The day opened with a world market not believing what was being done, or not done. We are closer to a 4000 point drop than the average McDonalds' Super Sizer American with a Hummer and some good patriotic country songs can perceive. When the market crashes, if the market crashes, if the banks crash....banks will fail right and left, and money will truly NOT be real.
By midday we all knew that the government could not agree on a bill, and the market hit bottoms at 10,360.
It was such a large drop today that we can only begin to imagine what the next drop will be, if we cannot gain closure. We had one of the largest drops of all time, and the Great Depression is upon us.
Many day traders had fun:
"The day opened with a world market not believing what was being done, or not done. We are closer to a 4000 point drop than the average McDonalds' Super Sizer American with a Hummer and some good patriotic country songs can perceive. When the market crashes, if the market crashes, if the banks crash....banks will fail right and left, and money will truly NOT be real.
By midday we all knew that the government could not agree on a bill, and the market hit bottoms at 10,360.
It was such a large drop today that we can only begin to imagine what the next drop will be, if we cannot gain closure. We had one of the largest drops of all time, and the Great Depression is upon us.
Many day traders had fun:
"What a trading extravaganza. buy, sell, $0.50 here, $1.00 there.
Spreads so large I'm scalping 50 cents just on the spread."
Now, of course, we will not learn a lesson on this, as we never do. We actually will believe the issue is "the banks on Wall Street" when it is much much more.
Simply: this is supply side degulated economics falling apart.
"The Bush presidency began with the destruction of the Twin Towers, and is ending with the destruction of the tri-trillions-the money spent on a foolish war in Iraq (653 billion and counting) and on a bailout of the financial sector gone hog wild during the Reagan administration of Deregulation. Bush and Republicans have revived Big Government in the worst possible way: the middle class will pay, in perpetuity, for the sins of the powerful."-Joe Klein, Time
Do not be deceived that the Democrats "caused this", as we now read and hear, and that they were complicit in this bribery. Although the Democrats in Congress were indeed part of the problem, and have guilt, this bail out is NOT a financial bail out alone, but a bail out of supply side economics. This trickle down "free enterprise" methodology historically has the next generation pay for falsified debt. Do NOT forget that McCain, Bush, and Cheney, less than one month ago all agreed "the country is not in recession,but struggling for bearing"
McCain is trying hard to move the widget from the center, and to use the great American Republican "fear" game that works so well....we will be safer with McCain than Obama, when in reality we are LESS safe than 8 years ago, with 653 billion in debt on Iraq alone, and with a world that sees us as "idiots imploding".. buy, sell, $0.50 here, $1.00 there.
Spreads so large I'm scalping 50 cents just on the spread."
Now, of course, we will not learn a lesson on this, as we never do. We actually will believe the issue is "the banks on Wall Street" when it is much much more.
Simply: this is supply side degulated economics falling apart.
"The Bush presidency began with the destruction of the Twin Towers, and is ending with the destruction of the tri-trillions-the money spent on a foolish war in Iraq (653 billion and counting) and on a bailout of the financial sector gone hog wild during the Reagan administration of Deregulation. Bush and Republicans have revived Big Government in the worst possible way: the middle class will pay, in perpetuity, for the sins of the powerful."-Joe Klein, Time
Do not be deceived that the Democrats "caused this", as we now read and hear, and that they were complicit in this bribery. Although the Democrats in Congress were indeed part of the problem, and have guilt, this bail out is NOT a financial bail out alone, but a bail out of supply side economics. This trickle down "free enterprise" methodology historically has the next generation pay for falsified debt. Do NOT forget that McCain, Bush, and Cheney, less than one month ago all agreed "the country is not in recession,but struggling for bearing"
McCain is trying hard to move the widget from the center, and to use the great American Republican "fear" game that works so well....we will be safer with McCain than Obama, when in reality we are LESS safe than 8 years ago, with 653 billion in debt on Iraq alone, and with a world that sees us as "idiots imploding".
Tuesday, September 30, 2008
Monday, September 29, 2008
Last Friday Calls Were Profitable to 44 Percent
Friday calls were profitable to 44%, leaving us profits all through one of the most shocking financial weeks in history.
For those of you that watched the debate, you were seeing TWO complicit politicians that HAVE BOTH (AS HAVE BOTH PARTIES) been influenced by lobbyists and Washington, and are BOTH part of the problem.
The issues discussed were pure babble, as nothing either have planned to do can ever occur now, as our financial situations have changed forever.
