A GOOD OLD FASHIONED CURRENCY WAR

  “A GOOD OLD FASHIONED CURRENCY WAR?”

Don’t worry. We’ll just gap up 200 tomorrow. Bazinga!

What’s all this complaining and whining about China? Did you just realize they were in dire straits and needed to do something? Haven’t you not seen the videos of their ghost cities? Of course, a move like ripping on your currency could be good in the near term but not so sure longer term. Haven’t we seen enough of that already? The bottom line is we have been telling you that China’s numbers are about as good as our unemployment number…just made up. But let’s not put this all on China. We, us, the U.S. of A is the biggest manipulator and the biggest rigger of everything. This country started it all up with 0% rates for over 7 years, the printing of almost $5 trillion in order to rig interest rates down and asset prices up and the pounding away at other countries to do the same as we did. This led to Japan printing a few trillion, Europe printing a few trillion, U.K. printing a few and who knows who else. Have you seen the yen and euro lately? The globe has printed anywhere between $15-20 trillion depending on whose abacus you are using and it started with Mr. Bubble Bernanke himself.

We knew something was up Monday when the leading areas of the day were the worst areas. We were asked on tv on whether we thought it meant anything. Our only answer was that it was one day. Today’s action is just the continuance of the nausea. Remember, it is not the news. It is how the market reacts to the news. How many times in past years did the market get hit with some bad news but still went up? This tells you markets have changed and right now, it’s not for the good.

As we have stated, the market’s deterioration continues. We are not sure what day or at what point the major indices break but it is a lock for it to happen if more and more stocks and sectors go to the negative side of the page. It is not good that the market has lost names like Apple and Disney and now, the financials need to be watched as we are not so sure currency issues are good for banks. And by the way, did you notice how easily the almighty Apple sold off after a one day, low volume bounce?

Lastly, we have told you on many occasions that the central-bank induced markets have turned into what we call “the one-sided trade!” It is the trade where everyone is all in. It is the trade where nothing can ever go wrong. It is the trade where everyone is comfy. It is the over-leveraged trade. It is the over-owned and over-loved trade. We mention this now because we do not like anyone that predicts meltdowns and crashes. Wall street is littered with people who call for crashes and big bear markets on a daily basis. They will miss 10,000 Dow points to the upside and when a bear finally hits, they tell you how right they have been. Thus, we will not call for one. But…we felt it necessary to let you know we are worried that everyone is on one side…and worry about what happens if that changes quickly. Good old currency wars could have repercussions. Watch that 2.040 S&P. If it holds, terrific. If it breaks…