Is something up in the financial markets.....

...maybe we should be watching the Wall Street openings tomorrow according to this article.

<More: graphs and good stuff>

http://www.safehaven.com/article-1597.htm

The Dow Jones Industrial Average rose 221.71 points this week, in line with the direction of our expectations - but a larger, earlier move - as our Short-term TII came in last week at positive 22.00.

Let me just say from the outset that the Federal Reserve has confirmed our Stock Market Crash forecast by raising the Money Supply (M-3) by crisis proportions, up another 46.8 billion this past week. What awful calamity do they see? Something is up. This is unprecedented, unheard-of pre-catastrophe M-3 expansion. M-3 is up an amount that we've never seen before without a crisis - $155 billion over the past 4 weeks, a $2.0 trillion annualized pace, a 22.2 percent annualized rate of growth!!! There must be a crisis of historic proportions coming, and the Federal Reserve Bank of the United States is making sure that there is enough liquidity in place to protect our nation's fragile financial system. The amazing thing is, the Fed's actions mean they know what is about to happen. They are aware of a terrible, horrific imminent event. What could it be?

One can draw no other conclusion except that the Fed is acting irresponsibly in its managing the money supply, in fulfilling its duty to "maintain a stable currency." I reject the notion that the Fed is acting irresponsibly. No, something is up, bigger than we have ever seen in the history of the United States. Let me ramble. Perhaps they simply see the ominous technical landscape we have been warning about in recent issues, and are attempting to pull out all the stops to avert the predicted crash. The recent rally in just about everything is similar to 2003's market behavior when the Fed pumped massive amounts of liquidity into the system during the first half of the year. This time seems different. The amount of liquidity is too large. The Fed is deflating the value of the monetary base by a fifth! Why are they willing to do this? Wisdom says something bad is up - big time.

<snip>

Bottom Line:

The Federal Reserve, contrary to our oftentimes cynical commentary, is not going to inflate the Money Supply 22 percent simply to get Dubya reelected. That sort of M-3 rise creates substantial financial risks that don't justify its necessity. No, something horrific is on the horizon - and soon. Perhaps the Open Market Committee was treated to a preview of The Day After Tomorrow - and they believed it! I don't want to be an alarmist, but I am reporting what I see. Like in the movie, it may be time for prayer. The Master Planners' prayer is that all markets float higher on the rising tide of swelling money and that the coming catastrophe be mitigated or delayed. Should they be successful in extending the Bubbles, greater imbalances emerge and the ultimate market event will be worse than if now. Defensive strategies are warranted.

"But be sure of this, that if the head of the house
had known at what time of the night the thief was coming,
he would have been on the alert and would not
have allowed his house to be broken into."
Matthew 24:43

That's what it mean!!

....or will it be something major in the way of a natural catastrophy, or will it be something externally driven that will create a major financial crisis?

My thoughts:

1. A crash brought on by the fact that stock values are at least 20% higher than they should be?

2. A research group at UCLA is predicting a 6.4+ earthquake on the West Coast, probably in southern California. The hurricane experts are calling for 29 storms this season, any one of which could go major and devastate some major metropolitan area along the East Coast. Either coast would be bad...but both?

3. A "terrorist" act on American soil that will far exceed the toll of 911?

4. All of the above?

Any ideas? What are your thoughts?

the market has been overvalued for as long as I can remember

I don't believe the terrorist threat, Bush admin is behaving too strangely for that to be real (unless you believe Bush will cause the next terrorist threat, which I do not)

I don't think the Fed would move based on the possibility of a natural calamity (earthquate, hurricane)

I think it has to be financial. Jobs report? instability in some foreign source (oil? which countries own the most US stock? How stable are the economies of those countries? the dollar gonna take another dive?

What do I know?

nada

the market has been overvalued for as long as I can remember


Not you alone, but just about everyone under 50. Keep in mind that the last bear market ended in October of 1974. That's thirty years ago...so if a person was just getting interested in the market at age 20, they would be 50 today.

