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May 2017
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This week’s important information for investors and traders…

By: Great Iota

                I’m going to pretend for one second that the market is rational…just for a second.  The one outcome that could completely send the market for a tailspin or propel the market to new short term highs is the fate of CIT Group.  This Monday, CIT Group will announce if they were able to come up with additional financing to keep its doors operating or if they will file for chapter 11.  So, CIT Group provides short term capital for over 1 million small businesses.  These small businesses use the capital to do pay roll, purchase merchandize, fund projects and other while waiting for payments.  So, let’s estimate a worst and best case scenario for the damage that CIT Group would inflict on the economy.  Best case is government steps in during BK and keeps CIT’s customers healthy while the destiny of the company is being sorted out.  Worst case scenario is you have an additional 1 million small business closing their doors and laying off an additional 10 employees each (10 million people).   I’m sure the reality will be somewhere in between.  Either way, keep an eye on CIT Groups fate.

                But hey, that’s just the start; we are in the middle of earning season!  We also need to keep an eye on Halliburton who reports Monday before the bell (very low expectation, like 60% drop from 1 year ago earning, will easily beat it), after the bell we have Boston Scientific and Texas Instruments.  Tuesday is the big day, Blackrock, Caterpillar, Merck, Freeport McMoran, DuPont, Schering-Plough and Lockheed Martin before the bell!  After the bell we have Apple and Yahoo.  On Wednesday before the bell we have Air Products, Boeing, Eli Lilly, Domino’s Pizza (for the fat boys), Morgan Stanley, PepsiCo, Pfizer, Wells Fargo and Whirlpool.  After the bell we have eBay and Mosaic.  Before the bell on Thursday we have 3M, AT&T, CIT Group (maybe muhahaha), Philip Morris International, Raytheon and UPS.  After the bell on Thursday we have AFLAC, Baidu.com, Capital One and Microsoft. Friday is a slow day, nothing really worth mentioning in terms of earnings.  Not much going on in terms of economic data lined up for next week.  Only important day will be Thursday when initial claims and existing home sales numbers are released.

                I’m actually surprised how much the government was able to manipulate the market.  For example, if you told me 3 years ago that NEW, AHM, CFC, Lehman, Bear Stearns, GM, and Chrysler would be declaring Bankruptcy, while California would be paying with IOUs, I would have not been surprised.  I would of just smiled and said, “see, I told you so”.  But if you told me that at the same time the DJI would be trading near 9,000…I would have been shocked.

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