This page has been archived and commenting is disabled.

Guest Post: “Only Thing We Have to Fear Is A Lack of Fear Itself”

Tyler Durden's picture




 

Submitted by Peter Tchir of TF Market Advisors

“Only Thing We Have to Fear Is A Lack of Fear Itself”

After 6 weeks of steady decline in the stock market, what
amazes me is how little fear there really is. 
Investors do not seem concerned.

I have lost count of how many people have pointed to the VIX
as an indicator the market is in okay shape. 
There may have been a time where there was empirical evidence that the
VIX was a leading indicator.  As far as I
can tell, it is now just a coincident indicator and is part of the risk on/risk
off trade.  If you look at stocks, oil,
Eur, and VIX in the morning, all you need to do is look at one of those in the
afternoon, and you can probably come pretty close to guessing where the other 3
markets are.  That is all the evidence I
need to decide that VIX is no longer a leading indicator.  I have heard the smart money now looks at
forward implied volatility or volatility skew as a better predictor of future
market moves.  Those sounds confusing
enough to me that they may work, but the VIX, in my opinion has little predictive
value, and if anything may be a good contrary indicator.  It seems to me that VIX gets very low before
big corrections, and VIX gets very high before big rallies.

Speaking of contrary indicators, even Alan Abelson took the
time to point out that the American Association of Individual Investors had
turned decidedly bearish, which is a contrary indicator.  Again, maybe that has been the case, but for
the past 6 months, investors seemed to time the market pretty well.  They turned bullish and the market continued
to trend higher.  They became bearish and
the market started to sell off.  The
timing has not been perfect, but it doesn’t completely support the assumption
that is a contrary indicator.  Once
everyone knows about a contrary indicator, does it remain a contrary
indicator?  Maybe it is the fact that
retail is now so irrelevant to the market, that their sentiment doesn’t
matter?  Or maybe it is because the
internet has created a greater bias to the survey than it had in the past?  In any case, it makes me nervous anyone who
comments on this number is convinced it is a contrary indicator.

I hate to bring my mother into it, but even she is asking if
she should buy at the 200 day moving average or buy a bit early in case it
doesn’t get there.  It is getting hard to
type because of that annoying noise made by trucks backing up to load up on
S&P 500 here at the 200 DMA.  Maybe
it will work, but it seems like too many people are thinking the same thing for
it to be a good strategy.  The people I
listen to on TV seem supremely confident that we have strong support at the 200
DMA and are looking forward to buying stocks there.  Again, where is the fear?

I have head the “stocks climb the wall of worry” trotted out
a few times, though less than I expected. 
Sadly, the people who like this cliché don’t really seem worried, they
just like to point out reasons people could worry.  What worries me is how many analysts get
something completely wrong, then 2 months later change their opinion and ignore
the fact they were ever wrong.  In early
May almost no one was calling for haircuts or restructuring any time soon.  Now they all say there will be.  How many analysts predicted that stimulus
from Japanese rebuilding efforts would be good, and now blame all their overly optimistic
forecasts on supply problems from Japan? 
I have no problem with changing your mind over time, but I do worry
about a market that doesn’t worry about how good analysts have been.

Finally, the one comment that struck me as most peculiar was
Mr. Santoli, who I think is very good, trotting out “The market never discounts
the same news twice” quotation. 
Seriously, that is why we shouldn’t worry?  Is it that sort of thought process that let
the market rebound strongly after Bear Stearns was saved only to be shocked by
Lehman failing?  Did we discount Greece
last year so don’t need to again this year? 
Or was last year discounting a liquidity event and now it is a solvency
event?  Of all the market slogans, this
one irritates me more than any other as it reeks of complacency and has all the
practical applications of a horoscope – you can always interpret the results to
make it seem correct.

But why is there no
fear?

