We are trapped in a Groundhog Day-like market environment and we can’t get out. Each year since the breaking of Shadow Banking in the multi-trillion dollar fraudulent financial system, markets have done almost exactly the same thing at almost exactly the same schedule.
In this election year anything in possible. Are you waiting for some insane political posturing? Its here. Do you believe the worlds economies are in trouble and near a systemic failure? They are. Are you looking for governments to save the world? Its right around the corner. And amazingly, the market is in almost the exact same place.
Sure, there has been movement; down 50%, up 100% down 20%, up 30%, down 10%, up 15% etc. But we continue to drift lower and spike higher providing the cushion for the next drift lower, etc. Predictably, we spend the majority of the month flat to higher with spikes up near option expiration and month end punctuated by a couple of terrifying downdrafts that eat away at the cushion. And it happens over and over again.
It’s taken trillions of dollars in free money to train markets and their participants but the markets remain “strong” in anticipation of the guaranteed and inevitable additional free money to keep the status quo alive. Don’t worry about Libor-Gate. Don’t worry about Silver conspiracies or losses by JPM. And you certainly shouldn’t worry about the economic numbers because they are meaningless.
There will be plenty of opportunities in both overall market directional bets and specific stock selection but we should expect that the chest-pumping bulls and the crash-hoping bears will be slowly drawn and quartered as we continue this muddle-through see-saw action that is our destiny.