Iraq is the real issue, and you either believe we should not have gone, and should leave, or you believe we must be there to "win" and "protect Israel" and the world.
I am so appalled that America could even believe McCain and "we must be in Iraq, the surge is working", or that "Obama a Junior senator not knowing the difference between tactic or strategy".
If anyone saw Sara Palin interviewed by Katie Couric and will still vote for the possibility this woman could be the leader of the world, then all of the problems we have right now are more than deserved, and may we become an obese nation of indebted people.
China is beginning to cut off their buying of our debt. The USD grows less in value each day.
How was the USD and how was the deficit 8 years ago?
Who was in charge?
(My absolute favorite is the fodder now circulating that the entire housing mess was created by the Democrats. The false financials and lack of regulation were led by Abramoff, Delay, Rove, Scooter, war in Iraq, fake bids to Halliburton, and oil lobbyists. The mortgage mess is only part of the crash, and what we are seeing)
With this said a bailout will hit the news in some fashion as this weekend continues, or early next week, and it is likely for two way trades.
At OEX Options we will only trade to the call, for the short term, even if we miss a dual signal, as we think the market ripe for another dead cat bounce.
This is the fact: Under President Bush, and under a Republican administration, it is very likely today that IF an agreement for bailout is not reached, that the stock market could drop as low as 7700. If the Democrats are given the blame for this, or if this country elects McCain over "the fear of terrorism invasion" (what Floyd calls the 9/11 Rebublican "fear" game) we will enter the next great Depression, under an 8 year Republican watch. Supply side economics, which Floyd has preached about for years, does not work. This is the issue, NOT whether to bail out the banks. The issue is "who is in control", and who is being represented (not the Middle Class).
Do not think of silly things like "abortion rights" or "family values" when our world as we know it may be ending. This is not God talking time, but time to really think about pure government logic. Deregulation does great for those being deregulated, with no controls, and with a government that borrows its money from Communist China to support a war, and ongoing potential conflicts. If McCain dies, could Sara Palin honestly represent you as a citizen to the world?
For those of you that watched the debate, you were seeing TWO complicit politicians that HAVE BOTH (AS HAVE BOTH PARTIES) been influenced by lobbyists and Washington, and are BOTH part of the problem.
The issues discussed were pure babble, as nothing either have planned to do can ever occur now, as our financial situations have changed forever.
Iraq is the real issue, and you either believe we should not have gone, and should leave, or you believe we must be there to "win" and "protect Israel" and the world.
I am so appalled that America could even believe McCain and "we must be in Iraq, the surge is working", or that "Obama a Junior senator not knowing the difference between tactic or strategy".
If anyone saw Sara Palin interviewed by Katie Couric and will still vote for the possibility this woman could be the leader of the world, then all of the problems we have right now are more than deserved, and may we become an obese nation of indebted people.
China is beginning to cut off their buying of our debt. The USD grows less in value each day.
How was the USD and how was the deficit 8 years ago?
Who was in charge?
(My absolute favorite is the fodder now circulating that the entire housing mess was created by the Democrats. The false financials and lack of regulation were led by Abramoff, Delay, Rove, Scooter, war in Iraq, fake bids to Halliburton, and oil lobbyists. The mortgage mess is only part of the crash, and what we are seeing)
With this said a bailout will hit the news in some fashion as this weekend continues, or early next week, and it is likely for two way trades.
At OEX Options we will only trade to the call, for the short term, even if we miss a dual signal, as we think the market ripe for another dead cat bounce.
This is the fact: Under President Bush, and under a Republican administration, it is very likely today that IF an agreement for bailout is not reached, that the stock market could drop as low as 7700. If the Democrats are given the blame for this, or if this country elects McCain over "the fear of terrorism invasion" (what Floyd calls the 9/11 Rebublican "fear" game) we will enter the next great Depression, under an 8 year Republican watch. Supply side economics, which Floyd has preached about for years, does not work. This is the issue, NOT whether to bail out the banks. The issue is "who is in control", and who is being represented (not the Middle Class).
Do not think of silly things like "abortion rights" or "family values" when our world as we know it may be ending. This is not God talking time, but time to really think about pure government logic. Deregulation does great for those being deregulated, with no controls, and with a government that borrows its money from Communist China to support a war, and ongoing potential conflicts. If McCain dies, could Sara Palin honestly represent you as a citizen to the world?
