Wealthbuilder Stock Market Brief 20th. November 2015.

EU Seeking End to Passport-Free Travel. In an unprecedented move following the horrific attacks in Paris last Friday the 13th the European commission is

reviewing its founding treaty with a view to strengthening border controls. This development goes to show the

change in European conscious brought about by the sheer scale of the Parisian death and injury. The vision of the

founding fathers of the EU saw the end-game being a Federal “one nation” Europe and progressive treaties over the

last 70 years or so sought to bring this “binding” about. I believe that recent events have put a stop to this goal once

and for all. If the European Union cannot protect its citizens (and it is obvious it cannot) then the only fallback is the

individual state, ergo this state cannot be abolished in this new world of hyper-terror. It would thus now appear that

David Cameron’s desire to see the EU revert back to being a common market of independent Nation States is going

to come about after all. What negotiation was not achieving it would appear radical terrorism has. Who would have

thought? Here is how the Associated Press reported this story:

AP. 20th. November 2015:

Between the French Interior Minister Cazeneuve: "we're face with a new kind of terrorism", and Hungary’s PM

Orban: "allowing people into our own back yard who may then commit acts of terrorism was irresponsible”, AP

reports that the EU's founding treaty with regard to passport-free travel - the so-called Schengen Agreement - is to

be reformed. "We want Europe, which has lost too much time on a certain number of questions, to note the urgency

and take decisions today," exclaimed Cazeneuve, with Orban adding "the founding treaty is currently an obstacle to

this and I believe it needs to be reconsidered." According to Cazeneuve, the reforms will happen by year-end.

“EU ministers have agreed to carry out more stringent controls at the bloc's external borders, in response to the

attacks in Paris last week”, says Luxembourg Deputy Prime Minister Etienne Schneider.

“Member states must fully apply the rules of the border-free Schengen zone to carry out systematic controls on EU

citizens at the bloc's external borders, he says, adding, "It's not an option, it's an obligation."

“The bloc's internal and justice ministers have also requested a strengthening of the existing Schengen border

controls. On one hand, “we cannot close Europe,” Schneider continued, “But on the other hand, we cannot open

Europe totally for millions and millions of poor people in the world or even for all of those coming from conflict

zones. Impossible,” he stated, calling for a change to the European refugee system.

Even Berlin intends to slash cash benefits to refugees, providing them with food instead.

“The European Union's founding treaty should be reconsidered”, Prime Minister Viktor Orban said after meeting

Macedonian counterpart Nikola Gruevski on Friday.

The prime minister continued: “European should face up to the fact that migrants come from areas involved in

military conflict with EU members. We are considered enemies in those countries, and the acts of terror committed

in our areas are considered war successes over there, allowing people into our own back yard who may then commit

acts of terrorism was irresponsible”.

"The founding treaty is currently an obstacle to this and I believe it needs to be reconsidered, In order to make

Europe effective, basic questions need to be reevaluated”, he added. “It is increasingly obvious that the EU is

capable only of responding to crises rather than taking preventive measures. It appears only now that European

politicians are starting to assigning security its proper role”, Orban concluded.

Market’s Technical Strength Grows.

With each passing week the stock market is giving indications that it is rebuilding itself for a breakout to new all-

time highs.

Given the scale of breakdown on August 20th. this is quite amazing. While from a Dow theory perspective the Dow

Industrials are far stronger than the Transports, if the 8437 level on the Trannies is breached to the upside I believe

by all accounts we will get a decent “Santa Rally”.

However there is one area of the market that is causing me some worry and that is the area of consumer retail. Many

of the big players have the technical configuration of a looming recession. For example I attach the charts for

Macy’s, Ross Stores, Best Buy and Sears. How their sales figures fare over “Black Friday” will play a major part in

my rosy year end prediction. Let’s all keep our fingers crossed.

Chart: Dow Industrials: Daily.

Chart: Dow Transports: Daily.

Chart: Macy’s Inc: Daily.

Chart: Ross Stores: Daily.

Chart: Best Buy Co:Daily.

Chart: Sears Holding Co: Daily.

Charts: Courtesy of Worden Bros.

© Christopher M. Quigley 20th. November 2015.