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Spin it spin those lies... fear and loathing in the markets



June 20, 2013 – Comments (6)

It's  amazing  how  the  computers run by  the big  boys  and  their lackeys  have  spun  around  and  managed  to  screw  up  even a   wet dream.

So  we  are too believe  that a slight increase  in  the  interest rates  are gonna make  money flee out of  dividend  stocks,  out of  MLP,  out of  REITS, out of technology, out  of  bio pharma, out of  utilities, out of  basically  everything  and  anything, including  silver  and  gold  as  well  as  frankensense and  muir.

WTF ?  But  its  like  someone  screaming  fire  or  now  a  days  guy with  gun  in a  movie  theatre  and  you  have  people  ~  computers  ~   killing  one  another  to  the  snickering  of  bears who  are  eating it up.

Idiots  come  on  television  and  talk  about  the  FED  is  going to stop manipulating  because  the economy  is  better,  another  says  everything is  F up...

They  are  basically  all full  of  "censored smell stuff"

So let me get  ths  right ?   we  are suppose  to buy  10 year  bonds  at  2 something  percent...

Man  can't  they spin  the  smelly stuff  better ?

They  are  knocking it  down  just  to  get   back  in  and  since  nothing  other  than  earnings  next month  can  do  anything  to  stop  fools  from  running  out  the  theatre  before even  the  commercial  finish  before  even  the  real  movie  begins.

Well  I'm  gonna  stay  in  my  seat...  

Expect  all  the  talking  heads  to  scream  run  sell sell sell sell.......................

Expect  the  programs  to   sell  and  beat  the market  like  its a  red  headed  step child...

Until  it whip saws  back....


All this  and  the  fed  hasn't  even  mentioned  or  hinted  of  any  interest  rate  rise ?

ANd whats  to  fear  about  interest  rates  returing  to  where they are suppose to be ?

Has  anything  really  changed ?

Isn't  the  fed  talking  positives ?  

I'd  like to  at  least  see  how  the movie  starts  before  I  head  out  the door...


6 Comments – Post Your Own

#1) On June 20, 2013 at 6:51 PM, awallejr (36.64) wrote:

Lordz this is the correction the market needed to make.  Bernanke was just the excuse.  And with computers running the show things happen quickly now.  I saved up money just for this.  Notice how everything went down, stocks, bonds, gold, commodities.  That means that all went into cash, and cash still yields squat.

Right now many stocks I follow look reasonably and now attractively priced. Every month I take my income stream funds and redeploy. Cost averaging.  

QE was not the cause for the market rising, improved earnings have been.  QE simply allowed the Federal budget to pay for the deficit with cheap interest, and it allowed many homeowners to lower their monthly expenses by refinancing into lower rates which means more cash in their pockets. It didn't go into the stock market which many have suggested.

The only question to me is how much of a correction and how long.

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#2) On June 20, 2013 at 7:34 PM, amassafortune (29.20) wrote:

 "whats  to  fear  about  interest  rates  returing  to  where they are suppose to be ?"

If the Fed & Treasury ever have to pay about 2% more to fund all the debt created, interest quickly will consume all tax revenue, including future projected revenue increases from growth.

Pretty simply, game over.

That is why they have this arrangement where they are buying 80% of Treasury issues. There is no natural market for all the financial instruments the U.S. Treasury is issuing.

We've been told debt doesn't matter because we "owe it to ourselves" or the money expansion is balanced by Treasury issues so everything balances. Now it seems the market is thinking some of this does matter. 

Don't forget the other big news today - China is over-extended and is not likely to buy massive amounts of U.S. Treasury products, nor provide planned U.S. growth market prospects. 

So, triple whammy. 

1. Loss of QE within one year.

2. Higher, unaffordable interest rates paid to finance the Bush/Obama give-aways of the past decade coming in a year or so.

3. China (and Japan) no longer able to buy expected U.S. debt issuance, plus lower earnings prospects for U.S. corporations due to the newly-revealed situation in China. 

So who will buy our debt? Underfunded pension funds? U.S. workers who have had stagnating wages for many years? Brazil? Oil producing countries? Base expectations and assumptions have drastically changed recently.. Pumping the market was a way for headlines to distract most from the underlying situation. 

Just as the original QE announcement kicked off a great upward run for stocks, Bernanke's hint that it will end by this time next year may kick off a long stagnation or decline for stock prices. 

Since 2007, the natural economic force at work has been deflation. The Fed decided to hold back that tide until growth could wipe away its effects and the effects of Fed actions.

Growth barely showed itself and now the side effects and unintended consequences are forcing themselves through the cracks.  

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#3) On June 21, 2013 at 1:40 AM, awallejr (36.64) wrote:

Except the deficit has been DECLINING.  This year it is projected to be under 700 million.  Next year who knows.  But if things are improving you would think less.  Sorry what you are listening to is just noise.  The market needed to correct, end of story.  Just follow earnings and you won't fail.

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#4) On June 21, 2013 at 12:11 PM, jiltin (45.18) wrote:

QE and interest are well known. Has  anything  really  changed ?

Answer:Mindset. Announcement is a triggering point

Knowingly, people wanted ride the shares value up and up and up again no matter whether good or bad news. It was a free ride made by free printing money concept.

People are moving money, like awalejr said, from stocks to cash until stability comes.

Expecting this exact show down, I moved entire stocks (personal,IRA and 401k)  to cash on the first day (May 22nd)

When I moved to cash, I was firm that I can pay short term capital gain tax rather than keep watching the stocks to go down, down and down. Nice lessons learnt of out 2001 and 2008 fall !

My stay in stocks wasvery brief time, 3 months, but made 25% ROI. Nowadays, just watching and learning.

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#5) On June 21, 2013 at 10:26 PM, HarryCaraysGhost (87.59) wrote:

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#6) On June 22, 2013 at 1:46 PM, valuemoney (< 20) wrote:

Listen to comment  #3 by awallejr .....pretty much spot on.

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