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How High Can the Fed Pile Manure?

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A U.S. banking system that is being held aloft solely by hot air and brazen lies took an ebullient leap toward November 6 yesterday with the release of an Administration-friendly Fed report declaring most banks sufficiently capitalized to weather severe adversity.  How severe? It’s hard to tell, since there were only passing references in the New York Times to a still-deflating housing market that has helped make The Great Recession and a plummeting standard of living an entrenched fact of life for most Americans, if not for their bankers. And nowhere in the front-page article was there even a word about the Fed’s warehousing of trillions of dollars’ worth of mortgage paper once held by the banks – debt paper that might never recover in value.  Under the circumstances, far from being healthy as the Fed and its shadowy masters would have us believe, the banks are afflicted with the financial equivalent of stage four cancer. Not that anyone on the Street would care to notice. In fact, with this week’s big stock market gains, Wall Street seems to be literally banking on the ability of the spinmeisters to hide the financial system’s deathly pallor with the skill of Sonny Corleone’s mortician.

In the meantime, many on the Street, and even a contributor or two in the Rick’s Picks forum, were seeing cloudless skies at least till the election. “Money is going to be pouring into the stock market at the expense of other investments,” noted one forum regular, Gary L. “I now see the possibility of a 20 percent rise in the stock market year over year,” he continued. “If external factors don’t derail this trend, we are in a perfect sunny day lasting perhaps another nine months. This will make Obama’s chances of winning re-election an odds on favorite.”  We’re not so sure ourselves, especially since the real economy that most Americans encounter in their day-to-day lives is wholly different from the sunny illusion being spun with increasing brazenness by The Powers That Be.

Strong Dollar vs. Gold

And while it’s true that gold and silver futures got sacked yesterday, we see the weakness as merely corrective rather than impulsive. Even conceding that bullion could remain under pressure if our own, extremely bullish forecast for the dollar pans out (click here to access all of our forecasts free for a week), we very strongly doubt that precious metals have seen their bull market highs. And keep in mind that the dollar is not “strong” in the sense of being sound; rather, it is in demand because global managers of Other People’s Money believe it will be the “last man standing” when Europe’s inevitable financial collapse occurs.  We agree but only up to a point, since it’s quite possible the smart money may only have an hour or two to react  to Europe’s implosion before it takes the dollar and all of our banks down with it.

Continuing with the sunny observations of Gary L:  “Inflation tame, import and export costs low, a recession in EU and China, wages tame, domestic spending up along with debt. Looks like the old patterns are coming back.”  Although Gary has proven himself to be an astute and flexible observer of the markets in the past, we think his optimism is misplaced — like looking at Europe in the early summer of 1914 and remarking on the robust health of Germany’s manufacturing sector.  If inflation seems tame, as he notes, it is only because the counterforce, a nearly quadrillion dollar derivatives bubble, is poised to deflate catastrophically if the central banks ease off the monetary throttle even slightly. As for Europe’s deepening recession, it adds force to the already deflationary impact of austerity measures taking root in a growing number of zombie nations. As for the sharp selloff yesterday in precious metals, if it eventually takes gold down to $1500, we would view that as the last great buying opportunity before the metal leaps to $2000 and beyond. (Please note that, from a technical standpoint, we’ll be looking on Thursday for at least a tentatively bullish turn from well above that level – specifically, from 1623.00, basis the Comex April contract.)

Perfectly Scripted

As bearish as we are on the big picture, we can only marvel at the scripted perfection of recent, ostensibly bullish, economic “news.” For starters, a couple of banks were reported to have failed the stress test — including, most notably, Citi.  Clearly, this was meant to mollify skeptics who might have dismissed the report if no banks of size had gotten an “F”.  Also, the Times, using talking points presumably planted by the Fed itself, inserted this red herring into the article: “Another potential shortcoming in the tests is that they don’t focus on one of the main problems the industry faced during the financial crisis, the difficulty banks had borrowing money in the markets.”  In fact, and as everyone knows perfectly well, there is no limit to the amount of “money” that problem banks will be able to borrow from the Fed the next time TSHTF.

