Okay, let’s recap recent events, starting with the good.
German, Finnish, Austrian and UK yields are spiking, as Spanish and Italian yields are flat to down. Scared money has been hiding in short dated “safe haven” sovereign debt. It needs to come out, in order to get the juices flowing again. The fact that German 2yr yields are +17% today is decidedly positive. The euro has stopped going lower, despite all of the negative news flow. And the dollar has started to soften, always a “risk-on” signal. Oil has been getting the stuffing kicked out of it, definitely a positive for a number of industries saddled with onerous input costs–due to expensive crude. Borrowing costs have plunged, making the Fed’s “Operation Twist” policy a massive success. Lastly and most importantly, despite the endless stream of bearish news and sentiment displayed by the media, stocks have been trading sideways for a few weeks now, possibly a sign of consolidation.
The bad.
On a whole, the global economy is slowing, including the fetus eating Chinese. The whole BRIC theme is a fucking joke. Brazil’s economy is in freefall mode, putting a big ol’ capital B in the BRIC being tossed through the global growth facade. Syria is in full-fledged civil war mode and our business with Iran is far from over. Free markets don’t exist anymore. We’re all on bath salts, zombies fueled by the generosity of desperate policy makers. The fact that we depend on the fucking Germans to do right by its fellow EU members is comedically tragic.
The Ugly.
The world hinges on Greek democracy, scheduled to be displayed this weekend. Ironically, the inventors of democracy might destroy their country, by exercising such rights. Should Greece unravel, it will bode poorly for other weak euro countries, possibly leading to the collapse of 17 nations–simultaneously. The Germans have no choice but to back everything and that’s not exactly ideal for their balance sheets. This all has the feel of “end game”, a story that ends with the bad guys winning. The worst of all is our dependence on policy makers and central banks to print money, in order to buoy the markets. Although I am looking for QE3, this is not a healthy investor environment, depending on those fucking assholes to reinflate our busted bubbles.
Gone are the days of normal economic cycles, which makes this market exceedingly hard to predict.
Enter the meat-grinder.
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Smashing machine.
End game, indeed.
Central Bankers have shot their collective deflation-fighting loads, and are now hanging limp and tired.
Personally, I’m ready for the battle. Waiting around for it – and wondering if it’s gonna be left for my kids to fight through – is draining. Let’s get it on.
Bullshit. Central banks BORROW money (sell ten-year bonds, for which there is insatiable demand) at the current absurdly low rates and use the money to buy (long) stocks in the broad averages.
And assign those stocks to the pension funds of ALL countries, in proportion to their GDP.
Beautiful summary. Succinct and to the point and clearly free of any bias.
Cheers.
The clam will lead us to salvation and you know it.
As always accurate and clear. fantastic!
we aproch the cliff
/r/SIG=130d8rg5k/EXP=1339623862/**http://www.nwfdailynews.com/articles/financial-50228-approaching-walter.html
lol ,approach
I lost it at fetus eating Chinese.
LOL, yes, they are the ones that the U.S. depends on to buy our humongous debt. So we are trusting this repressive governent to support the economy of our supposed free democracy. This whole world all fits together so ridiculously.
That is why you should not eat shrimp in Shanghai
best yet
Spanish and Italian yields going higher again.
“The fact that we depend on the fucking Germans to do right by its fellow EU members is comedically tragic.”
I spat my coffee up when I read that. Comedic gold!
Nice summary as usual.
Headline PPI # down 1.0%. I posted yesterday that I think QE is not an option until after the election. But I could have sworn I heard the faint sound of a helicopter engine starting up when I saw the PPI report this morning.
I thought the same. Lower inflation data gives Fed green light to drop cash on the people.
He may need to drop oil a few more $$$ before he takes the helicopter to the sky..
Anybody like Dell here? Or do you think the pop will get sold… I like it longer term just not sure if it’s the right entry.
Screw it, I’m buying a bit here. HP is severely handicapped in the near term. Dell investing for growth while others are cutting costs.
its obvious the fix is in…the market is going higher.
Thanks for the jinx. Please stop.
Hey Fly, where’s that picture from?
Game of Thrones