1. APRIL MARKETS
2. UP STARS/DOWN STARS
3. GOLDEN OPPORTUNITIES
4. QUOTES
5. ON THE WEB
6. LETTERS 

1. IS THE WORST OVER? WALL STREET ACTS AS IF IT WERE, BUT IT IS NOT FOR MAIN STREET: Workers Get Fewer Hours, Deepening the Downturn
“The gradual erosion of the paycheck has become a stealth force driving the American economic downturn. Most of the attention has focused on the loss of jobs and the risk of layoffs. But the less-noticeable shrinking of hours and pay for millions of workers around the country appears to be a bigger contributor to the decline, which has already spread from housing and finance to other important areas of the economy.” 

I believe this reality will be ignored for only a few days/weeks more.  When markets rise on “wrong expectations” I have historically underperformed as I warned WSNW readers previously. This may be such a time. However, I do expect to more than make it up as I have in the past once the insanity level is reduced.  In the meantime, I still sleep soundly at night. 

My view and those of some colleagues is that the market will top either before or after a meager 13K test.  We cautiously sold Friday at Dow 12888. We are prepared to trade around this position and add a second one higher before Wednesday should market euphoria remain.  We do acknowledge some positive day astro, some good earnings while others may not “as bad as feared.”  If so, we will try again in May [“Sell in May and go away” OCO DOW13071 +/- 100.] Why? Because on May 23/28 the current market zeitgeist changes, plus fundamentally speaking,  looking head,  current economic conditions do not bode well for the Q3 2008 reporting season. 

INVESTORS:
1) This is a stock pickers market. Do not buy the market but carefully select stocks. Currently markets mercilessly punish e.g. GE, or generously reward e.g. GOOG, stocks that do not meet or exceed analyst expectations.
2) Before June, Sell and/or Write calls and/or lock in profits on stocks you do not wish to hold until Q4 2008. 

GUEST HYDE PARK SOAPBOX: DollarDaze Economic Commentary Blog - Gold, Oil, Stocks, Investments, Currencies, and the Federal Reserve
HW: Unfortunately, I basically agree with you. 

KEY DATES:     APRIL 29, 30 May 2
DJIA:                12888 PIVOT 12500 SUPPORT?  13000 RESISTANCE?
SPX:                 1380 PIVOT
NASDAQ:         2400 PIVOT
XAU:                 184 PIVOT 172 S1 184 S2 174 S3 174 R1 188 R2 195 R3 202
JUNE GOLD:     925 PIVOT 108 SUPPORT 117 RESISTANCE
JUNE OIL:         115 PIVOT 900 SUPPORT 950 RESISTANCE 

Market Marker Sentiment is:  Worry and HEAVY Recession Fears until Mary 23/28.
DON’T BUY AND HOLD: BE LIQUID WITH A BALANCED AND DIVERSIFIED PORTFOLIO!
2007 CLOSE:           DJIA 13264, SPX 1468 & NASDAQ 2655
2006 CLOSE:           DJIA 12463, SPX 1418 & NASDAQ 2415
2005 CLOSE:           DJIA 10717, SPX 1248 & NASDAQ 2205
DIJA:                      3 ~ FV 0 UV; 6 offer 4%+ Dividends 4 offer 5%+ Dividends.
Looking ahead, my question is whether 2008 will show less than 2% growth or be a classical recession?  
THINK SWISS AND PRESERVE CAPITAL: FOCUS ON PROTECTING AGAINST DOWNSIDE RISK. 

2. With the possible exception of some undervalued precious metal stocks, we prefer to sell into market rallies, rather than buy. 

IPO WATCH
AMERICAN WATER WORKS (AWK) April 23. 

3. Boone Pickens Adopts Long Position on Oil Investments

While I continue to believe both Gold and especially Oil should be much lower before the end of April,, we have to trade these positions more than I expected.  We profitably covered a number of our gold trading shorts on Friday. We are prepared to reshort to at least $900/905, especially if the US Dollar strengthens short term.  When will Oil prices approach reality?  We were forced to trade Oil aggressively on Wednesday news. However, if Oil does not go below 115 by this Wednesday, we will reduce this bet and wait for fresh blood before attacking in force again. 

Unlike Oil stocks, there are a large number of Precious Metals stocks that are cheap and undervalued.  The Nova Gold (NG) quarterly conference call last week made a strong case that NG is a very undervalued investment. Currently trading near strong support circa $7, I plan to personally use IRA money and buy more NG over the next few weeks. Additionally there are a number of microcaps I am watching and near ready to start accumulating before August 2008. 

EVERY PRECIOUS METAL INVESTOR’S QUESTION: WHEN DO THE INTERNUTS JOIN THE PARTY?
Years ago I forecast it would happen when three non-astrological requirements were met post January 2008: $1000 gold, increased M&A activity and a major gold/silver strike.
If I am right, we are already two thirds there and Q4 2008 IS COMING SOON! 

4.  “The pressures are building, though spillover into the consumer level will be quite limited. A lot of the increase is going to end up being eaten by companies and will hurt profit margins. Inflation isn't the focus right now for the Fed.''
Joshua Shapiro, chief U.S. economist, Maria Fiorini Ramirez
HW: So true.  Just imagine how HIGH food and energy would be IF THERE WERE INFLATION! 

"My philosophy is there are a lot of bargains now. But that doesn't mean I won't be guilty of premature accumulation -- or trying to catch a falling knife.''
Gary Hindes, manager, Deltec Asset Management
HW: A few but I believe there will be more and better ones ahead sooner or later. 

"We are close to the end of rate cuts. The economy will be improving. Also, the inflation pressures are only intensifying at this point.''
Dean Maki, chief U.S. economist, Barclays Capital
HW: Yes. 

5. Buckle up
With earnings, expiration and economics converging into a perfect storm, quiet times are a thing of the past. 

Rolling the Dice on Oil Prices 

Recession Roadmap - The Wealthy Boomer 

6. READER:  Click here: http://www.sprott.com/pdf/investorsdigest/digest.pdf  Hank, read the final paragraphs. It's what you have proclaimed as well.
HW: yes.

Subscribers please send your comments, questions and suggestions to LETTERS.
Silver Investing subscriptions $360 one year; $555 two years.
$10,000 one year; $1000 Monthly.
Platinum subscriptions $3000 monthly; $33,000 annual.
Diamond subsciptions $68,000 annual.