From the perspective of a guy who sat behind a desk in a brokerage firm for twenty years, I first have to admit that I don't know much other than that the PhD crowd from MIT, Yale, and etc., don't know much either, if they did we wouldn't all be broke.  The main task of an investor or speculator is to identify a trend quickly, riding a trend up or down is the sure path to Nirvana.  It's easy to see a trend after a market has moved 20% one way or the other, it's identifying it after it has moved .1% to .5% and jump in with everything you got.   Trouble starts when we believe we have found a unique way to spot trends before they happen.  Keeping this in mind that besides market prices, volume is where it's at.  Markets ain't going nowhere without big volume telling you the trend.  

"So?" all of you are asking.  "Look at the market over the past months or so, volume is in the toilet and it has roared, if you ain't in it you missed it, asshole."  On the contrary, the current lack of real volume is the warning flag hovering over the entire market and economy.  You'll note that the big corporate shitheads are selling their company stock, and that the horrid stimulus package that hasn't worked is about to be jumped started again by the usual suspects.  The stimulus has only worked in lowering risk and increasing speculation.  Are dividends suddenly going up up up?  The prices of commodities when adjusted for inflation have shown a run, but commodities prices are usually a function of weather (floods kill crops, drought kills them too, and don't forget them bugs and things that spread diseases from cow poo), and government subsidies.   The disaster that is the bailout of corrupt and inefficient companies is about to hit us.  Then what?  Then you will see volume, only it will be selling volume not buying.   And the leader going down will be gold, a useless commodity that has no value to anyone outside their (our) own minds.  The current price rise has not been a function of either protection or hedge against inflation, it has been pure speculation and product accumulation by Third World assholes. 


Geewhiz said...

Explain something to me (really am curious):

1 - which corporate shitheads are, in your words, selling company stock (hyperlinks?)

2 - are you saying dividends aren't going up? (again, hyperlink?) and what exactly does that portend?

Howard said...

NYT, Barrons, and SEC publishes lists of insider sales each week. The latest data indicate broad insider (executive) stock and stock options sales.

When dividends on a percent of stock price are not going up it means that profits are made at the expense of laying off workers etc.

Howard said...

ADD; The reports of executive sales of controlled stock can also be a fake in order to drop the stock price as a set up to make big buys. Broad insider selling ain't good, buying is usually good but also might be a fake to cover losses.

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