"In equities markets, well, speculative dynamics have taken full command. The
bears have been squeezed into oblivion, with a dearth of selling pressure now
allowing speculators to easily push prices higher. Bringing back memories of
1999, heavily shorted Tesla Motors was up 41% this week and Green Mountain
Coffee jumped 33%. It was a week where I was again contemplating “how crazy
could things get?”
The Fed and global bankers should never have become
such active players in the financial markets. Asset inflation is indeed more
dangerous than consumer price inflation. Central banks will actively support
asset prices, while refusing to remove the punchbowl. At all costs, Chairman
Bernanke will avoid being a Bubble Popper. And when you read his comments from
Friday morning (below), keep in mind that as Bubbles become more systemic they
actually become less conspicuous. Today, Bubbles proliferate throughout the
securities and asset markets. It’s all become one big historic global Bubble.
Yet the Bernanke Fed won’t even begin tapering its $85bn monthly “money
printing” operation in the midst of increasingly conspicuous market excesses. "
Folks, it's not really an argument to be had as to whether the stock market rally from 2009 has enterred the speculative blowoff phase, or that what we are witnessing is BUBBLE DYNAMICS.
And what eventually happens to all bubbles throughout history? THEY POP. And what happens when they pop?
Goodnight. This time I think everyone will know exactlt where to point the finger, a loss of faith in the FED on top of the greatest bubble bursting in history, will prove to be a nasty combo.