The EconomicJoker's  Instablog

I'm one of those guys cheering for the correction.  I won't lose my butt again.
After some downward momentum last week and a yucky ugly duckling today, the fat lady is coming.  Can you feel the boards warping as she jumps in? 

Well today's movement was a slap in the face.  And we're not even in September yet.  I expected more weakness but not a fall on your face.  But either way, I'm still on the fence whether we're getting a 20% correction or a 40% correction.  (I think we're getting the major economy killer in a few years)  In the short term, bring the correction.  I am not fearing it.  I've been in shorts for a week or two and what I've seen is that my portfolio is going nowhere.  As my shorts go up, my equities go down and seriously, it's balanced perfectly.  No profit, no decline.  So bring on the correction,  I'll be buying doubling my current equities in a few months with short-driven profit. 

:)

I am now officially speechless and starting to get angry.  This blog is nothing but me whining and I'm warning you in sentence #2.  So get out now if you don't want to hear the crying.  :)

I'm a firm believer that markets need to dive, crash and burn, swirl down the drain, whatever you may call it, so that they can emerge like a phoenix, stronger the next time.  But in this crazy world of who knows what, what is propping this market up?

I haven't heard this talked about yet ...
Sellers -Obviously, we know this isn't the case because that's not how the market works.  But sellers would give at least some volume to the board.  But there are NONE.  But then again, this lack of sellers might be the culprit. 

Could it be that everyone is sitting on the sideline sitting on their losing equities, hoping they get back to some semblance of their prices last year?   They can't bear to sell them at a loss so they will just sit on them.  They're effectively out of the market and won't come back in out of fear of another fall or their equities go even again.  It's this reason and that they are saving money instead of investing.  It's human nature to not want to lose.  Whether it's the home seller not coming down enough or simply sitting on your down equities.  It's drove everyone out.  This is obvious. 

But that leaves a handful of serious risk takers pretty much free will on moving the markets their way.  Like a blackjack player getting the dealer all to himself.  Throw in a bunch of HFT and Goldman and other shadowy types and it's pretty easy to weather through this low volume fiasco.  Push the market whichever way you want it to go.  If the market can't collapse under these crappy fundementals, will it ever drop significantly again anytime soon?

 

I keep hearing about how this Recession is going to be over in 2009.  I would really like to believe this but here are a few reasons, ripped straight from the heart of middle America, myself, of why I just don't believe the 'Hype'.  Now before you read, I am just a man, like one of you.  I get the markets and I make and lose money in my investments but what I write here is what I see and hear on a daily basis.  I have no economic experience other than econ 101 in college and even then, my grades were a bernanke short of a paulson. 

Real Estate

My friends are brokers and realtors.  If you ask them, it's the worst market they have ever seen.  Some of them have quit and some don't even try anymore.  People are just not moving anywhere, for any reason. And I believe them.  My house has been on the market for almost 4 months and I have had three showings.  The price has been dropped twice now.  I live in a major metro area in a gentrificating neighborhood in an awesome city.  I can't sell my house.  Not for lack of trying.  Two brokers don't even want to try it themselves

Mortgages

Sure, there are great interest rates right now.  I had a 780 credit score until I just recently bought my diesel Jetta.  Now I have a 720.  Someone explain that to me.  I have a 6 figure salary and plenty of money in the bank and I had trouble refinancing.   I can only imagine the hardship of someone making 50K and barely scraping by.  There simply isn't any credit right now.  But this is nothing new.  Is it me or do banks make more money by actually lending it out?  So why are they not doing so? 

Jobs

Almost 10%, did I read that right?  My company has closed plants, layed off a bunch of people and can't meet their monthly budgets... Counties and states don't have any money to buy our building products.  Where is this golden stimulus package for infrastructure? &...

Inflation

About to go off the charts.  Nobody wants our dollar and pretty soon our debt anymore.  I don't blame them.  I don't want our dollar.  I'm a TBT guy, Too Bad for Treasuries.

Oil

Tankers are sitting in some ocean port somewhere full of oil and bursting yet our gas keeps going up.  Anyone who says speculators and manipulators are not driving the price up are the ones making money on it.  Put it above $3 a gallon and kiss any recovery goodbye.  If we're going socialist, regulate this stuff already.

Gold

I've been know to dabble in GLD but I'm a bigger believer in guns and food if the world is going to end.  I can always take your gold with my guns. 

I think the world needs to get together, sing kumbaya and spend.  Seems like an easy solution huh? 

Sounds better than kicking itself in the economic jewels.

Disclosure in GLD, UCO and TBT