Richard Suttmeier is the Chief Market Strategist at www.ValuEngine.com.

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December 3, 2009 – Beige Book shows that “The Great Credit Crunch” Continues

The Beige Book reflects a continuation of “The Great Credit Crunch”. My focus for the Bull /
Bear Debate is the Dow Industrial Average. Tracking Amazon’s MOJO, the Parabolic Rally for
Gold, and the sideways to down pattern for crude oil.
Beige Book shows that “The Great Credit Crunch” is continuing
I consider the Beige Book as the Gossip Columns from the twelve Federal Reserve Districts. Let’s look
at some of the anecdotes from comments presented.
Overall there is an anemic attempt at improving economic conditions including consumer spending for
general merchandise and vehicles, including used cars. Manufacturing is said to be steady to
moderately improving. Even residential real estate conditions were improved but from very low levels.
Home prices were described as flat or declining modestly, but home construction continued to be weak.
A key negative is the statement that commercial real estate and related construction was
depicted as very weak and in many cases deteriorating.
“The Great Credit Crunch” continues with weaker loan demand and tight credit standards with steady or
deteriorating loan quality.
Labor conditions remained weak with some scattered signs of improvement. There were no
comments with regard to “shovel-ready” projects or jobs saved or created by president
Obama’s huge stimulus spending. In fact the Beige Book stated that labor market conditions
remained weak with further layoffs, sluggish hiring, and high levels of unemployment in most Districts.
Some Districts reported upward pressure on commodity prices, but these are not being passed on to
consumers.
The headline from the Associated Press read, “Fed survey finds recovery gaining momentum”. I would
like to know what version of the Beige Book they read!
The Dow remains positive but overbought on its weekly chart with a daily pivot at 10,490 today.
Ascending Wedge Resistance is 10,612 with down trend resistance at 10,581, and monthly resistance
at 11,035. Charts courtesy of Thomson / Reuters.
We need to see a clear catalyst for a breakout above 10,600 to signal an end to the multi-year bear
market, and strength to monthly and semiannual resistances at 11,035 and 11,508. This would not be a
new bull market, but a continuation of dollar carry trade and the formation of a stock market bubble.
Amazon.com (AMZN) is rated a BUY according to ValuEngine, but it’s more of a MOJO Play.
At a new all time high of 142.67 Amazon is 44% overvalued with overbought MOJO on its daily chart.
The stock is up 242% over the past twelve months and has a PE ratio of 56.6. This is a retailer with an
upside of just 3% over the next twelve months.
If you are a MOJO Trader have a sell stop below my monthly pivot at $125.03 and consider booking
profits on strength to my weekly risky level at $150.29.
Comex gold reached another new all time high at $1227.5 this morning as the parabolic bubble
continues to inflate. My weekly pivot is $1200.4. When a market goes parabolic you don’t know how
high it can go. I warned about this potential when the down trend shown was broken to the upside.
Nymex Crude Oil has seen lower weekly highs for the past seven weeks with the 200-week simple
moving average as support at $75.64 and the high for the move at $82.00. Supply is flooding the
market, as the Recession reduces demand on Main Street USA.
Send me your comments and questions to Rsuttmeier@Gmail.com. For more information on our
products and services visit www.ValuEngine.com
That’s today’s Four in Four. Have a great day.

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Richard Suttmeier
Chief Market Strategist
www.ValuEngine.com
(800) 381-5576
As Chief Market Strategist at ValuEngine Inc, my research is published regularly on the website www.ValuEngine.com. I
have daily, weekly, monthly, and quarterly newsletters available that track a variety of equity and other data parameters as
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“I Hold No Positions in the Stocks I Cover.”