You can make an argument that the year 1968 was the most pivotal year in the 20th century, and many would agree.  The deaths of Martin Luther King Jr. and Bobby Kennedy clearly changed the future of the country.  One of the happenings that may not be talked about enough was the performance of the United States athletes in the 1968 Summer Olympics in Mexico City.  Without question, the performance of the track and field team was the greatest of all-time.  The reason people do not talk much about the performances of the athletes because they remember or have seen the “Black Power” salute by Tommie Smith and John Carlos.  It was only 40 years ago, but today it seems like a lot longer than that.

Kobe Bryant and Lebron James may be the most recognizable faces performing for the United States in the Olympics.  They are the most popular players on the “Redeem Team,” and arguably the most popular basketball players in the world.  During last season, both Bryant and James spoke out against the injustices committed by the Chinese government in their support of the Sudanese government in Africa.  The Chinese buys oil from and provides arms to the Sudanese government, a government responsible for a genocide that murdered 400,000 Sudanese in Darfur.  Both Bryant and James said that they would be making comments later on about the injustices, but mysteriously, that has not been the case.

The Chinese government has been going to the limit in order to have a situation-free Olympics in Bejing.  They even revoked the visa of Joey Cheek, a former Olympic medalist turned human rights advocate, because they did not want him mentioning the genocide in Sudan.  Well, doing that to Cheek is not that difficult because no one knows him, but they could not do the same with either Bryant or James since they are global icons and are immensely popular in basketball-crazy China.  Had Bryant or James continued to speak out against the Chinese, they would have exposed the public to China’s policy, but they have not.  Instead, they have fallen into silence, which is exactly what the Chinese government wanted in the first place.

One would have to wonder how disappointed the U.S. athletes from the 1968 Games are with those from the 2008 Games.  The major difference between the athletes is simply political involvement.  It has been a major criticism from the athletes of that time period, especially Jim Brown, that the athletes of today not only do not get involved politically, but the reason they do not has to do with the amount of money they make.  Both Bryant and James should be ashamed that they choose not to speak out on the subject, especially when it comes to basic human rights that are violated by the Sudanese government, with help from China.  They have the platform to do so, but have chosen not to, with the excuse being that they need to focus on the Games.  Maybe someone should tell them that the greatest athletic performance that this country has ever seen came 40 years ago, with the athletes protesting while performing.

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The next best thing to having a guest blogger is to have permission to repost a good article from another blog.  Thanks to Zach Bass from Investor in the Wilderness for allowing me to repost this article.

By the end of the summer of 2008 Apple will be in position to grab gold in the Desktop and the Mid to Hi-end Cellphone events. It’s all coming together for Apple, from the economic cycle to the Beijing Olympics. And I’m going to explain how it might play out, but first there’s a bitter pill that must be swallowed.

We’re in a down market and things don’t look good. The Dow has recently dropped below January lows, the S&P 500 is skirting along critical support, and the Nasdaq dropped nearly 100 points last week. The market internals are dismal with decliners leading advancers by 2 to 1, and new lows are outpacing new highs by an astonishing 10 to 1! And let me tell you right now, it’s going to get worse before it gets better. Ouch!

The reason it’s going to get worse, is that as bad as things are, investor sentiment has not yet reached the level of fear needed to affect a trend reversal. This is apparent by looking at the state of two key indicators, the Volatility Index (VIX), currently at a relatively mild mannered 23.44, and the Put-Call ratio, which is sitting at a complacent 1.13. During the recent March lows, volatility and fear were rampant, the VIX was teetering on 34, while the Put-Call ratio was spiking as high as 1.80-1.90 intraday.

When fear is rampant, and everyone thinks we’re going to hell in a hand basket, the markets invariably reverse direction. The problem is, that as bad as things are, we simply don’t have enough fear to incite a reversal. So, we need a good push down to ramp up the fear and get this market moving in the right direction. The VIX is climbing, and the Put-Calls are getting there as well. But first, it appears that we’re going to see a bounce before this Independence Day-shortened week is over due to extremely oversold conditions on all time frames.

VIX Inverse Head and Shoulder pattern

After we get the bounce, we need to move down to the depths required to get unbridle fear coursing through investor’s veins. This seems very likely, as the VIX is setting up in an inverse head and shoulders pattern, set to breakout soon. Now that may happen just before the long weekend, or just after, but in either case, when it does a reversal will be upon us soon after.

So, that’s the first act in this play. The second act is all Apple, with the release of the 3G iPhone on July 11th, with a 22 country rollout. Apple is clearly prepared for the event as FBR Capital Market analysts Craig Berger and Robert Pikover, released a note to clients this morning about Apple’s supply chains indicating that 2008 iPhone build volumes have been revised significantly higher to an estimated 15 million units for 3Q!

A follow up to act 2, is that Apple and China have apparently cleared the way when Apple dropped its revenue sharing demands. So now the question is, will Apple be able to get China Mobile online with iPhones in time for the Beijing Olympics? It would be awesome timing as Apple will be opening two Apple Retail Stores in China, the first on July 19th in Sanlitun, a fashionable bar area of the capital city, according to the Shanghai Daily website. The second store will open during the Olympics in Beijing. If iPhones are ready by then, expect Apple to leverage the awesome marketing power of the Olympics.

This heightened exposure of all things Apple, plus the reduced iPhone price of $199, will be a powerful attractor for returning college and high school students. The third act. iPhones and Macs of every flavor will be flying off the shelves and from online stores. Hopefully this will bring a boost to ailing carriers like UPS and Fedex.

So, what’s the outlook for investors. Well, next week, as I suggested, there will likely be a bounce from oversold conditions in the markets. If the bounce is weak, it will present a good opportunity to take short positions. If it is strong, then we’ll need to wait and see, as a retraction may not be immediate. Soon after the market has retracted from the bounce, I would expect the VIX to breakout, and the Put-Call ratio to spike. As the VIX crosses 30 and nears past highs, and the Put-Call ratio clears 1.50, cover those shorts and go long. At that point we should be near a bottom. Then ride this puppy into Labor Day, and at that time, Apple can take the winners podium and collect its gold!

As always, I’ll be providing daily guidance and intraday alerts to members of the Wilderness Investors Group(go to http://www.zacharybass.com/2008/06/apple-positioned-to-take-olympic-gold.html for mor information). You might want to check it out, it’s free and there are great discussions among many talented investors.

Christmas In July @ BustedTees. 31 New Shirts in 31 Days!

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