Strange Days
By Mr Practical Nov 06, 2009 3:25 pm
The dollar is the new yen, from which investors are still cutting their losses.
Just look what happened to the yen. Everyone was negative on it for the same reasons and everyone was borrowing in yen to buy risky assets. Of course they took huge currency risk in doing so and thus paid the price. They're still counting their losses.
So now, in my opinion, it’s the dollar's turn.
Speculators are borrowing dollars (short) to buy risky assets and loving it right now. Everyone thinks the Federal Reserve is going to keep printing and printing until the dollar goes to zero. The problem with that is the Fed right now can't print enough, that is to say, it can't create enough credit. It's trying as hard as it can, believe me, for that is what it does, but without a fractional banking system willing to lend, it's impotent.
One way the Fed can print money/extend credit could be in a very devious way.
Many are marveled at the boom in stocks, given really rotten fundamentals. Of course, so far it's been a function of a lower dollar and there's a way to "reflate" with those printed dollars that normal conduits won't allow.
What if the government/Fed realized the most efficient way right now to "print" dollars and "reflate" the economy was to get stock prices up? What better way to do that than print dollars to buy stocks?
There's ancillary evidence that stocks are acting "artificial". Stocks aren't only climbing a wall of worry, they're scaling the Mt. Everest of bad fundamentals. Tick data is extreme, especially when the stock market is down. We constantly see 1000+ tick prints when stocks are down; this is very strange indeed. Volumes are down at least 20% from normal levels (and much more if you discount for high-frequency trading), making it easier to get stocks up.
Under TARP, the fine print allows dealers to REPO stocks to the Fed as collateral (holy cow is right).
What if there were an arrangement where large dealers buy stocks and stock futures through the day and REPO them to the Fed at the high closing prices? The dealer would book the profits derived from the difference at no risk.
If you look at the trading patterns of the largest dealers, one in particular lost money trading in only one day last quarter. Statistically that's like finding a needle at the bottom of the ocean.
Of course no one knows for sure because no one is allowed to see what's on the Fed's balance sheet. But more and more of us are suspecting it's not just the normal junk people talk about.
There was a good editorial in the Wall Street Journal describing the government’s and the Fed’s involvement in the financial ponzi scheme that has accumulated over the years. I believe it disingenuous for the government to persist in covering up its complicity by doing more of the same. They seem intent on bankrupting the country instead of steering clear of gobbledygook economics.
This won't work in the long run and only serves to increase risk.
Risk is very high.
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2009 Minyanville Media, Inc. All Rights Reserved.
Copyright 2009 Minyanville Media, Inc. All Rights Reserved.
(28)
Reply
2009-11-06 15:33:35
great stuff from the buzz!
so glad this got posted on the main ville!
this info is of stuff so blatant, it's no wonder hardly any regular people put their money in the market!
the degree of distrust being developed by these actions, is astounding!
and there's surprise incumbents were voted out earlier this week?
this info is of stuff so blatant, it's no wonder hardly any regular people put their money in the market!
the degree of distrust being developed by these actions, is astounding!
and there's surprise incumbents were voted out earlier this week?
2009-11-06 15:36:50
Thank You
Thanks for chiming in. You are a must read for me. I want to know if you think that money may flow into gold rather than into the dollar if we get a risk averting rout. Despite the higher prices and commercials, gold is owned by very few people in the US. I simply cant imagine a fundamental reason to own dollars despite the recent drop. They will be sending checks to the populcae soon, to mitigate the acrimony from the Wall Street bailout. Thanks for your time!
2009-11-06 15:46:11
GS
For them to only lose on one trading day is a ridiculous feat and to think they are getting richer thanks to the blood and sweat of the taxpayer, jobless and homeless is truly disgusting
2009-11-06 16:02:09
who are those guys?
Do these "dealers" have names? Who are they?
Thank you.
Thank you.
2009-11-06 16:30:41
Churn till they get you sick
So what reality is this... 1000+ tick followed by 1000- tick a very short time later?
