Weekly Watch List

PCLN
BUCY
GMCR
RAX
ISRG
SIRO
BIDU
LFT
VRX
BCSI
AAPL
ABV
AAWW
GES
ACF
CREE
NMM
V
RNOW

Additions:
AAWW
ACF
CREE
LFT
RNOW

Subtractions:
ASIA
NEU
SHOO
TLVT
WBD

Last week the institutional selling downdraft continued on higher volume, with no immediate end in sight. Most of the indexes broke through support levels as the Nasdaq dropped 2.6%, the NYSE sank 2.1%, the S&P 500 fell 1.7% and the Dow shed 1%. The IBD outlook remained at “market in correction”. Don’t try and catch the proverbial falling knife here. Hunker down and play portfolio defense until the market finds some footing.

This week, there are no watch list stocks in a proper buy range.

/as usual, your mileage may vary, always do your own homework

Better Than Nothing

There’s little argument that the reliability of the U.S. nuclear arsenal is questionable and needs to be addressed. All our nuclear warheads are at least 20 years old and some date back to the 1970s. None of them have been tested since 1992. Nuclear warheads are complex systems and, unless it’s certain that they’ll operate as intended, they’re not an effective deterrent.

In my opinion, the Reliable Replacement Warhead (RRW) program is the obvious and preferred solution to the nuclear arsenal reliability question. U.S. Defense Secretary Robert Gates agrees. However, because of Obama and his administration’s vehement antipathy to nuclear weapons in general, the RRW program is dead in the water. So, for now, I guess we should be grateful that it looks like the Obama administration might be prepared to do something, albeit grudgingly, to address the U.S. nuclear arsenal reliability problem.

2011 U.S. Budget to Fund Refurbishing of Nukes

A reliable replacement for the now-dead Reliable Replacement Warhead program will be funded in U.S. President Barack Obama’s proposed 2011 budget, said the woman most responsible for killing the RRW in 2008.

Ellen Tauscher, undersecretary of state for arms control and international security, said the budget Obama plans to send to Congress Feb. 2 includes “very crucial investment” in the Stockpile Management program. She declined to disclose specific dollar amounts.

Stockpile Management will do what RRW was supposed to do, Tauscher told defense reporters on Jan. 13.

Just three years ago, Tauscher led successful efforts to kill the RRW. At the time, she was a congresswoman from California and chairman of the House Armed Services strategic forces subcommittee. Her subcommittee blocked funding for the program in the 2007 and 2008 Defense Authorization Acts.

Tauscher left Congress and joined the Obama administration last June.

The Stockpile Management program would permit the National Nuclear Security Administration (NNSA) to “refurbish” aging nuclear warheads to ensure that they still work and are safe, Tauscher said. During refurbishment, features could be added to the warheads to make them theft-proof and more environmentally friendly, she said.

But the warheads cannot be “improved” in the sense that they are made into more effective weapons, and they cannot be tested by exploding sample warheads.

That is essentially what was intended with the RRW, Tauscher said.

But the RRW evolved into “a toxic concept” after officials in the Bush administration touted it as a program to improve existing warheads, Tauscher said.

“We don’t want people believing that we expect to go out and build new weapons,” she said. Thus the RRW program became “dangerous” when it came to be perceived as a program to “modernize” rather than “refurbish” warheads.

“We had to get rid of RRW,” Tauscher said. The perception that the United States was improving its nuclear arsenal undermined U.S. efforts to convince non-nuclear countries not to seek nuclear weapons and to encourage nuclear-armed nations to shrink their inventories.

Under the Stockpile Management program, the NNSA would maintain the nuclear stockpile without adding to its capabilities, without testing and “without causing people to be concerned about what we are doing,” Tauscher said.

Stockpile Management would provide for a “safe, reliable and effective stockpile until we can get to nuclear zero,” she said.

Projecting the proper nuclear image is critical to advancing Obama’s nuclear disarmament goals, she said.

