Sunday, October 10, 2010

Stock market geniuses keep rolling - WOO HOO!


Yes, the stock market just keeps kicking ass.  It's as if there's no recession at Wall Street.  How come gold and stocks just keep going up?  Do you know?  Here's the news. (Bold is mine.)
The Dow's rebound to 11,000 on Friday seemed almost inevitable as investors shook off all the bad news and instead focused on slivers of hope in jobs, government intervention and politics.

By nearly any measure, Friday's nonfarm employment report was a disappointment: Payrolls dropped 95,000, the so-called "real" unemployment rate jumped to 17.1 percent and one of the few growth areas came in restaurant and bar jobs.

Yet there was Wall Street, sorting through the rough and finding diamonds in a private payroll increase and continued hopes that a second round of Fed money injections—commonly referred to as quantitative easing, or in this case QE2—would help right a listless ship.
More here:
See anything  "amiss" in here?  Anything not quite adding up?  Sure, to you ... but that's because you're not a Wall Street genius.  Neither am I.  Here's what I predict:

One day the Fed will have to stop "injecting money/easing." One day they will have to raise interest rates (or taxes) to pay for all the spending. I think that day will come sooner rather than later (unless conservatives take control of Congress and begin with the slashing and burning of expenses ... which they won't.)

As an aside, for the last 20-30 years government has been constantly busy writing laws -- thousand and thousands of pages ... taxing or criminalizing everything they possibly could as fast as they possibly could. But the government needs money to enforce those laws. Without money, they can't come for you.

They can't come to inspect your house to see if you're using the correct toilet or light bulb. They can't pay people to stuff a probe up your car's tail pipe to see if you're conforming with their global warming agenda.

Starving the government of money is a great idea as long as they also can't borrow more. You see where I'm going with this? Yes, I think you do.

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