Scam, scam, pyramid, ponzi, whatever you call it, all it is now is a scam market monopolised by high frequency GS skimming huge profits from everyone who does any trading.
The government should bring in a tax on short term trading and fast, but will they? No of course not, they want the scam, bubble to keep on going up.
If the market was going down they would be screaming blue murder and putting all sort of fancy curbs and short bans in place.
The Fed are forever blowing bubbles, ugly bubbles, the Fed are forever blowing ugly bubbles, sickly bubbles that go BOOOOOOM in the night and frighten little children that haven't even been born
Scam, scam, pyramid, ponzi, whatever you call it, all it is now is a scam market monopolised by high frequency GS skimming huge profits from everyone who does any trading.
The government should bring in a tax on short term trading and fast, but will they? No of course not, they want the scam, bubble to keep on going up.
If the market was going down they would be screaming blue murder and putting all sort of fancy curbs and short bans in place.
The Fed are forever blowing bubbles, ugly bubbles, the Fed are forever blowing ugly bubbles, sickly bubbles that go BOOOOOOM in the night and frighten little children that haven't even been born
2009-11-06 16:37:23
Slow Downward Japanese Style Spiral
Mr. Practical.
Thanks for the high risk reminder.
"REPO stocks to the Fed as collateral (holy cow is right)." -Not surprised.
Note the FED lawyer who stated, they have no direct activities in the equity markets. "Direct" being the key word.
But now it seems to me that the only way they can get this beast higher is to continue to hammer the dollar. But I agree with you, it looks like it's getting harder to do.
Did you see the article showing SPX has gone nowhere priced in Euro or Yen for the last 3 months?
These "berries" are always searching for the next bubble, to fix the last one that just burst. I think they are simply out of bubbles. The dollar carry trade will just strengthen emerging markets (and cause capital to flee), and weaken our own economy further. In addition the crowding-out effect, seems to be slowing down the economy.
I have yet to find any bubble in history that has ever been successfully reflated. But the "berries" will try, as it is easier than fixing fundamentals.
Slow downward Japanese style spiral.
All opinion.
Thanks for the high risk reminder.
"REPO stocks to the Fed as collateral (holy cow is right)." -Not surprised.
Note the FED lawyer who stated, they have no direct activities in the equity markets. "Direct" being the key word.
But now it seems to me that the only way they can get this beast higher is to continue to hammer the dollar. But I agree with you, it looks like it's getting harder to do.
Did you see the article showing SPX has gone nowhere priced in Euro or Yen for the last 3 months?
These "berries" are always searching for the next bubble, to fix the last one that just burst. I think they are simply out of bubbles. The dollar carry trade will just strengthen emerging markets (and cause capital to flee), and weaken our own economy further. In addition the crowding-out effect, seems to be slowing down the economy.
I have yet to find any bubble in history that has ever been successfully reflated. But the "berries" will try, as it is easier than fixing fundamentals.
Slow downward Japanese style spiral.
All opinion.
2009-11-06 16:47:52
What Another Deflationist? Say It Isn't So.
"Not much has changed since we last spoke"
and
"Everyone is negative on the dollar, for good reason, but that fact alone could, and I think will, propel the dollar higher at some point in nasty fashion"
These two statements make you at least a short-term deflationist.
An even rarer animal now in this current environment.
and
"Everyone is negative on the dollar, for good reason, but that fact alone could, and I think will, propel the dollar higher at some point in nasty fashion"
These two statements make you at least a short-term deflationist.
An even rarer animal now in this current environment.
