Louis: So, what's on your mind this week, Doug? I understand you've had a "guru moment."
Doug: Well, it's nothing but a gut feeling, but I think the stock market is riding for a big fall this year.
Everyone was afraid the world was going to come to an end a year ago, and it almost did. But governments all around the world stepped in and printed up trillions of their various currency units - it's not just the United States. And still, retail price inflation hasn't blossomed. It seems that governments are bent on keeping asset prices up to avert panic. They focus on controlling perception instead of fixing the problem. It stems from an economic version of the theory that all we need to fear is fear itself. As long as we have the right psychology, everything is going to be okay - total nonsense.
L: That old saw: as long as there's confidence, all is well.
Doug: Yes. It's the Wile E. Coyote theory of economics. As long as you never look down after running off a cliff chasing the roadrunner, you can keep treading air. Unfortunately, although the power of positive thinking may help in many ways, it's of zero use if you continue living above your means and making stupid decisions.
L: Insolvency doesn't seem to matter; as long as everyone has confidence that things will keep going, the experts believe they will. But in the real world, you can't remain insolvent for long, even if "you" are the United States as a whole society.
Doug: Exactly. My thinking about the stock market is this: corporations have done as "well" as they have mainly by cutting expenses. Laying people off, that sort of thing. So the bottom lines have not fallen as far as we might expect - but the top line has been hit. Revenues are falling for corporations across the board.
L: And the market has to notice this reality sooner or later.
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Don't look down! Great analogy.
ReplyDeleteDow 3500 in about 18 months
ReplyDeleteDow will be 11000 by March end, it's way oversold after this week.
ReplyDeleteBy the way, your pm's are doing great, losers.
Markets contract and expand. Get a back seat view of this thing. Measure it within terms you microscope geeks can understand. Creating urgency for a select few; instead you should be letting them get on with their lives and be productive, responsible and elect. This is a severe recession, yes, however this is not the end of the USA. The market is contracting. Certain sectors will feel it and unfortunately its a devastation to whole lives. THAT'S WHY ITS CALLED RECESSION.
ReplyDeleteIf any of you in the sound of my voice can understand what I am saying, then snap out of it. Start a new business, apply for some Jobs in a different field than what you was used to working in. Sometimes sacrifice comes, but the strong prevail! Sorry webmaster, that's the way I feel about the whole thing. The strong do survive and those that got spunk will overcome anything. To shoot this post down would mean you was personally "swallowed up completely" in all of this horror drip or you concede this personally takes away from your solicitations. So c~mon readers. Have faith, and overcome your fears this web-page brings down to the belly and in the mind. Its the fruit on the tree that's negative that poisons the spirit of man's thinking. I chose to see the bright side in all things. Bottom line is that Pessimism just sucks!
Yep, as Schiff said the price of an ounce of gold and the DOW shall meet in 2010.
ReplyDeleteIt will be a Depression that is unavoidable now since the wrong steps were taken after the Bankers fraud was exposed. People will realize this near the end of 2010. Dow Jones true fair value would only be about 3,500 not over 10,000 - The PPT cant keep their expend and pretend game going forever.
ReplyDeleteThe above posters were the same Obamabots that were saying Housing was a fair value from 2004 to 2006 and not a bubble. They are just naive and cant see what is coming until it hits them in the face.
ReplyDeleteWORRY NOT!!! The stock market, bond market, etc. will eventually uncrash itself and continue its boundless climb to infinity as a direct result of Federal Reserve powers to create and inject an infinate amount of money into the system. Althought the process must immediately appear absurd to those grounded in reality, one must also understand that the gross ignorance of the people, and Americans in particular, is directly proportional to these same miraculous Federal Reserve powers. In fact, for those who worship money and the pursuit of wealth, THE FEDERAL RESERVE IS GOD - their god anyway, with the power to reward and punish according to the laws of consumerism and growth-centric faith-based economics.
ReplyDeleteWe must ALL Believe, and we WILL be saved.
Drink the koolaide...drink the koolaide... all is well. Barrack Hussein Obama will provide for all... all is well!
ReplyDeleteTHE BUSH CRIME FAMILY WILL SAVE THE DAY YEEEHAWWW
ReplyDeleteSay good bye to the middle class forever
ReplyDelete