See also:
Obama to seek major increase in nuclear weapons funding
Obama to boost spending on maintaining nuclear stocks
Obama Administration to Increase Nuclear Spending
Obama to seek more funds to secure N-arsenal
After pledging to ‘reverse’ their spread, Obama increases nuclear weapons budget
The President’s Nuclear Vision
Biden Sends A Message On Nukes
Debate heats up on Obama’s nuclear agenda
Nuclear Bomb Update Effort Slowed by Posture Review, Science Studies
No Nukes . . . For US

/as Reagan said, trust but verify, let’s see what happens to this modest proposal when Obama’s budget hits Congress

Obama Adds Astronauts To The No Fly List

No Shuttle plus no Constellation program equals U.S. manned space flight grounded.

White House won’t fund NASA moon program

NASA’s plans to return astronauts to the moon are dead. So are the rockets being designed to take them there, if President Obama gets his way.

When the White House releases its budget proposal Monday, there will be no money for the Constellation program that was to return humans to the moon by 2020. The Ares I rocket that was to replace the space shuttle to ferry humans to space will be gone, along with money for the Ares V cargo rocket that was to launch the fuel and supplies needed to return to the moon. There will be no lunar landers, no moon bases.

“We certainly don’t need to go back to the moon,” one administration official said.

Instead, according to White House insiders, agency officials, industry executives and congressional sources familiar with Obama’s plans, NASA will look at developing a “heavy-lift” rocket that one day will take humans and robots to explore beyond low-Earth orbit. That day will be years away.

The White House will direct NASA to concentrate on Earth-science projects — principally, researching and monitoring climate change — and on a new technology research and development program designed to someday enable human exploration of asteroids and the inner solar system.

See also:
Obama aims to ax moon mission
Obama to End NASA Constellation Program
US plan to return to moon ‘is dead’: administration advisor
White House killing NASA’s moon mission, reports say
President Obama to Propose Abandoning NASA’s Moon Plan
Obama to suggest end of NASA moon program
Speculation about NASA’s future swirls in advance of Obama’s budget request
Battle brewing over Obama’s NASA plan
NASA Workers Anxious About Obama’s Commitment to Space
Rebel Engineers Sit With NASA to Chart Future of Manned Space
Good Night Moon
Obama Says, No Moon For You!

To put things in perspective, Obama and the Democrats are now talking about wasting another $80-200 billion on another unnecessary, worthless “stimulus” after already wasting $1 trillion on the first worthless “stimulus”. Just yesterday, Obama announced that he was passing out $8 billion for unprofitable choo choo trains!

NASA’s annual budget is less than $20 billion, yet these out of control, tax and spend peons can’t dig in our taxpayer pockets for a few measly billion dollars more to fund something worthwhile, U.S. manned space flight. I guess they can’t figure out how funding space exploration translates into buying Democrat votes.

/the moral of this story is, if any of your children are dreaming of growing up to be an astronaut, they’d better learn how to speak Chinese and/or Russian

The Cyberwar Rages 24/7

Corporations’ cyber security under widespread attack, survey finds

Around the world, corporations’ computer networks and control systems are under “repeated cyberattack, often from high-level adversaries like foreign nation-states,” according to a new global survey of information technology executives.

The attacks include run-of-the-mill viruses and other “malware” that routinely strike corporate defenses, but also actions by “high-level” adversaries such as “organized crime, terrorists, or nation states,” a first-time global survey by the Center for Strategic and International Studies (CSIS) in Washington has found. More than half of the 600 IT managers surveyed, who operate critical infrastructure in 14 countries, reported that their systems have been hit by such “high-level” attacks, the survey concludes.

A large majority, 59 percent, said they believed that foreign governments or their affiliates had already been involved in such attacks or in efforts to infiltrate important infrastructure – such as refineries, electric utilities, and banks – in their countries.

Such attacks, the survey said, include sophisticated denial-of-service attacks, in which an attacker tries to so overwhelm a corporate network with requests that the network grinds to a halt.

But they also include efforts to infiltrate a company. Fifty-four percent of the IT executives said their companies’ networks had been targets of stealth attacks in which infiltration was the intent. In two-thirds of those cases, the IT managers surveyed said company operations had been harmed.

