Europe has been saved. Again! The rescue package worked out for Spain shows that when it comes to giving free money to Banksters, the real masters of the universe, the Politicians will find out new and ingenious methods. The EU went out on limbs to provide money to Spain without demanding any conditions associated with bailout.That is the beauty of the MMT. You just have to write cheque to yourself. In any case, the modern money, which is not backed by any real asset, is an illusion, a figment of imagination, which the politicians and TPTB (The Powers That Be) can create out of thin air and make the sheeples dance and sing and do their bidding. As I say, never underestimate the powers of the CBs( Central Bankers) and now ZH can take a hike for next six months.
So are we going to see a repeat of January when the equities will keep going up and up to another galaxy? I would rather wait till the bearded one shows up with money here at home. What has happened in Europe has just put a band-aid on the bleeding banks and will help restore the calm in the market. More likely we will see a pop on Monday morning but I had other reasons for the pop. I do not think we are at the moment ready for new bull phase but I think at this point we are going to deviate from the last year’s script. We will have a correction soon and I now think that we will not have a lower low. In that case we have seen the bottom. It is still too early for safe investing and trend has not yet developed but more and more it looks like we will follow the Presidential year cycle pattern.
There is still risk of whipsaw in the market and this bottom is not going to be an event but a process. Last Monday I wrote “Muppets Beware”. http://bbfinance.blogspot.ca/2012/06/muppets-beware.html When CNBC, Crammer, GS, every one of those tries to scare the hell out of investors, we would be aware that something is in works. It is going to be choppy few weeks for sure and not yet conducive for sustained bull run. “O” needs good August till October.
I quote the following from The Reformed Broker:
“ John McCain was running steadily ahead of Obama in 2008 - with a message that "the fundamentals of the economy are sound" no less! - until the September meltdown of Lehman Brothers. That event was the trigger that shot Obama ahead of McCain and essentially ended his campaign. Contrary to Hollywood's take, it wasn't Palin's idiocy or McCain's age or anything else - simply his defending of the Bush Economy in the midst of this hundred year's storm. He looked ridiculous and out of touch, his optimism juxtaposed with the apocalyptic headlines that had jumped from the business section to the front page. By the time he was "suspending his campaign" to try and fix everything, it was already over."
As long as we understand that markets are rigged by these honourable folks, and we get an idea as to how it is rigged, we can place our bets accordingly. Nothing else matters. After election will be a different ball game altogether. We are watching the last hurrah and while we are at it, why not enjoy the show.