Friday, September 26, 2008
It Is Precarious
This could trigger two way trades, with a larger upswing to the call on FED action. HIGH RISK, but calls lead
JPMorgan Chase May Acquire Washington Mutual After FDIC Seizure
Sept. 25 (Bloomberg) -- Washington Mutual Inc. may be seized by regulators later today and parts sold to JPMorgan Chase & Co. in what will rank among the biggest banking failures in U.S. history.
Bush did get it right. Sadly. I consider this man an embarassment to us worldwide with his style and bravado, and not truly even understanding "recession", but his explanation of the situation was succinct. It is precarious.
Originally I stated, 7 months ago, that we were IN a recession, and that it would typically (following the definition of recession) end by October of this year. Sadly, I was wrong here, as the Fannie, AIG, and brokerage lies have gotten the better of us, and we now truly face frightening decisions.
Constitutionally everything Paulson is advocating is illegal, and regulation without clear accountability, and a bail out of greed, led by lobbyists that have had Congress in their pockets.
Sadly, there is little alternative, as Buffet so clearly has stated, and John MCain missing the debate to the "be there to help" is such fodder than only the flag wavers will agree. It's time to quit wasting time, and get relief in place. The world economy is dependent upon our moves.
We saw initial reactions yesterday with a market that hit tops of 11, 169, and bottoms of 10,787, and struggled by day end to close above 11,000. This is trade range bound movement, with a market "waiting for action".
From Republican Level 3 subscriber, RC from Oklahoma, my dear friend:
"1999
Under Clinton Administration removes regulations on Freddie and Fannie
Sept 10, 2003
Bush Administration and Treasury Secretary Snow called for Regulations on Fannie and Freddie
Barney Franks “Freddie and Fannie are not in financial trouble and we do not want to prevent low income families from being approved for home loans”
April 2005
Alan Green calls for regulations on Fannie and Freddie
Blocked by Chris Dodd, Barney Franks and Chuck Schumer
May 2006
McCain writes a bill to regulate Fannie and Freddie
The bill is blocked before it could hit the floor by Barney Franks, Chris Dodd, Chuck Schumer and Barack Obama
Sept 23, 2008
Republican Senator Tom Coburn calls Barack Obama for him to agree to an investigation on top executives at Freddie and Fannie, also Senator Coburn asked Obama to meet with McCain and put together a single statement with McCain regarding the financial crisis.
At every turn regarding Fannie and Freddie are Barney Franks, Chris Dodd, Chuck Schumer and Barack Obama, the same people who received record contributions from Fannie and Freddie."
JPMorgan Chase May Acquire Washington Mutual After FDIC Seizure
Sept. 25 (Bloomberg) -- Washington Mutual Inc. may be seized by regulators later today and parts sold to JPMorgan Chase & Co. in what will rank among the biggest banking failures in U.S. history.
Bush did get it right. Sadly. I consider this man an embarassment to us worldwide with his style and bravado, and not truly even understanding "recession", but his explanation of the situation was succinct. It is precarious.
Originally I stated, 7 months ago, that we were IN a recession, and that it would typically (following the definition of recession) end by October of this year. Sadly, I was wrong here, as the Fannie, AIG, and brokerage lies have gotten the better of us, and we now truly face frightening decisions.
Constitutionally everything Paulson is advocating is illegal, and regulation without clear accountability, and a bail out of greed, led by lobbyists that have had Congress in their pockets.
Sadly, there is little alternative, as Buffet so clearly has stated, and John MCain missing the debate to the "be there to help" is such fodder than only the flag wavers will agree. It's time to quit wasting time, and get relief in place. The world economy is dependent upon our moves.
We saw initial reactions yesterday with a market that hit tops of 11, 169, and bottoms of 10,787, and struggled by day end to close above 11,000. This is trade range bound movement, with a market "waiting for action".
From Republican Level 3 subscriber, RC from Oklahoma, my dear friend:
"1999
Under Clinton Administration removes regulations on Freddie and Fannie
Sept 10, 2003
Bush Administration and Treasury Secretary Snow called for Regulations on Fannie and Freddie
Barney Franks “Freddie and Fannie are not in financial trouble and we do not want to prevent low income families from being approved for home loans”
April 2005
Alan Green calls for regulations on Fannie and Freddie
Blocked by Chris Dodd, Barney Franks and Chuck Schumer
May 2006
McCain writes a bill to regulate Fannie and Freddie
The bill is blocked before it could hit the floor by Barney Franks, Chris Dodd, Chuck Schumer and Barack Obama
Sept 23, 2008
Republican Senator Tom Coburn calls Barack Obama for him to agree to an investigation on top executives at Freddie and Fannie, also Senator Coburn asked Obama to meet with McCain and put together a single statement with McCain regarding the financial crisis.
