Friday, September 03, 2010

HIP HIP HOORAH FOR RECOVERY


In 2002 market bottomed at 7,286 unemployment rate then was slightly above 6%....and we had the "CREDIT BOOM" just ahead of us...with FED keeping rates at 1%.
Today we have FED keeping rates at 0% (and you know all the other stuff they did to stimulate and liquefy) yet things are MUCH different today, then in 2003.
We don't have a housing market to bubble, we don't have historic expansion of debt/credit to look forward to, or explosion of auto sales or anything to do with housing related....and we are ABOVE historic % of home ownership...we have record inventory and we have 20% of home owners unable to borrow against homes as they are upside down.
We have nothing in place in place like we had in 2003.....but we do have 1 in 6 getting gov dole, and we have $TRILLION deficits......we have 9.6% (OFFICIAL! ) unemployment....not 6%....if we had REAL GROWTH we would create REAL JOBS!
I know what you may be thinking, come on Duratek, why don't you just go along with this?....don't you see the markets reaction.....the worst MUST be over....WHY are you so THICH HEADED and STUBBORN?
Because you cannot paper over your problems nor spend your way out of debt, nor print your way to prosperity.....and the parts of economy that could provide growth have been bubbled and are trying to recover.
Real world data NOT from BLS points to a different reality then today's data is trying to be presented....as PROOF the economy is growing, getting stronger....getting healthy.
Few things to think about. TOO BULLISH sentiment for bonds....drove yield way down...popping today near 2.75% (still damn low). I think this false hope rally will provide a better entry into bonds...AAII polls showed too many bears.....time to slap them around again.
Now triple digit gain or not, we have that upper range to break, first 1100 on SPX then 1130. Market is also overbought.
I posted that chart Thursday I believe.
Funny FED was pondering addt'l QE moves and rates still sit (what 2 years now?) at RECORD LOWS 0%.....ANY REAL STRENGTH they would be preparing at least or moving rates back up....what good has low rates done at 0% for lending? what we can't even stomach .25% rise?
Nothing is what it seems, if it wasn't as bad as it looked, it sure as hell isn't as good as THEY are trying to present, IMHO
Duratek

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