THIS PLUNGE TODAY LOOKS A BIT FAKE...
NOT THAT THE MARKET ISN'T WAY OVER VALUED...BUT THE MARKET PLUNGED ON LOW VOLUME ....AND THERE WERE NO OTHER DISRUPTIONS IN NORMAL TRADING.
GOLD AND OIL AND THE DOLLAR WERE QUIET...NO BIG ACTION... BONDS DITTO...
I SENSE THAT THIS CRASH WAS A ONE DAY EVENT THAT WAS TOTALLY PLANNED...BY THE MARKET MASTERS TO SEND A MESSAGE TO THE FED ABOUT THE NEED FOR LOWER RATES TO KEEP THE ASSET INFLATION GOING...
BUT THE FED SEEMS TO HAVE A PROBLEM WITH THE STREETS " ASSET INFLATION FOREVER" LOGIC...
THE FED RIGHTLY SEES THE ASSET INFLATION SPILLING OVER INTO THE REAL ECONOMY HAS GENERAL INFLATION...
ALSO THE DOLLAR IS ON THE FEDS MIND...ALTHOUGH THEY ARE PROHIBITED TO EVEN MENTION IT IN PASSING!!
SO THERE IS THE SEEN AND THE UNSEEN...
THE TEXT AND THE SUB TEXT AT WORK HERE...AS ALWAYS...
BUT I DON'T THINK THE MARKET MASTERS HAVE LOST CONTROL OF THE FREE FLOAT YET... SO THIS IS A CONTROLLED DECLINE...THAT IS MORE MESSAGE THAN REALITY...
MY HUNCH: THE FED KNOWS IT'S A HEAD FAKE...AND WILL NOT LOWER RATES IN SEPTEMBER...
THE RISKS OF LOWERING...AND HAVING A DOLLAR DISASTER...ARE GREATER THAN THE RISK OF LOWERING AND HAVING A MARKET DISASTER...
THE FED WILL KEEP THE STREET WELL LIQUIFIED... BUT IT WILL NOT LOWER RATES TO SAVE THE ASSET BUBBLE...LIKE GREENSPAN ALWAYS DID!!
