Tuesday, May 04, 2010

STILL IN PLAY


"From my analytical perspective, the system has found its way into another “terminal phase” of excess – this time emanating from the Global Government Finance Bubble. Intoxicated yet again by the effects of loose “money,” the bulls see (inflating) markets as confirmation of sound system underpinnings. I, in contrast, see another policy-induced absolute mess in the pricing and distribution of finance throughout the entire system. As always, calling the timing of a Bubble’s demise is a perilous proposition. But I can sure see the makings of acute systemic fragilities."
Above inverse head and shoulders still in play, final direction won't be known until breakout, but we have our parameters.
Friday produced a powerful downdraft and was 88% down volume day, just shy of 90%....we have had some wild swings lately, sure feels like volatility is on the move.
2 BIG CAMPS weigh in on interest rates. One sees contrarian play as many say rates will spurt up but they see DEFLATION and feel bonds is the long play. OTHER says rates are being held down artificially and now global crisis is setting up an interest rate spike here.
Rates are being held down ARTIFICIALLY if you consider banks bought over $50B 10 yr notes last week!! Banks are getting near FREE money from the FED and repay them with whoring their bonds....or else? WHY NOT make $50B in loans? You see how system gets perverted and maladjsted?
My observations tells me that the CONSUMER is not doing anything significant, and is NOT committing to large purchases, home renovations, things that really pull the economy along.
Maybe car sales are up but when I drive around I see tents and balloons but no customers. How perverse is a system where non performing mortgages (foreclosures) create a flowof free funds to spur consumer spending? SO I CANNOT PAY MY MORTGAGE but I could sure use a pair of pants and a latte'?????? WTF?????
Seeing the transports double in a year, and the DOW rise 75% even as a MILLION continued to lose jobs, credit continues to CONTRACT along with bank lending....seems the most perverse of all as the stock market is throwing a CLOAK over the REAL ECONOMY that is causing REAL PAIN and devestation to so many Americans.....as most responsable.....float down the lazy river..
Duratek

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