Sometimes a chart is all you need

From Bryan Rich at Money and Markets via R.E. McMaster.

Click the chart below for the entire article.

This dangerous combination of persistent unemployment and rapidly rising food inflation isn’t just specific to North Africa and the Middle East. Global unemployment remains at record levels. And world food prices rose to a record in January.

The expanding unrest is most vulnerable in those countries with low per capita income, where people may spend as much as 70 percent of their income on food. Moreover, the threat of civil disorder rises when those countries have significant income inequality and/or have gone through major economic stress where the outlook for a return to normalcy looks bleak.

In this environment, there are many countries that fit the bill. Take a look at how risks in other parts of the world stack up against Egypt and Tunisia.

The table below is a gauge of economic misery across the biggest countries in the world. This index was created by a former economic advisor to President Lyndon Johnson, Arthur Okun. It simply takes the sum of inflation and unemployment rates. According to his index, the higher the index value the more miserable life is in these countries.

The US is at 11% only if you believe that inflation statistics shouldn't include food and fuel.

From Calculated Risk via Clusterstock Chart of the Day.

Click the chart for a very simple analysis of the numbers.

Blue is the total trade deficit.

Red is the trade deficit minus petrolium.

Black is petrolium. 

Pro Publica is doing a nice job of keeping track of who's doing what to whom regarding all of these bailouts.

Click on the chart below for the entire list, it's a hell of a lot longer than you think.

From the United Nations Food and Agriculture Organization, by way of Clusterstock and Business Insider.

World food prices are trying to breakout.

 

The President's Deficit Commission released their recommendations yesterday, and they are as follows:

The much maligned New York Times has come up with some wonderful and instructive interactives over the past several months, this one stands among the best.

You are in charge.

Enact your plan to cut the deficit, the interactive does the math for you.

Click the image below to link up the site.

Recommended.

From Good.is.

Thanks to Charley D. for this one.

 You Have No Idea How Big Africa Really Is (But This Map Does)

It's about 11.7 million square miles, which is really big—big enough to fit the United States, China, India, Japan, and much of Europe within its borders. And that's precisely what Kai Krause did with this inventive map, "The True Size of Africa," which he describes as his contribution to "the fight against rampant Immappacy."

Click on the above map for the entire piece.

Yahoo Movies rates the many varieties of Zombies for both speed and smarts.

Pay close attention here, this could save your life.

Clusterstock updates the S&P 500 to gold ratio.

I'm thinking somewhere around .25 or .3 should be a real good time to start thinking about the broad market again.

So to speak.

More than once now, I've plugged Richard Russell and his fine site Dow Theory Letters.

As though he needs it.

The following perfectly simple explanation of how to read a chart, perfectly illustrates his value.

Question -- Are charts really of any use?

Answer -- You might as well ask the question, "Are maps of any use?" And the answer is "Yes, both charts and maps are useful with one caveat, you must know how to read them."

Let's take a current example. Below I show a daily chart of the Dow going back three months. The first thing I see is that long blue ascending trendline. It continues higher until it hits what I call a consolidation box. The box is defined by a horizontal line at its top and another one at its bottom. So far, the Dow is "caught" in the middle of the box; it hasn't broken out to the upside or the downside. 

Then I see the red arrow at RSI. The arrow points to RSI heading down. Next I see another red arrow at MACD at the bottom of the chart. Here we see MACD rolling subtly over. In both cases, RSI and MACD appear to be ready to sink lower. This suggests that the Dow will break out below the box.

 If the Dow does break below the box, where is it likely to stop? The first support appears to come in at around 10800 on the chart. That is where the last decline halted when it touched the rising trendline. Often, moving averages will provide mysterious support and resistance levels during advances and declines. Today, the 50-day moving average for the Dow comes in at 10671. This should represent a resistance level on the downside. Below that we have the 200-day MA, which comes in at 10523. 

And that's the valuable information this single daily chart of the Dow provides us with. So are charts useful? Do they serve any real purpose? I'm convinced that they do. But like an explorer with a map, you have to know how to use charts.

Piece of cake.