RiskAverseAlert

Options Trader Monday Outlook: Stuffing the Futures for Thanksgiving

Regarding CME-driven surges, I think what one must appreciate about these (and you more or less allude to this) is that the interest behind it is stuffed with inventory it wishes to unload. Probably the greater hope is a wider interest will develop among money managers, precipitating follow-through buying on increasing volume. That this is not occurring presents a risk that those who supported the market during the first three months of this year (as witnessed by a spike in the volume of shares exchanged) eventually will become the very element whose actions lead stocks to "fall of their own weight."

Chance of a Depression Now 5 Percent

Absent any effort to address a decades-long deficit in capital investment in physical economy the nation and the world are doomed to experience a severe dislocation whose odds are far greater than 5%. Different this time versus the 1930s will be the impact on physical goods prices, however. Rather than deflation, hyper-inflation caused by profound collapse in the supply of basic things stands to be the more likely outcome.

Yet per grossly leveraged financial assets it'll be the same old crushing deflation as before.

Some call this dynamic a breakdown crisis, and project an impact unlike anything since the Black Death. As hard as this might be to swallow, considering all things presently in place such dire outlook makes a great deal of sense to anyone with higher power of thinking than your typical Monetarist Monkey.

The Twenty Year Stock Bubble Is Still Inflated

Trust me! I won't be surprised at all. Anyone with their head screwed on straight (and this includes Mr. Buffett, and now Mr. Gross) in their own way sees how equity is doomed to be dead money.

Meredith Whitney: 'I Haven't Been This Bearish in a Year'

One ought not confuse a rising market and an operation to clear out weak-handed shorts. Much as was the case March-May, 2008 this rather appears the case right now.

It is plain equity is dead money. Were this not true would Buffett sink such a big stake into a hugely capital-intensive railroad? This capital preservation play screams loud and clear equity is grossly overvalued and soon might not buy much of anything possessing sure cash-generating value. That Buffett could not wait for the next shoe to fall speaks of fear his BRKA would not possess the same currency as now.

Something like Whitney, I have never been this bearish.

Banning Derivatives and Other Such Foolishness

And what of speculators working in the London office of AIG Financial Products whose operations cascaded into spectacular collapse of the company threatening to bury the global financial system? What good purpose did this group serve?

Do you deviate into a realm where those intimately knowledgeable of the history of nations might consider your generic defense of derivatives a case of giving aid and comfort to an enemy of the people of the United States of America? Might you too, then, be saying, "Do as I say, not as I do?"

Time for the U.S. Economy to Reindustrialize

Is the author saying we are to be saved by fascism? Public-Private partnerships, wherein private companies drive the availability of finance, which in turn drives the availability of infrastructure needed to sustain an advanced economy (in this case, electricity) is what Mr. Steinberg essentially is proposing via his call for the transformation of knowledge-based commerce into utilities. How is this any different than what Mussolini imposed upon Italy in his time?

A better approach is bankruptcy reorganization of our dead, overbearing, overreaching globalization junkies (at whose core finds the companies indicated here) and resurrection of national banking along lines Alexander Hamilton developed. Then, we can get on with the job of a massive build-out of 4th generation nuclear power facilities and a transformation from a hydro-carbon-based economy to a hydrogen-based economy, financing this at rates of interest the private sector simply cannot compete with.

Fed Maintains the Emergency Rate While Saying 'All is Well'

Your last two takeaways are interesting. Per understanding the other side of the trade I am curious to know when Buffett's BNI takeover is slated to close, for it is then an attack on equity as currency might more likely ensue.

Charlie Gasparino: Another Crash 'Has to Happen Again'

I agree. Equity appears well on the way to becoming dead money. Yet, even now, some would pump up its currency to gain control over economically vital physical assets. Right, Mr. Buffett?

Bank of America, Citigroup, JP Morgan and Wells Fargo Stocking Up on Liquidity

How can one not perceive a greater measure of bank balance sheet fakery when even the long-term solvency of the U.S. Treasury increasingly is being called into question? Indeed, this might be one reason why Treasury holdings among banks are so low. When the whole thing is set to blow, why not improve momentary appearances of solvency squeezing yield further out on the risk curve? It seems that, despite last year's near meltdown of the money market, those who chase yield even among what are widely perceived "safe instruments" (agencies) either have not learned a thing or the present moment is a ruse whose intention falls under "all things are not what they seem."

