Dow Hits 10k as Bailed Out Banks Announce Huge Profits and Bonuses
Stock-Markets / Financial Markets 2009 Oct 18, 2009 - 01:12 AMBy: Nadeem_Walayat
Goldman Sachs lived up to expectations of huge profits and "two fingers up to the tax payer" bonuses (no it does not mean V for victory) as a consequence of the funneling of billions of U.S. tax payer cash onto their balance sheet and huge profit margins in the artificial tax payer funded banking system that squeezes retail customers and rewards failure which is not so surprising since the central banks remain firmly at the centre of the parasitic banking sector.
In the UK the public sector is rebelling in ever increasing numbers and this is BEFORE deep public sector workforce cuts of 10% have even been enacted which sows the seeds of severe political and economic turmoil in Britain post the 2010 General Election. Postal workers announced an escalation of strike action from regional to national action which will hit small business in the run up their most active pre-Chrismas period. The Labour Government hell bent on committing political suicide declared it would not give in to their demands which would cost some £100 million per year. Though at the same time there were murmurs that the tax payer bailed out bank Lloyds TSB / HBOS is seeking at least another injection of £5 billion of tax payer cash, I wonder how much in bonuses they and other bailed out banks will be announcing next week? Meanwhile the bailed out bank is seeking to transfer £260 billion of bad debts off of its balance sheet and onto the British tax payers.
Meanwhile the white wash Legg report on MP expenses was published that required MP's to repay for minor indulgences such as gardening and cleaning costs usually amounting to sums of less than £1,000, which still angered many of the tight fisted fraudsters at Westminster. Though Gordon Brown the walking disaster area still managed to bodge it up by having to cough up £12,000. However the report is a white wash for it FAILED to address the REAL FRAUD of flipping houses which has benefited many MP's to the tune of hundreds of thousands of pounds each! The voters are NOT going to forget the fraudsters at the next general election regardless of the party under who's banner they defrauded the tax payers! Already a record 170 MP's doomed to be rejected by the voters at the next election have decided to step down which means they get to walk away with nearly £160,000 each and an annual pension of £30,000 each, instead of a prison term which would be if any of you committed similar fraud in the workplace.
Quick Markets Review.
Stock Market - The Dow breached 10k and showed remarkable strength that caught even the bulls by surprise. The perma bears continued to hang on to crash / collapse / bear market resumption hopes despite being on a loser for the past 7 months. Now the mantra is that everyone is hyper bullish and therefore a collapse is imminent. Hyper bullishness does not come THIS early in a bull market ! Looking under the hood you don't see people piling into stocks, on the contrary the rally has been SOLD INTO ! Don't believe me ? Take a look at the volume which is heavier on declines than the rallies. And neither will raising of old charts from 80 years, 50 years, 20 years ago going to make any difference. Where will the market go next is going to require in depth analysis, which I hope to complete either Sunday evening or Monday and email out (subscribe to my always free newsletter).
Gold - Stood steady at $1050 ending little changed on the week. The breakout remains intact with silver showing relative strength. I last analysed Gold in January therefore in depth analysis is pending before I attempt to project forward.(subscribe to my always free newsletter).
Crude Oil - Marched higher to $79 and is now showing relative strength against Decembers forecast implying the worlds economies are far stronger then they appear in the data. This now demands an in depth update (subscribe to my always free newsletter)., though the outperforming oil stocks have always remained a part of the mega-trends portfolio with $200 eventually beckoning stock prices higher.
U.S. Dollar - As if out of some CNN report of an Iranian demonstration, "Death to the Dollar" mantra continues near across the board. Meanwhile the USD at 75.77 stubbornly manages cling onto support, therefore the bull market scenario remains intact.
British Pound - Early in the week the mainstream press ran with the Centre for Economics and Business Research (CEBR) string of forecasts which included that the British Pound would fall to £/$1.40 in the coming months, sterling abruptly did a u-turn by rising from £/$1.58 to £/$1.63.60 by the end of the week. Other forecasts included UK interest rates to remain below 2% until 2014 - No chance!.
Are you hunting for the holy grail of trading ? You may find yesterdays short piece informative.
Your analyst thinking forget money, forget gold, time is the most precious resource anyone actually really has, so don't waste it!
Source :http://www.marketoracle.co.uk/Article14307.html
Nadeem Walayat
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