At every turn regarding Fannie and Freddie are Barney Franks, Chris Dodd, Chuck Schumer and Barack Obama, the same people who received record contributions from Fannie and Freddie."
Thursday, September 25, 2008
Trading Was Very Hard
Bush was brilliant; he told the truth.
The best way to describe the market is this:
10,968 as the high, 10,713 as the low. The 530P moved from 10.30 to 13.20 and the 580C moved from 5.80 to 7.80.
It was a day where the market studied what is NOT happening, and the market had FEAR as to what could happen.
Only tight profits were possible, and trading was very hard. I suspect it will continue to be, until someone takes ownership of the situation and Congress acts.
____
Reader RC, a devout Rebublican, and I may be more in synch than ever before.
Sarah Palin is as qualified as Barack Obama. That's one thing he is dead right on. Bush was no more qualified as Governor of Texas, and the bankrupter of 4 businesses then McCain, the lifelong patriot, Obama the "change" speaker, or anyone else.
The question is who you want to be the CEO of a large bankrupt company. That's what we have.
And, he commented, "we do not just want change", correct, and he's right...we do want right change. I have yet to hear how McCain will change anything, only that he is a maverick, and that Palin fought the status quo in Alaska.
Personally, I'm unhappy with both our candidates. It's a mess. I'll shut up on who is right, and who is wrong, and simply ask you as subscribers, as taxpayers, and as citizens to not fall for FALSE FACTS, to not "buy the ad" rather than the candidate, and to truly analyze the implications of the situation we are in.
Buffet knows what we must do. Perhaps we might listen to the world's richest man, and not Congress, or candidates: Buffet is also a Democrat.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a8B.QQmw5A8M&refer=home
The best way to describe the market is this:
10,968 as the high, 10,713 as the low. The 530P moved from 10.30 to 13.20 and the 580C moved from 5.80 to 7.80.
It was a day where the market studied what is NOT happening, and the market had FEAR as to what could happen.
Only tight profits were possible, and trading was very hard. I suspect it will continue to be, until someone takes ownership of the situation and Congress acts.
____
Reader RC, a devout Rebublican, and I may be more in synch than ever before.
Sarah Palin is as qualified as Barack Obama. That's one thing he is dead right on. Bush was no more qualified as Governor of Texas, and the bankrupter of 4 businesses then McCain, the lifelong patriot, Obama the "change" speaker, or anyone else.
The question is who you want to be the CEO of a large bankrupt company. That's what we have.
And, he commented, "we do not just want change", correct, and he's right...we do want right change. I have yet to hear how McCain will change anything, only that he is a maverick, and that Palin fought the status quo in Alaska.
Personally, I'm unhappy with both our candidates. It's a mess. I'll shut up on who is right, and who is wrong, and simply ask you as subscribers, as taxpayers, and as citizens to not fall for FALSE FACTS, to not "buy the ad" rather than the candidate, and to truly analyze the implications of the situation we are in.
Buffet knows what we must do. Perhaps we might listen to the world's richest man, and not Congress, or candidates: Buffet is also a Democrat.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a8B.QQmw5A8M&refer=home
Wednesday, September 24, 2008
The Great Depression Was Averted... For Now
Oil was manipulated Monday by Short Sellers. The market itself has been manipulated for years by shorts, by the large investment bankers that have lied through their teeth, and the house of cards has crumbled.
I repeat again: CREDIT CARD FRAUD (banks misrepresenting their own exposure) is next, as our nation is run on credit, and it is now catching up.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aMSdh.rgPmx0&refer=home
Now, Congress is playing games with the worldwide bailout, and the market reacted beautifully yesterday, with profits for traders to both put and call.
Smart traders were able to buy the Oct530P and sell for 2.00 to 3.00 per contract, and those that held the Oct580C on day trades also locked 2.00 per contract. We're left with an open signal to the Oct600C, and more potential two way trades.
Several traders reported dual profit trades on put and call during the market whipsaw this afternoon.
YES, the Great Depression was averted last week. It was postponed. And you fell for it.
And now, we're figuring out if we can even pay for it.
When you vote in November, ask yourself WHO has the greater chance to make REAL change. And if you don't believe change is needed, you're hopeless :)
I repeat again: CREDIT CARD FRAUD (banks misrepresenting their own exposure) is next, as our nation is run on credit, and it is now catching up.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aMSdh.rgPmx0&refer=home
Now, Congress is playing games with the worldwide bailout, and the market reacted beautifully yesterday, with profits for traders to both put and call.
