junkyarddog

Options Trader: Thursday Outlook - How Much More Disappointment Can We Stand?

It's interesting that the market's psychology was similar when oil was >$140 and people were cock sure it'd hit $200 soon. When the dust settled (albeit perhaps temporatily), more realistic values return to market.

This time around I don't know what the DOW's "real" value is or should be. However, one thing is for sure: there's a lot of panic out there and as such it's hard to assess value on anything.

If it goes below 9K I imagine a lot of people will take their 401K's out of stocks and move it to money markets, perhaps compounding the sell-off.

Options Trader: Monday Outlook

Call me crazy, but I think this is all by design. No, I'm not a conspiracy theorist! I simply don't believe there is too much mystery behind the scenes.

1) Steep decline of the US dollar since 2003.
2) Mortgage rates at 1% variable, no money down to buy a half mil house (what did you expect?) Mortgage meltdown!
3) USA losing "market share" in the world
4) China's meteoric rise and influence
5) The EURO slowly taking place of the US dollar
6) US debt: 9 trillion and still counting
7) Lastly, war in Iraq.

So, if you look at this picture, what is the simplest 'solution' to the US problems?

I say, the US tells its creditors: you want US dollars, we'll give you US dollars! Inflation. Another benefit: kill the EURO. Lower the dollar and give free money (2%) to banks and help exports. Didn't the Japanese automakers do that to us in the 70's and 80's with their cheap and then piece of junk cars? The weak yen helped them. Cheap dollar helps the US in the short and medium term. Look at our trade deficit shrinking (discounting oil, minor detail...).

Italy, France, and Spain are struggling with the strong Euro, yet ECB is talking about raising their interest rates. You bet these countries won't be happy about that and it'll hurt their ability to compete in the international markets.

And then oil. What a better way to slown down the economy, make people forget about the war in Iraq, and help JP Morgan, Goldman Sachs, and the rest of the gang to recoup their money from the mortgage meltdown? What a better way to slow down China, even if momentarily? What a better way to restart drilling offshore?

In the end, look at who benefits the most with all of this. Is it OPEC? Maybe, but I still think they're peons. Could it be more power to Congress? Didn't Rep Watts already propose nationalizing the oil companies? Doesn't the SEC & FED have more controlling power and increased jurisdiction than ever before?

In the end, this is all my guess and it could be all crap. I simply believe there's too much "coincidence" on all of this. It could be very well our leaders are that stupid and this chaos is random.