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Peter Schiff is Right - It's Not Enough To Be Right!

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October 16, 2009 – Comments (7) | RELATED TICKERS: SDS

We continue to see reality all around us.  Unemployment up and soon to pass 10%.  Profits are down.  Loan losses are piling up.  The bears have all the facts on their side - except one!  It's not enough to be right.

The Federal Reserve is giving billions to banks - who are NOT loaning it out.  Instead, they are pouring that money into the stock market.  Once the market begins to look safe (as it has to many Americans), the trillions of dollars begin to pour in, as the investment banks begin to book their profits.

It's a SCAM and we all know it - but it will last for some time.  As I've said in my blog yesterday, this market will blow past S&P 1100 on its way to 1150 by the end of the year.  And as I said yesterday, I expect at LEAST a 5% pull back in the next week.  But the bears will start getting their shorts squeezed in November on another FED induced buying spree.

Let me repeat -  It's not enough to be right!

7 Comments – Post Your Own

#1) On October 16, 2009 at 9:58 AM, brickcityman (< 20) wrote:

This is something I've struggled with, and continue to struggle with...

 

The real conundrum is what to do...  Stick to your guns based on what you think the facts bear out (no pun intended).  Or try to anticipate the behavior of something you believe to be artificial and profit from it over the near term.

 

I'm of the mind that willful participation in something you believe to be artificial is dangerous, mainly because it means that the chances for violent (and excessive) volatility are much higher.  If say some sizable percentage of a markets participants are there with one finger over the sell button and the other hand pinching their nose then this is not a good thing.

 

Perhaps I'm in the minority on this but I think its alot safer (and better for all involved over the long run) to be right about the facts than to be right about the direction of the market.

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#2) On October 16, 2009 at 10:17 AM, Counterparty (< 20) wrote:

At present with historically low interest rates and the dollar situation the US stock market and commodities are still a pretty good places to hold your money until Q1 of 2010, especially for foreign investors.

The question is what's going to happen with the US, in particular in 2010 and 2011, as some of the fundemental problems will need a long time to sort themselves out. Once you lose the effects from the stimulus and the inventory rebound, it's probably better to have more diversification into foreign companies and markets.

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#3) On October 16, 2009 at 10:30 AM, jesusfreakinco (28.91) wrote:

There is always a bull market somewhere...

If you hate the manipulation and the fundies and still want to be in the market - play the declining dollar trade - long gold, silver, other limited commodities like oil.

JMHO

JFC

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#4) On October 16, 2009 at 11:37 AM, cbwang888 (25.42) wrote:

The US fed and treasury policies has push the economy to a extreme bipolar state:

Wall street:  GS/JPM 300K~600K/i-bankers 

Main street:  running out of unemployment paychecks and facing higher taxes

 

 

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#5) On October 16, 2009 at 1:12 PM, abitare (35.12) wrote:

BTW - Schiff is long the markets. Just not the US. He invests in Europe and Asia. Hense his firm: EUROPACIFIC capital.

He is a stock Bull

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#6) On October 16, 2009 at 3:39 PM, SideShowMel0329 (49.20) wrote:

Bears haven't been right since January

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#7) On October 17, 2009 at 1:12 AM, Harold71 (22.06) wrote:

Bears have been right for over two years.

It's the stock market that hasn't been right, since March.

 

This mini crack-up boom is nothing to be proud of.  The entire show is embarrassing.

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