We will watch for any possible BREAK of ZERO (0) in the ROC indicator below as a warning bell. It has managed to stay above since March rally began but has been non confirming in its weakness as markets around the world have rallied.
GAS is nearing $3 a gallon. Commodity prices have stayed inflated, even as DEMAND wanes and real signs of recovery are hard to find.
Instead of suffer the same fate as Japan since the 1980's and even worse the US Great Depression, the Gov's and FED printed and back stopped like no tomorrow in attempt to beat deflation. IMHO if indeed DEFLATION is whooped, we will get its nasty cousin HYPER INFLATION instead, does anyone really think we end will safe happy landing?
Here is a Shadow Stats PDF REPORT I suggest as always to READ what I offer, it will help you make your OWN mind up as to what lies ahead.
The US already owes Foreign Gov's near $14 TRILLION which is about 10% of our GDP as reported, this is likely to DOUBLE in the next 5 years.
The FED has bought near 50% of ALL TREASURY BONDS PRINTED! Foreign appetite has deminished for our debt at CURRENT YIELDS....unlike many here in this country who have crammed into them.
Some see rampant inflation near with MUCH higher interest rates, a collosal calamity.....other see 10 year yields falling below 2% !!! (Deflation camp)....what is more likely?
Added to recent budget needs is the escallation of troops in Afghanistan to the tune of near $30 BILLION a MONTH....this more than likely NOT on GOV balance sheets! held off in some kind of sneaky "suplimental spending thing"
You see inflation in all kinds of assets which would include the stock market, you don't see it where it was intended to help at the HOUSING PRICING LEVEL as recent stats showed a continued devaluation in existing home prices (and recently a whopping 16% decline in sales EVEN WITH GOV giveaways)
Not being talked about is the OVERWHELMING INVENTORY of unsold and foreclosed homes being held OFF the market........the stock market is full of BS if it is insinuating a V SHAPED recovery in anything but itself thanks to all those $'s sloshing around which have found a home.
Expect some data to misrepresent the real issues and weakness in months ahead as 100,000's get temp jobs for 10 yr census.
If we have V shaped recovery why then hasnt the GAO reversed its suspension of Mark To Market accounting from current mark to fantasy? BANKS DO NOT REFLECT current holdings valuations from a mkt standpt.
We need economy to HIRE about 150,000 a week to just cover new entries into job hunting, so now we celebrate a loss of only 450,000? we have LONG WAY TO GO.....FIRST part timers accepting that over loss of job need to be made full time......we have LONG WAY TO GO!
Duratek
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