Starting at 7 A.M. this morning a steady,unceasing stream of bull pundits were paraded on air. All highly objective Market observers. lol ie. Sonders,Chief Strategist at Charles Schwarb, She said that we are at the beginning of a bull Market - the BEGINING!! Should I go on?? Hurry,hurry "Schwarbis retail, get in here Then there was Mineri fro Guggenheim Partners. "We'll be up 35% over the next two to theree years. We are in the midst of a 10-15 year bull market." yada,yada. And,of course,Abbey Joseph Cohen exclaimed thatthe Market hasn't come close to catching up with the strong economy. Got it?? Her simple thesis? Up,up and away from here. And so it goes.
The problem with them. The global economies and even here are deteriorating. The data shows that. In denial - self-serving - totally delusional?? The overwhelming theme is this. Drive the retail investor into the Market. Period. Create enough liquidity so as the big money can exit. The insider selling ratio is at an all time high - at 5.7%. THEY want out. And are getting out.
Last week I posted I had added several shorts in the airline stocks (total of three) and several homebuilders. Have also added seveveral big name consumer related stocks. - one of which I just put on - JNJ today.
The self serving manicism is deafening. Historically? As good a tell as there is. The latest economic data is very disturbing. Cyprus is just the first salvo in the European collapse. China's numbers are as bogus as they can get. The Fed?? THAT is the primary and only factor holding the Markets up. Is it enough?? I don't thionk so. Global evwents will overwhelm the lunancy of the global Central Bankers. - especially this reckless Bernanke. Remember this. The rich regrouped $7 TRILLION in asset wealth due to his easy money policy. The rest of America?? They now are burdened with $16 TRILLION IN debt. That is the fact.
You believe the Fed "gots your back" thesis.? And that there is no chance the Market can ever go down.
"ray" and "freed" Well stated points by both of you. We are in historic "no-man's land". Frightening scenerio. I do believe that the Fed can't even give the Markets a whiff that they might consider stopping the lunanacy. Market implodes almost instantaneously. The Fed knows that. I also believe that Bernanke knows the "grand" experiment has failed. The consequences are inevitable. He knows it. He will leave in January as quickly as possible.Hoping that those consequences havn't occured yet. I think mthey will manifest themselves starting in a few months. Is the "end" unpredictable? I don't think so. I believe it is very predictab;e. Global economic,monetary and fiscal crisis of biblical proprtions. Am I doom am and gloom? Not really. Just realistic and having done my math. Good luck to you both. How are each of you positioned?
Yes, they're trapped alright. It must be getting hot under their collars. They cannot possibly want to end up owning the market.
As far as my own positions are concerned I exited most of my long positions somewhat too early since I started getting nervous before the S&P hit 1490. I held TZA for a while thinking it would be a hedge for my remaining long positions, but I took a loss on that yesterday not wanting to hold through the reverse split.
Right now I think there's a "flight to quality" thing in the air. This could presage turbulence and maybe a showdown. I'm tempted to jump back in on the short side but this is the thing: Bears will still have to contend with the Fed on the other side.
Twilight zone kind of stuff. But what happens if and when all market participants other than the Fed are ready for a drop ? Let's say the Fed isn't willing to contemplate that just because they think it will upset their plans to help the economy - then what ? Will GS, MS and others be willing to fight the Fed ? Or are they waiting for the Fed to pull out and then crush whatever retail has already taken the bait ? I don't think we have a precedent for the current market conditions. Personally I think the Fed has painted itself into a corner and has no exit strategy. I think the outcome is completely unpredictable.
Yeah. It looks like enough were convinced to go short again Monday. I like the NIKKEI it is more reflective of reality; less manufacturing/consumption, it goes down during a pending recession or war. Not like what the fed does in our markets by priming the pump; lowering the dollar, buying treasuries, using lipstick on the pig.