Meet the New Boss. Same as the Old Boss.
First off, before I forget, if you are on an iPad or iPhone and haven't downloaded SocialTrade Mobile yet, please do so. If you like charts, you'll think it's pretty cool, and it's free.
It was a pretty interesting day in the market, of course, since two Fed-related items were happening. First, as was initially reported last night, "Damn It" Janet Yellen was nominated by Obama to be the Chairhuman, once bearded-wonder Bernanke splits in January. It's a little odd that in the midst of all this rancor Obama decided to address this bit of not-at-all-urgent business, but maybe he wanted to remind the market that all that matters is QE-infinity.
So why do I have such a bug up my butt about the Fed? It's simple, really, and this all comes from a simple soul. I wish the natural market had been allowed to finish what it started in the autumn of 2008. That is, an honest-to-God cleansing. A prolongation of the bear market (which was unnaturally terminated on March 6, 2009), a prosecution and imprisonment of hundreds of executives and bankers, and sweeping reform. No monetary easing. No artificial injections. Just the country staring boldly at the mirror and figuring out what went wrong, who should be punished, and how to avoid a repetition.
Instead, of course, all the culprits got off scot-free (and they're all much, much richer today), and we're $17 trillion in debt as a way of papering things over. So the natural cleansing that was avoided is now going to be ten times worse when it finally does come. I have a feeling Yellen is going to want to slash her wrists once things start going haywire, and more realistically, she'll probably wind up just resigning in shame.
Since Yellen is going to be front-and-center for years to come, I thought I'd set a couple of ground rules for myself, if for nothing else, for my own well-being.
The first thing is to avoid making comments about her personal appearance. Any time I do, someone gets upset, and I suppose the woman isn't being given this post for her dazzling good looks (that's Larry Summers' department, and he - wisely - doesn't even want the job). Just as I refer to Bernanke as 'the bearded one", I thought I'd just use "the albino" as a shorthand for Yellen, but maybe that would upset people who think I'm being a bully. So I'm going to avoid chiming in on her ghastly, ghostly, gnomish corporeal properties.
The second area I intend to avoid is her religion. I couldn't even refer to Bernanke as "Shalom" (his middle name) without getting hate mail. And anyway, it looks like the mainstream media is doing plenty enough to let the world know (and keep in mind, these are supportive articles):
It still seems a little weird that such a tiny sect can dominate an important body like the Fed. I tried to find another religion with a similar population, and the closest I got was Spiritism (which is actually larger!). I daresay if the vast majority of Fed leadership hailed from the Spiritist Church, year after year, decade after decade, some people might scratch their heads. But, in that case, they probably wouldn't be lambasted for doing so.
All the same, I best avoid the subject altogether. The woman, simply stated, is going to continue to make my life difficult, and I shall revel in the glorious day when it's payback time. That day will come, and by God, I'm never going to stop crowing about it. For now, we wait.
More immediately, what keeps me up at night is the thought that some Big Announcement will be made about some Great Compromise, sending the Dow 400 points higher. Even our friends in Gainesville are putting forth the idea that a huge rally to yet another lifetime high may be around the corner. That may well be, although I probably wouldn't be able to stop throwing up.
I do take solance in the Dow, however, which is looking ungodly vulnerable to a collapse....we just have to break that long-standing trendline that dates back to March 2009 to do so.
Trendlines are breaking, however. We've seen in with the DIA, the IWM, and the Russell 2000 itself. The cracks are modest, but this damage is helpful, and I hope it presages worse things to come.
That's it. Good luck with your trades......
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