Not that unlimited borrowing power is going to do the banks any more good than it will Europe’s when their hour of reckoning arrives. At that point, it is credibility with the public that will matter, not borrowing power. Unfortunately, what little credibility remains — evidenced by the stock market’s maniacal response to the latest Fed dog-and-pony show — is destined to be squashed as the central banks and politicians continue to pile up bald-faced lies one on top of another.

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  • mava March 18, 2012, 6:22 pm

    Buster,

    Yes, I agree. I feel that way too. Actually, I haven’t seen anyone yet, voicing this very thought of the masses being just as guilty as the elites. Most people are absolving themselves from responsibility by claiming that they were too damn to know. However, this is a lie, as they were smart enough to know good and bad, but just clever enough to never admit that.

    This is why my personal choice, this day, is increasingly Anarchism and nearby grounds (actually, I still hadn’t left Minarchism, – just can’t get enough evidence that Anarchism could be implemented in practice and not be immediately converted in to dictature).

    This is because I now believe people will always remain evil, as they are today. Basically, the stories about “humanity” are just lies, and we are living in a wolfpack.
    OK, but I then need a set of my own fangs.

    Non-collectivist systems provide that, by allowing individuals to be excepted from the law, if they do not agree with it, where in collectivist society like our own, the majority will beat the minority into submission (officially, we describe the beatings as”the choice”).

  • mava March 18, 2012, 2:43 am

    I would like to chime in on the side of redwilldanaher.
    Everything is manipulated and is a lie.

    Gary L. proposes an interesting counterattack argument, asking if everything is manipulation then how come markets did crash in the first place.

    Again, like redwilldanaher, at a risk of sounding like a broken record, I would suggest Gary L. steps back and looks at the picture of bunch of trees again, trying to see the forest.

    Logically, Gary, if the market can be manipulated, then that does not necessarily creates the requirement that the manipulator must always keep it up. Do you agree?

    This is like asking: “If you believe that the driver is in control of a vehicle, and that it was the driver that accelerated the vehicle, then why was the vehicle dead still in the first place, before the driver began accelerating it?”

    Alright, that one is clear. Now, on my broken record. I claim that both, the crash and the efforts to help the market are and were part of the plan to begin with. My theory is that the plan was put in place and now is in mid stages of execution with the end goal being the survival of current chain of command (TPTB, not the president, nor any other small fish), during the transition of the United States from parasitic existence mode as it is today, to productive existence mode, as it will be after the dollar collapse.

    • Buster March 18, 2012, 4:34 pm

      Agreed mostly, Mava.
      I think where there is a little doubt on the part of Red & others, myself included, is the move to a ‘productive’ end. This game has been developing for millennia & is probably reaching it’s conclusion in the next couple of decades. A very nasty conclusion it looks, too. One where the shortcomings of human nature overwhelm it’s strengths, as we are seeing. There were 300 million dead at the hands of world governments in the last century alone, with the sleight of hand of the worlds Bankster establishment pulling most of the strings, & despite the media cover stories of ‘Freedom & democracy’, the endless march of corporate fascism around the globe is bulldozing living things out of it’s way, giving an indication of the utopia the Elites have planned for us all, with the likes of FEMA & international extradition laws whipping the complainers into submission.
      The one thing in this bulldozer’s way is the community & neighbours around us who, to a large part, are as bad as the Elitists who pull their strings. They have little grasp of what is happening, or care other than when it is hitting their own wallet. With no real sense of justice or acceptance of personal responsibility they are easily manipulated with a few crumbs.
      No, I put little hope in my fellow man to sort this mess out since it is our very mindset that is the problem that prevents a world of abundance & peace from existing. The Elites and the masses are just the same but in different roles. We are all sick. There is no solution other than to change the way we ALL think.
      I conclude that a truly understanding, unbiased, incorruptible & powerful global system of justice is necessary for intelligent societies to exist long term. Anything less than this will inevitably end like it always has in history, but now with bigger weapons making a ‘final solution’ more realistic, …even permanent.