Smart traders were able to buy the Oct530P and sell for 2.00 to 3.00 per contract, and those that held the Oct580C on day trades also locked 2.00 per contract. We're left with an open signal to the Oct600C, and more potential two way trades.
Several traders reported dual profit trades on put and call during the market whipsaw this afternoon.
YES, the Great Depression was averted last week. It was postponed. And you fell for it.
And now, we're figuring out if we can even pay for it.
When you vote in November, ask yourself WHO has the greater chance to make REAL change. And if you don't believe change is needed, you're hopeless :)
Tuesday, September 23, 2008
A Bit of Sobriety
Well, by Monday a bit of sobriety may have hit the markets, as we began the real study of what we've done.
And oil surged $25.00 a barrel. Oops, suddenly America is thinking a bit of conservation again:)
But we'll drill Alaska, that will solve it.
Monday's market moves allowed traders to take two buys to the call. We did not gain entry to a put with the immediate downside, but continue to see potential two way trades taking place this week.
Bear in mind that a market that runs 450 points UP on Friday, and 330 points down on the following market day is a market that no longer believes, and cannot be validated. NO government actions seem to slow the fall out. The plunge protection team did not win this time:)
____
"Obama is a socialist" This is the best one. Rumors pass around the internet now showing the "socialism" of Obama.
And to think, after what happened last week!
Obama is a classic politician, a Democrat, and perhaps the better of two evils. I care most what people the President will surround himself with.
Articles have been sent to old Floyd on "Obama the socialist", utterly amazing when we have just seen a Democratic and Republican Congress, AND a President that has utterly ignored economic controls for 8 years, that have just approved a SOCIALIST (God ford) Government bailout on our GREED.
What Paulson has led is a FDR type socialized bailout of our banking and financial sectors.
Many believe this action has diverted The Great Depression 2. Perhaps.
And a quote from a young voter, ready for Palin:
"I knew absolutely nothing," said Tyler Deeds, 19, who made the drive from Auburndale 90 miles away and waited more than 5 hours to see Palin. "I couldn't even tell you who the governor of Alaska was."
But Deeds, who plans to enter the Navy soon, said he "tends to cling to my guns and religion" and he quickly grew excited about Palin's candidacy.
Damn right. The right to bear arms, and Pray to God. We need old fashioned family values:)
It is NOT the President that decides things, but those that he surrounds himself with. It's evident in Bush, and will be with whomever wins, so make sure you are understanding who the OTHER players are that will win.
We do not elect "one person", but an entourage of people that work with the CEO, or President. We are deciding who we believe will be the best CEO.
And oil surged $25.00 a barrel. Oops, suddenly America is thinking a bit of conservation again:)
But we'll drill Alaska, that will solve it.
Monday's market moves allowed traders to take two buys to the call. We did not gain entry to a put with the immediate downside, but continue to see potential two way trades taking place this week.
Bear in mind that a market that runs 450 points UP on Friday, and 330 points down on the following market day is a market that no longer believes, and cannot be validated. NO government actions seem to slow the fall out. The plunge protection team did not win this time:)
____
"Obama is a socialist" This is the best one. Rumors pass around the internet now showing the "socialism" of Obama.
And to think, after what happened last week!
Obama is a classic politician, a Democrat, and perhaps the better of two evils. I care most what people the President will surround himself with.
Articles have been sent to old Floyd on "Obama the socialist", utterly amazing when we have just seen a Democratic and Republican Congress, AND a President that has utterly ignored economic controls for 8 years, that have just approved a SOCIALIST (God ford) Government bailout on our GREED.
What Paulson has led is a FDR type socialized bailout of our banking and financial sectors.
Many believe this action has diverted The Great Depression 2. Perhaps.
And a quote from a young voter, ready for Palin:
"I knew absolutely nothing," said Tyler Deeds, 19, who made the drive from Auburndale 90 miles away and waited more than 5 hours to see Palin. "I couldn't even tell you who the governor of Alaska was."
But Deeds, who plans to enter the Navy soon, said he "tends to cling to my guns and religion" and he quickly grew excited about Palin's candidacy.
Damn right. The right to bear arms, and Pray to God. We need old fashioned family values:)
It is NOT the President that decides things, but those that he surrounds himself with. It's evident in Bush, and will be with whomever wins, so make sure you are understanding who the OTHER players are that will win.