2009-11-06 17:37:05
a few comments
'Everyone is negative on the dollar'
i would say way too many people are still trying to pick the bottom. UUP had to register 100m. new shares with the SEC because it had hit the limit on how many shares it could issue. so there is heavy betting on a dollar rally. one day that will be correct of course, but to say that 'everyone is bearish on the dollar' is belied by such data.
there is a decisive difference between the yen and the dollar. the Japanese current account is in permanent surplus, which means that it exports capital. the US current account is in perennial deficit, i.e. it needs to import capital. whenever Japanese repatriation of capital occurs, bearish yen positions are in trouble. the yen carry trade blew up not just once, but several times (most notably in 1998), and always came back.
the dollar has repatriation-wise the exact opposite problem though. its only saving grace is that so much debt is denominated in it that during times of crisis, those who need to finance dollar liabilites can be subject to sudden cash crunches.
all that said, i eventually also expect a strong dollar rally. emphasis on 'eventually'. currency trends have the greatest inertia of all trends.
re. 'The problem with that is the Fed right now can't print enough, that is to say, it can't create enough credit. It's trying as hard as it can, believe me, for that is what it does, but without a fractional banking system willing to lend, it's impotent.'
this is actually not true, and it is not just stocks that the Fed can buy. it can print money and buy anything with it. so far it's been treasuries and MBS, but i predict if the private sector credit contraction continues, as seems likely, it will start buying all sorts of things, officially.
the 'impotent' Fed has somehow managed to produce year-on-year AMS growth of 15% by September of this year - in spite of the private sector credit contraction.
when there is 15% more money in the economy than a year earlier, then that is not a sign that the dollar is suddenly getting scarce. it signifies the opposite.
now, if the Fed is true to its word and stops its purchases of MBS, then the money supply could potentially shrink (it has already stopped buying treasuries, although i would note it can continue to do 'coupon passes', which amounts to the same thing. base money actually continues to increase at an explosive pace - most recently at an annualized rate of nearly 100%).
in other words, were the Fed to allow market forces free rein, then we would have an actual deflation, and the dollar would indeed become scarcer.
anyone who thinks Ben Bernanke will give the market free rein , please lift your hand. what, no-one? didn't think so.
so is the dollar out of luck? not completely - the ECB inflates even faster than the Fed, believe it or not. while money AMS growth has slowed down in the US since September, it has actually accelerated in the euro-area to about 16% annualized.
i would say way too many people are still trying to pick the bottom. UUP had to register 100m. new shares with the SEC because it had hit the limit on how many shares it could issue. so there is heavy betting on a dollar rally. one day that will be correct of course, but to say that 'everyone is bearish on the dollar' is belied by such data.
there is a decisive difference between the yen and the dollar. the Japanese current account is in permanent surplus, which means that it exports capital. the US current account is in perennial deficit, i.e. it needs to import capital. whenever Japanese repatriation of capital occurs, bearish yen positions are in trouble. the yen carry trade blew up not just once, but several times (most notably in 1998), and always came back.
the dollar has repatriation-wise the exact opposite problem though. its only saving grace is that so much debt is denominated in it that during times of crisis, those who need to finance dollar liabilites can be subject to sudden cash crunches.
all that said, i eventually also expect a strong dollar rally. emphasis on 'eventually'. currency trends have the greatest inertia of all trends.
re. 'The problem with that is the Fed right now can't print enough, that is to say, it can't create enough credit. It's trying as hard as it can, believe me, for that is what it does, but without a fractional banking system willing to lend, it's impotent.'
this is actually not true, and it is not just stocks that the Fed can buy. it can print money and buy anything with it. so far it's been treasuries and MBS, but i predict if the private sector credit contraction continues, as seems likely, it will start buying all sorts of things, officially.
the 'impotent' Fed has somehow managed to produce year-on-year AMS growth of 15% by September of this year - in spite of the private sector credit contraction.
when there is 15% more money in the economy than a year earlier, then that is not a sign that the dollar is suddenly getting scarce. it signifies the opposite.
now, if the Fed is true to its word and stops its purchases of MBS, then the money supply could potentially shrink (it has already stopped buying treasuries, although i would note it can continue to do 'coupon passes', which amounts to the same thing. base money actually continues to increase at an explosive pace - most recently at an annualized rate of nearly 100%).
in other words, were the Fed to allow market forces free rein, then we would have an actual deflation, and the dollar would indeed become scarcer.
anyone who thinks Ben Bernanke will give the market free rein , please lift your hand. what, no-one? didn't think so.
so is the dollar out of luck? not completely - the ECB inflates even faster than the Fed, believe it or not. while money AMS growth has slowed down in the US since September, it has actually accelerated in the euro-area to about 16% annualized.
