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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: nspolar who wrote (10324)	10/22/2008 12:11:44 AM
From: John Pitera	2 Recommendations Read Replies (3) \| Respond to of 33421

Falcon, Great question and it involves several different scenerio's that are may occur as a result of the collapse of a truly "laissez faire" free market economy, versus what has become a globally politically market managed system. 9 months ago their were comments by astute observers on CNBC that in the US in the post WWII period we had not changed the rules during the middle of the game ala Brazil..... not the US and the rest of the world is doing all kinds of financial interventions that have nothing to do with free markets and it all goes back to the concept that Alan Greenspan put a backstop or a "put" option on negative market outcomes through Central Bank and non Treasury Liquidity initiatives. Jim Bianco is brillant and has been for a long time, I hope that everyone gets a chance to see his 19 minute interview on Bloomberg. Bianco points out about 16 minutes into his interview that the present policies and liquity creation and injection measures should then convert the current deflationary environment into a hyperinflationary one. Why are we not thinking of this downturn in commodity prices as a parallel to the big pullback we saw after the 1973-74 macro bull markets in all commodities. We then had major declines for 12 to 18 months prior to the next much larger ramp up in GOld, Oil, Real Estate that ran wild from 1977 to 1980. If you were here in my living room I would pull out those 20 year CRB chartpackages that they used and probably still sell. 20 years of monthly commodity prices. bloomberg.com SI really needs a thread where we come up with the top 25 axes,.... experts on WS who have a prolonged record of coming up with insightful commentary and then we dedicate the thread to their ongoing analysis. Guys like MER Richard Bernstein, Pimco's Paul McCully, Marc Faber, Jim Bianco, Jimmy Rodgers, Bill Gross, Byron Wein, Barton Biggs, John Mauldin etc. I know I'm missing half of my field...... But to circle back around..... The key question is whether or not we see a political mandate to negate Credit Default Swaps. The biggest question is does the Democratic party win the Presidency, over 60 senators and a majority in the house and will that enable them to apply aggressive punative measures to Wall Street, the rich, the upper middle class......... in the process of creating a socialist society. I have more thoughts on this, so let me try to give more context and analysis to this. John