I think it all comes down to 3 letter words.  Mom, Dad, Fed, IMF, and ECB.  Children know that their parents are there
for them, to take care of them, and to make them safe.  At the first sound of thunder, a child will
look for their parent and take comfort in their arms.  Little children don’t necessarily know why,
they just know that mom and dad will be there for them and will make them feel
better.  The market must have that same
faith in the Fed, IMF, and ECB.  Whenever
the data gets bad, the market ‘knows’ that one of these entities will be there
for them.  Maybe it is QE3 instead of warm
milk, but these entities will be there to support them.  I don’t know how long these entities can
support every blip in the stock market. 
The real economy is different than the stock market, and all the cures
and comforts of these entities have done a great deal for the stock market in
the short term, but relatively little for the economy, and the long term
consequences of their actions are yet to be felt.  I certainly don’t want a 30 year old kid
living in my basement because I made it so easy for him that he was never able
to go out and do it on his own.  At some
point the Fed is going to have to kick some birds out of the nest and see if
they can fly on their own.  In the meantime,
the market clinging to hopes that its parents can take care of them runs the
risk that the problems are just too big to be dealt with easily and
quickly.  Then we might get some real
fear in this market.

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Wed, 06/15/2011 - 13:29 | 1371706 Ahmeexnal
Ahmeexnal's picture

Reality is about to set in.

By then, it will be too late.

Wed, 06/15/2011 - 13:30 | 1371728 Cindy_Dies_In_T...
Cindy_Dies_In_The_End's picture

Nah, they know they got big problems. I'd say its 33% arrogance that somehow they can fix it/ 33% denial, with 33% stupidity, with the slim sliver of the remainder grimly embracing the Deep Impact comet movie scene, waiting for the inevitable, somehow hoping its not as bad as they think it will be.

Wed, 06/15/2011 - 13:38 | 1371751 HelluvaEngineer
HelluvaEngineer's picture

If we get to 1250 today, it's gonna be fireworks.  They shouldn't have chased out the shorts yesterday.

Wed, 06/15/2011 - 13:50 | 1371814 jus_lite_reading
jus_lite_reading's picture

Actually the only thing we have to fear is the FORT CALHOON NUCLEAR POWER PLANT!!!! NOW A LEVEL 4 EMERGENCY!!! SAME AS FUKUSHIMA WAS!!!

http://fiatsfire.blogspot.com/2011/06/meltdown-wednesday-greece-at-level-7.html

The sky may be really falling or at least starting today!!!

P.S I am back from weekend vacation!!!! reading updates!!! I will write my findings later!!!

Wed, 06/15/2011 - 14:18 | 1371961 jus_lite_reading
jus_lite_reading's picture

Does nobody live near the Missouri river?!?! Hello people!!!  

Wed, 06/15/2011 - 14:58 | 1372117 JW n FL
JW n FL's picture

http://www.youtube.com/watch?v=LR8dlcI49X8&feature=related

 

People of the Mid-West... the Nukes are coming to you! som much for being safe from the crowds in the middle of no-where!!

Wed, 06/15/2011 - 15:15 | 1372205 JW n FL
JW n FL's picture

http://www.propublica.org/article/electrical-fire-knocks-out-spent-fuel-cooling-at-nebraska-nuke-plant/single

 

A fire [1] in an electrical switch room on Tuesday briefly knocked out cooling for a pool holding spent nuclear fuel at the Fort Calhoun nuclear plant [2] outside Omaha, Neb., plant officials said.

The safety of deep pools used to store used radioactive fuel at nuclear plants has been an issue since the accident at Japan's Fukushima nuclear plant in March. If the cooling water a pool is lost, the used nuclear fuel could catch fire and release radiation.

Wed, 06/15/2011 - 15:17 | 1372233 JW n FL
JW n FL's picture

> NRC Library

> Document Collections

> Reports Associated with Events

> Event Notification Reports > 2011 > June 15

Event Notification Report for June 15, 2011

U.S. Nuclear Regulatory Commission
Operations Center

Event Reports For
06/14/2011 - 06/15/2011

** EVENT NUMBERS **

 

46938 46944 46945 46946 46948 46957

 

 

Wed, 06/15/2011 - 15:25 | 1372277 JW n FL
JW n FL's picture

ALERT FOOTAGE OF LATEST FLOOD LEVEE BREACHES, IOWA, MISSOURI Nuclear Danger http://t.co/MLbkrZb via @youtube

Wed, 06/15/2011 - 21:00 | 1373195 JeffB
JeffB's picture

Holy crap, people! You're scaring the hell out of me.

Yeah, I live near the Missouri River. Well actually right between the Missouri & the Mississippi.

