Saturday, November 16, 2013

"HEARING JANET YELLEN" Doug Noland's latest.

Neither Ben, nor Yellen saw the housing bubble forming, and now she does not see an equity bubble forming either. So the market and the leveraged privaledge class are ALL IN and THEN SOME.

FED balance sheet rose 35% this year alone ($1T), so have stocks....certainly NO correlation here.

Though I cannot argue I rather have an economy limping along then one in a death spiral, but when does it go along on its own 2 feet? The LONGER everything is supported by the QE and ZERO interest rates, the harder it will be to function without it. And the higher we go, the harder the fall will be.

Is the market "meltup" being supported durectly by FED policy?

"Investors aren’t worrying much about the stock market, and that worries Edward Yardeni. "

I think this current bull market has further to go, and THE END I don't think can occur without one violent zap hgiher in a blowoff top sort of action, where we might get an intraday top and reversal.

And it must go along that the masses, will not see danger, and will continue to sit tight as this mess unravels.

Even Yardini, in the above piece see SPX 2000 plus in 2014. Other measures of this bull mkt show a healthy one, without many of the normal signals it might give that a top is in the near future (up to 6 months out).
It may be long in the tooth, but that doesn't rule out much higher prices, or even a nasty correction is around the corner.

We arrive in November a normal bullish period thru Xmas, with markets already enjoying a helluva year.

I dont care what the FED says or anyone else, the action since 2009 is ALL but supported by the FED balance sheet.

Is it any wonder the FED can create a $1T a year out of thin air, and same time BITCOIN appears, a "VIRTUAL" currency, and it (digitally) is tearing through the roof in value....

I say, and repeat buyer beware, but calling tops a tricky business and at this point, and its backed up by the fear guages....not a lot of worry out there....not at all.

PROBLEM is, sooner or later there will be and we are not talking 1 for 1, players are playing with OPM...and it will unwind and feed on itself, a lot faster on the way down, then it did on the way up.

We ARE in the process of forming a top, but the level that occurs may even surprise me.

How we got here, ignorance to bubble formation, will insure a painful retreat


Saturday, November 02, 2013


**note from my prorpietary TA MODEL
>RSI not made new high yet....though MACD reaching to or near it's higest point.....I would suggest we could see another 100 pts or so tacked onto SPX before THE TOP.<




2003 and 2009......MOMO signals were of greater magnatude and did not offer a divergence in force and price. far anywho...RSI, CCI making lower highs...that can change of course.


SECULAR BEAR should last about 16 years (conventional top was 2000) 
putting in a LOW LOW (OUR LIFETIME) in the 2014-2016 time frame (it IS still possible that 2009 low will hold but feel it COULD get tested) . What that will look like I don't know.
IMHO ENERGY, delivery , storage many facets of it will LEAD the "next great bull MKT" as cost for energy DROPS, jobs created, consumers have more spendable income (unlike todays stagnant income growth), manufacturers costs drop dramatically as energy costs drop more will be made in this country.

We are becoming, will be huge net exporter of energy...spurring a real economic boom, IMHO

Fallout from FED policies any are now saying "FED effects are overrated, they get too much credit". I recently asked a financial advisor what will happen when the 30 yr BOND BULL busts?

I've waited this long, I will not change my opinion of what I think has been going on since 2000 burst....not fooled by new highs....or appearence of a healing economy...PIPER HAS NOT BEEN PAID...only DELAYED.

I'm ready for next great Bull, one that isn't created by artificial sweetner...and made to bubble just to burst as they all have been with no fing lessons learned.


Last weeks Noland


" guess it took the 2008 crisis for economists to finally acknowledge that their models might be deeply flawed, though one would have thought the previous 20-years (plus) of serial global booms and busts would have raised some concerns. I have argued that we’ve been witnessing a unique period in history: For the first time, during recent decades there have seen no constraints on either the quality or quantity of Credit issued on a global basis. No one should expect that unlimited cheap Credit would prove conducive to system stability, and we’re now privy to sufficient history to be certain it’s not. All along the way, policymakers have seemed to go out of their way to avoid learning lessons.

U.S. and global finance were going through epic changes. Meanwhile, policymakers and the economics community stuck their heads in the sand, clinging steadfastly to their outdated old models and analytical frameworks. Greenspan became a vocal proponent for derivatives and Wall Street risk intermediation. He also used the rapidly expanding global leveraged speculating community as the most powerful monetary policy transmission mechanism ever (spur risk-taking and “wealth creation” with a mere hint of a 25bps rate cut!). And with Greenspan (along with the GSEs) backstopping the markets, the bubbling derivatives marketplace could mushroom to hundreds of Trillions on the specious assumption of “continuous and liquid markets.” Opportunistic hedge fund managers could incorporate enormous leverage on (Fed-assured) high probability bets – and become billionaires."