2009-11-06 18:51:10
Finally... finally someone gets it. How long will we have to put up with this David Copperfield market! Thanks Mr P for breaking ground. Who still believes that their are still independent investment/brokerage banks? It's all an amalgamation of Gov't, Fed and Big Trading institutions now. Grrr....be careful out there.
I'm a tech pattern trader. This whole year I been deceived by the "signs". So much so I think the recent market patterns are BS! There gunna burn the bears again.
I'm a tech pattern trader. This whole year I been deceived by the "signs". So much so I think the recent market patterns are BS! There gunna burn the bears again.
2009-11-06 22:39:19
Churn till they get you sick
We really need to get behind Congressman Ron Paul's push for an audit of the Fed! It would be interesting,to say the least, to see how "independent" it really is
2009-11-07 08:30:31
An interesting theory, but not a realistic one
The idea of using stock as collateral in a repo would certainly be an indication of desperation on the part of the Fed. But I doubt that is what is driving the market higher. The anatomy of a repo: an asset is pledged as collateral against an overnight or short-term loan. As part of that contract, the borrower agrees to buy back that asset at a slight premium to its original value. In other words, the risk that the asset deviates from the original value remains with the borrower, not the lender.
If I were Goldman Sachs (or Morgan Stanley or JP Morgan for that matter), pledging stock against a loan only makes me money if I can guarantee that the collateralized securities are higher in price when I buy them back than the price I've contractually agreed to pay. This is no sure thing. If it were, why pledge the securities as collateral at all? You could just drive up their value day after day, guaranteeing limitless profits, on paper at least. I could maybe see the Fed accepting stock as collateral at the worst point of the credit crunch when liquidity was tightest, but not now. Goldman's outsized profits are coming from fixed income trading on their prop desk. Spreads are wide and dollar volume is much larger than in equities. No dark conspiracy involved.
If I were Goldman Sachs (or Morgan Stanley or JP Morgan for that matter), pledging stock against a loan only makes me money if I can guarantee that the collateralized securities are higher in price when I buy them back than the price I've contractually agreed to pay. This is no sure thing. If it were, why pledge the securities as collateral at all? You could just drive up their value day after day, guaranteeing limitless profits, on paper at least. I could maybe see the Fed accepting stock as collateral at the worst point of the credit crunch when liquidity was tightest, but not now. Goldman's outsized profits are coming from fixed income trading on their prop desk. Spreads are wide and dollar volume is much larger than in equities. No dark conspiracy involved.
2009-11-07 11:22:10
Car Crash vs. Cancer
Thanks to Mr. Practical. Todd uses the analogy that the Fed sold the the car crash and bought the cancer. Instead of treating it with chemo they seem to be using medical marijuana. Surely someone in our Government must notice the number and (increasing size) of the weekly bank failures, the rise in the number of unemployed, the huge unbalance in our "budget" and the fact that we have two horrific wars going on. Its been my experience that many cancer patients can go quickly once the disease progresses to a certain point. Doesn't seem to have much correlation as to how stoned one might be at the time either.
- DRH
- DRH
2009-11-07 19:07:15
Thanks Mr. P for your article. I understand the broken fractional banking situation and hence your vacation in the US and being long USD assets. Could you please shed some light on your time horizon and asset mix as I think it would be of interest to Minyans. I'm not asking for investment advice but I'm rather curious because other than cash or short duration Treasuries, I can't "see" any low risk USD assets that wouldn't drop in value if the USD rose.
Also, any thoughts on Japan/Yen since you decided to (temporarily?) leave. With Debt-to-GDP approaching 200%, declining savings rates, aging population, failed reflation(s)- are they worse off then the US? Or, are better because they are further along the path of debt destruction?