What's up with the engineers and planners on these things? They build nuclear power plants on "the ring of fire", on fault lines and in flood zones and then don't have any adequate safeguards against massive catastrophe if anything happens to go wrong, or as this engineer said, "If nature throws us a screwball." Like maybe a flood, or earthquake, tsunami or tornado? Umm, hello, isn't that a part of the game? Are screwballs outlawed in baseball? Did they outlaw earthquakes or tsunamis in Japan?

I want my mommieeeeeeeeeeee.

Well, at least we have the Fed & the IMF to save us on the economic front.

 

Wed, 06/15/2011 - 13:53 | 1371828 Hugh G Rection
Hugh G Rection's picture

normalcy bias bitchez!

Wed, 06/15/2011 - 13:31 | 1371718 GeneMarchbanks
GeneMarchbanks's picture

NO fear!? well maybe...

But I guess there will be a sad day when everone understands what huge risks they've been taking, it'll be too late. Many suicides will commence.

Wed, 06/15/2011 - 13:31 | 1371732 Boston
Boston's picture

Jump!

Wed, 06/15/2011 - 13:36 | 1371734 Boston
Boston's picture

.

Wed, 06/15/2011 - 13:54 | 1371852 GeneMarchbanks
GeneMarchbanks's picture

I'd just like to go on record saying that I'd rather prefer people not to jump. Even bankers. My impression is that it'll come to that simply because the illusion is so powerful. It's a sad state of affairs in the so called civilized world.

Wed, 06/15/2011 - 13:34 | 1371719 Ahmeexnal
Ahmeexnal's picture

And yet, even when the sheeple realize that governments do not care about them, they will still cling on to denial. 

Men are infinitely malleable.

Wed, 06/15/2011 - 13:32 | 1371737 oogs66
oogs66's picture

baby owls can imprint themselves on human handlers...it is in the nature of children to trust even when not rational

Wed, 06/15/2011 - 13:49 | 1371827 jus_lite_reading
jus_lite_reading's picture

I believe the condition is called Stockholme Syndrome.... the sheeple want to believe their rapist is a good guy!

I was in RI ovet the weekend and I have never seen such ghettos and trailer homes. Every corner there was one. RHODE ISLAND looked like HAITI!! WTF?

Wed, 06/15/2011 - 14:53 | 1372113 topcallingtroll
topcallingtroll's picture

He he

Trailers aren't just for the south anymore.

We prefer to call it modular portable housing anyway.

 

Wed, 06/15/2011 - 14:58 | 1372120 JustPrintMoreDuh
JustPrintMoreDuh's picture

So not nearly the paradise that is Detroit, Harlem, Watts, etc ...?

Wed, 06/15/2011 - 14:55 | 1372101 topcallingtroll
topcallingtroll's picture

Becuase they don't understand the system (central planning, socialist transfer payments) is what is fucked up.  Mankind does not have the wisdom to make it work.  This is why our founding fathers in the usa tried to limit government.  Government eventually fucks up everything if it is not kept small and powerless.

However the sheeple think that the failure was caused by the current politicians not the system itself.  Sheeple set themselves up for repeated failures and misery since they reject the nihilist politician and will repeatedly vote for the charlatan who promises he can make big government work.

The fact that it has never worked before doesn't cause them to question the system.

Wed, 06/15/2011 - 15:45 | 1372338 centerline
centerline's picture

The timeframes are too long for experience to lead.  And history is rewritten as needed to obscure.

Wed, 06/15/2011 - 21:04 | 1373204 JeffB
JeffB's picture

It's sad that so many people seem to understand the problems and can articulate them so and even the solutions so very well and yet everyone seems to be powerless to do anything to stop the carnage.

 

Wed, 06/15/2011 - 22:26 | 1373343 CH1
CH1's picture

Yeah... it's tough to stop 300 million suckers who've been told there's free beer in the next room.

Wed, 06/15/2011 - 13:29 | 1371724 Seasmoke
Seasmoke's picture

The FED and IMF are mom and dads who are child molestors

Wed, 06/15/2011 - 13:38 | 1371747 GeneMarchbanks
GeneMarchbanks's picture

That begs the question are people better off as orphans or does the paternal/maternal Entity keep on daughter-diddling?

Wed, 06/15/2011 - 13:36 | 1371756 subqtaneous
subqtaneous's picture

See: Lizzie Borden or Lyle & Eric Menendez

Wed, 06/15/2011 - 14:00 | 1371812 GeneMarchbanks
GeneMarchbanks's picture

I see what you did there... clever.  so murder, something to look forward to!