The IT managers also believed that these “stealthy” attacks were conducted by “nation states” targeting their proprietary data, says the survey’s main author, CSIS fellow Stewart Baker, in a phone interview. Mr. Baker is a cybersecurity expert formerly with the Department of Homeland Security and National Security Agency.

“It’s all the same kind of stuff – spear-phishing, malware, taking over the network and downloading-whatever-you-want kind of attack,” he says. “Over half of these executives believe they’ve been attacked with the kind of sophistication you’d expect from a nation state.”

The CSIS report describes such attacks as “stealthy infiltration” of a company’s networks by “a high-level adversary” akin to a “GhostNet,” or large spy ring featuring “individualized malware attacks that enabled hackers to infiltrate, control and download large amounts of data from computer networks.” The GhostNet attacks, which Canadian researchers attributed to Chinese state-run agencies, bear similarities to recent attacks on Google and other high-tech companies, Baker says. Google attributed attacks on it to entities in China.

Read the report:
In the Crossfire: Critical Infrastructure in the Age of Cyber War

See also:
In the Crossfire: Critical Infrastructure in the Age of Cyber War
Report: Critical Infrastructures Under Constant Cyberattack Globally
Utilities, Refineries and Banks Are Victims of Cyber Attacks, Report Says
Critical Infrastructure under Siege from Cyber Attacks
Critical Infrastructure Vulnerable To Attack
Critical Infrastructure Security a Mixed Bag, Report Finds
Report shows cyberattacks rampant; execs concerned
Key infrastructure often cyberattack target: survey
Critical infrastructure execs fear China
SCADA system, critical infrastructure security lacking, survey finds

Ironically, the more dependent we become on interconnected network technology, the more vulnerable we become too.

/so keep your fingers crossed and your computers patched against hacking and intrusion, at least you can do your part to avoid being part of the problem

71 Minutes Of Whining

It was all about Obama. According to one count, Obama used the words “my” or “mine” 18 times and “I” 88 times, better than once a minute.

/cartoons by William Warren and Michael Ramirez

Read It And Weep For America’s Future

Obama gets bad numbers from Congressional Budget Office

Jobs and the deficits are going to be big themes of President Obama’s big speech tomorrow — and he got some bad numbers on both topics today from the Congressional Budget Office.

Oval colleague Richard Wolf breaks it down for us:

Here’s more bad news on the budget front for President Obama: A new report by the Congressional Budget Office says the nation’s $1.4 trillion deficit is likely to stay in that range for the next two years.

The 2010 deficit should be about $1.35 trillion, and if Obama keeps President Bush’s tax cuts in place and extends other expiring tax breaks, the 2011 deficit would be about the same, the report says. Over the next decade, the nation would rack up another $12 trillion in deficits, thereby doubling the size of the $12 trillion national debt.

“Daunting” and “bleak” were just some of the adjectives used by CBO Director Douglas Elmendorf on Tuesday to describe the 10-year budget picture. Spending is projected to outpace revenue, and the debt would soon be two-thirds the size of the overall economy. By 2020, interest payments on that debt would be more than $700 billion, about four times the size of the current amount.

The report shows the unemployment rate rising slightly above 10% before declining slowly. Not until 2014 would the rate drop back to 5%.

“In sum, the outlook for the federal budget is bleak,” Elmendorf said. “U.S. fiscal policy is on an unsustainable path to an extent that cannot be solved by minor tinkering.”

But don’t worry, it’s Obama to the rescue.

Obama’s federal spending freeze

The White House has been cranking out initiatives daily in an effort to regain the public’s confidence, and on Tuesday, its target was the enormous federal deficit. Aides to President Obama disclosed that his forthcoming budget will call for a three-year freeze on “non-security discretionary funding.” That’s bureaucratese for capping everything but defense, homeland security, veterans, international affairs and entitlements (for example, Medicare and welfare), with no adjustments for inflation. That would result in $250 billion less being spent over the coming decade than currently projected, said Rob Nabors, deputy director of the Office of Management and Budget. Although it’s merely a gesture, it’s a good one that sends the right signals to Congress and the public.

