Dean M

Break-out or Fake-out?

I guess you missed the runup completely. I jumped in the market when the length of this rally exceeded 106 days (the length of the 1929 bear market rally). You think the market rally is happening in spite of the dollar collapse? That is the cause.


On Oct 14 04:27 PM market ace wrote:

> The whole financial world and the US economy are riding the gov't
> and medias giant FAKE OUT
>
> The FED is destroying interest earnings for millions of retirees
> and therefore destroying income necessary for recovery just so they
> can pimp for their failed banks. Bottom line: Right now, $1,000 invested
> in a 3-month Treasury bill yields a meager $1.20 in yearly interest.
> At that rate, just to match the 5 percent interest you could have
> earned on T-bills in early 2007, you’d have to leave your money sitting
> there for 42 years! U.S. savers are obviously getting shafted. <br/>
>
> The U.S. Treasury Gobbling Up Available Credit, Crowding Out Nearly
> All U.S. Businesses!
>
> Due to giant bailouts and out-of-control federal deficits, the U.S.
> Treasury is now borrowing money at the fastest rate of all time,
> hogging nearly all available supplies of credit. Meanwhile, American
> businesses and average consumers are getting shut out or even shoved
> out of the credit markets.
>
> In the first half of this year, the Treasury has stepped up its pace
> of borrowing to annual rates of $1.4 trillion in the first quarter
> and $1.9 trillion in the second quarter. That’s 3.5 times and six
> times more than last year’s pace, respectively.
>
> Meanwhile, businesses are getting crumbs: Last year, banks provided
> new credit at the annual pace of $472.4 billion in the first quarter
> and $86.7 billion in the second. This year, on a net basis, they’re
> not providing any credit whatsoever. In fact, they’re actually liquidating
> loans at the rate of $857.2 billion in the first quarter and $931.3
> billion in the second.
>
> Ditto for mortgages. Last year, mortgages were being created at the
> annual clip of $522.5 billion and $124 billion in the first and second
> quarters, respectively. This year, they’ve been liquidated at an
> annual pace of $39.3 billion in the first quarter and $239.5 billion
> in the second. WIth a foreclosure every 13 seconds this will only
> get much worse.
>
> For consumers to borrow on credit cards and with other consumer loans
> is even tougher. Last year, people were able to add to their consumer
> credit at annual rates of $115 billion and $105 billion in the first
> two quarters. This year, in contrast, they’ve been forced to cut
> down their credit balances at annual rates of $95.3 billion in the
> first quarter and $166.8 billion in the second quarter.
>
> Clearly, consumers, small businesses, and even larger businesses
> are also getting shafted.
>
> But Wall Street Traders Reap Gigantic Rewards While Average Workers
> Face Worst U.S. Job Market Ever Recorded!
>
> So it should come as no surprise that, with the U.S. Federal Reserve
> virtually guaranteeing a fantasy land financial environment for banks,
> GS has hit the jackpot this year: The bank has accumulated a bonus
> pool of an estimated $16 billion to dish out to an exclusive group
> of its heavy hitters as part of Wall Streets pool of an estimated
> $140 billion. That’s enough to cover a $50,000 bonus check for each
> and every household living in Los Angeles, Chicago, San Francisco,
> and Detroit.
>
> Meanwhile, all across the USA, with small and medium-sized businesses
> unable to get credit or hire Long-term joblessness has hit the highest
> level in at least a half century: The share of the unemployed who
> were out of work for at least six months reached 35.6 percent in
> September, the most since the U.S. Labor Department began keeping
> statistics in 1948.
>
> More than 5.4 million people have been unemployed for at least 27
> weeks, with 1.3 million expected to exhaust their benefits by the
> end of this year. 15 million unemployed Americans are competing for
> 3 million available jobs, the worst on record, while 35 million remain
> on food stamps.
>
> More than 7.2 million jobs have been lost in the past 21 months.
> In contrast, in the 30 months of the past recession, only 2.7 million
> jobs were lost. The official unemployment rate, at 9.8 percent, is
> just the tip of the iceberg. The true unemployment rate, including
> part-time workers who can’t find full-time jobs and workers who have
> given up looking, is 17 percent according to the U.S. Labor Department
> and 21.4 percent according to Shadow Government Statistics.
>
> Anyone thinking that this Stock Market miracle reaching over 10,000
> today while the US dollar is getting crushed is not a head fake will
> soon learn a lot ablout false hope.

Stretching Out the Bear Market Rally

So to recap

fundamental logic = your point of view

"I am not altering my longer-term bearish view, but showing the divergences as the convoluted bullish consensus continues to defy fundamental logic."

Beware the Ides of October

Sorry Rich, you already called the market top, I think it was back in July. You only get one bite at that apple.