  • Mercurious March 18, 2012, 12:46 am

    All quite interesting to read but one looming factor I’m quite surprised to see left nameless here, unless I missed it. We can cut to the chase in the event of our/Israel’s “Iran strategy” going hot: Just one outcome possible as Iran’s formidable military exact a significant penalty on US forces. That would be $6 gas–if we’re lucky–the collapse of stock and bond markets and the likely sight of panic PM buying. If you like UST now as a flight to safety hedge, let’s talk again if a US carrier is sunk. Can’t happen? Right…I’d rather not base my retirement on one lucky surface-to-surface missile hit.

  • Richard March 17, 2012, 5:27 pm

    HA! HA! HA! HA! HA! FASB practices are suspended and untold other obfuscation, manipulation and smoke-and-mirrors are already being used. The Fed itself has only 48 billion in cash, but God Bless electronic zeros. The FDIC is also broke and the US Government is the largest debtor in the world and has definitely been broke for quite some time. Real Bank Stress Tests would confirm several heart attacks have already taken place and the patient is only technically alive because of extensive ‘life-support’ equipment, some which is visible, while most is not. Stress Test is an acronym for Simulated Transparent Reviews Enhanced by Scheming Statists for a Totally Erroneous Summary of Trust.

  • Buster March 16, 2012, 1:23 pm

    As they say…”You can fool some of the sheeple some of the time, but you can’t fool all the sheeple all the time”

    I think Zimbabwe’s stock market has risen strongly during the catastrophic economical situation there during the last few years. People have left for work in neighbouring countries to avoid starving & a government that panders to a chosen few. Sounds at least a little familiar, doesn’t it? So let’s not get confused between markets/statistics looking good & the reality of people’s lives.
    Anyway, despite all this, the sheeple are wisening up a little & support for the abomination that is the financial/military-industrial/media-religious secret empire of the elite’s (Babylon the great, no less!), is drying up. This will eventually lead to the very governments who have sold out to her in return for favours, turning on this organisaton & stripping it of it’s resources & power. I would suggest taking your money off the table & investing in the ‘real world’ for some good if & while you can. It may happen this year or it may be in 10 years, but happen it surely will & then it will be too late…(think MF Global).

  • steve m March 16, 2012, 1:05 am

    Sure, it’s mostly lies and scams. To really see the truth you just need to pick up a newspaper and look at the classifieds section to see there are no jobs

  • FranSix March 15, 2012, 11:47 pm

    Rick, your skills are required on the USB price, stat!

  • Bradley March 15, 2012, 9:11 pm

    The older I get, the less I’m willing to see things as black and white. Hedge one’s bets.
    Are gold and silver the only things to hold? Nope, but they’ve been going up for a long time, and there are lots of reasons to think they will continue. Hold some.
    Are stocks the only thing to buy? Nope, but since early 2009, they certainly have shown some nice gains, and are still showing strength. Hold some.
    Is the USD going to go away? Maybe, but for now, it’s pretty hard to buy things without it where I live. Hold some. Are people going to stop using oil? Nope. Hold some oil company stock.

    …an update from Kauai. At the Kiahuna Plantation, sales of condos in past years averaged 20 or so. (complex built in the 1970’s). They sold 5 last year, and only one this year. Many condos on the market. The price for the one that sold was the same as it sold for over 15 years ago, when I first started coming here. Costs of holding condos here rising, as they will–$1,100 per month for maintenance and nothing else.
    Another VERY upscale project down the road hasn’t gotten off the ground, (clubhouse and golf course built, building lots sold, but houses not being built). Lots which sold for $1 million are asking half that. Management says they intend on hanging in there. I can’t see how they will be able to.

    Nevertheless, I’ll be back. Beautiful and peaceful place.