Skeptics were quick to note how little of the budget actually would be affected — about 17% — and how small the savings seem in comparison to the $6 trillion in total deficits expected over the coming decade. And presidential budgets are just proposals; Congress controls the purse strings. It’s hard to say how well received Obama’s latest offering will be, given how few details have been released. The official line is simply that the administration’s budget for fiscal 2010 (which runs from October 2010 through September 2011) will call for cutting some programs and increasing others.

So, in case you’re still confused, the National Debt is projected to double to over $20 trillion in the next ten years and Obama’s answer is to save $250 billion over the next decade. It’s like trying to put out a five alarm fire with a squirt gun, it’s a joke.

Oh, and remember that useless “stimulus” that we borrowed almost a trillion dollars for, the Democrat porkfest that had to be passed immediately to keep the unemployment rate below 8%? Well, four million jobs lost and a 10% unemployment rate later, guess what?

Officials Say Stimulus Bill to Cost $75B More

Last year’s $787 billion economic stimulus bill is going to be even more expensive — $75 billion more.

The new Congressional Budget Office estimate, released Tuesday, provides more ammunition for Republicans who say the stimulus has been long on spending and short on creating promised jobs. The additional cost also eats into the savings forecast from the budget freeze President Barack Obama is expected to propose Wednesday night during his State of the Union address.

Almost half of the additional cost, $34 billion, is because the food stamp program won’t be able to take advantage of lower-than-expected inflation rates and will instead have benefits set by the stimulus bill.

Higher unemployment insurance costs added $21 billion to the bill, and stimulus-subsidized bonds to pay for infrastructure projects have proven more popular than expected with state and local governments.

The $75 billion increase would erase one-third of the $250 billion in 10-year savings that would come from the partial domestic spending freeze being proposed by Obama. The boost in unemployment payments alone would more than erase the $10 billion to $15 billion in first-year savings from such a freeze.

And don’t forget that we borrowed the “stimulus” money so the debt service over time is going to make it cost more.

Read the whole depressing, frightening, and sobering CBO report:

The Budget and Economic Outlook:
Fiscal Years 2010 to 2020

See also:
Bleak Economic Projections as Obama Prepares for State of the Union Address
The CBO’s Economic Outlook Is Bleak
US Congressional Budget Office Chief Sees ‘Bleak’ Outlook
CBO Chief: “The Outlook For The Federal Budget Is Bleak”
Budget Office: The government’s finances on ‘unsustainable path’
CBO: Federal Deficit Projected at $1.35T
The Obama Fisc
Budget sanity
A ‘Bleak’ Budget but Slightly Better
Obama Seeks Partial Three-Year Spending Freeze
Broad range of programs targeted by proposed spending freeze
How much would Obama’s spending freeze trim US deficits? Not a lot.
The “spending freeze” in context
Tepid Reception for Obama Spending Freeze
Obama faces backlash on spending freeze
The Obama Spending Freeze is Simply Not Credible
Spending Freeze Won’t Melt Partisan Divide
Stimulus is now $75 billion more expensive
Stimulus Bill to Cost $75 Billion More Than Expected, CBO Says
Congressional Budget Office says stimulus bill to cost $75 billion more
CBO: Stimulus $75 Bln More Expensive Than Estimated
Stimulus price tag soars as jobless rate rises

/no matter what Obama sys tomorrow night, the State of the Union, is not strong

Dowsing For Live Explosives With A Magic Wand, Without Any Magic

Ever wonder how so many bombs keep getting through Iraqi security?

Widely Used Bomb Detectors Deemed Useless

If you think the pictures in a promotional video are dramatic, just look at the claims made for the device it promotes.

The “ADE-651″ is a metal antenna on a plastic handle, sold as a bomb detector that uses no batteries or electronics, reports CBS News correspondent Richard Roth. According to its British distributor, it can point to hidden drugs, guns or explosives and it’ll work underwater, underground or in the air.

According to the U.S. military, it’s completely useless.

“I can think of no practical application for this beyond party entertainment,” said Air Force Lt. Col. Hal Bidlack.

