Imminent and severe market correction

basilio said:

In all the kerfuffle over Greece and the rest of the PIIGS we somehow overlooked Hungary!

So why are we surprised that the whole of Europe is in deep debt and ready to fall over with the next scare?

We don't have a financial system. We have a wreck of a financial system held together with smoke and mirrors. Any decent wind and the smoke will disappear, the mirrors fall over and we will all be looking at mountains of worthless scrip.

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basilio said:

In all the kerfuffle over Greece and the rest of the PIIGS we somehow overlooked Hungary!

So why are we surprised that the whole of Europe is in deep debt and ready to fall over with the next scare?

We don't have a financial system. We have a wreck of a financial system held together with smoke and mirrors. Any decent wind and the smoke will disappear, the mirrors fall over and we will all be looking at mountains of worthless scrip.

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G-20 Coordination Fails as Governments Clash on Recovery Recipe

June 7 (Bloomberg) -- Global policy makers are starting to clash over their individual prescriptions for recovery as Europe demands lower budget deficits while the U.S. warns against pushing exports instead of domestic demand.

At a meeting of Group of 20 finance chiefs in Busan, South Korea, June 4-5, Treasury Secretary Timothy F. Geithner said the world cannot again bank on the cash-strapped U.S. consumer to drive growth and urged other nations to stimulate their own demand. European Central Bank President Jean-Claude Trichet said fiscal tightening in “old industrialized economies” would aid the expansion by shoring up investor confidence.

Each strategy carries threats for the global rebound that the G-20 said faces “significant challenges.” Continued stimulus risks bondholder revolt over rising debt burdens, while spending cutbacks could worsen unemployment. Relying on exports leaves the world prone to trade wars and competitive currency devaluations as countries seek to give their companies an edge.

“The world may end up in a period of sub-potential growth for two or three years,” said Venkatraman Anantha-Nageswaran, who helps manage about $140 billion in assets as global chief investment officer at Bank Julius Baer & Co. in Singapore. “We need to accept that all of us cannot simultaneously grow our way out of trouble.”

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Edwood said:

http://www.hussmanfunds.com/wmc/wmc100628.htm

its all looking a bit ropey eh - key support levels going, could be time to batten down the hatches

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Edwood said:

http://www.hussmanfunds.com/wmc/wmc100628.htm

its all looking a bit ropey eh - key support levels going, could be time to batten down the hatches

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In short, my concerns about the economy and financial markets are escalating quickly. Given the already vulnerable condition of the U.S. economy, a second phase of weakness would most likely contribute to already troubling levels of mortgage delinquency and foreclosure, and could be expected to push the unemployment rate toward 12%. It is not useful to rule out unfavorable outcomes simply because they seem unpleasant or unthinkable. It is also not useful to place superstitious hope in the Fed and the Treasury to fix the consequences of irresponsible lending without any ill effect. In the coming quarters, remember that every time you hear an incomprehensibly large bailout commitment from government, it will equate to an unconscionably large extraction of public resources, possibly through overt taxation, but more likely through the long-term destruction of purchasing power.

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Bushman said:

US bond yields are pricing in a double dip recession (sub 3%).

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Full Recession - Not a good time for businesses or the unemployed. GDP has been retracting, quarter-over-quarter, interest rates are falling, consumer expectations have bottomed and the yield curve is normal.
Early Recovery -Finally, things are starting to pick up. Consumer expectations are rising, industrial production is growing, interest rates have bottomed and the yield curve is beginning to get steeper.
Late Recovery -In this stage, interest rates can be rising rapidly, with a flattening yield curve.Consumer expectations are beginning to decline, and industrial production is flat
Early Recession -This is where things start to go bad for the overall economy. Consumer expectations are at their worst; industrial production is falling; interest rates are at their highest; and the yield curve is flat or even inverted

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Edwood said:

http://seekingalpha.com/instablog/2...-puts-stocks-at-risk-says-veteran-sky-watcher

Hocus pocus maybe, and definitely not tradeable (in my opinion ) - but interesting nun-the-less.... article was written March 31 2010 & called an April / May top & August 1 meltdown

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We want to talk about the upcoming Cardinal Climax, which you say puts stocks””and perhaps humanity””in jeopardy.

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Edwood said:

http://seekingalpha.com/instablog/2...-puts-stocks-at-risk-says-veteran-sky-watcher

Hocus pocus maybe, and definitely not tradeable (in my opinion ) - but interesting nun-the-less.... article was written March 31 2010 & called an April / May top & August 1 meltdown

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Edwood said:

Hey G, good to see you around
Yeah I guess it'd be prudent to book something meaningful in the diary now for Aug 1 >> its a Sunday so no markets open >> maybe the event will be on the Monday, could be a good a day to take off & go fishing or something

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Tanaka said:

reminds me that the planets are aligned by a fibonacci number with the average distance between them equaling 1.618! If you are interested about how numbers affect the market and nature in general, I found 'Fibonacci Analysis' by Constance Brown a good read.

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professor_frink said:

Fishing may not be the best idea if humanity is at risk Ed. Perhaps hiding in a bomb shelter is in order

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