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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: 2MAR$ who wrote (73604)	4/28/2011 9:17:45 AM
From: 2MAR$	Respond to of 217669

The economy grew at a 1.8% annual rate in Q1, slowing sharply as high gas prices cut into consumer spending, bad weather delayed construction projects and the federal government slashed defense spending by the most in six years. Not Ben's fault ...

To: 2MAR$ who wrote (73604)	4/28/2011 9:36:47 PM
From: TobagoJack	Respond to of 217669

there are gutters all around, semi concealed, and done in way to be easy to decongest. the hill is all rocks and we are in the rainy season. the run offs create a most pleasing sound :0) pic of jack this day trying to breakfast something not altogether edible and just in in-tray From: H Sent: Fri, April 29, 2011 12:14:19 AM Subject: Re: stay long oil ...the other bank counter the one that said sell Speaking of which (see second update 'The Music Is Still Playing'): 1. The Magic of the Echo Bubble A look at the interaction/feedback loop between an increasingly optimistic social mood and expert forecasts for the stock market and the economy. It appears that the main thing that makes people - including economists - optimistic about the economy's future are rising stock prices, which in turn are rising even more as this optimism grows and the Fed pumps up the money supply. By several measures, fund managers are currently more bullish than at any time in history. The case of economists being led astray by rising stock prices is nicely illustrated by the fact that the underlying economic fundamentals appear to be weakening concurrently with their rising confidence. It has of course happened quite often in history that famed economists turned bullish on the economy and the markets right after a large and extended increase in stock prices. The same seems to hold for commodity prices, where Jeremy Grantham spies a 'paradigm shift' - when in reality he should recognize that commodity price increases are simply a lagged effect of monetary inflation, as all commodity price booms in history have been. This can be shown both theoretically and empirically - there really is nothing new under the sun and contrary to Grantham's inference, it is not a 'new era'. As to 'peak oil' and similar problems, one should keep in mind that another famous economist, Stanley Jevons, worried about 'peak coal' back in 1864 - in the wake, not surprisingly, of a large increase in prices. While we would always bet on free markets and human ingenuity to eventually win the day, there is of course a danger that could favor Grantham's scenario - a rolling back of what is left of the free market by political means. Meanwhile, Greek ECB board member Athanasios Orphanides is still fantasizing about Greece being able to get out from under its debt mountain. Wishful thinking will likely be on display right up until the official restructuring announcement comes. A small chart update included. acting-man.com 2. FOMC to Speculators: The Music Is Still Playing A look at the FOMC statement and the passages that were most important for the markets. As it has turned out, not one of the presumed 'hawks' has been dissenting with what was an ultra-dovish decision. McChesney Martin's advice to 'take away the punch bowl before the party gets going' clearly has been utterly forgotten. It appears from the statement that once 'QE2' ends, 'QE Lite' will take its place - the Fed will not allow its balance sheet to shrink. A look at the history of the monetary base shows that a shrinking Fed balance sheet is a rare animal indeed, so this is not too surprising. The Fed's job after all is to inflate the money supply and thereby reverse redistribute wealth. We look at the reaction of the markets to the announcement and ponder how and why the SPX managed to tack on nearly 200 points since we first mentioned that 'risk is high'. In late December we noted that some of the characteristics of the advance reminded us of the Nasdaq's blow-off in late 1999/early 2000. With hindsight we should probably have realized at the time that this meant that even more gains were in store. Evidently though, risk is now even higher. acting-man.com