Friday, February 4, 2011

Everything's Just Peachy....NOT!!!

Bondzilla(10 year):

Quick Take:

This is what the bond market thought of today's jobs number. 

Translation:  The recovery is a sham and every month that goes by where we see zero to little job creation puts more and more pressure on our government's ability to pay off it's deficits.

The reason for this is simple:  Without jobs there is no tax base.  Without a tax base the government cannot raise revenue.  Without revenue the government can't pay their bills.  When they can't afford to pay their bills they lose their ability to buy treasuries unless they print more money.  When they print money it devalues our currency and increases the risk of inflation.

The Bottom Line

This is not rocket science folks.  We are spending money that we don't have.  Stockman explains the numbers in the video below.  We are spending more than we bring in.

This is mathematically impossible to sustain without destroying the currency.  The fact that stocks don't understand this is mind boggling to me. 

SAdly, millions of people are going to get their 401k's shoved up their ass for a third time in a decade when the stock market eventually wakes up and starts calculating the numbers. 

The robots rule equities for now but this also can't last.  I am hearing more and stories around how some of the  the trading algos are starting to lose money.  The trading desks on Wall St had a terrible 4th quarter from an earnings perspective when you look at their quarterly reports.

Why is this happening?  Because the market no longer trades rationally.  It trades based on zero fundamentals.  At this point it basically trades based on positions that are held for seconds at a time.

IMO:  The problem the robots have right now is there is no accurate way to program their trading algos at this point because the market trades so inconsistently.   There seems to be no rhyme or reason in which it moves.  It often goes up on bad news days and trades down on good news days.

How in the hell can you program anything based on such nonsense?  I predict that you will see a drop off in algo based trading if the market continues to trade so erratically. 

One More Rant Before I Roll 

I started getting really angry today after watching yesterday's Bernanke speech a few times on the internet. 

This dude needs to seriously take his foot off the easy money gas pedal.
The Fed is creating political instability throughout the world with their disgusting policy of printing money.  

When I saw the bad jobs print this morning I immediately asked myself this question:


How many bad unemployment numbers do they need to see before they wake the hell up!!!! How many countries have to implode before they realize that their policies are creating destruction all throughout the globe?

Grrrrr......This is all getting so infuriating to watch. 

Well...I'm off for some cocktails.  Numbing my mind with booze is the only thing that keeps me sane at this point.

Happy Friday and GO STEELERS!!!!!!


getyourselfconnected said...

I am flat out of Bernanke jabs, a first for me. This guy is now dangerous.

Maybe you mean this peach, time lapse gif so let it load:

Jeff said...


Nice Pic.

Go Stillers

Anonymous said...

Well done! Great post!

Jeff said...

Thanks Hansi!