Friday, April 3, 2009

Evening Thoughts And Question Of The Day

The market runs unabated... fundamentals have long ceased to matter, and technicals and momentum have taken over... all is based on the printing presses in Geithner's basement stuffing those duffel bags with brand new, sequential dollar bills... investors are searching for fool's gold: credit markets are improving due to the guarantees behind improvements in credit markets, not due to a reduction in risk... the government's intervention is now distorting asset prices across all categories... sovereign CDS widening represents the shift of credit risk from private investors to taxpayers... the pulling of governmental guarantees would be akin to an earthquake just as the house of cards is getting higher and higher... and the political risk tornado will destroy whatever it is the earthquake leaves.

In the meantime - question of the evening: who said these words?
"The government calmly goes on printing these scraps of paper, because, if it stopped, that would be the end of the government. Because once the printing presses stopped - and that is the prerequisite for the stabilization of the currency - the swindle would at once be brought to light. Believe me, our misery will increase. The scoundrel will get by. The reason: because the State itself has become the biggest swindler and crook. A robbers' state! If the horrified people notice that they can starve on billions, they must arrive at this conclusion: we will no longer submit to a State which is built on the swindling idea of the majority. We want a dictatorship."
Is the U.S. facing the same dilemma? Sphere: Related Content
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26 comments:

getyourselfconnected said...

Words by Adolph Hitler.

I agree macro on the dollar, I mean what else can happen to even out our ridiculous debt load but to devalue the dollar? Still the tipping point was "stick saved" over the last 8 days so we have to wait, probably till next fall for another run at reality.

getyourselfconnected said...

PS,
Great blog!

James said...

Its really amazing. How can anyone not expect this thing to collapse again? we still havent learned our lesson

MLM said...

Tyler, you're seriously bumming my Friday night high. "Whoa, wait, this is crazy. You want me to hit you?"

qadi said...

You still short CRE, or did you retreat in the face of global QE?

maximus said...

TD

Hope your readers have been following my blog as well....

I have been on this for quite some time....all the key elements are there....but the parallels go back much further into history, Ancient Rome is providing every bit of the "political technicals" roadmap for our future that the historical stock charts are that lay out the stock technicals....

The big question remains the in the fortitude of the masses....thus far we are doing exactly what they want us to do....

I can't compete with the incredible data and analysis you provide, so I will not try....

I can, however, continue to provide historical context for what we face and lay out the truth for readers in the hopes that this time can truly be different....

Once again thanks for all you do....

Maximus
http://4best4worst.wordpress.com/

getyourselfconnected said...

If any are bummed out, try out friday night rock blogging at my site, always a strange mix of tunes.

Anonymous said...

Who said it?

I don't know and I don't care it's rally time baby!

666 Generational low!

http://www.rallymonkey.com/oldvideo.php

Rally Monkey

John Williams MD said...

Tyler: Great posts as usual and frequent, but I'm sure I don't have to tell you not to fight the tape. I AGREE--never again will I hold anything but gold Eagles and Krugerrands, and silver dollars "for the long run," but I think this one has been "stick saved" for a while longer. The eventual price, though, will be oh, so much higher.

But like some kind of a riddle, Mr. Market gives us more than one chance to save ourselves, and we just made it through the second. Who will be ready for the third....

getyourselfconnected said...

oh yes the "stick saved" mantra! Luv it!

Anonymous said...

And just in case the Rally Monkey doesn't work for you you can check this out.

http://www.gold-eagle.com/editorials_01/seymour062001.html

It might be nice to start a chart like that for this decline..

John said...

You know though despite massive attempts to devalue the dollar, the race/pace at which foreign countries are doing it is far greater. I think the initial repatriation of dollars and the yen carry trade undwinding accelerated the strengthining process. The problem of course is a severe shortage of cash to pay off debts and every single default will result in another round of deleveraging. All of this is highly deflationary sort of the opposite of the German experience.

Heck even when Treasury and Fed announced programs to spend 2 trillion dollars (combined) within a week of each other, the dollar fell 5% and started to rebound right away. There's a lot of truth to the saying 'the dollar is the worst currency in the world, except for every other one.'

