, if they consider it a bad one — even if it means letting billions in across-the-board cuts go through, according to GOP sources on Capitol Hill.

The issue: Republican budget hard-liners fear that the White House, congressional Democrats and their own party leaders will try to replace or forestall the cuts with budget gimmickry or new taxes. They worry that “fake” cuts — savings that would have happened anyway or other accounting tricks — will become increasingly popular, even for moderate Republicans, as the zero hour approaches for the Defense Department.

At least somebody in Washington gets it.

Bloomberg: Contempt for Congress Rampant as Public Rejects Sacrifice

The U.S. public is critical of both Republicans and Democrats in Congress for failing to resolve such issues as the national debt while rejecting the sacrifices that may be needed to fix it.

According to a Bloomberg National Poll, Republicans in Congress have an unfavorable rating of 51 percent, and Democrats are only in slightly better shape, with 49 percent of poll respondents viewing them unfavorably.

…Even with the public’s frustration with Congress’s inability to address the national debt, there’s little appetite for the type of tax-and-spending measures budget experts say would be necessary to balance the nation’s long-term fiscal demands.

Fifty-four percent aren’t willing to cap Medicare benefits and raise the eligibility age to 67; 52 percent don’t want to reduce the cost-of-living adjustment for Social Security recipients; 64 percent balk at an increase in individual tax rates; and 58 percent don’t support eliminating some tax deductions, such as those for home mortgage interest or charitable giving.

I am reminded of the classic line from Walt Kelly’s comic strip Pogo: “We have met the enemy and he is us.”

Since the start of the current bull market in June, assuming we are still in one, the S&P 500 has dropped below the 20 day moving average 6 times. The S&P futures are now pointing to 1437, which is the bottom of the next support level. If that support holds, the S&P could bounce back, but don’t expect a strong run, because we now have more upside resistance.

In other technicals, the short-term McClellan Oscillator, which measures the NYSE, is at -36, which is neutral on the oversold side. It won’t take much of a drop to push it to -60, which is clearly oversold.

As for yesterday, I think it was an aberration. The big drop was just professional fund managers lowering equity allocations as we head into October, which is typically a bad month for the markets. Since it is also the last week of the quarter, the professionals have to make their sales before the last 3 days, when the SEC acts like a traffic cop trying to get their speed ticket quotas at the end of the period. All the Media’s talk about yesterday’s drop being due to Fed President Plosser’s comments (he said QE3 won’t help the economy, which is true) is complete B.S. The markets have become disconnected from economic reality, thanks to too much liquidity in the financial system.

However, there is another aspect for October: earnings. For the 3rd quarter, earnings aren’t expected to be good. The market is anticipating this, until it starts anticipating whatever the 4th quarter will bring. The 4th quarter will be better, although how much better remains to be seen.

Overall, I am still bullish long-term, but not because of anything economic. It all comes down to liquidity. Money has to go somewhere, and it will eventually find it’s way into commodity prices, and commodity stocks will respond.

The S&P 500 levels to watch today:

UPSIDE: 1449 (September 20th’s low), 1452 (September 24th’s low), 1456-1459 (5 data points including the 10 day moving average), 1460-1461 (4 data points), 1463-1465 (4 data points), 1467 (September 21st’s high), 1474 (September 14th’s high), and 1482 (top of the Bollinger Bands).
LAST CLOSE: 1441 (also yesterday’s low).
DOWNSIDE: 1437-1439 (4 data points), 1436 (20 day moving average), 1435 (September 13th’s low), 1431-1432 (3 data points), 1426 (August’s high), 1422 (April’s high), 1415 (May’s high), 1403-1409 (5 data points, including the 50 day moving average), 1396-1401 (2 data points), 1391 (July’s high), and 1390 (bottom of the Bollinger Bands).

Another day, more links, with minimal commentary. Sorry folks, but I have class today (as opposed to most days when I have no class). I will put up the Daytraders Corner later, but I will leave the blog in your capable hands the rest of today. Play nice…

Reuters: Yahoo CEO fleshes out plans, new CFO named

So far, Marissa Mayer has made all the right moves as CEO of Yahoo. Although the details from her meeting with employees are scant, whatever she said seemed to have been received positively. I still see Yahoo as a strong, albeit speculative, buy.

Fox News: BlackBerry 10 preview: new interface, features and more

Could RIM be back? Just speaking for myself, I am not satisfied with the on-screen keyboards. I have a qwerty keyboard on my smartphone (an LG model), and it works fine. While it isn’t as easy to use as a pc keyboard, it still tops the on-screen versions.

Still, I don’t see RIM competing with Apple or Samsung.

Bloomberg: Samsung Sees Stronger Start for Note 2, Unfazed by iPhone

Contrary to what the American Media says, Samsung is still the smartphone manufacturer to beat.

Bloomberg: Windows 8 Bugs Hurt Microsoft, Intel CEO Said to Tell Staff

This is a bad sign for Microsoft investors.