Also, any thoughts on Japan/Yen since you decided to (temporarily?) leave. With Debt-to-GDP approaching 200%, declining savings rates, aging population, failed reflation(s)- are they worse off then the US? Or, are better because they are further along the path of debt destruction?
2009-11-08 14:45:50
My Two Cents
Mr. P,
For me it will be interesting to plot the debt/GDP ratio, as this thing unfolds.
Right now we have the personal/corporate decreasing, while Uncle Ben is desperately increasing gov. to still ramp the total higher.
I personally think the personal/corporate component can not again be increased as baby boomers now need to save for retirement (not to mention the market crashes effect on the wealth effect). So we are on the Japanese path.
Maybe you can convince Mish or Ron Colby to keep track of this metric?
My thoughts (long-term): The credit in the system must be reduced as peak oil (2011,13,15)? will cause a further reduction in GDP (up to 1/3), and a reduction in the standard of living due to higher costs for essentials produced and transported by oil. But these kinds of predictions are difficult to make.
we shall see about peak oil.
Medium Term: The wrestling match between Mr. Market and Uncle Ben continues. Mr. Market wants deflation, Uncle Ben doesn't understand this is a debt crisis, so he tries to reflate.
Net result is the Japanese experience with periods of weak growth and recession.
Short term: Never seem a more manipulated market, which is further from fundamentals (as you discuss in your article). I guess every trading trick Toddo has discussed should be applied, just for wealth preservation.
My two cents.
For me it will be interesting to plot the debt/GDP ratio, as this thing unfolds.
Right now we have the personal/corporate decreasing, while Uncle Ben is desperately increasing gov. to still ramp the total higher.
I personally think the personal/corporate component can not again be increased as baby boomers now need to save for retirement (not to mention the market crashes effect on the wealth effect). So we are on the Japanese path.
Maybe you can convince Mish or Ron Colby to keep track of this metric?
My thoughts (long-term): The credit in the system must be reduced as peak oil (2011,13,15)? will cause a further reduction in GDP (up to 1/3), and a reduction in the standard of living due to higher costs for essentials produced and transported by oil. But these kinds of predictions are difficult to make.
we shall see about peak oil.
Medium Term: The wrestling match between Mr. Market and Uncle Ben continues. Mr. Market wants deflation, Uncle Ben doesn't understand this is a debt crisis, so he tries to reflate.
Net result is the Japanese experience with periods of weak growth and recession.
Short term: Never seem a more manipulated market, which is further from fundamentals (as you discuss in your article). I guess every trading trick Toddo has discussed should be applied, just for wealth preservation.
My two cents.
2009-11-08 20:28:04
My Two Cents
I am astounded by this site. As far as I can tell, its only purpose is to be a nattering nabobs of negativism with the obvious purpose of doing everything possible to sabotage economic recovery. The articles are amazingly and consistently wrong.
The entire economic recovery is being weighed down by those who would do almost anything to work against it, because of political demagoguery.
However, I have supreme confidence that the nattering negative, Foxist, Teabagging, fear mongering and selfish nabobs will come around...as soon as their greed makes them unable to join in and enrich themselves from the recovery.
When that greed takes control, that will be the point at which there will be a huge (even perhaps over-inflated) jump in the markets.
Look for it to happen.
By the way, I absolutely can't figure out why Minyanville is included as a "financial news source" at Yahoo financial. I can only figure out that it is because Minyanville has purchased substantial amounts of advertising from Yahoo.
I assure you that I am doing everything possible to register my outrage with Yahoo, and I encourage everyone who believes that news (financial or otherwise) should be objective, unbiased, and without ulterior motives) to join me and protest Minyanville's presence on Yahoo's financial news sources.
The entire economic recovery is being weighed down by those who would do almost anything to work against it, because of political demagoguery.
However, I have supreme confidence that the nattering negative, Foxist, Teabagging, fear mongering and selfish nabobs will come around...as soon as their greed makes them unable to join in and enrich themselves from the recovery.
When that greed takes control, that will be the point at which there will be a huge (even perhaps over-inflated) jump in the markets.
Look for it to happen.