Wed, 06/15/2011 - 14:44 | 1372080 topcallingtroll
topcallingtroll's picture

Lizzy Borden had an axe

She gave her father 40 whacks

and when she saw what she had done

she gave her mother 41

Wed, 06/15/2011 - 13:33 | 1371725 nantucket
nantucket's picture

was it here that I saw an article about low vol because so many mkt particpants selling calls to generate income drives down the price of calls (and with it vol, or std dev, an input in black scholes goes down as well).  i forget, i read too many fin and mkt blogs 

Wed, 06/15/2011 - 13:33 | 1371726 Alea Iacta Est
Alea Iacta Est's picture

Look! In the sky! It's a bird! It's a plane! No....it's.....a Black Swan! OH DAMN!

Wed, 06/15/2011 - 13:30 | 1371729 Sudden Debt
Sudden Debt's picture

I found a good way to explain to people what's happening and going to happen.

ADD a little upside in the story!

I always begin like this:

Remember how our parents where able to buy such big houses in the 70's and 80's?

The reason was because their wages suddenly popped 300 to 400%.

It was all because of inflation back than and...

 

Believe me, you've got everybodies attentions with a starter like that.

 

Wed, 06/15/2011 - 13:32 | 1371736 Eireann go Brach
Eireann go Brach's picture

Bernanke is currently in the fetal position right now crying for his mother!

Wed, 06/15/2011 - 13:36 | 1371757 Caviar Emptor
Caviar Emptor's picture

Wile E Coyote has no fear!......Until.. that.. moment

Wed, 06/15/2011 - 13:41 | 1371761 Atomizer
Atomizer's picture

"The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks."

-Lord Acton (1834-1902)

Wed, 06/15/2011 - 13:43 | 1371768 redpill
redpill's picture

Gold hanging on as the market takes a dump.  That isn't supposed to happen during a deflationary stock environment, according to some.

 

Wed, 06/15/2011 - 13:52 | 1371848 qussl3
qussl3's picture

FED still printin - check.

ECB bullshit liquidity programs still printing - check.

Ummmm what deflation?

Till someone defaults and bank capital and assets go whoosh we still have plenty liquidity.

Wed, 06/15/2011 - 14:01 | 1371866 Quintus
Quintus's picture

In a deflationary episode, people will abandon investment assets and rush back into Money.  The gap in the dollar deflationists' logic is that they fail to recognise that Gold is, and has always been, Money.  Not currency.  Money.

Wed, 06/15/2011 - 14:02 | 1371876 equity_momo
equity_momo's picture

Bingo. 

Wed, 06/15/2011 - 14:31 | 1372014 Dr. No
Dr. No's picture

Gold is at $1520/oz.  So you expect gold to be worth more in the next 3-6 months?

Wed, 06/15/2011 - 15:40 | 1372316 gmrpeabody
gmrpeabody's picture

Dr. Yes

Wed, 06/15/2011 - 16:15 | 1372449 Shell Game
Shell Game's picture

..and short-term oscillation matter why?

Wed, 06/15/2011 - 15:24 | 1372273 dust to dust
dust to dust's picture

 Bingo+1

Wed, 06/15/2011 - 13:47 | 1371800 Josh Randall
Josh Randall's picture

SNAP Safety Blanket = As soon as thats gone, or people become 99ers - then watch the fear roll

Wed, 06/15/2011 - 13:48 | 1371804 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

Nobody on a white horse is coming to save you.

@#$%

Wed, 06/15/2011 - 13:47 | 1371817 walcott
walcott's picture

the only people still sucking off mommies tit are the dirt bag bankers who have screwed everybody.

Wed, 06/15/2011 - 13:47 | 1371820 Rusty Shorts
Wed, 06/15/2011 - 13:58 | 1371856 centerline
centerline's picture

A comparison of the market to kids and the IMF, ECB, and Fed as loving parents who make the market feel better?  What a turd of an analogy.  Come on.

 

Wed, 06/15/2011 - 14:00 | 1371860 Vinny
Vinny's picture

This analogy doesn't work. The Fed and IMF have manipulated the market not to feed the "kids" but to eat them instead. The people who trade in these comodities have had to adjust to these tyranical overlords so that they can survive. They've done their best to predict these overlords and now your point is that the overly benevolent IMF and FED should go on a shooting spree?

