Rock, add to that the shrink in M-2 money supply, which I mentioned many times over the past 8 months. It was never a question of "IF" the markets would correct, just a matter of when the gas would be let out. In real basic terms, don't fight the FED, and the FED sees big banking problems down the road. I am telling you all, there are many, many US banks & thrifts that are on the edge of collapse this minute.
And, this was all caused by the cheap money party we have had the past several years, which was engineered to save the banks, etc. Remember when all the S&L's took gas a few years back? Guess who is still paying for it?? Want to pay again?
This may help explain why they took action to shore up the value of gold, which if you have read the transcripts of thar accord, allows govt. banks, and the world bank, and all the rest of that lot, to revalue their gold reserves up to the new level, from something like 45 per oz. Presto-chango, rock solid balance sheets by a mere pen stroke. Starting to get the picture of what is going on?
Tobacco not an everyday item? Not to someone who can't quit..
Interest rates up a point last 12 months? Not a historic move?
In a 10 minute market like we have been in, it is historic.
Wait till the FED raises margin requirements, to 55-65%. Yeah, the FED can do that. Again, you can't fight the FED.
Throw in a weaker dollar, and probably the most important thing, no more Robert Rubin. He got out before the sh*t hits the fan.
And, on top of all this, the small investor is starting to get hip to the fact that the markets are rigged. Here is a small excerpt from the Thursday WSJ. This is serious stuff>>
Abercrombie & Fitch Ignites
Conflict Over Possible Leak
By SUSAN PULLIAM
Staff Reporter of THE WALL STREET JOURNAL
Abercrombie & Fitch, the trendy clothing retailer, is stirring controversy
about whether it selectively disclosed information to at least one Wall
Street analyst about sluggish sales five days before making the information
public.
The company's shares plunged Wednesday, the Class A stock falling in
New York Stock Exchange composite trading by $6.1875, or 19%, to
$26.3125, after it announced that sales in stores open more than one year
were up just 12% for the current fiscal quarter to date.
Here is the real news nugget: Wednesday's announcement didn't come as a
surprise to some on Wall Street. A handful of investors got advance word
on Friday about sluggish sales at Abercrombie from Lazard Freres analyst
Todd Slater, who received that information from an Abercrombie official, a
person familiar with the matter says. Mr. Slater then told his firm's sales
force that sales trends trailed Street expectations, the person says.
One client who got a call from the Lazard sales desk Friday afternoon,
hedge-fund manager Seth Tobias, says he quickly "shorted," or put on a
bearish bet on, Abercrombie shares. He made a quick profit on the trade.
"They were saying the whisper numbers were going to be a stretch," Mr.
Tobias says, "and in hindsight it looks like he was right."
The incident is an illustration of how uneven the playing field can be for
small investors, who are often cut out of the loop -- and left holding the bag
-- when it comes to the dissemination of market-making corporate news.
And, the corker>>But the pressure on analysts and companies alike to leak important
business information to investors isn't likely to let up soon. Says Mr.
Tobias: "If an analyst can't get an edge from the relationships he's
developed with a company, then it doesn't make any sense for me to pay
for the Street's services. We'll all just go to E*Trade."
All that said, I will be in there next week doing what I do best, picking stocks and indexes, long and short, big & little.
Our markets, even with shady dealings such as this, are by far the easiest to trade and most liquid in the whole wide world.
We just have to sift through the b/s. |
