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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: UncleBigs who wrote (71635)	10/11/2006 12:51:19 PM
From: Paul Kern	Read Replies (1) \| Respond to of 110194

12:30 pump.

To: UncleBigs who wrote (71635)	10/11/2006 1:29:02 PM
From: benwood	Read Replies (4) \| Respond to of 110194

I'm not talking about the housing market. I'm talking about the entire world of equities markets. And I personally don't see any conspiracy at all, except the usual greed-driven processes that milk money out of wherever it can be milked. Just the sheer size of the middle class makes them the cow of choice. But that's just the same old same old isn't it? It makes for efficiency in a certain sense -- a weak hedge fund or foreign currency is detected, attacked, and killed off in the blink of an LCD screen. When I say "rigged" what I mean is that it's detached from economic reality and controlled by very few players who have far more influence than ever existed before, and they use it. Fed involvement I believe is far greater than ever before. Program trading is the majority of all trading now. Hedge funds and derivatives need a fairly tightly controlled feedback loop in order to function, and when one's feedback deviates unexpectedly, or perhaps through exhaustion (stability of loop requires narrower and narrower feedback), there's a terrible screech followed by lots of pain. Will there be a domino effect at some point? Of course -- the escalation has continued unabated for so long that the entire financial product sphere dwarfs the real world. And when in the history of human financial engineering has some new and brilliant idea NOT crashed and burned a few times? If a little is good, then so must be a billion or a trillion. Can you really have too many nukes? Let's ask North Korea. Or Japan. I think I would be a blind idiot to think there will not be serious collateral damage at some point. I've no idea when that point will come, but I have no doubt that it will. "It" all survives by growing, and it grows faster than our economy, by far. Is that a trend that can continue? No. The only reason I'm pissed by the evolution of these choices and behaviors is that our real economy suffers -- the fostering of bubbles has driven malinvestment, kept lousy businesses running when they ought to have failed, and help oversee overseas jobs growth as a consequence of our shrinking ability to compete -- a price we pay for the "free money" and reckless thinking and choices. In a few years, I may have to commute 10000 miles to keep my job, although at a fraction of the salary. The desperation to mitigate the damage already created leads to greater damage, but benefits a few financially and/or politically NOW. And worse, an increasing number of those decreasing few don't really care what happens in the US. They are not bound to be here, nor will they stay if things blow up. I cringe at the erosion of our future -- financially, personal rights, liberty, safety, freedom from tyranny, environmental -- for the sake of avoiding tough reality today. Just send me another credit card so I can hide behind the curtain of credit for just one more year. I mourn the loss of status I used to enjoy as an American: the ones who helped the world so much (on the whole) in the last 60 years of the last century. I see us growing as fundamentally deluded as the Muslims have been for the past 500 years. That kind of scares me. But I digress. I haven't invested in any aspect of the housing market, btw -- don't have any confidence in my ability to navigate those waters, so just don't.