Is There Something Out There?

We’re in a recovery though. At least that’s what you believe, right? You know deep down inside you’re right and the rest of us non-believers are wrong. The market’s up and the meme that through their “monetary policy” that “this can go on indefinitely” is being proven to be valid. In other words the incredibly stupid, ignorant, morons, buying shares of Amazon, Netflix, Faceplant, etc and ripping these malinvestments into the stratosphere proves that the real morons are those that believe leverage and sound monetary policy are just insane doom-mongers. Right? Come on. Deep down inside you know you’ve been right. The Fed really does have your back and your well diversified portfolio of stocks proves it. 

For one thing, we all know that in any bull market there’s major froth in the market before the bull is over. I listened to experts today on CNBS reporting this very important warning sign that is always given before a major bear market. In fact, I remember vividly in 2000 the daily froth as IPO after IPO and stock after stock reached crazy valuations with either NO P/Es or forward P/Es of 700 or more and people just kept buying. The smart money was selling into the froth to the suckers. It was soooo obvious, yet it went on for several months before the plummet to hell. 

I don’t want to go too far back reminiscing or I might start doubting these great advice givers, but I stepped back to the year 1987 and suddenly had to pause and then I realized…….there was almost no froth and there was almost NO ONE saying to sell because of valuations or “froth”…..yet it crashed over 30% in just three days. Most of that was in the second day of course. Hmmmmm 

As I listened to the agreement of the panel on CNBS of the “icing on the cake” for the “end” of all bull markets (that we just don’t see yet) according to them, it occurred to me to go back to an even more recent bear market. Some of you might be young enough to remember that one. You know. That one in 2007-2009. Surely you bulls remember. You know it was the one that the Fed now says almost DESTROYED our financial system and that by a miraculous number of amazing interventions (printing trillions and trillions) we averted the stone age. Surely you remember that period of time. I do. I remember that super parabolic spike on the SnP……wait…….no…. I don’t. There was no “icing on the bull cake”. There really wasn’t any obvious 2000 Naz parabolic move of icing. In fact just like today they pointed to the “fair valuations” on stocks and their P/Es. It sure wasn’t an IPO bonanza like 2000 was. In fact all during 2007 Bernanke said there was no Housing bubble and that Housing NEVER had a drop in price in this nation in a single year. Then he repeated that several times in 2007 and that we were not facing a “slowdown” in the economy much less a “recession”. hmmmmmmmm no icing there either before the market began tanking in late 2007. Hell, I remember those dip buyers on CNBS all through 2007 and 2008. I don’t remember any in early 2009 when you could have been accumulating cheap stocks.

Oh, I know just more perma bear nonsense and you’re right. Buy the dip. There’s plenty of warning when the bull’s over. Hey! Here’s another sign we aren’t even close to the end of this bull. The 25th country in 20115 (South Korea) just slashed interest rates tonight. So yeah… “we’re a long way from the crisis”.  I mean how can it get better…. Negative interest rates in many European countries signal “all clear”. Hey….here’s a dumb question. How does this work? Help me out. If everyone is “debasing” their currency because we’re in a “global” recovery and lowering interest rates and printing money to buy their debt…….and our dollar is going PARABOLIC and we are now touting its all good and we are “going” to raise interest rates with our dollar going PARABOLIC, which is supposedly destroying commodity prices and our export sector, then WHAT is going to stop us from taking the dollar even further PARABOLIC? What stops this trap the Fed has created? I am confused but something tells me the word patient being removed might spell even more trouble for this meme. You bulls enjoy your meme. I’m certain that Lord Rothschild and Sir Allen Greenspan are just fear mongering with their recent warnings of a potential collapse coming. Probably just trying to sucker in some more bears.  I’m sure there’s a simple solution. gl