. . . Shudder the Thought . . .
By "looking for", do you mean "hoping for" or "dreading the thought of"? There are plenty who are hoping for Dow Zero...and the anarchy that would follow. As a country, we never imagined the sort of diabolical overseas conspiracy that led to the 9/11 attacks. Are we complacent again and so concerned with damage control that we miss seeing another attack in progress? ....right before our eyes? This is a strong possibility.
Don't know about you, but personally I hope not. Yes, with the triple bottom, the hope is that we build and all the expensive bailouts take hold and create a new foundation for growth. The dread is that we would slip back through 7450. At that point, I highly doubt we would stop at 6000 as you infer. 5600 is a more likely support level, but not a strong one. Below that is about 3800 or so. Back in the mid-nineties, we were making new highs at an alarming rate so there is little support in the vicinity. Dow 3800 would erase 15 years of economic gains in America. It would likewise represent an unprecedented 10,000 point drop, and would mirror the 30 month decline from 1929 to 1932.
This would set us up for a depression way beyond the scope of the imagination and far worse than was experienced in the 30's..believe it or not. In the 30's, everyone outside of the city (and some inside), were farmers and/or knew quite a bit about hunting and growing food, raising chickens, pigs and beef and more importantly: survival. It wasn't the first traumatic experience for most who were alive back then.
With today's suburban sprawl, lack of farming knowledge, huge city populations and weather anomalies eerily similar to the 30's (droughts, floods, etc.), this country and the rest of the civilized world could conceivably plunge into global chaos, finger pointing wars, mass starvation, panic in the country, anarchy in the streets, marshall law, world currency attempts and every global power jockeying to become the next super power.
For instance, trucks loaded with whatever food is found in the midwest, bound for New York City, would likely be hijacked along the way....in Chicago, Toledo, Cleveland, Youngstown, etc. Ports would be raided. Armed city dwellers would begin moving outward from the cities, in search of food or anything they could find of value. Suburbanites would be left to defend their homesteads, else allow the plunder or whatever you would call it.
So I hope the change of administration has the truly clever solutions to sustain the stock markets from here, and keep them from slicing through Dow 7450. I hope they know how to restore consumer confidence and investor confidence as was done in 1932. More importantly, I hope they can ignore traditional economics and flatulent economists, open their collective eyes and actually SEE that markets have always been manipulated and this current market is no exception. As I have warned before, this is a matter of national security.
Restore the safeguards placed in the 30's and repealed just last year, IE short-selling on a downtick. Place a percentage limit on foreign broker short-selling of somewhere like less than 20% of total permitted trades. Excessive naked short-selling would be cause to immediately suspend or revoke a license to trade...perhaps even reversing positions if proof of underlying securities are not proven (as happened to me back in 2000). Appoint a Homeland Markets Security Agency to oversee and investigate the origin and intent of mass short-selling attempts and act accordingly.
It's a brave new world. OK, maybe not brave....but it's a new world.
Rande Is
P.S. President-elect Obama just began a press conference discussing the appointment of a non-Washington non-political citizen economic assessment team. If he chooses members well enough, this could really help. I would hope such a team would be loaded with cynics. |
