24 SEP 2010, Friday

• Hasn't been much to say recently as the market is not moving in a normal ebb and flow manner.  More like it's just being pushed, held and pushed again.  Most of the push is happening while you are asleep via the after hours stock index futures and overseas markets.  (You can check the charts via the sidebar...put the SPY or QQQQ in the daily chart and you'll see the overnight gaps.)

• Above, history of Quantitative Easing overlaid on the SP500...click chart to enlarge (as always).  Can "Buh...Buh...Buh...Bennie and da Feds" buy a stock market rally?  Hmmm...chart seems to indicate they can. 
• Currently, the POMO is going and as the market approaches resistance areas...it jumps them during the low volume after hours timeframe.  Uncanny....reminiscent of the MAR 09 launch and also the MAR-APR 10 pump.  This is very frustrating...but it is exactly how Goldman Sachs was generating those "no losing day streaks" that just aren't possible...unless of course, you ARE the market?
• Fed-Man is saving the day!  Fed POMO cash injected into the Broker/Dealers and just the threat of a potential Quantitative Easing II (QE2) has forced most bears to the sidelines or convert to trading upside action.
• My only question is if QE1 hasn't really worked, why don't we try something different instead of going to re-visit....    

• All this is doing is reducing the purchasing power of your dollar!  This has the greatest negative impact on the middle class and poor.  Yup, they lose purchasing power while the value of property, stocks and materials are propped up.  And we still have not investigated, prosecuted and sentenced the fraudsters that created the biggest collapse since the Depression.  Unbelievable...absolutely, un-forking-believable!!!  Blasted rats are still running freely about on our ship of state and in the canyons of Wall Street.  Sad...just sad.  And us everyday average Shmoes are the ones paying for it.  Most of the time, I steer clear of the class warfare thing....but can you describe this as anything else?  When I see some perp walks, orange jumpsuits, hand cuffs and leg irons on those responsible...then I will be able to step back from that charge.  I'm still hopeful that the wheels of Justice remain...even if they are grinding agonizingly slow in this instance.
• I don't know about you, but I'd prefer the deflation route where values come down but the purchasing power of the dollar is maintained.  Prefer not using the old buck for wallpaper, toilet paper or for heat from a fire.  Sheesh!

• I still think we're going to get the deflation first....just my opinion.  The pumping has bought time but I think they're just about out of time and the debt deflation will come as nothing has been fixed.  Instead it's all been papered over.
• Another thing to consider...What if Super Ben is just jawboning QE2 for effect???  What if he's already taken way too much on the Fed's balance sheet and is instead looking for a way to lighten up.  What happens when Super Ben and Da Boyz stop propping the stock market?  Just some questions I ask myself. 
• Time will tell.