I don't think so.

At some point, all tyrants get slaughtered. That is the happy thought which should be racing through the minds of FED and IMF directors. 

Wed, 06/15/2011 - 14:05 | 1371890 Quintus
Quintus's picture

This analogy doesn't work. The Fed and IMF have manipulated the market not to feed the "kids" but to eat them instead.

Yeah.  I can totally see The Bernank dressed in a witches costume inviting unsuspecting kiddies into his gingerbread house.  Only in his case the house is made of green paper pieces, rather than gingerbread.

Wed, 06/15/2011 - 14:03 | 1371901 centerline
centerline's picture

Thanks. I simply had a brain-fart when reading the child-parent analogy.  It threw me for a compete loop.  The market is nothing more than a conduit through which the banks are enabled and current fiat system is extended to it's maximum possible wealth extraction.

Wed, 06/15/2011 - 13:56 | 1371861 DoChenRollingBearing
DoChenRollingBearing's picture

I've been scared for decades!  Some indicator...

But, even a broken clock is right twice a day.

Or would that be a busted bearing doesn't work anymore?

Wed, 06/15/2011 - 14:06 | 1371884 g
g's picture

This is actually a pretty good article, especially the last paragraph. When are we going to get the TBTF and just about everything else, off the government/fed tit? because really its the taxpayers tit. Lanolin anyone?

Wed, 06/15/2011 - 14:04 | 1371887 Vinny
Vinny's picture

Deflation happens but not to FIATS. We have been in a period of deflation for decades, once you realize that gold and silver are the real money.

Wed, 06/15/2011 - 14:06 | 1371893 buzzsaw99
buzzsaw99's picture

I don't care what they do anymore. It's all coming down.

Wed, 06/15/2011 - 14:13 | 1371953 DoChenRollingBearing
DoChenRollingBearing's picture

Correct.  

Best be prepared.  If you do not own Au and/or Ag and/or Pt, best get started ASAP.

Consider buying guns & ammo (while you still can?) as well as other survival gear.

Wed, 06/15/2011 - 14:07 | 1371906 HpDeskjet
HpDeskjet's picture

Yes, but but .... whatever!!!

"QE3 Will be here to save us soon!! ... Right?"

"They have to, they just have to print! ... Right?"

"Without printing we all die, so QE3 is 100% sure, in whatever form, it will come and it will come soon! ... Right?

 

People who really think that the FED is so powerful that it can influence all markets all the time, you really should wake up. The only thing that the FED can do is improve confidence by making it look like they are in control. However, this is NOT the case. If confidence is lost, they are powerless and S&P 500 will hit 500 in no-time

 

Wed, 06/15/2011 - 14:08 | 1371909 The Axe
The Axe's picture

Has anyone surveyed the computers for their market bias...because that is all that really matters..lol ???

Wed, 06/15/2011 - 14:11 | 1371922 mynhair
mynhair's picture

Luving these $ swings in TNA today.

Wed, 06/15/2011 - 20:19 | 1373138 Vlad Tepid
Vlad Tepid's picture

Vlad loves swings in T&A, too.

Wed, 06/15/2011 - 14:14 | 1371932 Troy Ounce
Troy Ounce's picture

 

 

Well said. Good post.

Wed, 06/15/2011 - 14:14 | 1371938 Highrev
Highrev's picture

http://tickerforum.org/akcs-www?singlepost=1063193

Things get turned upside down?

 

BTW, is the NDX looking like it wants to bungee jump from the 200dma?

Wed, 06/15/2011 - 14:12 | 1371944 YesWeKahn
YesWeKahn's picture

It's really scary that I am afraid of the fear of the lack of fear.

Wed, 06/15/2011 - 14:17 | 1371951 Quintus
Quintus's picture

Is there a phobia for that?

Wed, 06/15/2011 - 14:15 | 1371963 Syrin
Syrin's picture

That title sums up my thoughts EXACTLY!   We're about 600 yards from smacking into the iceberg, and NO ONE is paying attention?   Politicians are bickering over what songs the band is playing in the ball room and demanding that everyone receive free drinks.

