as i posted before, the sell off at the open was the market telling us its not concerned about the debt deal. its concerned about a potential debt downgrade as well as the slowing economy. sometimes the markets speaks in riddles but today was clear as a bell.
ISM: 50.9. Very, very ugly number. The economy appears headed back down into recession. Goodbye and good riddance Obama, you never were man enough for the job. It is time for a new Fed chairman also, along with the other deadbeats driving USA into the sewer.
its concerned about a potential debt downgrade as well as the slowing economy. ________________________________________________ Very good point HOOD. We are entering the second phase of a very bad Depression. Of course the Pundits will not speak of this, they will call it a possible slowdown. There was never a recovery, it was the printing press, QEs and Bailouts that bounced this market but not the economy. The US STOCK MARKET should be near 6500 if not lower. It will head that direction and slowly bleed with very violent Rallies lasting months at a time. This is due to the Government Intervention and not allowing either the Housing Market or Stock Market to naturally correct itself. The downgrade has all ready happen but has not been "Written" by MOODYs . Foreign Investors and Governments have been selling their dollars and hedging their remaining exposure with Gold and Oil. What we are looking at is the following possibilities before Winter. 8 buck gas per gallon. Food cost double if not triples. Massive Private Sector Layoffs that made 08 look like a cake walk. Municipalities going broke for real....no money at all and no access to money, laying off massive employees and scrambling for basic services. (keep in mind this will depend on each state and its Fiscal house.) Serious migration out of the East Coast cities/Mid west cities by people who can afford to relocate and who have "Skills" needed in the work force. We have been here before, except with the massive paper printing. We will follow the same pattern across the country much like during the Depression of the 1930s, however, we do not know how bad inflation will get. The US has never in its history printed up so much money. The only correlation in the world is ZImbawae and Wiemer Germany. (SP?) and we all know how that ended. Bottom line, get your "house' in order and prepare. This is no joke and many people are about to wake up to a nightmare that they have tried to ignore.
Before winter (I guess you meant 2011/2012): 3 dollar gas...or closer to 3 than 8... Food very close to what it is now... Layoffs...some, yes...but far from massive... Economy is growing, very slowly, but still growing...Unemployment will improve, but also slowly... Have been wrong before...let's see what happens...
Municipalities going broke for real....no money at all and no access to money, laying off massive employees and scrambling for basic services. (keep in mind this will depend on each state and its Fiscal house.) ------------------ I get the drift that any municipalities with a surplus, the state is going to take it OR withhold funds and force the municipality to use the surplus. Why should fiscal prudence be rewarded? (sarcasm). You have the money - we need it.
Additional Quant Easing will be instituted the minute the economy seems to go into recession again and there are further sell off in asset prices. The devaluation will be in real, not nominal terms. You'll get that 6000 target but via the spoos priced in gold, not USD.
Atlast the bastard politicians came to their 'partial senses' and extended the room to move for the economy. But they will have to take the hard pill and measures to mend the economic van for the long run. Btw, I had a call from the Commander of 82nd Airborne Division of the US Army and he affirmed with 'definite plans' to land his division size team on the WH and Capital Hill and whip the 'bastard politicians' into straight actions. Glad that troop landing is not required, atleast for now.
Cleveland Ohio recently ran their large police academy class as they normally would. The difference this time was every single graduating officer was laid off an hour after graduation.
I think I agree with you the deficit is a local government problem. The federal government will print money when it needs it and will take money from local governments. The local governments provide a lot of services so it makes you wonder how justified the federal government allowance is.