As recently as the early eighties, you could by Exxon stock and the dividend was 10%. The book value was equal to the stock price!

But markets revert to the mean - always. We have a considerable amount of reversion ahead of us.

Time the market(s).
However, the US market is an accident waiting to happen. The deficit is nowhere to be commented on.
The country needs hundreds of millions each day to pay for the imbalance on trade. It can go on for a long time but when it turns, it will turn very sharply and methodically. But don't count on the turn happening at any one time or being able to have a heads up.

Which would be...? I mean, what????

Worst case, gold. Bad but not worst, insured bank and credit union deposits, money market funds, U.S. treasury bills, and maybe some gold stocks. Sorta bad, add some good stocks with dividends, high grade bonds, and maybe some oil stocks.

I'd avoid the high-tech stocks with high PE ratios. Like cancer, I'd avoid those.

(Quoted from the article)

My guess...purely a guess...is that the powers that be can see the Saudi fields coming under increasing terrorist threat. If the oil flow is interrupted, all bets are off.

China and India are using more oil, as is Europe and the U.S. If the flow is substantially diminished, the whole world's economy is in deep trouble.

Imagine 25% unemployment in the U.S. Imagine China facing internal revolt and considering the possibility of a foreign adventure.

Let's hope I'm wrong.

Things are getting better... not worse. Sorry chickenlittle... the sky is not falling, IMO. ;)

http://story.news.yahoo.com/news?tmpl=story&cid=1538&e=8&u=/afp/britain_saudi_attack

Terrorists plan "spectacular attack" in Saudi Arabia: report

LONDON (AFP) - Intelligence agencies fear that the Islamic terrorists behind the deadly kidnappings in Saudi Arabia over the weekend are planning a "spectacular attack" in the country, The Times of London reported.
(snip)


A major interruption in Saudi Arabia's oil supplies would be just such a calamity it seems to me.


on edit:

Also found this interesting from the original poster's article:

<<There was only one other time we saw this level of M-3 growth over a six week period in the history of the United States, and that was AFTER 9/11/01.>>

The Fed,...,is not going to inflate the Money Supply 22 percent simply to get Dubya reelected.

Wanna bet? That is exactly why they've been doing it. Most of the other points are correct about the consequences of this irresponsible behavior. But, the reason is not something mysterious: it's to get Dumbya votes.

Don't forget the the right will do anything now to keep and consolidate power. They'll worry about the fallout after the election.

the fed and fiat money have doomed us

and so many criminal acts hidden by the National Security Act of 1947.

I love the smell of a fish rotting from the head down in the morning.

:freak:
dbt

There have been a lot of dire, apocalpytic warnings in the alternative financial press. They haven't panned out yet. IF a Big Bang is indeed on the way, I only hope it's before the election.

We learned from 9/11 the importance of watching the markets for unusual activity. This is important stuff.

Let's also note the unprecedented deployment of fleets on a massive, simultaneous scale:

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=104&topic_id=1685819

Something big is coming soon, and some people know what it is.

ALL seven major aircraft carriers are going to be deployed simultaneously for months. This is not top secret as it was in the Navy Times.

Oh yeah, there are preparations being made. I also see- now that it very late in the game- that testing is being down to simulate what terrorists might do to stolen plutonium bombs, Russia is cooperating(finally)in seeking out those darn WMD's(non-Iraqi this time), that Libya(who has done penance and confession and is now a "pal") has said Ooops, we are missing nuke material don't blame us, NK saying the same. So who WILL take the fall this time?

It just seems at times we are being led right into it, but nobody is wondering why this charade has no explanation, no rules except- expect the worst if you can read between the lines.

Some business scuttlebutt I get very third hand you won't hear on TV is that one major terror attack and the market sinks again big. They also blame everything on Bush, something else you won't see much of on the loyal media.

If it isn't headline mainstream news we're not supposed to notice. Should we act surprised? Or relieved if we are still around to act at all?