We do not elect "one person", but an entourage of people that work with the CEO, or President. We are deciding who we believe will be the best CEO.
Monday, September 22, 2008
The Shell Game
Enough happened Friday that new history has been made, and perhaps The Great Depression 2 was averted, or worsened.
I'll let you read and listen to the babble from TV and news. You're being inundated.
But these are facts:
*This was a classic socialism move. This bail out, 1 trillion (2 Iraq Wars) is a TAX the American citizens will pay. We will. Our children will. And the debt will be so monstrous that truly no economist could predict how this will truly affect our economy.
Of course, the market took it with complete and euphoric abandon, as our money market funds were now guaranteed by the Government and historic bank failure worldwide was averted.
And most Americans won't even know it, simply hearing of the "big things" and having no understanding of it.
While financial stocks and the broader markets appear to be recovering, much of the gains are a result of short covering, particularly in the financials. Bloomberg reports that short interest in financial stocks increased this year to 36 percent of all shares sold short in the S&P 500. The true underlying strength of the rally will not be clear until all the shorts are covered.
Until the details of the Treasury plan are released, and there is bi-partisan support for it, the market recovery is at risk. Republicans may balk at a $1 trillion bail out and Democrats will not support a plan that rewards Wall Street for its excesses but leaves Main Street struggling and with an added burden on taxpayers. With only a week before Congress adjourns, there is little time to agree on the biggest Government expenditure ever contemplated.
The bailout will almost certainly depress the dollar further adding to inflationary pressure on imports and may do little to improve the economic fundamentals, so while we may see a short term bounce, the underlying trend may still be downwards.
Calls have the upside. Reality may soon set in, as the world begins to see what this will cost, and that none of it is real. Please read that again. None of the money we are discussing and reading about is real. It is paper, on paper, and in spreadsheets and financials. It is the "moving electronically" of "nothing". We have created the value to the instrument.
And our instrument, the USD, now has no value. It is pure debt.
This is the fault of: 1. American and our GREED 2. ALL of Washington, Democrat and Republican 3. Supply Side Economic thinking, led by Greenspan and leading with Reagan Administration, and moving from there through each Presidency, and finally fueling the mass arson under Bush, as we "warred" and "debted" and allowed GREED to lead.
You are at fault if you are not a true student of "truth" which is NOT what you read.
And most important, this shell game has not been approved or finalized.
I'll let you read and listen to the babble from TV and news. You're being inundated.
But these are facts:
*This was a classic socialism move. This bail out, 1 trillion (2 Iraq Wars) is a TAX the American citizens will pay. We will. Our children will. And the debt will be so monstrous that truly no economist could predict how this will truly affect our economy.
Of course, the market took it with complete and euphoric abandon, as our money market funds were now guaranteed by the Government and historic bank failure worldwide was averted.
And most Americans won't even know it, simply hearing of the "big things" and having no understanding of it.
While financial stocks and the broader markets appear to be recovering, much of the gains are a result of short covering, particularly in the financials. Bloomberg reports that short interest in financial stocks increased this year to 36 percent of all shares sold short in the S&P 500. The true underlying strength of the rally will not be clear until all the shorts are covered.
Until the details of the Treasury plan are released, and there is bi-partisan support for it, the market recovery is at risk. Republicans may balk at a $1 trillion bail out and Democrats will not support a plan that rewards Wall Street for its excesses but leaves Main Street struggling and with an added burden on taxpayers. With only a week before Congress adjourns, there is little time to agree on the biggest Government expenditure ever contemplated.
The bailout will almost certainly depress the dollar further adding to inflationary pressure on imports and may do little to improve the economic fundamentals, so while we may see a short term bounce, the underlying trend may still be downwards.
Calls have the upside. Reality may soon set in, as the world begins to see what this will cost, and that none of it is real. Please read that again. None of the money we are discussing and reading about is real. It is paper, on paper, and in spreadsheets and financials. It is the "moving electronically" of "nothing". We have created the value to the instrument.
And our instrument, the USD, now has no value. It is pure debt.
This is the fault of: 1. American and our GREED 2. ALL of Washington, Democrat and Republican 3. Supply Side Economic thinking, led by Greenspan and leading with Reagan Administration, and moving from there through each Presidency, and finally fueling the mass arson under Bush, as we "warred" and "debted" and allowed GREED to lead.
You are at fault if you are not a true student of "truth" which is NOT what you read.
And most important, this shell game has not been approved or finalized.
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