Shepherds and Flocks
The truth shall set you free!
"With all due respect, sir, the American people have a funny way of deciding on their own what is and what is not their business."
A.J. MacInerney, The American President
Good morning and welcome back to the Hump Day flack. Just as Boo was set to dive in, the Fed said instead that there was a new spin. The timing was odd for the late day addition and added some spice to our Minyanville mission. "I'll tell ya it stinks" said Boo from his station unable to hide his ursine frustration, "Just as I mapped the Red Dye formation, the FOMC said there is no inflation!" Was it a mistake (and a meaty head-fake?) or is there something to this Fed on the take? We'll know soon enough as we hike up the hill and ready anew for a romp through the 'Ville!
Elmer's late day mea culpa triggered a slew of reactions across the financial spectrum. There were those that chalked it up as an honest error and others who viewed as an act of desperation and deceit. While the timing of the chime was a bit curious-four minutes before the close as major support was giving way-our collective interpretation will have to suffice for the time being. We won't belabor the point this morning but I would like to quickly express my source of distress.
We, the people, are conditioned to believe what we read, see and hear in the popular press. That psychology, responsible for everything from consumer demand to electoral choices, is the primary driver of our great nation. I don't know when the tipping point was-perhaps it was the dot.com bust or maybe it was 9/11-but it feels like we're being fed an edited version of reality. I can point to an egregious alphabet, from the BLS to WMD, but what we know likely pales in comparison to what we can't even imagine.
I'm no conspiracy theorist but I certainly believe there are motions and movements behind the curtain designed to shepherd the flock. Remember, the only difference between intervention and manipulation is communication and we're not getting the full show from the powers that be. The Minyanville mission is to further financial literacy and provide a compass to navigate an increasingly difficult journey. When our map contains blind spots, the landscape becomes a bit more dangerous.
I don't want to drift off point (we have a market to trade) and my intention is to inform rather than offend. And while I may be off base, I will simply ask you to pay particular attention to the evolving dynamic and potential agendas. If we are, in fact, edging our way through a long-term psychology bubble, confidence in the system-or lack thereof-will have a profound effect on the financial markets. That may not be today's business but consciousness will serve us all in good stead aswe forge ahead.
We power up this Hump Day pup to find the S&P above initial resistance (1163) and General Motors (GM) spurring the herd. My sense is that the late day thataway caught a few hedgies leaning short and that will likely add early demand to bovine command. Please keep in mind that NDX 1460 and DJIA 10,400 remain layered resistance and the financials feel like they have a steep step to boot. One step at a time, Minyans, as we find our way together.
Good luck today.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at firstname.lastname@example.org.
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