  • bc March 15, 2012, 9:10 pm

    We have to choose the least crappy option. This militates in favor of equities. Don’t get me wrong, equities will fall too, but not as much as cash. In asset preservation mode, you give up on the idea of gains (in purchasing power anyway), and you just try to hold on to purchasing power you fear losing by inflation, by taxation, by theft and confiscation, and by bankruptcy of firms you hold equity in. These are all coming IMO. Buy firms least likely to go bankrupt. They will come back in price (purchasing power equivalent) eventually.

  • The cynic March 15, 2012, 8:16 pm

    Every market can be manipulated. That was shown in the last crisis. All manipulations EVENTUALLY fail. Look at the Soviet Union, et al. And 2008. The only true and real market is the PHYSICAL metals market. That is because metal = reality. Simple equation. Now that the fiat world is in disarray and the masses are stating to awaken after being financially violated anally with asset bubbles, inflation, etc, the paper market that pretends to masquerade as reality is coming to an end. A few more MF Globals, and hang on to your hats.

    • SD1 March 16, 2012, 2:42 am

      Nonsense. Metals are like anything else to which we attach a “value.” Gold and silver are a game.

  • gary leibowitz March 15, 2012, 6:56 pm

    Wow, what cynicism. A good number of posters believe in some sort of conspired and controlled markets. In such a diverse and complex global trading environment to suggest that there are all powerful people that can cause markets to bend to their will is ignoring some glaring flaw. If that were true why did we crash in the first place? Why allow Gold to go from 200/oz. to 1900? Why has all commodities soared? Why not just inflate our way out of this mess like we have in the past? I guess there is no all-seeing financial guru.
    The notion that the 4th year of a Presidency is being manipulated suggests that all 4th year terms have been manipulated. To some extent it is manipulated by an accommodative Fed and congress, but that game has been with us for centuries.

    The notion that politics and policy are intertwined is an age old institution. It’s just during extreme conditions that we take notice.

    Finally it all comes down to a belief that publicly traded companies are intentionally lying about their earnings with the sanction of all governments. Here is where capitalism smacks against any attempt at deception. While politics and policy can affect the markets with give-always, there is always a cause and effect. If the current policy will lead us down the destructive path then surely you must believe that outcome can’t be changed. It’s only a question of scale. The larger and longer we take the wrong path the worse the end result will be. Does anyone here believe we can avert a catastrophe based on the current path? Putting it another way, does anyone believe governments can deceive the public in perpetuity?

    • redwilldanaher March 15, 2012, 7:05 pm

      Define “perpetuity” please. Search around the Internet a little and you will come across the statistical oddities that have occurred repeatedly during this “rally”. If an idiot/thug/pathological liar like Cramer can manipulate the markets for a day then I’d be willing to wager that a all-powerful cartel that possesses “magic” can do it for a helluva time longer.

    • gary leibowitz March 15, 2012, 7:13 pm

      Sorry for this long rant. I just want to point out technically the last 3 years have shown a trajectory that is constant. No reason to conclude we are moving up at a steeper pace then we have in the last 3 years. In fact, assuming corrections along the way, we should hit 1550 – 1600 on the SPX near the end of this year. Not an unrealistic expectation.

      Even bull runs have sharp corrective moves. This is long in the tooth. Betting the next correction is something more must be backed up with news or events that are drastically different from today’s.

      I find it odd that I am defending a bullish yearly outcome since I was one of the first to envision a catastrophic world economy. This was way before we had the mortgage implosion. I knew excesses were developing and that the exponential accumulation of debt would eventually implode, but I had no idea it would take the form it has.

    • redwilldanaher March 15, 2012, 7:35 pm

      Gary, I have no problem with anyone’s “bullish” yearly outcome. I’ve been on the same side as you with respect to forecasting and for a long time. Rick even printed a few essays wherein I commented that “nothing” would surprise me, even new index “highs”, of course, it would all be due to manipulation. While that remains to be seen, I know for a fact that the fraud and lies have been ratcheted to stunning new highs to continue to push up the “blue line”. Nutshell: The sheople lost confidence in the Man behind the curtain to a degree so now they must restore confidence so the man can remain comfortably behind the curtain.