By the way, I absolutely can't figure out why Minyanville is included as a "financial news source" at Yahoo financial. I can only figure out that it is because Minyanville has purchased substantial amounts of advertising from Yahoo.
I assure you that I am doing everything possible to register my outrage with Yahoo, and I encourage everyone who believes that news (financial or otherwise) should be objective, unbiased, and without ulterior motives) to join me and protest Minyanville's presence on Yahoo's financial news sources.
2009-11-09 13:35:50
My Two Cents
Randy,
I would suggest reading Mishs' article (Nov 9th), "What Is Inflation and How Does One Measure It?"
at: http://globaleconomicanalysis.blogspot.com/
You can decide if there is too much negativity, or if it is that we are living through profound times.
Best Of Luck
I would suggest reading Mishs' article (Nov 9th), "What Is Inflation and How Does One Measure It?"
at: http://globaleconomicanalysis.blogspot.com/
You can decide if there is too much negativity, or if it is that we are living through profound times.
Best Of Luck
2009-11-09 18:58:04
Biased Political Contro by Minyanville
I am astounded by this site. As far as I can tell, its only purpose is to be a nattering nabobs of negativism with the obvious purpose of doing everything possible to sabotage economic recovery. The articles are amazingly and consistently wrong.
The entire economic recovery is being weighed down by those who would do almost anything to work against it, because of political demagoguery.
However, I have supreme confidence that the nattering negative, Foxist, Teabagging, fear mongering and selfish nabobs will come around...as soon as their greed makes them unable to join in and enrich themselves from the recovery.
When that greed takes control, that will be the point at which there will be a huge (even perhaps over-inflated) jump in the markets.
Look for it to happen.
By the way, I absolutely can't figure out why Minyanville is included as a "financial news source" at Yahoo financial. I can only figure out that it is because Minyanville has purchased substantial amounts of advertising from Yahoo.
I assure you that I am doing everything possible to register my outrage with Yahoo, and I encourage everyone who believes that news (financial or otherwise) should be objective, unbiased, and without ulterior motives) to join me and protest Minyanville's presence on Yahoo's financial news sources.
The entire economic recovery is being weighed down by those who would do almost anything to work against it, because of political demagoguery.
However, I have supreme confidence that the nattering negative, Foxist, Teabagging, fear mongering and selfish nabobs will come around...as soon as their greed makes them unable to join in and enrich themselves from the recovery.
When that greed takes control, that will be the point at which there will be a huge (even perhaps over-inflated) jump in the markets.
Look for it to happen.
By the way, I absolutely can't figure out why Minyanville is included as a "financial news source" at Yahoo financial. I can only figure out that it is because Minyanville has purchased substantial amounts of advertising from Yahoo.
I assure you that I am doing everything possible to register my outrage with Yahoo, and I encourage everyone who believes that news (financial or otherwise) should be objective, unbiased, and without ulterior motives) to join me and protest Minyanville's presence on Yahoo's financial news sources.
2009-11-09 19:00:40
My Two Cents
Sorry,
This was my first post. I was not referring to any individual posters, but to this outrageous, politically motivated site. I posted my message as a comment, and again did not mean to single out any other poster.
This was my first post. I was not referring to any individual posters, but to this outrageous, politically motivated site. I posted my message as a comment, and again did not mean to single out any other poster.
2009-11-10 07:20:42
Biased Political Contro by Minyanville
"I assure you that I am doing everything possible to register my outrage with Yahoo, and I encourage everyone who believes that news (financial or otherwise) should be objective, unbiased, and without ulterior motives) to join me and protest Minyanville's presence on Yahoo's financial news sources."
Ugh! Publishing the truth is not an objective of any media. NO, it's not, never. Truth is boring, truth doesn't sell, truth doesn't entertain, truth doesn't further agendas. Minyanville doesn't tell you to believe what it publishes, it tells you to see both sides and make up your mind. For your own sanity, please stop longing to believe other's opinions, see through the distortions, opinions and not so subtle biases and strive to form opinions of truth for yourself. Yes, I said opinions of truth, crazy, I realize that, but no more crazy than believing that Bush's truth is any better or worse than Obama's truth.
