We gave up trying to pick the Mother of All Tops when the Dow Industrial Average blew past a major target of ours at 13045 last April. As early as 2004, one could have seen this bullish explosion coming when the blue chip index tripped a major 'buy' signal of ours at exactly 10542. The predicted 2,500-point rally seemed pretty farfetched at the time, especially considering that the engine of the U.S. economy, real estate inflation, was beginning to leak air by 2005. In retrospect, Colorado-based quant Bob Bronson appears to have been the only forecaster around who was able to describe the nascent trend statistically. As early as two years ago, he was practically shouting it from the rooftops, joined by our friend Jas Jain, a provocateur and steadfast deflationist whose trenchant real estate reports 'from the front' ' i.e., California -- circulate widely on the Web. (Click on chart to enlarge) So what of it, now that the Indoos have hit 14000 for the first time? We must confess that we were unable to imagine stocks would 'go vertical,' gaining more than 2,000 points in the last year alone, as the housing sector sank into its worst funk since the Great Depression? We were too busy making dire predictions to take the rally seriously, even if Hidden Pivot analysis had afforded us little wiggle room for doubt. Our Worst Nightmares And now, the odd thing is that some of our most dire pronouncements appear well on their way to being fulfilled. The most immediate of them, and potentially the most devastating to the consumer economy, is the tightening of the screws on debtors. We wrote here a long time ago that, at some point, a 'low' 6% mortgage would become a crushing burden to most homeowners. We are nearly
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