    • mario cavolo March 16, 2012, 3:53 am

      Hi Gary….interesting diatribe between you and RWD…let me insert….for example, Chinese govt has in fact FULL control. They are EXACTLY pegging the rate of their currency for example, see what I mean? No time right now to continue the theme…Cheers, Mario

  • redwilldanaher March 15, 2012, 6:14 pm

    Apparently it is my lot in life to “sound” like a broken record. I’ll add that everything we’re permitted to see is based upon fraud and lies. The “profits” are based on accounting fraud and lies. The centrally planned stock market laden with OPM cheerleading leeches is entirely comprised of fraud and lies even if it does respond to HPivs to a degree. The whole damn apparatus is fraud, lies and propaganda. This is all PSYOPS and has been PSYOPS from the proverbial git go! Everyone that’s cheering this manufactured illusion along is essentially aiding and abetting their enemy. I don’t want to be reinserted back into the Matrix. I’m just stupid that way.

  • C.C. March 15, 2012, 5:54 pm

    “…with the release of an Administration-friendly Fed report…”

    There’s your ‘reality’. Not that is wasn’t apparent all along that the current Fed chairman was ‘friendly’ to this administration. ‘Strong $Dollar’? Not if recent history is any guide, based on the past ~4 years, a ‘strong dollar’ has proven incompatible with the de-facto proxy for ‘recovery’ sentiment, a rising DJIA/S&P.

    If it is the will of the banking cartel that the current ‘leader’ be re-elected, all indicators currently employed to create positive public sentiment will either be kept in-range or bolstered sufficiently to all but guarantee a victory and continuation of same, right into 2013, the waterfall of expiring tax breaks notwithstanding.

  • gary leibowitz March 15, 2012, 4:24 pm

    I agree with Rick on the eventual outcome, but not on the timing. Banks for instance have had 3 years of negative rates which enhanced their books. Have started charging customers more, and is waiting out the housing mess with the Feds blessing. It’s a question of how long can this last. In reality the staggered collapse of the EU is a blessing to us. Had all this happened 3 years ago we would not have recovered at all.

    The real question on how well equities will do this year is what are their earnings prospects and what can derail it. On the spending front, people are starting to loosen their pocketbooks but at the expense of borrowing again.
    On employment it is showing steady but slow improvement, with little pressure for companies to expand wages.

    I have made the analogy before that we are in the eye of the storm. Dead calm before all hell lets loose.

    It looks more and more like the 70’s, with steep wild swings from one year to the next. This time around it will not be run away inflation, at least not in the beginning. I am as confident as one can be that the next steep decline in equities will be followed by a 12 to 18 month deflation cycle not seen in over 70 years. I still see all his happening next year.

    Some see a canoe (stocks) on the path of hitting rapids and then going over a waterfall. Others see it in calm waters with no reason to worry. It’s all a matter of perspective. If you don’t know the river’s path or can’t see above the tree line then there is no way of knowing what’s in it’s path. While my eyes are not what they used to be I do believe I have navigated these waters before. Time will tell whose reality takes hold.

  • John Jay March 15, 2012, 3:12 pm

    As far as Real Estate goes extend and pretend is working to some extent here in Southern California. The banks have held so many non paying properties off the market for so long that now inventories of homes for sale in the better areas have shrunk dramatically. If they feed them into the market with an eyedropper they might avoid a real collapse in the higher end properties. Cheaper for them to eat three years of cash flow on non performing loans than it is to have million dollar loans knocked down to 400k. All with the blessing of Uncle Sam. On the inflation front the Government says PPI Energy Prices for February were up 1.3%. Really?
    Crude futures went from a low of 98 Feb 1st to a low of 105 Feb 29th. Why that is ……. 7.5% ! And I think gasoline prices went up a little as well. Maybe they lump Nat Gas in there which dropped about 10%.
    Or perhaps they use the new Fed inflation assumption that states if gasoline prices go up 15% people use less of it. So prices for gasoline actually went down!
    There are no longer any markets, only interventions.

