Saturday, August 14, 2010

Quick Review

Lets step back and look at the forest.

The first round of QE had a payback of around 10%, for every Trillion "invested", or sent into a "shovel ready" project, the GDP went up around $100B.

The stock market did not go up based upon "real factors".   80% of the rise occurred on low volume after hours futures trades.   This was gub'mint sponsored....they told HBB to work overtime and to pimp up the future afterhours in exchange for 1) saving their asses, 2) continued free money.

Dabama is a great orator, great politician and fund raiser.   He "gets it" when it comes to influencing humans.   He doesn't know diddly about business or the financial markets, and thinks that all we need is "con"fidence.

No one wants to take their medicine before they have to, and your elected leaders are no different.   They will try anything to avoid pain, even if the avoidance has a high likelihood of causing more serious pain.

90% of the big financial problems--yes, it's a banking problem....the collapse of the easy money Ponzi scheme that really has been going on for several decades--- well 90% of those problems were just knowingly hidden and still exists (but hidden) on balance sheets.  Do you know what "Mark to Market" means...if not, research it, it is very important.   Don't just accept it like another financial buzzword.

Speaking of buzzwords...whenever Wallstreet or FETV (Financial Entertainment Television) come up with  some new buzzword...."shields up!"....that is when yet another shenanigan card is going to be played.

OK, hope I covered the basics.  Personally, 50% short on trading account into the weekend, enjoyed the nice mini-tank at EOD.


1 comment:

  1. the big question, as it has remained for the past 20+ years, long can the jugglers keep the balls in the air? they've managed pretty well during all that time, just one little hiccup a couple years ago. I have a feeling they have a trick or two up their sleeves yet--certainly they aren't going to just throw up their hands and let the balls drop. so the next year should be very interesting. or as arte johnson used to say in his german soldier character on 'laugh in'...'verrrry interesting...but stupid!'


Insightful and Useful Comment!