the economy of the usa .. and thus the world

  1. dub
    29,544 Posts.
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    The following excerpt is from Puplava's Market Wrap-up for the (US) 29th. The whole article is worth reading and you can do that at the URL

    To me, the following reinforces my belief in the wisdom of buying (holding, not trading) gold and silver...either shares, physical or both.

    Anyway, here 'tis -

    "Too Many Holes in the Dike

    The Fed and U.S. policyholders have their hands full. They have to contend with a weakening economy, rising unemployment, rising government deficits, record trade imbalances as well as a volatile and unstable stock market. The Fed is now actively monetizing debt in an effort to keep interest rates in a narrow range. However, with bigger government budget deficits and a weakening economy, they must keep the credit machine flowing and interest rates low or risk major defaults in the financial system. They now have their fingers in all segments of the financial system. It is apparent that conventional monetary tricks, such as lowering interest rates, have failed to create an enduring and lasting recovery. The economy is now in danger of slipping into recession again. Given the numerous Fed speeches made recently, it appears that unconventional measures are being taken which includes intervention in the financial markets. The Fed’s problem is what happens if foreigners start to exit the system. Furthermore, John Q. and the smart money isn’t buying stocks. The amount of insider selling recently should be a warning to those who believe in pro forma earnings. The company insiders now understand the GAAP numbers, which tell a completely different story. That is why they are taking advantage of stock rallies to sell off shares.

    As for John Q., he is putting his money in real estate and bonds, not the stock market. This explains the falling volume in the stock market and the weak momentum in recent rallies. This rally doesn’t have the strength and power behind it. Without constant interventions as seen in miraculous rallies that take place on rumors, this market wants to head south. Sentiment indicators show a turning point, volume suggests weakness, stochastic and on-balance volume indicators are flat or falling, and the VIX and the VXN are dropping to levels where market corrections have begun. What the authorities will need to do is pull off a Robert Rubin, which is to keep intervening in the markets all the way up and drive all the bears and shorts into permanent hibernation, a feat considered to be unlikely unless they can find Saddam and Osama on the very same day. If they are going to give us a rally that goes beyond resistance levels and above the neckline of a major head and shoulders pattern, they better do so soon. We are about to head into the summer months, a time of market weakness that lasts from the end of April all the way until late October. Seasonal market patterns are about to take over, so a market catalyst is immediately required, which is why I humbly suggest they find Osama and Saddam.


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