This is intended to be a forum for me to post chart ideas and hopefully receive feedback and stimulate discussion.It is not intended to constitute investment advice.
People say that the SPX has to crash for Bernanke to give the go-ahead on QE3. I think the THREAT of a crash is, in itself, good enough, and what we see in these charts, as well as in many other places (major weakness in Asia and the rest of the emerging markets, big problems as we all know in Europe, disappointing U.S. Econ data releases one after another) is something that the Fed also sees.
From the last FOMC minutes:
"The information received over the inter-meeting period indicated that economic activity had decelerated in recent months, with a notable slowing in consumer spending."
"Furthermore, members generally attached an unusually high level of uncertainty to their assessments of the economic outlook and continued to judge that the risks to economic growth were tilted to the downside. . ."
"Many members judged that additional monetary accommodation would likely be warranted fairly soon unless incoming information pointed to a substantial and sustainable strengthening in the pace of the economic recovery."
Major weakness in Asia. It was not to long ago when everyone was talking about China being the engine that drives the global economy. http://finance.yahoo.com/q/bc?s=000001.SS&t=my&l=on&z=l&q=l&c= Today in Drudge Report Dow 15,000??? with everyone on food stamps. Something is going to happen. In 1987, instead of QE3 they called it increasing liquidity to the market. Ben will hold out until they have lost control, then trigger his last QE. http://www.bloomberg.com/news/2012-09-04/food-stamp-use-climbed-to-record-46-7-million-in-june-u-s-says.html Nitram
People say that the SPX has to crash for Bernanke to give the go-ahead on QE3. I think the THREAT of a crash is, in itself, good enough, and what we see in these charts, as well as in many other places (major weakness in Asia and the rest of the emerging markets, big problems as we all know in Europe, disappointing U.S. Econ data releases one after another) is something that the Fed also sees.
ReplyDeleteFrom the last FOMC minutes:
"The information received over the inter-meeting period indicated that economic activity had decelerated in recent months, with a notable slowing in consumer spending."
"Furthermore, members generally attached an unusually high level of uncertainty to their assessments of the economic outlook and continued to judge that the risks to economic growth were tilted to the downside. . ."
"Many members judged that additional monetary accommodation would likely be warranted fairly soon unless incoming information pointed to a substantial and sustainable strengthening in the pace of the economic recovery."
http://www.reuters.com/article/2012/08/22/idUSW1E8G201520120822
That's a big change from recent "the economy has been expanding moderately" statements.
I'd say they are on top of things, and that we'll most probably get more accommodation next week on the heels of Draghi doing the same this week.
In any event, I'm of the opinion that it will be stopgap, and that it will be just enough to produce the LAST rally of this cyclic bull.
Major weakness in Asia. It was not to long ago when everyone was talking about China being the engine that drives the global economy. http://finance.yahoo.com/q/bc?s=000001.SS&t=my&l=on&z=l&q=l&c= Today in Drudge Report Dow 15,000??? with everyone on food stamps. Something is going to happen. In 1987, instead of QE3 they called it increasing liquidity to the market. Ben will hold out until they have lost control, then trigger his last QE. http://www.bloomberg.com/news/2012-09-04/food-stamp-use-climbed-to-record-46-7-million-in-june-u-s-says.html Nitram
ReplyDeleteThanks Nitram
ReplyDelete