Market bulls always have something to talk about even when there is nothing to talk about.

This time of year, they tirelessly pitch the silly notion of a Santa rally.

You’ve got to admit the stock market does bear a striking resemblance these days to Santa, being plump and jolly and jingly.

But a pre-Christmas rally, which is supposed to happen every year and hardly ever happens, may not be in the bag.

How do we know this? The smart money told us. According to insider trading statistics in the U.S., corporate insiders have been frantically dumping their own company shares while doing precious little buying.

A red flag, you ask? You bet. Even if the insiders weren’t taking profits, this is a market that has been on thin ice for some time, having posted a nine-month bullish run in which the Dow Jones Industrial Average is up 17 per cent and the Nasdaq 45 per cent.

While the markets have been booming, company insiders have been dumping their own company shares for six consecutive months through October at an escalating rate.

According to the Thomson Financial, in October, insiders with U.S. companies sold $59 worth of stock for every $1 of stock that they purchased. That ratio has exceeded 20-to-1 on the sell side for six successive months.

That 59-to-1 ratio is the highest rate of selling by insiders since Thomson Financial began to track these stats 15 years ago.

Insiders sold $3.2 billion worth of their stock in October while buying $52 million worth of stock, the lowest monthly buy total since 1995.

If the top execs think their company stock is fairly priced or trading at a premium, it may be unwise to bet against them.

For a classic case of insider selling raising a red flag, check out Canadian soft drink giant Cott Corporation (BCB-TSX, COT-NYSE).

Cott has been racking up fizzy earnings numbers but, with the stock soaring near nine-year highs in October, six insiders at the Toronto-based company sold a total of 654,250 shares between $25 US and $26.38 US on the New York Stock Exchange.

Of course, some of that selling may be the result of diversification of portfolios, but it also tells you the stock may be due for a correction.

With Cott shares looking jolly and fat, four analysts with bells on continue to rate the stock a buy. Four others say hold (which usually translates into sell in analyst speak) and only one is hollering sell.

Of course, some of that selling by Cott insiders may be the result of some portfolio diversification, but the massive number of shares sold also indicates the stock may be all puffed out.

Although we may not get a Santa rally, it should be a very merry Christmas in the Cott boardroom.

* SHAREHOLDERS UNDER THE WEATHER:

Bob Sartor, rookie CEO of Forzani Group (FGL-TSX), has blamed “unusual weather patterns” as a factor in the Calgary company’s dreary quarterly results that showed $7.5 million in earnings (23 cents per share) for the third quarter compared to $10 million (31 cents per share) for the year-ago period.

The company also cited SARS, eastern blackouts and western forest fires and slashed its full-year earnings forecast to $1.01 - $1.05 per share from a previous estimate of $1.35.

Shares in Canada’s largest sporting goods retailer plunged 10 per cent on the day of the news, leaving us with only one conclusion – plenty of shareholders aren’t too comfortable investing in the weather.

* CRACKDOWN: At long last, the Feds have taken a bold step toward cracking down on capital markets crimes with the launching of the Integrated Market Enforcement Teams.

The IMET teams under federal Solicitor General Wayne Easter are comprised of RCMP investigators and lawyers. There are two teams already in action in Toronto and additional teams are slated to be launched soon in Calgary, Vancouver and Montreal.

* SAGE WORDS: “It takes a touch of genius – and a lot of courage – to move in the opposite direction.”

– E.F. Schmacher, British economist, on being a contrarian.



HOT STOCK: ELGIN RESOURCES
ELR-X $1.50
Up 68 cents (+83.0%) on 79,600 shares (for week ending Nov. 28).
If it’s metal, it's hot. It doesn’t even have to be a precious metal. Any metal will do in this market. Vancouver-based Elgin is pitching a platinum metals project in South Africa and the shares have gone ballistic with a 500-per-cent spike in just three months.



STOCK STOCK: COLLICUTT ENERGY SERVICES
COH-TSX $2.11
Down 59 cents (-21.9%) on 32,800 shares (for week ending Nov. 28).
Collicutt cited increased competition as one of the factors for its unsightly quarterly results. Competition resulted in the Red Deer energy services company posting a $400,000 loss compared to a $1-million profit in the year-ago quarter. But watch out – if the competition goes away, they could shoot out the lights, don’t you think?