Yet the Iraqi government has spent at least $85 million for about 2,000 of the so-called bomb detectors, and a training program that teaches troops to shuffle their feet to generate static electricity to make the things work.

Now Britain has just banned export of the devices – and arrested the businessman who’s made a fortune selling them.

Jim McCormick, a former policeman, is accused of fraud.

But the “ADE-651s” are defended by Iraqi officials who backed their purchase. And they’re still in use.

“They’re fine for fooling a 4-year-old at a birthday party, but they’re immoral if they’re trying to save lives at a checkpoint,” said Lt. Col. Bidlack.

Iraq Keeps Banned Bomb-Detecting Devices in Use

An Iraqi security official on Monday defended a bomb-detecting device that Britain banned for export to Iraq because of questions about whether it works, saying it would be a “big mistake” to withdraw it from checkpoints.

The ADE651, made by the British company ATSC, is used at security points across Iraq, including outside the protected Green Zone that includes the Iraqi Parliament and the U.S. and British embassies. Britain halted the export of the machine to Iraq and Afghanistan after a BBC report challenged its effectiveness.

But Col. Hato al-Hashemi, a senior explosives expert at the Iraqi Interior Ministry, said the estimated 2,000 devices used by Iraqi security forces wouldn’t be taken out of service.

“We have great confidence in this device,” Mr. al-Hashemi said. “They have proven their effectiveness in discovering and seizing many car bombs and cars that were loaded with explosives and weapons.”

The hand-held device consists of a swiveling antenna mounted on a hand grip. Mr. al-Hashemi said about 5,000 Iraqi security personnel have been trained on the device since early 2007. He wouldn’t comment on the device’s price or details about Iraq’s deal with ATSC.

Asked if Iraq planned to pull back the devices, Mr. al-Hashemi said: “This would be a big mistake that would create frustration among the security forces and would contribute to the flow of huge amounts of explosives into Baghdad.”

The BBC took the device to a laboratory, which concluded that the key component contained technology used to prevent thefts in stores and wasn’t suitable for detecting explosives.

The findings appeared to back up the U.S. military, which has had concerns about the device for months. In June, the U.S. military distributed a study using laboratory testing and X-ray analysis that found the ADE651 ineffective.

See also:
Iraqi Military Still Hearts Bomb-Detecting Magic Wand
‘Magic Wand’ probed in Iraq
Iraq Spends $85 Million on Fake Bomb Detectors
Unival Group comments alleged fraud linked to ADE651 explosive detectors
Explosive Detector Fraud – Trading Money for Lives?
ADE-651 Magic Wand Bomb Detector Is A Fraud, Probably Killed Hundreds
Lives at airport threatened by bogus bomb detectors
Cambridge Computer Laboratory Declares The ADE 651 A Fraud
Export ban for useless ‘bomb detector’
UK ends ‘bomb detector’ exports
UK bans export of bomb detection device
Head of ATSC ‘bomb detector’ company arrested on suspicion of fraud
UK businessman arrested on charges of fraud
Police arrest MD of dowsing-rod ‘bomb detector’ firm
British Man Held for Fraud in Iraq Bomb Detectors
Iraq MPs bid to remove bomb detector

As if it wasn’t bad enough that the ADE651 doesn’t work at all, the Iraqis paid between $16,500 and $60,000 a unit and, if you watch them take one apart in the video, it’s clear that there’s maybe $20 worth of “parts” used to build them.

/Jim McCormick and anyone else in on this scam should be sent to Afghanistan, equipped with their very own ADE-651 explosive detectors, and made to walk 100 yards in front of NATO convoys

Weekly Watch List

BUCY
RAX
NEU
PCLN
SIRO
GMCR
TLVT
ISRG
BIDU
ASIA
BCSI
VRX
WBD
ABV
AAPL
NMM
V
SHOO
GES

Additions:
NMM

Subtractions:
GOL
KMGB
MELI

Between China cracking down on bank lending, sudden Senate Democrat opposition to Ben Bernanke’s reappointment as Federal Reserve chairman, and Obama’s juvenile jihad against Wall street, last week turned out to be a disaster.The NYSE composite dived 4.4%, the Dow tanked 4.1%, the S&P 500 gave up 3.9% and the Nasdaq slipped 3.6%. The IBD outlook rolled over to “uptrend under pressure” on Thursday and then raised the white flag of surrender on Friday, ending the week at “market in correction”. Don’t make any new purchases and keep a short leash on your portfolio. Don’t let profits turn into losses, don’t take a loss of more than 7-8% on anything, and consider adding some downside protection using puts or shorts in case this correction last for a while.