Whether we like it or not that is the case; find another currency that has risen in the past year and stayed up. The yen is getting the crap kicked out of it as Japan continues to slide.

Also as a sidenote, you had a great write up about a rally fizzle, I think the idea may be more of black-swan laden event. Everyone knows about AIG, or GM, or CRE blow ups on the horizon, or weaker earnings. I think it may be a scenario where downgraded bonds are forced into the marketplace. Lots of pension funds, govt slushes, mutual funds etc. can't hold paper unless it's IG, what would happen if two or three big names were downgraded? That may be the trigger that sets off the next wave down.

fredw said...

That would be Adolf Hitler ....

ts said...

godwin?

eh said...

It is what it is. Market action is a bit painful if you are short. To say the least. Most surprising is the strength of REITs. Why in the world would anyone pay a premium for KIM? Reminds me of last spring when e.g. the homebuilders went to the moon. Market makers and other insiders may be coordinating a short squeeze in vulnerable sectors. I had the same feeling last year.

Personally I'm using the rally to sell some well-in-the-money calls on positions I'd like to exit.

Anonymous said...

When Hitler's speeches sound reasonable and applicable, there's something so wrong with the country that it send shivers up my spine.

Great site; keep up the superb flow of information!

Julian said...

...eerr, yes - the US is facing a dilemma.

so instead of being apart of dilemma land, come to australia - the view is better from down under folks.

Anonymous said...

This is an amazing blog. Keep it up Zero Hedge!

Bagsnatcher said...

I too want to praise TD and this wonderful blog. I just recently stumbled upon it and now I'm hooked. thanks my friend.

My take on this (being from Europe) is that I think Geitner &Co are "Jedi-mind-tricking" the whole market:

"These are not the bonds you're looking for"
"The value of these assets are much much higher"
"You can carry on buying"

maxx said...

"I think Geitner &Co are "Jedi-mind-tricking" the whole market"

The market/the world are "Jedi-mind-tricking" themselves - because reality is too grim to face.

Every government is bankrupt, except for their printing press, and they have NO flexibilty to deal with any changes in circumstances (political instability, war).

And the special interest groups (from Big Agriculture to public sector unions to Citi to your local ear mark king and on and on) is willing to give up their piece of the bankrupt pie.

And Congress views its only mission as being to serve their rent-seeking.

And except for a few rays of light like this excellent blog, the msm contines to provide them all cover.

Anonymous said...

Tyler, I love your blog and i follow it hourly. just make sure not to fall into a "bear trap" of being ultra negative all the time. The market is what it is, dont let your views overwhelm reality. Keep up the good work though, this is a top 5 financial blog in the world.

Anonymous said...

Hitler was speaking about a proud and intelligent people, we the sheeple will continue to take it up the ass thank you very much.. USA USA USA... if all else fails we'll start a war with the russians.

john bougearel said...

yez the market runs unabated and fundamentals, technicals and momentum have nothing to do with it.

It runs unabated because the banksters have no need to be hedged short into Q1 earnings season, as they have eliminated the risks of further writedowns for now.

Once past that timeline, the risk of chyrslers bankruptcy at end of April will rise to the foreground.

Offsetting Chyrslers demise will be tiny Timmie's PPIP implementation in May, just in front of GM's June 1 bankruptcy. How successful Timmie's program goes is dubious at best. Either way, by the time GM's BK takes center stage, you can bet your bippy we will have a big mess on our hands, and further that the markets will focus on what a shitty economy it is after all, and there isn't anything Treasury or the admin or the Fed or FDIC can do about it. Then the fundies will matter, and momentum on the downside will regain traction.

Anonymous said...

Love the blog - thanks for the great commentary!

DH said...

If Geithner et al think that their little PPIP (Pimpin' Pimco Investment Plan?) is "gonna save the world" they run the risk of being sorely mistaken. Frankly it's more like the Mayor calling Bill Murray in Ghostbusters. These clowns don't even have a Plan A, never mind a Plan B. They are just clenching their butts and hoping for the best.

Anonymous said...

Sovereign CDS for sale, the latter half of the week, following G20...so we'll see...