Wed, 06/15/2011 - 14:21 | 1371974 Ergo
Ergo's picture

"But why is there no fear?"

Plenty o' fear at the Ergo's home.  We've deleveraged to the hilt, and stocked up the family farm.  Our biggest fear now is being cash rich when the dollar fails.  Hard to navigate these waters.  Whether the hyperinflation chicken comes before the deflationary egg, I can't say.  But I'm convinced that central planning by idiots, sociopaths and crooks is bound to be a disaster. 

Wed, 06/15/2011 - 14:26 | 1372013 DoChenRollingBearing
DoChenRollingBearing's picture

Fear at Ergo's home.     Check

Deleveraged big time.     Check

Stocked up family farm.     Check

Cash rich.     Check

Ergo's family is going to be OK.  Good for you.

+ $1530

Wed, 06/15/2011 - 15:16 | 1372207 Ergo
Ergo's picture

Thanks.  The time to prepare is BEFORE the possible disaster strikes.  Not many people want to hear that.  It's taken a while to convince immediate family.  Thank God for giving us time.

Meanwhile, I've spoken to Ukranians who went through the collapse of the USSR and its currency.  We ourselves fled New Orleans with Katrina bearing down on us.  And now we're watching Japan's troubles.  The usual state of world history is chaos.  People are crazy to think nothing will happen. 

Wed, 06/15/2011 - 16:21 | 1372485 Syrin
Syrin's picture

I converted 80% of my liquid assets to gold and silver, have a year's supply of food and wate, and am getting set to buy a firearm (SKS to be precise).  All we can do at this point is brace for impact.

Wed, 06/15/2011 - 22:18 | 1373338 delacroix
delacroix's picture

a 22 semi-automatic rifle, is a much more practical first firearm. and ammo, is common, and cheap.

Wed, 06/15/2011 - 15:56 | 1372375 centerline
centerline's picture

Nicely said.  And sounds like you are playing it careful too.  The only thing I would add is the difference between throwing cash at deleveraging versus holding cash.  With rates so low, it might be worthwhile to build cash towards whatever is needed... be it deleveraging in one shot - or throwing cash elsewhere, rather than just straight deleveraging.  Hell, it could come down a choice between deleveraging and eating at some point.  The trick would be to stay out of trouble until enough other folks are in so much trouble that the system is overloaded.

Wed, 06/15/2011 - 14:21 | 1371991 oogs66
oogs66's picture

google trends flash crash....spiked up coming into the anniversary, but once again off the radar screen

Wed, 06/15/2011 - 14:26 | 1372005 Franken_Stein
Franken_Stein's picture

 

I have a serious question:

 

Can the movement in the EUR/CHF and USD/CHF FX pair be regarded as the inverse of what the movement of the gold price in € or $ would be, if it was only driven by supply and demand and not distorted by COMEX short positions ?

 

Both qualitatively and quantitatively ?

 

I mean gold is a scarce resource and the Swiss Franc is too.

 

The SNB, after unsuccessfully trying to print like crazy and buying Euros by the boatload which now rot on their balance sheet, has now given up on that and can only watch the Franc rise with despair as their Euros become ever more worthless.

 

Or is this comparison too far fetched ?

 

Wed, 06/15/2011 - 14:37 | 1372012 Shell Game
Shell Game's picture
cour·age / 'kerij / Noun
1. The ability to do something that frightens one.

2. Strength in the face of pain or grief (or fear).

Wed, 06/15/2011 - 14:31 | 1372027 Medea
Medea's picture

I love the diatribe against cliches followed by the 30 year-old in the basement schtick. Nothing like being consistent.

Wed, 06/15/2011 - 14:31 | 1372029 Saxxon
Saxxon's picture

There is plenty of fear & suffering in the lower castes of the U.S. population.  I guess the journalist who wrote this thing is just not in touch.

Wed, 06/15/2011 - 15:10 | 1372184 blunderdog
blunderdog's picture

They don't own anything.  The lower 40% of wealth-holders in the US can't affect market performance! 

Heh.

Wed, 06/15/2011 - 14:37 | 1372055 anonnn
anonnn's picture

Why is there no fear?

Privilege!