There has never been, nor never will be "unbiased, objective" news. EVERYONE has an opinion and ulterior motive. Accept the fact that there are three sides to every story; your side, their side and the truth. Truth is invariably distorted by our reactions to it. Hear all sides and decide for yourself which you believe and how you should act, but don't give up your freewill to decide for yourself in the vain hope that everyone / someone / anyone will tell you the truth.
Ugh! Publishing the truth is not an objective of any media. NO, it's not, never. Truth is boring, truth doesn't sell, truth doesn't entertain, truth doesn't further agendas. Minyanville doesn't tell you to believe what it publishes, it tells you to see both sides and make up your mind. For your own sanity, please stop longing to believe other's opinions, see through the distortions, opinions and not so subtle biases and strive to form opinions of truth for yourself. Yes, I said opinions of truth, crazy, I realize that, but no more crazy than believing that Bush's truth is any better or worse than Obama's truth.
There has never been, nor never will be "unbiased, objective" news. EVERYONE has an opinion and ulterior motive. Accept the fact that there are three sides to every story; your side, their side and the truth. Truth is invariably distorted by our reactions to it. Hear all sides and decide for yourself which you believe and how you should act, but don't give up your freewill to decide for yourself in the vain hope that everyone / someone / anyone will tell you the truth.
2009-11-10 09:56:08
Biased Political Contro by Minyanville
That is a very cynical view. Of course no medium is absolutely true. Nothing is. However, the point is that Minyanville does not even attempt to be objective. Minyanville clearly has ulterior political motives. For that reason it should not be cited on Yahoo.
To suggest that, because every medium is not absolutely truthful, they are equally worthy of consideration is irrational and just a rationalization of the kinds of blindness that make Teabaggers think that Rush and Beck are telling some sort of truth.
To suggest that, because every medium is not absolutely truthful, they are equally worthy of consideration is irrational and just a rationalization of the kinds of blindness that make Teabaggers think that Rush and Beck are telling some sort of truth.
2009-11-10 13:19:56
Biased Political Contro by Minyanville
Cynical? Maybe. Objectivity is in the eyes of the reader - depending upon whether you agree with the views expressed or not. Yahoo and Minyanville want eyeballs and could care less about objectivity - some writers feel a need to publish their truth more forcefully. The blindness you reference is just as irrational and prevalent when instigated by various liberal commentators. On both fronts, by being aware that all outlets are biased to one extent or another, we are free to make a determination about whose version of the truth to believe. Failure to see and accept that fact is a contradiction to your statement that no medium is absolutely true. Ultimately, just because we choose to believe something, doesn't make it the truth and certainly doesn't mean that others should not be able to express their version of the truth. If the truth were easy to recognize - we wouldn't be divided as a country right down the middle - maybe they do it to us on purpose?
2009-11-11 19:49:55
Economics requires bias, hopefully based on reason
With all due respect, one can not make an economic analysis without a political bias. People buy, spend, and save, within the rules made and enforced by governments. Our individual opinion about these government rules, i.e. laws, forms our “political bias”. In order to think about economic issues, one generally takes the facts and forms a model from them. Then one tests that model, searching to understand events and predict the future, in order to individually survive and prosper, and perhaps to suggest improvements to the laws that govern our world.
Thus, a criticism of political bias is misplaced as all economic analysis has a goal of suggesting improvements to the system being analyzed, i.e. a political bias. Rather, the more appropriate criticism would be a reasoned disagreement with the facts selected, their meaning and significance, or the suggested individual acts or rule changes.
The Federal Reserve has chosen not to disclose much of its dealings with private financial players. We (or at least I) do not know who is receiving funds and under what conditions, or what collateral the Fed has accepted. Therefore, I believe it quite appropriate to investigate and speculate as to what Fed is doing. What else can one do in that regard?