Gold Is Not in a Bull Market

Per Nadler's "four factors that truly make a gold bull market," only the fourth holds analytical sway supporting his "Gold is not in a bull market" thesis.

The question is what will gold do as the present economic breakdown crisis accelerates? Believing that the stock market has been tracing a counter-trend rally in a bear market with much, much further to go, what seems gold's likely fate in a capital-starved world is no different than its fate last year as the world rushed to plug gaping holes in the various three-letter securities marketplaces blown to bits with the collapse of Wall Street's structured finance. In other words there is considerable risk of a huge wave of gold selling precipitated by unstoppable, ongoing balance sheet de-leveraging.

What has come to pass thus far in the de-leveraging process is only the beginning. That said, though, gold still could rocket higher in this present period of transition into the next phase of financial collapse. But beware. That gold principally is being bid higher out of perception it represents a financial store of value strongly suggests it can just as easily be sold were the need to raise capital to sweep upon the scene (which eventuality, I believe, is a virtual certainty).

Cramer Does It Again with CIT Call

The trouble with Shemp is he believes the Fed is not bankrupt and that the credibility of the institution remains intact. This, however, is a serious flaw at the foundation of Cramer's contemporary macro analysis. Though he recognizes credit expansion is a necessary element for cultivating a bull market in stocks, it is the collapse in confidence in the quality of credit and in the credit market's capacity to infinitely expand in a manageable way that he fails to acknowledge. Big mistake. However, I don't imagine it'll be all too terribly a costly one. He may be a macro idiot, but he does know how to trade.

The Intrinsic Value of Nothing, Part 1

First, I believe a dollar has "value" not because "the government" says so, but rather because organized government representing the will of a sovereign people makes it so. Indeed, constitutionally, the U.S. government is charged with the means for doing so: this via extension of credit whose practical worth is backed by robust physical processes serving human needs whose very being, itself, was affected by the same, organized application of national credit. Government neither "says" nor "decrees" anything lending value to currency. Rather it is through action affecting the uplifting of human creative potential that brings a currency its intrinsic value.

That said, I agree the "elaborate fiasco called quantitative easing" is doomed to fail. Yet that we have among us the blind leading the blind into a ditch is not necessarily a bad thing. How else might wiser minds gain the path of least resistance in rising to the top?

Still, sir, I have said this before in this forum and I should say it again: the Austrian school is one whose principles best suit a fascist social arrangement, whereas a Hamiltonian credit system best suits a nation whose foundational principle seeks to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare and secure the Blessings of Liberty to ourselves and our Posterity.

Economic Crisis 2008-9: Ignore Friedman's Lessons at Your Peril

Monetarism is the tool of a dying imperialist current whose living adherents apparently would rather perish in the rage of its desperate victims than consider the error of their worldview in the framework of the simple, single-sentence preamble to the U.S. Constitution whose stated principles have been persistently ill-served by fantasy-filled formulations separating financial processes from physical processes, such as the Chicago School has become quite adept at developing. Y'all might better call yourselves "Greenspan" because although you might talk brilliantly, deep down your sense of history is as dull (and wrong) as Bernanke...

Ten Stocks for the Next Ten Years

So long as the process of de-leveraging continues threatening the global financial system, most (if not all) equity will remain dead money over the next several years. Processes beyond any given company's ability to control will continue burdening equity valuations until such time as the global financial system is reorganized in bankruptcy and financial claims presently destroying growth prospects are written off. Presently, we are at the precipice of what might prove the worst financial/economic/social nightmare the world has ever experienced. This is no time to be accumulating risk, no matter how attractive it might seem by traditional measures.

Cramer's Mad Money - When the Facts Change...(10/23/09)

Good advice, Shemp! Now take it, because the fact a massive short squeeze (see unbalanced RSI surge in both March and July) largely has brought stocks to present levels is evidence you fail to account for in your bullish stand. And speaking of facts, diminishing volume shows this rally climbing a wall of complacency, and since when is this bullish? This same condition wasn't bullish last March-May, 2008 (while you, on the other hand, were bullish) and it continues not being bullish now.