This week, there are no watch list stocks in a proper buy range.

/as usual, your mileage may vary, always do your own homework

How Strange Can It Get?

Just when you thought NFL playoff football couldn’t get any weirder.

See also:
Prince Vikings Song Hails Purple and Gold Before NFC Title Game
Prince pens ‘Purple and Gold,’ new Minnesota Vikings fight song
Prince debuts new fight song for Vikings
Is Prince’s “Purple and Gold” Better Than “The Super Bowl Shuffle?”
Prince’s ‘Purple And Gold’ Is No ‘Super Bowl Shuffle,’ But It’ll Do
Music review: Prince’s Vikings song is ‘Purple and Mold’

And if that’s not bizarre enough for you, aparently Brett Favre is a big American Idol fan.

See also:
Brett Favre Sings ‘Pants on the Ground’
‘Pants on the Ground’: Favre playoff edition
Pants On The Ground and Favre
“Pants on the Ground” Guy Larry Platt Wants to Duet With Brett Favre

Let us pray.

Our Favre-ther who art in Minnesota, hallowed be thy name.
Thy bowl will come, it will be won, In Miami as it is in the Dome.
Give us this Sunday, Our weekly win.
Give us touchdown passes, but do not let others pass against us.
Lead us not into frustration, but deliver us to the Super Bowl.
For thine is the MVP, the …best of the NFC, and the glory of the Purple People Eaters now and forever.
Amen

Is there a football game somewhere amid all this insanity?

/Go Vikings, stomp the ‘Aints! Brees on the ground, Brees on the ground . . .

Democrats Clamor For Market Chaos, DJIA 9000

And you thought today’s 200+ DJIA loss sucked? It could get seriously out of control by Monday.

Bernanke faces new opposition from Democrats

Federal Reserve Chairman Ben Bernanke’s nomination to a second term is in fresh jeopardy because of growing opposition from Senate Democrats, who have been battered by public anger about the economy and the political setback of losing a Massachusetts Senate seat to the Republicans this week.

At least four Senate Democrats have said they will oppose President Barack Obama’s decision to renominate the Fed chairman. Critics of Bernanke, who was named to his first term by former President George W. Bush, are pressing the case that he was an architect of policies that helped drag the U.S. into a period of recession and high unemployment. His term expires Jan. 31.

“It is time for a change,” Sen. Barbara Boxer, D-Calif., said Friday, hours after Sen. Russ Feingold, D-Wis., announced his opposition to Bernanke.

“It is time for Main Street to have a champion at the Fed,” Boxer said. “Our next Federal Reserve chairman must represent a clean break from the failed policies of the past.”

Bernanke received an important boost late Friday, when Senate Majority Leader Harry Reid, D-Nev., endorsed the renomination. But several other Democrats remained noncommittal.

Amid uncertainty about Bernanke’s fate, the Dow Jones industrial average dropped nearly 217 points, or 2.1 percent, on Friday, after falling sharply a day earlier on Obama’s announcement that he would pursue strict new banking regulations.

See also:
Bernanke’s Nomination in Trouble
Bernanke Reconfirmation Delay Adds to Market Uncertainty
Populist backlash puts Federal Reserve Chairman Ben Bernanke under siege
Growing opposition puts Bernanke approval in question
Opposition Grows Against Second Term for Bernanke
Wall St Week Ahead-Investors brace for earnings, Bernanke vote

Bernake is not perfect but he is the embodiment of market stability as far as investors worldwide are concerned. These frivolous Democrats had better come to terms with economic reality over the weekend and stop grandstanding.

/if this isn’t resolved over the weekend, brace for impact!

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