The shellacking the markets took last Thursday is the most powerful warning sign we’ve seen yet that things are not what they seem in the financial markets. For lack of a better term, it’s a bearish omen, despite Monday’s recovery.
If you like bull markets, you better hope Janet Yellen is one of the most talkative Fed Chairs in history.
There’s a very dangerous meme making the rounds.
It goes something like this:
The economy is improving, therefore the Fed’s going to taper… and, when it does, the economy is strong enough to endure the withdrawals that will come with it.
Don’t fall for it.
Today I’m going to show you three charts Obama hoped you’d never see.
You’re about to get a very different view of the “recovery” picture that the administration keeps painting for us.
This one, for starters, is accurate.
It also explains why incoming Fed Chair Janet Yellen can’t cut stimulus, which is one of the reasons you have an opportunity to make some money here… especially if you follow my “mid-December plan.” More on that in a minute.
Let’s start with the charts…
The Twitter (NYSE: TWTR) hype machine is in full gear, and the first trades are now indicating $45, up 73% from the $26 pricing last night.
If the stock market were a pinball machine, it would read “tilt.”
I’ve made no bones about my feelings for Facebook Inc (Nasdaq: FB) – that it’s overrated, a flash in the pan, and ultimately doomed.
Yes, the company just knocked the ball off earnings yesterday. And the stock is up 4.86% as I write this. But I really couldn’t care less what happens in the short term. I still can’t get behind its long-term potential.
After more than 30 years in the markets, I’ve seen all kinds of new technologies that are supposed to change the world. Most are pumped by little-known companies with overly hyped marketing, aggressive underwriters, and little more than vaporware. To say I’m jaded would be an understatement.
It used to be that companies went public after achieving a modicum of success. There were business models, calculations, and plans, all based on real results and proven success.
If you’re like most folks, there’s a nagging fear at the edge of your brain that’s trying desperately to make sense of what’s happening each day the market drops further
Bernanke’s actions last week – failing to taper, yet still trying to maintain the illusion that QE is a good thing – are setting up a one-two punch that’s not unlike boxing champion Mohammed Ali’s famous “float like a butterfly, sting like a bee” approach.