Friday, September 07, 2007
However, looking at the internals, I anticipate the market will weaken, barring a fucking miracle.
Right now, most of the weakness is focused in the financials and home builders, with 2 and 3% declines, respectively.
In addition, retail is down 2.1%, semi's -2.2%, trannies -1.6% and small caps are down 1.7%. And, the yen carry trade is taking a belt to the stomach, with the FXY climbing 1.14%.
As you know, the only silver lining is the rise in gold, as every fucktard with access to E-trade believes the dollar will "shit the shower." Again, I do not believe the dollar will fall, as much as the gold bugs say it will.
Finally, there is reasonable strength in biotech, drugs and defense stocks.
Taking a wild guess, I think we'll close down 2%.
Of course, you can try and manage this volatility but eventually you will get your head chopped off when its becomes bigger than you.
Fuck Peter Schiff. He doesn't know dick from doorknobs.
There is no plausible way the US tanks and the world doesn't follow us into the crapper.
You're either too dumb or ignorant to understand this paradigm.
As for the dollar, it will not drop as much as you think.
In a really bad economy, deflation is the risk. Under those circumstances, Gold will drop to $200.
Remember, fucktard, inflation is no longer the risk.
The gold trade is crowded.
As a matter of fact, I think I will sell it short.
Remember, I do not want you or need you to side with me. I have longs coming out of my ears and will have to sell a lot, in order to avoid getting poleaxed.
For you, before committing fresh capital, try to remember what rate cuts did for us in 2000.
If you conclude that the rate cuts were good for the market, in the two years following, I will eat my computer, effectively ending this blog.
Word of wisdom: It's always good to announce what you've got before it goes up.
Credibility-wise I mean.
If you care about that stuff.
PS -- I expect to see some photos of you drinking a glass of Chateau de Chaitillay on the banks of the Seine.
Second: Short LAZ hard here. With job losses comes heavily reduced M&A. Its holding up well and waiting for a nose punching.
Notice the strength in NTRI. Odd.
It's not fucking inflation or deflation, its called stagflation. I disagree with you as your crowd is too caught up trading yen for dollars. The price of gold is all in the dollar which is a function of the following formula. I can assure you Sinclair is not "ignorant" or "dumb" and understands the inner workings of the global economy much better than you do "fucktard".
First interest rates rise affecting the drivers of the US economy, housing, but before that auto production goes from bull to a bear markets.
This impacts many other industries and the jobs report. An economy is either rising at a rising rate or business activity is falling at an increasing rate. That is economic law 101. There is no such thing in any market as a Plateau of Prosperity or Cinderella - Goldilocks situations.
We have witnessed the Dow rise on economic news indicating deceleration of activity. This continues until major corporations announced poor earnings, making the Dow fall faster than it rose, moving it deeply into the red.
The formula economically is inherent in #2 which is lower economic activity equals lower profits.
Lower profits leads to lower Federal Tax revenues.
Lower Federal tax revenues in the face of increased Federal spending causes geometric, not arithmetic, rises in the US Federal Budget deficit. This is also true for cities & States as it is for the Federal government.
The increased US Federal Budget deficit in the face of a US Trade Deficit increases the US Current Account Deficit.
The US Current Account Balance is the speedometer of the money exiting the US into world markets (deficit).
It is this deficit that must be met by incoming investment in the US in any form. It could be anything from businesses, equities to Treasury instruments. We are already seeing a fall off in the situation of developing nations carrying the spending habits of industrial nations; a contradiction in terms.
If the investment by non US entities fails to meet the exiting dollars by all means, then the US must turn within to finance the shortfall.
Assuming the US turns inside to finance all maturities, interest rates will rise with the long term rates moving fastest regardless of prevailing business conditions.
This will further contract business activity and start a downward spiral of unparalleled dimension because the size of US debt already issued is of unparalleled dimension.
Therefore as you get to #12 you are automatically right back at #1. This is an economic downward spiral.
I heard all this "slow business" as negative to gold talk in the 70s. It was totally wrong then. It will be exactly the same now.
COT (thus far) says "1998."
A 50 basis point cut is already priced in. Furthermore, if you believe the rate cuts will do little to help the economy, tell me why I should own gold?
Asset diversification, maybe.
My gut says it's crowded. I haven't opined on gold in awhile, mainly because it has been quiet.
Don't you run a fucking trailer park?
You may believe it's stagflation all you want, but it isn't.
Geez, this is like teaching retards calculus. I give up.
Love your beer. One quibble with your analysis. If the US heads into recessionary or near recessionary straits, won't the Trade Account Balance moderate as our dollar weakens and we cut down purchases on foreign goods?
This, as you may guess, tends more toward the Fly argument, which is the thus far incontrovertible truth (for the last 150 years or so):
If the U.S. catches a cold, the globe gets crotch eating Ebola....
Or something along those lines...
You announced those "buys" after the market was open down big.
Another thing -- I'm not so sure that's you in your picture to the right.
Unless you recently shaved your beard?
It is not dependent on the US Trade Imblance but the US Federal Budget Defecit which will rise exponentially as the Fed will not be able to offset declining Tax revenue. I hope all of you are right, but I will stick with my plan as I have been correct for the most part so far.
And as "the Fly" has pointed out repeatedly, he is an asshat. Therefore, use the word at your own risk.
Also, I agree that the rate cuts are figured into the market. When GS comes out and says they expect a 50bp cut and the market goes lower, it means we have trouble.
Distribution... big money is selling this market.
There's going to be massive estimate cuts after this jobs number and after the banks/BDs finally drop whatever bombs they're hiding.
Estimates have to come down...ALOT, and I'm not going to own stocks until they do.
No truer words have been spoken here. No reason to debate, just make your trades and let your account tell you if you're right or wrong.
I've summoned my new voodoo Dr. to send a cow tossing hurricane to your favorite trailer park.
QID @ 12:03 = $44.55
QID @ 12:42= $44.58
Hope it was a trillion share trade, Ralph.
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