Im Gegensatz zu vielen aalglatten Kommentaren mancher Marktbeobachter mag ich hier die etwas zynischere Art im Stile eines George Ure bei Urbansurvival.com.
Innerhalb des Textes gibt’s 'ne Menge Verlinkungen zum besseren Verständnis, im Zweifelsfall hier den weiter unten aufgeführten Link zum Original-Text anwählen.
Bonfire of the Equities
Like I was saying yesterday morning, except a huge DCB (dead cat bounce, in case you missed Friday's dissertation). And, it was a dandy! Intraday, the market rallied from the previous 12,159.21 close to as high as 12,341.54 - a 181-point lovefest. And reality bit.
Like most dead cats, the bounce was pretty short-lived, and by the end of the session, the Dow was down about 60 points and the phone wires were burning up around here. As far as most folks were able to tell, the $146-billion "economic stimulus" package was a poorly contrived 'same-old' that wasn't going to a) make it through CONgress and b) wouldn't make much difference, even if it did. As one reader wrote in "They think $800 bucks is going to solve the problems of being in debt to the neck in bank cards and on the verge of foreclosure? What are these people on?"
Without going into an answer to that, which would likely land me on someone's hit list, we'll stick to the simple facts of the matter: Tax cuts are about as likely to bail us out as space aliens coming down and handing out Starbucks coupons (which won't happen till later in the year, in any regards.)
So we're left to sort out the economic future from a curious perspective.
---
One of the phone calls yesterday was from my attorney, who proudly announced "I'm off to visit the 'other' gamblers' this weekend! You know, the honest ones!" This means, being mid 50's and single, he was headed to Lost Wages, NV to bet the payroll at the blackjack tables. About an even bet with equities - maybe even a tad better this week.
Before leaving though, he shared an interesting point: "This may be one of those rare periods when the individual investor really does have a leg up on Big Money. "
Wondering what he meant, I prompted him to continue.
"You see, you and I can do the back-of-the-envelope kinds of calculations on the futility of trying to buck the tide here - but with equities about to crash [even more - G] the Big Money players have to work all weekend burning the midnight oil so they can get together with their 'investment committees' and work out their go-forward strategy. You and I don't have to mess around with that - we can just pull the trigger and that's that."
OK, I got it. What does it mean?
"What it means is that investment committees of some of the big players won't even meet until next week and that means late next week, or the week after, before they will be able to do much of anything in the markets. So you see what I mean? This may be one of those rare moments when small individual players may have a head start over the institutional players in heading to the exits."
The Big Players will no doubt pimp up the markets to sell at higher levels, but I get it.
---
When they finally do get around to meeting (next week and the week after), the investment committees will have plenty to ponder. Not the least of which is that "Peak-To-Crash" chart that I update every week for Peoplenomics.com subscribers and post around here once in a while.
A few other headlines that will likely weigh:
•§"Earnings won't bail out Market this time"
•§"Collapsing housing market clouds Nevada caucuses"
•§"Oil prices back above $90 a barrel"
---
A couple of other phone calls came in while I was working out the eight orbital parameters of the dead cat bounce in mid session. (If you don't know the 8-elements of orbital calculations, you're a Keplerian dunce and you need to click here).
Just as I was penciling out the right ascension of ascending node (for the dead cat bounce take-off early in the session) the time monks called "This weekend, we've got a bead on what happens to 401-k's this summer in the latest run...may get it posted on Saturday afternoon"
Oh damn, that report won't be good, and it just means more work for me because instead of a nice simple report on how to retool higher education system in America, Peoplenomics will be addressing where to park money while the developing 401-K disaster blows over. Still, nice to know what's coming. Having a time machine is sometimes useful and this may be one of them.
---
Another call came from some well a connected source that reported that gold, trading in US dollars inside China, is already well over $1,100 (US paper) per ounce and going nowhere but up. Sure enough, the story is getting legs now with headlines coming out of Chinese sources that "Gold Rush grabs Chinese as prices hit new high.
----
Then someone else called to report that Jim Sinclair was expecting a couple of thousand point drop days in the Dow just ahead. His timing would be coincident with those investment committees getting their act together. Jim's posting last night "The end of a powerful week in finance" is a must-read, but with a caveat.
The caveat is this: You know how some people will turn their head from a horrific accident, while other folks will watch? Well, if you're the kind of person who turns your head and feels a bit squeamish, you might want to skip Sinclair's column. The rest of us (those who would will stare into the cow-catcher of an oncoming train as it arrives ) will just go ahead and read it.
---
Meantime, elsewhere, God may save the Queen (or not) but He's certainly not doing much for British markets. They dropped below 6,000 as measured by the FTSE.
---
So, to wrap up before pouring another double spilt shot Americano tall with a shake of chocolate powder and two biscotti's, let's just wrap up with the week with another chorus of "I told you so!" Oh, and this being way-rural East Texas, there's no baristas in sight so I'll get by with watered-down Folgers and a biscuit. But I'll be six bucks ahead and out here that makes more sense than biscotti's. Until those aliens show up with the coupons.
---
Did I mention Venture capital funding is at a 6-year peak and despite a looming recession? I thought these people were smart. I've been wrong before.
---
Note from our Houston Bureau:
"The Houston Bureau thought you would be interested in the following article:
"All signs point to U.S. consumers hunkering down in recession bunkers" ''I'm walking down Fifth Avenue the other day, and all the stores have big signs saying 50 to 70 per cent off everything, and the only people in there doing any actual buying are, like, from Canada or Europe.''
Note from the Bureau Chief: "Don't look now... "
Say, if that's a cow catcher, then this must be a train wreck, right?
www.urbansurvival.com/week.htm