Economic systems of feudalism and capitalism...create poverty and scarcity while promoting privilege. [hat tip to Kropotkin and Wikipedia]

 

economic systems of feudalism and capitalism, and how he believes they create poverty and scarcity while promoting privilege

Wed, 06/15/2011 - 14:45 | 1372073 topcallingtroll
topcallingtroll's picture

So there was no scarcity in communist paradises?

 

Everything has a cost.  Too ignore cost is to eventually destroy an economy.

Wed, 06/15/2011 - 14:43 | 1372079 Shell Game
Shell Game's picture

Economic systems of feudalism and capitalism...create poverty and scarcity while promoting privilege.

Complete hogwash.  True capitalism creates opportunity for success for those who are willing to work and risk capital.  It also allows opportunity for epic Fail for all who partake.  Capitalism is not cronism, corporatism nor is it TBTF.  If it doesn't look like a duck, sound like a duck, walk like a duck, it probably isn't..

Also, WTF kind of make believe links are those?

 

Wed, 06/15/2011 - 14:50 | 1372084 gaoptimize
gaoptimize's picture

I blame the MSM for the calm behavior of the clueless sheeple (95%).  I blame normalcy bias to explain the calm behavior of the informed sheeple (4%).

Wed, 06/15/2011 - 19:02 | 1372961 andybev01
andybev01's picture

and the remaining 1% are soothed by hookers and blow?

Wed, 06/15/2011 - 15:01 | 1372134 GFORCE
GFORCE's picture

There's no fear because since March '09, every man and his dog has predicted imminent doom in the next quarter and stocks have continued to climb, while the euro has stayed relatively strong. China hasn't imploded and Japan shrugged off a massive earthquake.

That's why there's a lot of complacency out there.

Wed, 06/15/2011 - 15:27 | 1372287 Roger Knights
Roger Knights's picture

"That's why there's a lot of complacency out there."

Same deal after the boy cried wolf.

(THEN the wolf came.)

Wed, 06/15/2011 - 15:03 | 1372142 Clowns on Acid
Clowns on Acid's picture

At ES 1250 there will be screaming...at 1200 there will be outrage....lower than 1200 Ben gets itchy 'bout QE3.

Debt will crush Pelosi, Reid and indeed DEM party.

Wed, 06/15/2011 - 15:03 | 1372160 Downtoolong
Downtoolong's picture

“Only Thing We Have to Fear Is A Lack of Fear Itself”

I feel like I’m doing my share. I don’t have time to develop investing strategies anymore because I’m spending all my time trying to figure out how Wall Street is going to F%^k us all next.

Wed, 06/15/2011 - 15:07 | 1372169 Downtoolong
Downtoolong's picture

“Only Thing We Have to Fear Is A Lack of Fear Itself”

I feel like I’m doing my share. I don’t have time to develop investing strategies anymore because I’m spending all my time trying to figure out how Wall Street is going to F%^k us all next.

Wed, 06/15/2011 - 15:17 | 1372216 Doc Brown
Doc Brown's picture

If everyone is thinking alike then someone is not thinking

Wed, 06/15/2011 - 15:49 | 1372340 N57Mike
N57Mike's picture

I think that was a General Patton quote ??

Wed, 06/15/2011 - 15:16 | 1372231 Redneck Makin-tosh
Redneck Makin-tosh's picture

Love trumps fear but money is a fickle mistress

Wed, 06/15/2011 - 15:24 | 1372234 AldoHux_IV
AldoHux_IV's picture

I usually enjoy Peter's articles, but the whole comparing the fed as a parent to a the markets thing has me disgusted. I guess to carry the analogy further the fed/ecb are the type of parents that have allowed the market (child) to breastfeed into their 40's and have painted a reality that doesn't exist in order to prevent the child from actually becoming truly independent and as soon as it begins to 'man' up-- the parent injects the child with drugs and threatens to kill both of them if it ever leaves.

Sounds to me more like a cult where some nutjob has many brainwashed and held captive and is molesting the children.

It's time to kick in the door and take this menace: fed/ecb/imf/worldbank cult leader out and end the suffering of so many.  The real economy is in a depression while the modern day robber barons have infiltrated all levels of government and have figured out a way to suppress the peoples and eat them too.

Wed, 06/15/2011 - 15:41 | 1372313 Ura Bonehead
Ura Bonehead's picture

The market must have that same faith in the Fed, IMF, and ECB ... [that] these entities will be there to support them.