Every investor on the planet knows that the USD carry trade is feeding the world stock market rise. Even the IMF has publicly stated this. Stock prices and the USD have moved in clear inverse relationship since the US matched Japan's “zero” interest rate. In other words, the US is provided cheap funding for the stock and commodity rally. We do not know the exact mechanism for this, yet, it appears clear that low overnight loans by the Fed at close to zero interest are showing up as stock and commodity purchases in South Africa, Australia, and India and even in the US.
Mr. Practical has suggested one possible mechanism for this. If you believe that there is a different mechanism then please articulate your theory, and we can consider it. Thank you. Bill.
Thus, a criticism of political bias is misplaced as all economic analysis has a goal of suggesting improvements to the system being analyzed, i.e. a political bias. Rather, the more appropriate criticism would be a reasoned disagreement with the facts selected, their meaning and significance, or the suggested individual acts or rule changes.
The Federal Reserve has chosen not to disclose much of its dealings with private financial players. We (or at least I) do not know who is receiving funds and under what conditions, or what collateral the Fed has accepted. Therefore, I believe it quite appropriate to investigate and speculate as to what Fed is doing. What else can one do in that regard?
Every investor on the planet knows that the USD carry trade is feeding the world stock market rise. Even the IMF has publicly stated this. Stock prices and the USD have moved in clear inverse relationship since the US matched Japan's “zero” interest rate. In other words, the US is provided cheap funding for the stock and commodity rally. We do not know the exact mechanism for this, yet, it appears clear that low overnight loans by the Fed at close to zero interest are showing up as stock and commodity purchases in South Africa, Australia, and India and even in the US.
Mr. Practical has suggested one possible mechanism for this. If you believe that there is a different mechanism then please articulate your theory, and we can consider it. Thank you. Bill.
2009-11-12 08:27:42
a few comments
Pater, I always learn from your comments and appreciate them, although I usually disagree with you. The market will seize the "reins" from Bernanke. Among the lessons of the next Crash will be that the FED really is impotent against the Marketplace, an idea any Capitalist SHOULD embrace.
2009-11-12 08:40:40
The Market ain't "right"
I just read this on REPOs, and it confirms conclusion I"ve been coming to myself- That for National Security reasons, and with the President's and Intelligence agency involvement,
they have convinced themselves that the Public will panic if they became aware that ALL the money center banks are insolvent and that the most efficient use of a few trillion is to prop up the headline Stock averages (while the economy disintegrates beneath us). They (wrongly) believe that TIME will bail them out, or simply want to set up a nice exit point for the fasicstly connected.
I spent ten years watching prices on a trading floor and never saw a market trade like this.
Something is "off".
they have convinced themselves that the Public will panic if they became aware that ALL the money center banks are insolvent and that the most efficient use of a few trillion is to prop up the headline Stock averages (while the economy disintegrates beneath us). They (wrongly) believe that TIME will bail them out, or simply want to set up a nice exit point for the fasicstly connected.
I spent ten years watching prices on a trading floor and never saw a market trade like this.
Something is "off".
2009-11-12 08:50:58
My Two Cents
Your anger would be better directed at the delusional optimists who inflate credit bubbles rather than those who contemplate the results of that activity. The largest credit bubble in history is resulting in the largest crash. Your energies would best be directed at preparing for a New Great Depression, and the work that will be needed to dig our way out from the follies of the Failed Elites.
Join us in reality.
Join us in reality.
2010-01-07 03:38:44
The market is "fixed"
The market has always been fixed by the largest players.Now the government has control of the smoked filled room with mirrors. There is no painless way out,no magic bullet , we can't get back to any kind of normal until we restore trust .Bullish or bearish , does anyone actually have faith and trust the gov't?
2010-02-02 22:29:51
Mr. Practical
Does anyone know if he's still writing on this site? I miss his work.
Get real-time options trading ideas from Steve Smith, veteran options trader and newsletter author, plus let him show you the way to cut risk and boost your returns through the strategic use of options. Click here for a free 14 day trial to OptionSmith by Steve Smith.
Copyright 2009 Minyanville Media, Inc. All Rights Reserved
