Tuesday, January 17, 2012

A few points to keep in mind

The financial markets are in transition.  as they change, they are hard to gauge as the players and their motivations change.  Further there becomes a strange hybridizaton as a lot of the trading moves off established markets into areas not easily monitored as are stock quotes, so some of the results look different and old patterns do not easily match what we see.

Writing has slowed as I pondered the results, long term, of economic retrenchment are not often clearly printed in the American press, for the reasons that their content is, in-fact, censored by prior restraint of editors afraid to disturb what they think the "Status Quo" wants.  This article in the Guardian demonstrates this very clearly and articulately tells the story many Americans have experienced but not been able to put into words as well as this article does...LINK to UK Guardian article............. the phrase that hit home with me was the subtitle to a picture    -->>   "Middle-aged people who thought they would be unemployed for a few months have realised that they were, in fact, forcibly retired.", that in-fact they had been SACKED  and had only the faintest hopes of regaining any of their former economic status.  Most white collar Americans don't yet know how to accept the fact of being SACKED, a lesson so well already learned by their blue collar counter-parts.  More of concern is how the political establishment will attempt to demonize these displaced workers, which OCCUPY WALL STREET so forcibly called attention down upon, while spotlighting the Elite who in fact are at the bottom of this ( the Vamp Squid typles seeking their bonuses from "Riskless Trades").

I was ALMOST shocked to see the "dithering about" so oft referred to as Europe seemed paralyzed by a crises that was and is still sucking them into the vortex leading to the BLACK HOLE of Global Financial Systematic Failure.  I used to think American politicians were the most crass and foolish, but I see they are in fact, miles behind their European counterparts...........  So as I see this next step down in Financial Cyclical Behavior ( cycle chart published early).  I sincerely think that this next bottom will be the signal of impending Greek default and a shock for the Euro, from which the markets will robustly rally, realizing they are in and have been in the ABYSS since October 2 which is when I think the bottom of a serious rally  was made.

    I see the drop in the Liquidity within LQD to be a good indicator of the tidal flow of funds into and out of the markets.  The two black lines represent the movement of the Ratio Adjusted Summation Index of Advances minus Declines to date, which seem to lag the flow-of-funds by about two weeks ( we use 10 days on the daily data).

Given that I am making sure I have some buying power at the (GREEK DEFAULT ANTICIPATION BOTTOM).