Well, every GOOD parent knows that, sometimes, supporting your child means NOT being there with warm milk or (often the case) money. Every good parent knows that there's a time to open the front door and tell the kid, "Good luck out there."  It was a sad day when my parents cut off the QE.

That's where we are as a country. Everyone who's whining, "In the end, Daddy Fed will be there with new QE" is fooling themselves.  It's time for tough love as the last round of money put in our pockets by Daddy Fed (QE2) solved nothing and taught us nothing - we (investors, consumers, banks....) bitch about how worthless Daddy's money is yet we complain we need more of it (i.e., QE3).

NOTE TO FED: Open the front door and tell the children, "Good luck out there; your parents have done all they can. Convert your assets and all those shiny metal trinkets you've been hording under your bed to my good ol' cash and get ready for some tough times. We have faith that you'll figure this out."  SHUT OFF THE CASHFLOW SPIGOT, DAD & MOM!!!!  YOU'RE CHILD NEEDS TO GROW-UP!!

Wed, 06/15/2011 - 16:14 | 1372458 Dr. Porkchop
Dr. Porkchop's picture

Yeah, come on Mom and Dad.. stop enabling those deadbeat kids...what are they? 8 & 10 and still living at home? Socialist bastards like you are ruining society! In Dickens time, they'd be earning their keep in the factories! Feed the weak one to the strong!!

Wed, 06/15/2011 - 16:46 | 1372547 Diogenes
Diogenes's picture

"I think it all comes down to 3 letter words.  Mom, Dad, Fed, IMF, and ECB.  Children know that their parents are there for them, to take care of them, and to make them safe.  At the first sound of thunder, a child will look for their parent and take comfort in their arms.  Little children don’t necessarily know why, they just know that mom and dad will be there for them and will make them feel better."

Boy wouldn't that be great.

I used to wish I had a normal family. Instead of a bunch of lying theiving backstabbing bastards.

Then I found out that was a normal family.

According to Chris Titus 6O% of families are now classified as disfunctional.

THAT MEANS WE ARE THE NEW NORMAL.

Maybe that is why so many sheeple are wary, and why the actions of the little investor are not longer such a good contrary indicator.

Wed, 06/15/2011 - 17:41 | 1372656 Dr. Acula
Dr. Acula's picture

"But why is there no fear... it all comes down to 3 letter words.  Mom, Dad, Fed, IMF, and ECB"

LOL, no "God" in that list?

Commit a sin? Get bailed out with free forgiveness.

Have metaphysical angst? Get bailed out with the creation myth du jour.

Wherever there is a void in the space of knowledge that people can't currently or can't ever fill in, just insert nonsense like an invisible sky daddy texting via combustible shrubberies.

Wed, 06/15/2011 - 17:30 | 1372669 SpiritBlade
SpiritBlade's picture

Some good points. Discerning whether a hot fever will aid a blue screen reboot, or a cold coma will advance the next dark age seems to be the challenge at the moment.

We are taking meds to ward off the fever so...

hmm we'll see

 

III

Wed, 06/15/2011 - 18:53 | 1372942 flyr1710
flyr1710's picture

remember, it's a soft-patch that's Japan's fault

Wed, 06/15/2011 - 21:38 | 1373265 Sierra Hotel
Sierra Hotel's picture

The stock market and currency are just as much an illusion as they've always been. The shit won't hit the fan until the USA can't buy OIL any more. Till then it's business as usual. As long as OIL keeps magically showing up, it will keep going.

Thu, 06/16/2011 - 14:45 | 1375352 The Laughing Man
The Laughing Man's picture

Why is there no fear, you ask? Allow me to demonstrate with a Superman analogy.

*Lois Lane is saved from falling to her doom by Superman*
Superman: Don't worry, I've got you.
Lois: You've got me? Who's got you?!
*Camera pans to Lex Luthor holding Superman*
Luthor: Me (insert evil grin)
Lois: ...What?!
Superman: See Lex stabbed me with some kryptonite and it got embedded in me so I don't have my powers right now, but he gave me this cool jetpack so I can still get to work on time.
Lois: ...

Most people seem to feel safe so long as somebody -- doesn't matter who -- is there to hold their hand, even if it's someone who means to harm you or if the person holding your hand is having their hand held by someone dangerous to both of you.

Do NOT follow this link or you will be banned from the site!