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Presenting The Goldman Wall Of Worry, And The One Key Item Missing
Now that the bipolar market has once again resynced general risk appetite with the EURUSD (high Euro -> high ES and vice versa), everything in the macro front aside from European developments, is noise (and the occasional reminder by data adjusting authorities in the US that the country can in fact decouple with the entity responsible for half the world's trade. This will hardly come as a surprise to anyone. In fact, the conventional wisdom as shown by Goldman's latest client poll has European sovereign crisis worries far in the lead of all macro risks. Behind it are Iran and nuclear tensions, China hard-landing, the US recovery/presidential election and the Japanese trade deficit/record debt/JGB issues. Which for all intents and purposes means that the next big "surprise" to the market will be none of the above. What are some of the factor not listed as big macro risks? According to David Kostin 'Risks that clients did not mention include late March US Supreme Court review of health care reform (implications for 12% of S&P 500); mid-year deadline to implement Dodd-Frank financial reform (14% of market); and the French Presidential election on April 22nd where polls show incumbent Nicolas Sarkozy trails opposition candidate Francois Hollande." Oddly enough, one very crucial item missing is once again surging inflation courtesy of trillions in stealthy central banks reliquification, sending crude to the highest since May 2011, and the most expensive gas price in January on record.
That this has somehow failed to penetrate investors' skulls shows just how erroneously transfixed the market is that Bernanke has inflation, or rather deflation, under control. As WTI passes $105 in the next few hours, look for Op-Eds lamenting the hundreds of billions in lost purchasing power that have already more than offset the benefit from extended tax cuts. Alas, as noted previously, the central bank tsunami is only just starting. Watch for inflation, and concerns thereof, to slowly seep into everything, especially in the chart below.
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Gold and silver will hedge against it all....bitchez.
...and add a major flash crash to the equation.
Record gas prices = 2 wheels good, 4 wheels bad. (Autofarm)
Record gas prices = wood gasification, a la WWII, once again feasible.
Long trash cans, barrels, flex hose and ball valves....
Bloomberg is reading WTI at $105 this moment. Brent 121.
Anyone at Goldman worried about those Timberwolf securities they sold their clients?
Obviously Goldman knows something we don't, i.e. that downgrade will not happen until right political moment arrives. Rating agencies were disciplined by the last downgrade when they were accused of so many things, including treason that they will not proceed with any decision until some sort of go-ahead signal. At this point it is more or less irrelevant what comes out of Fitch, Moody's or S&P beyond simple trading opportunity, they will only be stating obvious facts that are long overdue.
Don't Goldman clients fear what Goldman "tells" them to fear?
At least that little MF segregated accounts issue is settled.
But something just doesn't seem fair about the US only measuring in trillions and Japan getting to use quadrillions.
Syria may turn out to be the thing that kicks everything off.
Hey! I just heard Stolper went long eur/usd! /sarc. I can't believe these asshats at FOX talking a better economy! Even that tool Rove doesn't seem to understand collective action clauses. I'm watching the light volumes drive the commodity trade into the Ionosphere, looking at gas at 5$ on the west coast. F..K this shit! I'll stay flat, because we all know the cave in is coming, sooner than later!
My son suggests March 21st of 22nd will see another gianormous earthquake along the Pacific somewhere - but not because of nefarious human leaders - but universe powers. Hopefully it will not unleash a horrid tsunami, but since you mention the central bank tsunami . . . here is something Goldman's clients aren't worrying about yet.
Apparently the following big and distructive earthquakes shifted earth's tilt just a little and changed "time" of orbits just a little recently. 2/27/10 Chile 8.8 magnitude, 188 days later on 9/3/10 New Zealand 7.2, 189 days later 3/11/11 Japan 9.0, 188 days later on 9/15/11 7.3 in Fiji, 189 days later is March 22ish, 2012. We'll see. Bullish for PMs, water, energy and food - depending of course. But that's the way with "triggering events".
Clarity indeed.
I went to look for some cheaper gas today and paid $4.19 9/10 for regular at Shell. I'm going to have to jog to where I go jogging if this keeps up.
What, me worry?
Gas here is around $3.379....
The Great Wall of correlations. So true. Does anyone think 350 million Chinese have/has, been liberated to the point of a 50 Basis point cut,(more) than a free pack of " BAND AIDS"?
Jeese, I forgot to tune-up my Jet, and this is Johnny Cash reincarnated speaking with you. In a ring of FIRE <>
What about another downgrade of the US debt? How in the heck is this not on the list of concerns?
Theft of used Kentucky Fried Chicken grease for conversion to bio-diesel will increase dramatically.
Just volunteer to be a Closer and do specifically the cleaning of those fryers.
Worst job in the joint.
I notice that Ron Paul isn't on this list either. It's like he's wearing an invisibility cloak or something.
Higher Euro = Higher Spy = Better economy (per the Fed). At the moment Euro +75 since Fri close. Any comment Mr. Bernanke? "Well, just one...... SCOREBOARD!"
Ah yes, Inflation!
I really needed something else to worry about.
Todays gas = $3.74 gal regular
$6.50/gallon for aviation fuel at local airport...
Now AV Gas is nothing like car gas.
We like to think terms of gallons per hour vs remaining fuel/ground speed etc.
if it's an one answer poll(and sure looks like one from the sum of the presented options) then investors are quite correct.
any of what you're mentioning, while correct, is far behind Europe imploding or Iran/oil price in the skies.
The negative effects of expensive energy and raw materials grossly underestimated
Rickards: 2% public FED inflation target is fake – Real inflation target is 4%-6%
Listen to:
Jim Rickards, Saturday, January 28, 2012 on KWN – AUDIO http://kingworldnews.com/kingworldnews/Broadcast/Entries/2012/1/28_Jim_Rickards.html
Also see:
Don’t Be Fooled, Inflation Is Already Here
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