HOW THINGS CHANGE AND REMAIN THE SAME

Do we all know how we got HERE? Let's take a moment and look back.

Because of the FED leaving interest rates TOO LOW (1%) after tech bubble burst and 911, this fostered one of the most hsitoric momumental financial bubbles ever. Anyone got credit to buy a home creating a subprime bubble, and with ratings agency's complicate by giving most AAA ratings, the BANKS responsable packaged them up MBS's, and sold them around the world.

As long as real estate prices kept rising, the plan worked great. This fostered even more SPECULATION, which kept prices rising even more, obviously well beyond their inherant values. THEN the game ended.......problems arose at the finacial giants, BEAR STERNS and LEHMAN BROS AND COUNTRYWDIE etc etc.....the PONZI SCHEME had ended abruptly....leaving the world's financial system in crisis.

How did we fix it? BY PRINTING MASSIVE amounts of FIAT money, manipulating interest rates down, FED funds to 0% and all kinds of new programs TALF, TARP and of course QE.

SHortly after, complaints about having to RECOGNIZE these assets as proper MARKET VALUE, was making the banks even sicker. They would need to raise capital to be within Banking capitalization guidelines.

The more they recognized, the bigger the losses grew, the more they went in the hole. THE GAO stepped in and abolished MARK TO MKT VALUE, and replaced it with? MARK TO MODEL? any model?

FED FORCED banks to accept $BILLIONS, so we figured to loan it out, if we dint do this all would be lost. It fell silent that the architechts of this saviour plan were WALL STREET INSIDERS.

THE TOO BIGGER TO FAIL BANKS were born.

What did they do with all that FREE MONEY? LEND IT OUT TO REPAIR ECONOMY to grow it? NO NO NO, they used it to INVEST in STOCKS and things and bring profits to themselves....and record bonuses to be paid....while shmuck on the street lost his job and home and got no help, no bailout.

THE TRILLIONS went into speculation and it would seem the forming of a SUPER BUBBLE....is this all the FED CAN DO? ignore real world situations, lower int rates as response....form even more bubbles? WHAT GOOD ARE THEY THEN?

Now because of this we have born the mutha of all rallies from MARCH LOWS....and the 3.5% GDP # is proof Recession is over and the plan worked....and market values are justified....

3.5% if you believe it was all GOV stimulus, some inventory rebuilding nothing more.....and they can't take it away. Because instead of pouring money into some productive means, fixing what was wrong, they pissed it away and made the big banks even bigger with more power and all they do is TRADE THE MKT, they don't lend.

Commercial Real Estate is popping, another reason banks dont lend.

In every prior recovery cycle DEBT OUTSTANDING has risen, but not this time, bank loans continue to CONTRACT.

Consumer confidence usually SOARS, not this time.

Historical BEAR MKT BOTTOMS (NEW BULL) valuations were not present again in MArch.

PERSONAL INCOME IS DECLINING.

CASH IN MUTUAL FUNDS ONLY 4%.

We are STILL seeing 60 year old records broken...like PLUNGING Residential and Commercial real estate values.

Let me repeat a CONTRACTION IN BANK LOANS OUTSTANDING (how is this proof of recovery?)

If a LITTLE goosing before y2K fueled a viscious tech bubble....hardly noticeable on 30 year chart from fed, what is going to happen with more than DOUBLING ADJ M base in a matter of months??????? HOW DO WE BACK OUT OF THIS, WHY IS GOLD $1,100?

RATE of NET FIXED NON RESIDENTIAL INVESTMENT IS NEGATIVE yr/yr. HOW DOES THIS FUEL RECOVERY?

A NEGATIVE yr/yr change in personal income, maybe an historic first, HOW DOES THIS FUEL RECOVERY?

8 million have lost jobs since 2007. 10.2% joblessness, or the U6 17.5% level....how will this effect overall CONSUMER SPENDING?

A 30 year bond bull, pattern of rising prices, falling rates......and FEd at 0% where to now? OTHER GREAT BULLS were FED from falling rates from MUCH HIGHER LEVELS.

ACCESS to credit has EVAPORATED for SMALL BUSINESS, they hire 90% of all workers, how does THIS FUEL RECOVERY?

THE DOW IN TERMS OF GOLD as I showed has had NO RALLY.

BULLS< enjoy it while it lasts, but the AMERICAN PEOPLE ARE SICK OF SMOKE AND MIRRORS and promises of change and never getting any.

We went on an over consumption credit/debt historic excess ORGY, and now with this in REVERSE, with FED and GOV stimulus and FIAT OUT OF THIN AIR..we will avoid the corrective phase? INSTEAD THE ASSHOLES are pumping it right back up and I ASK YOU "what happens when it fails?"

Duratek