  • Mark Uzick March 15, 2012, 12:29 pm

    If inflation seems tame, as he notes, it is only because the counterforce, a nearly quadrillion dollar derivatives bubble, is poised to deflate catastrophically if the central banks ease off the monetary throttle even slightly.

    Inflation only seems tame to those who believe the lies of the BLS and shop/pay bills with their eyes closed.

    Unless the central banks intend to allow the people they work for (the bankers) to be wiped out and sovereign debts to default, they will never willingly ease off the monetary throttle.

    It’s ironic that the only political leader that’s willing to save the fiat dollar from its impending death is its avowed enemy: Ron Paul.

  • Chance March 15, 2012, 8:57 am

    This rally won’t last much longer. One thing the US stock market can’t overcome is greed. It doesn’t matter who’s pulling the strings behind the scenes and incessantly ramping the ES higher… pretty soon the easier and bigger gains will be to the downside and the hedge funds and equity traders at GS will follow. Plus, you kick the door back open for QE, so you kill two birds with one stone. Easy gains and more free money.

  • Cam Fitzgerald March 15, 2012, 8:45 am

    How can I talk to you Mario when your sentences are written like something out of Star Wars! You are sounding more like Yoda each day. The verbs and the nouns are all mixed up like a pasta salad.

    Cheers, man. Good article yesterday by the way.

    • Mark Uzick March 15, 2012, 12:05 pm

      I’ve already explained that this argument between you and Mario is really only a difference of interpretation of what a crash is in the west: That China’s economy is sharply contracting is shown by the fact that their projected “growth” rate is much less than their real inflation rate. It’s indicative, not of a Chinese economic crash, but of an ongoing economic crash in the west. This is because a contraction that amounts to a crash in the over regulated, over leveraged west has few implications in China other than setting economic progress a few years back, yet still far ahead of not too distant memory.

      The Chinese economy has the flexibility and liquidity to adapt to sharp and extended economic contraction without crashing; after western economies have crashed and burned, the Chinese economy and financial system will be still intact, increasingly efficient and ready to resume real growth.

  • mario cavolo March 15, 2012, 8:06 am

    Why is it hard to imagine that the “market” will simply stay in the trading range from 10 to 14000 for the next year or so…? Every time I read the group trying to forecast the decline to further doom or the rise to further highs, the market turns around goes the other way….best perhaps to think that the overall long, slowwwwww trend is this quite inflationary, cheap money stealth bull higher that in fact, could continue on for many years, of course with gut wrenching declines along the way… Fact is, we don’t have a crazy valuation “nasdaq” bubble in any equity valuations right now, do we? If China its monetary policy away from sterilization towards more expansion, indications they are, we are going to soon see the HK/Shanghai indexes, which have formed quite a bottom, join the U.S. equity markets on this slow creeping rise…China/HK markets will from this point forward, continue innovating, improving transparency, increase availability of tradeable assets, tradeable products, which will serve to continually “goose” the game for many years to come…

    On the contrary, one would say that the western governments/central banks are out of tricks, but they’re not really, inflation, quiet inflation, declining purchasing power of a “dollar” is always an available backstop, nothing new for the past 75 years, why should the future be any different?

    ….just musings….:) Cheers, Mario

  • Cam Fitzgerald March 15, 2012, 8:00 am

    From Bloomberg Businessweek tonight: Comments attributed to Adrian Mowat, JP Morgans chief Asian market strategist during a conference in Singapore today……….

    “If you look at the Chinese data, you should stop debating about a hard landing, Mowat, who is based in Hong Kong, said at a conference in Singapore yesterday. “China is in a hard landing. Car sales are down, cement production is down, steel production is down, construction stocks are down. It’s not a debate anymore, it’s a fact.”

    JP Morgan: Hard Landing in China.
    http://www.businessweek.com/news/2012-03-14/chinese-economy-already-in-hard-landing-jpmorgan-says

    And there you have it. Not from Cam Fitzgerald anymore but from someone authoritative and with the tools and access to information and insights that make a difference in understanding the markets in China.

