Saturday, March 22, 2014

Squeezing the last 10%

From Doug Noland at Prudent Bear . Com

"Everything is just so much bigger than before: The Fed’s balance sheet; PBOC international reserves and the Chinese Credit system; the leveraged speculating community; the big “macro” hedge funds; the powerful “quant” funds; the sovereign wealth funds; the ETF complex; the big mutual fund companies. As history has shown, epic financial Bubbles by their nature spur a concentration of financial power. I often ponder how a marketplace dominated by big players tends to function differently than traditional decentralized marketplaces. Then I contemplate how such a “centralized” marketplace operates with assurances of ongoing central bank support. In my mind – and I see evidence for as much in the marketplace – the markets become more of a game, more speculative and increasingly detached from fundamental prospects."

Though this current Bull market may have further to go, it is more likely that it is in it's final stages of life. And I wonder why the FED feels it necessary to continue with its zero rate policy 5 years after it began, further punishing more conservative savers.

It seems more lucrative for companies to use their cash for stock buy backs , than build plant and buy equipment.

At the same period of time we find the highest level of Millionaires, we also find most citizens do not even have $30,000 saved away for retirement and many don't even have $1,000 in savings.

Things are anything but cut and dry my friends in the real world.


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