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One way or another, “The Fly” will sell the space.
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Fly,
What side of the Coin do you fall on, Inflation or Deflation?
You’re short materials via SMN yet you seem to fall in the camp that says lower interest rates will weaken the dollar and create inflation or have I “Missread” your signals?
Inflation mongers are loading the boat with energy, ag and pm while deflation favors those holding currency and often leads to a call by populists for a currency backed by silver.
So do you advocate a return to the gold standard or the more inflationary silver as a hedge to deflation and holding dollars or do you fall somewhere in between (stagflation)?
>> Wages failing to increase at the rate of productivity for protracted periods will ultimately cause deflation.
Indeed, if growth continues despite lagging wages, it is because of debt accumulation, producers lend to wage earning consumers part of their profits, in order to sell their products. For protracted periods, there is a lot of endogeneous money creation. The debt/GDP ratio rises.
Then, when debt payments exceed the borrower’s ability to pay, debt accumulation and endogeneous money creation stops, demand and goods’ prices fall (deflation), manufacturers reduce production, employment falls, and fewer borrowers are thus able to pay their debts, and the cycle exacerbates.
Once preventive action has failed, Keynesians advocate corrective action. In case of debt deflation, keynesians advocate “pump priming” or government creation of fiat money. As witnessed since 1990 in Japan, and in the 1930s in the USA, this policy is not very effective unless government creates employment via public works projects or military manufacturing.
With the rise of monetarist ideas, the focus in fighting deflation was put on expanding demand by lowering interest rates (i.e., reducing the “cost” of money). This view has received a setback in light of the failure of accommodative policies in both Japan and the US to spur demand after stock market shocks in the early 1990s and in 2000 – 2002, respectively. Economists now worry about the (inflationary) impact of monetary policies on asset prices. Sustained low real rates can be the direct cause of higher asset prices and excessive debt accumulation. Therefore lowering rates may prove only a temporarily palliative, leading to the aggravation of an eventual future debt deflation crisis.<< Seems that the Greenspan cuts have taken hold and while Bernake was fearing inflation as masked by foreign demand for natural resources he was too late to the party to raise rates in the face of this debt deflation and finally got on board the deflationary bus with his current dollar be damed monetary policy.
When the ad space doesn’t sell, you can give it to me for free.
-DT
Fly,
I would love to know what your technical servant thinks about moves up in the market near term. It sounds totally illogical to say, however, the DOW will make a move up to the 13,000 level. The response yesterday to news that would traditionally bury the market, on increasing volume, indicates an illogical desire to move up to trend. We have shaken out the oversold condition, consolidated, and now are ready for a sloppy pop to that level. Nothing new has popped up that will cause the market to puke further. Look at the news (and posts here), it’s all rehashing the same news and hypotheticals that the market has already factored in. So, the market moves north unless and until the U.S. nationalizes banks across America. In the mean time, get drunk and throw darts at stock charts.
I have been long XLF and UWM for a couple of weeks now. I believe my thesis finally plays out this week into possibly early next week.
BTW – nice move in RIMM
Targets are below:
S&P: 1,425
Naz 100: 1,970
DOW: 13,000
Alvari40,
They’re “technical team members”, not “technical servants”.
Ask The Fly when team-member polos and chinos will be available in the IBC Store.
Fly,
When will “team-member” polos and chinos be available at the IBC store?
Broad and Wall – what say you re: technical thesis?
I am Fly’s technical servant.
We need to break free of the triangles. Don’t get ahead of everything.
Lets break free of the consolidation first before projecting.
Alvari40,
Seems plausible, but (1) there’s a sharp downsloping MA50 at Dow 12774-ish, and (2) the daily chart looks to me to be in no-man’s land, and could easily test support as well as move up. Also, countertrend trading in the absence of raw panic is not my thing.
I have to go now. My grandma wants the computer back, and the bus is here.
Who is this “Fly” person?
K – have a good day. Make sure you give Ms. Smith the apple….and, bitch slap that fat whore that keeps tripping you in the hall. Have fun and play well with others.
Consider firing up some fresh DUG.
T. Boone is now short oil and natty per his appearance on CNBC this morning:
(After hitting fresh all-time highs yesterday, crude oil has slipped 0.9% to $98.89 per barrel).
On interview with CNBC, T. Boone Pickens said he has a short position in oil and natural gas, as he expects prices to fall in the second quarter, according to Reuters.
He expects oil to return to $100 per barrel in the second half of the year. Pickens previously correctly predicted that oil prices would hit $100.
Odd Catholic fact of the Day:
St. Paddy’s falls on Good Friday this year.
Short Guinness (DEO)
Its obvious the market will continue rising based on the Philly Fed reading and the subsequent reaction. BAD NEWS is GOOD NEWS.
This market is rather egregious, no?
Please wake me when the market gets a big whiff of “Barak Obama is going to be President for at least four years.”
Quietly, MVIS makes its move.
As I was saying…
Lets see how these triangles play out before getting giddy.
alvari,
it’s because Microvision doesn’t want to be upstaged by Macrovision (reporting earnings after the close)
Yen is getting stronger therefore market weakens. The relationship between US equities and the Yen are remarkable. Yen up, equties down and vice versa. Carry trade is evidently huge.
CAP,
Pretty much the whole US economy runs on debt, credit from the Asians and Arabs.
The American way is to consume a $400k house, $2k plasma TV, $30k BMW, yet only produce about $60k worth of income.
Ah CAP, you picking it up too. I havae been pounding this table so long I thought no one is listening. It’s not a strait carry though.I think cummguzzling Hank had some phone sex with Tricky Jean when he did those euro credit swaps in December and they are going to channel the carry trade through the eurofag via those couple of hundred of billions of repos they winked winked. Could not figure out what the fuck that was about when they first called it, but now I did.
btw.. reason? not even the crafty and stubborn little hirohito.. he not buy no more little dick amero.
JJ deserves more respect. He’s clearly a money maker and well on his way to executing his clever plan to a half billion net worth. And that’s just in his 401K.
He wants you to believe it’s all about the supercycle, but through dilligent study and analysis he anticipated the power outages in South Africa that would create supply shocks.
SWC and PAL to the moon, bitches!
Never heard of it before, but after reading this can say with assurance, that it’s a point of great interest and fun for me