It wasn't supposed to be a struggle yesterday to reach a Hidden Pivot at 1261.80 -- which, as you will surely know, the futures never did. What we saw instead was a garden variety bull-trap that got sprung overnight. Now, because the rally died at 1254.50, we'll need to ratchet down our expectations a tad and ask that bulls demonstrate their case one impulse leg at a time. For starters, we may be able to get a read on this vehicle as early as Tuesday night, since the dainty pattern shown in the chart ought go no lower than the 'p' midpoint -- and certainly no lower than 'D' -- if bulls are to remain in command. The no-sweat scenario would be for the futures to simply pump once or twice today or perhaps tomorrow to reach 1261.80.
Wednesday, June 9, 2010
Britain Becomes the First to Choose Deflation
– Posted in: Commentary for the Week of March 8 Free[Over the last three years, the Federal Reserve has conjured up trillions of dollars of funny money in an attempt to breathe some inflation back into the economy. The attempt has clearly failed. Now, it would appear, Britain has become the first country to throw in the towel on fiscal and monetary black magic. In effect, the country has decided to let deflation take its course, allowing the chips to fall where they may. In the essay below, "Cameroni," a frequent contributor to the Rick’s Picks forum, takes a close look at the decision and what it will mean not only for Britain, but the world. He concludes with a list that spells out what to expect, and the kind of pain we will experience as the world’s financial system comes very slowly back into balance in the years ahead. If his predictions are borne out, the standard of living is about to fall sharply for billions of people around the world RA] David Cameron's new Government in Britain announced Tuesday that it will introduce austerity measures to begin paying down the estimated one trillion (U.S. value) in debts held by the British Government. Lets let that sink in for a moment, for it is a stunning announcement. Now repeat it: Britain will introduce austerity measures in order to eliminate the deficit and begin paying down the national debt. And that being said, we have just received the signal to an end to global stimulus measures -- one that puts a nail in the coffin of the debate on whether or not Britain would “print” her way out of the debt crisis. That would have virtually guaranteed an eventual hyperinflation that would have spread to all Western nations, destroying the U.S. dollar as the world’s reserve currency in the process and
