The Rubber Band continues to stretch with Equities

Discussion in 'Trading' started by hayman, Feb 28, 2013.

  1. hayman


    You know that the HFT's and Institutional money is going to push the DOW into all-time record territory today or tomorrow. And every day, this rubber band stretches more and more. Heck, we may see DOW 15,000 before the Equity Implosion begins (that is, the Rubber Band snaps). And when it does, it's going to be an explosion that dwarfs 2007.

    In all my years, I have never seen a larger disconnect between the actual health of the World Economy and these Equity markets. The markets are impervious to reality, and the only information that equity traders want to hear is the bookie information that Ben Bernanke has been feeding them.

    Bubble Ben is a short-term hero to many, but believe me when I say it, he will go down as one of the all-time economy destructors in the modern financial world.
  2. Keep in mind that the markets can continue to go much, much higher than you would like to believe.

    The Real Estate Bubble continued for years and reached levels that made "absurd" look like an understatement.

    The Fed knows that it is all just a big game of perception and if they can maintain a certain level of stability long enough, then people will perceive it as the correct level ... and that's all that really matters.

    I gave up a long time ago trying to apply rational thought to the financial markets ... that will only lead to a blown out account and lots of angst!


  3. Bob111


    there was a great depression,great recession,why not to have great disconnection ? :p
  4. Tsing Tao

    Tsing Tao

    This chart bears repeating.

  5. piezoe


    It's unlikely I'll live to see it, but my guess is he will go down as one of the best Fed Chairman, if not the best, since the Fed was "reconstituted". He has demonstrated to the other central bankers how to deal with a crisis-- they are all wanting to copy him-- and when the time comes I have confidence that he will shrink the balance sheet with minimal disruption. A true genius. We could very well have been in a depression right now if it had not been for Bernanke.

    He has had to deal with an economy handed him by a largely incompetent Congress and a President of markedly mediocre mental capabilities, and he has done so brilliantly.

    His one failure was not acting immediately to crackdown on the mortgage market after taking over the reins from Greenspan, but he was still in learning mode when the crisis hit. Of course he was handed a totally deregulated banking sector gone wild thanks to Greenspan and and Phil Gramm. -- see "Banks Gone Wild" starring Bobbie Rubin, Chuckie Prince, Jackie Thain, Jamie Dimon, Twinkle Toes Feingold, Dickie Fuld, Jimmy Cayne, with Alan Greenspan and Phil Gramm, and a cast of thousands: all singing, all dancing! What a mess he had to deal with!
  6. hayman


    I'll certainly agree with you on the inheritance factor, but his inability to recognize what he inherited when he assumed his position is a BIG minus against him. I believe that his initial purchasing actions were justified, but I truly believe that he reached diminishing returns with this strategy a long time ago, and the stock market's ascension has masked what is going to be an overly large balance sheet that will not be able to be liquidated, and hyperinflation consequences - we're already feeling the pain of inflation, although the way the govt cooks the #'s and discounts the calculation of CPI, you'd think we have zero inflation.
  7. You don't think that it's too soon to draw such a conclusion? They thought Greenspan was a genius too. Noone knows what the endgame is for all this money printing since it has never been done before.

  8. I think John Templeton was calling for 100k DOW at some points decades ago..maybe we get there on this move.:D
  9. S2007S


    Sweet Sweet Sweet Chart....

    BUBBLE ben bernanke hasnt a clue of what is going to come....he thinks he fixed everything when all he is doing is creating the next collapse!
  10. piezoe


    Of course you are right. It is too soon. I'm merely guessing that he will succeed in the end in getting us out of a jam in a relatively painless manner compared to what might have been. But I respect those who disagree. We can only know the past with certainty.
    #10     Feb 28, 2013