The action of the three index futures is interesting. The YM can't get past yesterday's low, the ES is stuck in the middle of yesterday's range, and the NQ is making new highs. What fun
YM had three drags on their tailwind. 1) AA posted earnings #. Typical buy rumor, sell news. Nothing new. 2) SBC & AT&T were downgraded to sell.
don't count out the bear, if that's the direction of this thread it ain't finished growling...... grrrr
Does anyone here understand why we are having this "bull market" in equities? If I were the government, I would know a very easy way to make stock prices jump up by, say, 2000% overnight: Just print more money. If we suddenly have 10 times more dollars than yesterday, it has to go somewhere. Investors will like the president, because they will have huge returns on equities; fixed income instruments won't go down much either; Workers will make a lot more money, even the government will collect more taxes, and everybody will be happy! And guess what, it's not like the buuble bursts when we try to buy a TV or a car from Japan. They are joining the race and printing more money themselves, so even imported goods will have relatively stable prices. This is the holy grail of economics and the best recipe for re-election! Wouldn't life be great for everyone if the federal reserve could just print more money! Too bad our leaders are far too responsible to ever let anything like that happen. A strong dollar is simply too important, so they withstand the temptation of doing the same thing that individuals are doing when they max out their credit cards. Of course, it isn't as simple as that: America thinks it can use military force to create and retain wealth. Too bad our leaders have not learned from the example of the Soviet Union. They were a huge military power. What brought them down was simple economics. Give it 20 years and America will disintegrate. Unless we get back on the gold standard, I don't see how we can avoid becoming irrelevant as a nation. Now that we have started it there is no way we can ever get inflation back to below 10% a year. Ah, I forgot, our inflation is only 0.0002%, one tousandth of a percentage point below estimates. Makes me wonder why my hamburger cost 50% more than a year ago, my rent is up 80%, gas costs twice as much as five years ago, my phone and internet bill is up 10% from last year, my cable TV bill is up 60% etc. etc. Must be that the things I mentioned are not important for the typical American. Does anyone happen to know what kind of goods or services go into the official inflation numbers? It can't be wheat, copper, gold, platinum, or similar raw materials either.
We're in a pattern that may nor may not be a death spiral. Not too long ago I saw automobile dealers advertising financing for 72 months (and possibly beyond) -- just more evidence of expanding credit any way possible. The wheels are in motion -- we can't do anything about it -- because to do so, would require people to take a step back -- and in this age of immediate gratification that won't happen. I'm not sure what will happen -- and whether it will be as gloom and doom as you say -- but I don't think anything can be done about it.
I agree, Baruch. To argue economics is pointless from a trading standpoint. I just like talking about it -- but it is irrelevant to successful trading, IMHO.
Great point. I've long held a theory that it's all about who has the power to pick whose pocket. Like a pecking order of sorts where money is the object to be pecked. That theory answers why congress can give themselves great health insurance while the nation struggles with it, why $87 billion can be ordered up for one cause while other far less costly but important causes never have significant monies funneled just as quickly to them, why millions are spent on HOV lanes (though studies show they fail to reduce traffic significantly on non-HOV lanes) but it's really tough to get a stop sign put up until the third kid has gotten killed. Cable TV... have you noticed it's comprised of almost daily repeats of Lethal Weapon, Bachelor Party, Beetlejuice and a slew of home shopping network, and other eerily similar regurgitated stuff like dating reality shows, cooking and home repair, yet in turn for the same old, same old repeats and duplications, they get *new* money coming in every month from their customers. Why can't we in likewise manner repeatedly send them the same cancelled checks every month? You name it, and you see a web of businesses and power-wielding politicians trying to enrich their circle by taking money from those lower on the food chain. So, why do things cost more? When you get to the bottom lowest part down of the pecking order, those most vulnerable to the money vacuum of politicians and business and their respective interests, you'll find average joe citizen there. You have to... who else is there left from which people in higher authority can continually authorize the extraction of money?