Hi Dave,
Please do not take anything I might say personally, when I get started sometimes my directness startles me. The illustration and analogy that you present pertaining to the crash in Oct. 1987 is fascinating to me. It appears to me that individuals that hang their hat on a similar date for disaster are in a never ending search for meaning of such. Well, you will not find it here on the porch or at least from me because a more blue-blood realist never walked this earth. To partially understand where I am coming from from time to time you must realize, to me there is absolutely no MEANING to anything that has ever transpired or will transpire on this planet as it pertains to man. Ex. ( there are reasons why I met my wife but there is no meaning in meeting her )There are reasons why the 87 crash occurred but absolutely no meaning. So, - we can conclude right off the bat that because this or that occurred at such and such was at this particular point thus and therefore 99 will be like 87, forget it, THEY ARE NOT RELATED any more than you and I are.
To my mind there are reasons why it is not going to happen and these are the pillars of psychological insulation that get me through my day singing Amazing Grace.
The first pillar is the 87 crash itself. What is the old saying " first time shame on YOU and second time, shame on ME ", well, that is very very true. One of the greatest insulators we have is that we, " the intelligentsia of the animal world ", awoke about three months after the crash when the damn markets had recovered and said what? Damn, we got screwed! Damn sweetheart we got screwed! That is one huge reason it will be tough for the Houses to take fear to that level again because we learned that we should have just held. Now don't get me wrong, I am going up against people that know one hell of a lot more about the markets than I do but I am not interested in the markets, I am interested in only three things 1. Paramount above everything else is the FED. 2. Second, given what the Fed. is doing, WHAT IS THE AGENDA OF THE HOUSES 3. Understanding the first two and buying only stocks that the HOUSES are interested in accumulating for their inventory. The rest, Bond yield, trade deficit, employment numbers, deficit, PPI, CPI and any other consternating number that CNBC can come up with means absolutely nothing until the first two entities I talked about decide what they want to do with such. Everything being equal with the Fed. etc., the Houses can take a market in any direction they wish.
One reason that this 87 Crash analogy stuff fascinates me is that there are so many people being led down the " Path of No Returns " by certain Bear pundits. I almost choke on my peanut butter and jelly sandwich every time I see two of these MOTHERS in particular. The first screaming Bear that comes to mind is the fellow named Tice who heads up the Prudent Bear Fund out of Houston. This guy's jowls get lower and lower every time I catch him on CNBC. The other is a fellow by the name of Fleckenstien or as most people call him, FLECKEN-STUPID. Now, just think about this and maybe this will better illustrate what I am saying about " psychological insulation ". Here are two supposedly intelligent hard tails waiting for the reoccurrence of something that transpired almost 22 yrs. ago and are leading others down with them. They have waited 22 yrs. and God knows how much longer they are going to continue to wait and the disaster they are waiting for rectified itself in 3 months, Jesus Christ, at least Jim Jones used a fast acting cyanide laced Kool-Aid. Geez, I just don't get it I guess.
The second part of your post dealt with the Fed meeting and other meetings of different countries. Just ask yourself one question, when did we start cutting our interest rates. It was right after a meeting with all of the G-7 countries and only after they did what I am convinced they did, they lowered their rates because Rubin and Greenie told them until they did, we would not, they cut and so did we. That is a long answer in place of, they will do damn well what we tell them to do. It is the U.S. that has the leverage today, no longer Japan. For the first time on a truly global basis we the U.S. are the Money Merchants of this world. In short, at the present time I have absolutely no fear of the Fed. One must remember what I said earlier, everything being equal with the fed, the Houses can move in any direction depending on their agenda.
What is their AGENDA? This is the only key right now, nothing else matters not even the blather on CNBC, damn isn't that a surprise! Reading the HOUSES AGENDA will tell you everything you need to know.
First of all, rarely do markets go down with so much positive and forward looking occurrences on the Horizon. The most overriding occurrence is the passing into the year 2000, this to my mind is overshadowing everything else. You can forget about Y2K, that will be the most overrated debacle in the history of mankind. Trust me, anything to do with monies and profit will be compliant. If you think the Electric or Gas company is going to let this cost them one payment, NOT. If you noticed, almost in order of MONIES involved what was the first to be compliant, Stock Markets, then Social Security, and then the Federal Reserve and then your phone bill people, the Telecoms. So any problems will be inversely proportional to the monies involved.
Earnings will be fantastic for the third quarter and with an early jan. effect because of a early jump on yr. 2000 the Houses have no reason to bring the markets back. Clear sailing wth a few 200 pt. bumps.
Your third query was about the payroll numbers, I answered that in the first part about only meaning to such a number is how the Houses or Fed. want to use them. These numbers in a TANKER like market as Abby would say is nothing more than a bump on a flea's Ass.
Like I have said many times, it is TIME my friend, just simple old TIME. If you don't believe it, what month is it and what are we talking about, yep you guessed it OCTOBER and believe me next October we will be discussing the same type of thing.
My friend I appreciate the post, sorry about the length of the answer.
From the porch,
Voltaire |