    I rest my case, Mario.

    • mario cavolo March 15, 2012, 9:54 am

      Hah! 🙂 can’t let you off the hook that easy Cam!
      …from the exact same article… “Shilling and Mowat’s views are in contrast with Yale University Professor Stephen Roach, a former non-executive chairman for Morgan Stanley in Asia, who said on March 8 that concerns China will enter a hard landing are “vastly overblown.”…………Roach said at a conference in Shanghai. “These are all exaggerations.” ….I like this guy!

      And…”China’s factory output in the first two months of the year “ROSE” the least since 2009, while retail sales “INCREASED” less than economists predicted and inflation “EASED” to the slowest pace in 20 months.

      Actually, I did note a measurement I was wondering about where it was stated that growth dropping to a “6” % level would be regarded as a hard landing…I was wondering about that…

      So them its simple really! I’m with the Yale guy! Me and Roach and Jim Rogers are right! Mowat and Cam are goin’ down!

      Popcorn, cold beer, we’re all watching the show… Cheers, Mario

    • Cam Fitzgerald March 15, 2012, 11:05 am

      Hah! Don’t make me laugh, man!!!! I am giving you ammo for free. Stop it or join my army (at least I know you are reading the material though)…have a good night Mario, it is nighttime in Canada. Way past my bedtime.

    • Cam Fitzgerald March 16, 2012, 7:28 am

      Try this for more perspective Mario. Titled “China’s Impending Financial Crash.” It may be a softer look and a less data-rich article addressing reality there but it is no less sobering. Plus I always love when authors talk about the excess of skyscraper building and how it almost always signals crashes.

      http://www.straight.com/article-632871/vancouver/gwynne-dyer-chinas-impeding-financial-crash

      Did I mention yet that I think you should sell now and get out at the top?…….no…..OK Mario, I think you should sell now and get out at the top. This correction is going to be brutal and it is going to go global. It is in fact the biggest story of 2012 but too few yet realize the real danger.

      Get ready for a commodity correction end of this year and while you are at it prepare for a deflation shock. Nobody can control this economy anymore as it veers wildly out of control and skids back down to earth.

    • Cam Fitzgerald March 18, 2012, 10:15 am

      I don’t know why I never bothered to answer this post from you Mario. Maybe because your comments don’t make any bloody sense most of the time and you carry a heavy bias that often costs too much energy to argue with. Reading the following again I just noticed your emphasis is all wrong.

      Here is what you copied (your capitals)
      ————————————————-
      ” And…China’s factory output in the first two months of the year “ROSE” the least since 2009, while retail sales “INCREASED” less than economists predicted and inflation “EASED” to the slowest pace in 20 months.

      ——————————————————–
      And here is the exact same sentence and how it SHOULD look: (emphasis mine)

      “And…China’s factory output in the first two months of the year rose “THE LEAST” since 2009, while retail sales increased “LESS THAN” economists predicted and inflation eased to the “SLOWEST PACE IN 20 MONTHS”.

      By the way, you never responded to my case for a major housing correction and how it will impact commodities or Chinese growth. Very convenient for you. Try to make a real effort though if you want to challenge my links or data in the future. The fictitious account of a day in the life of someone in China is all very interesting but it is still just a story without all that time-consuming reality and the facts that most of us prefer.

  • steve m March 15, 2012, 4:56 am

    The market was gone up to fast and too high to last until election day (whatever that is supposed to be). Everything is looking primed for a major crises in the euro or Asia (Japan). If the market continues at this rate the DOW will be at 18,000 by November.

  • Pat March 15, 2012, 4:10 am

    FWIW, I think Gary just might be right. They’ll be gunning for new all-time highs in the markets now, which is only about 10% away for the SPX. And I believe O’bama will be re-elected easily this November.

    • Cam Fitzgerald March 15, 2012, 6:32 am

      So do I, Pat. and your idea of an all time high is probably pretty much where we will go by election time. Or perhaps we will end just shy of the high before the real SHTF.


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