I’m not normally a cynic.  When you make your living developing products on the cutting edge of research, you have to be an optimist.  That notwithstanding, hypotheses must be tested.  Presently, the talking heads would have us ask, “Have we seen the bottom?”  Well, I have seen through this charade of a bear rally and find it desperately wanting substance.

 

Leadership

Financials brought the market into this financial abyss and unashamedly dragged the confidence of consumers with them.  To further add fuel to the fire, government poured the last vestiges of American wealth onto the burning heap insuring that every American from this point onward would be enslaved with tax debts of European proportions.  Lucky us.  We’re still waiting on a cogent plan from SecTreas Timmy.  Meanwhile President Zero continues to campaign.  I haven’t written to him yet.  I just can’t bring myself to bust his bubble that he in fact won the election and is the president and should actually start leading.  Lack of leadership got us where we are.  Bad leadership has doomed the ship.  And no leadership will lead to the unimaginable and unspeakable.  Earnings have not changed!  This rally is bogus, pumped by hyperbolic talking heads pimping financial companies for a failing financial company.  CNBC, are you really relevant anymore?

 

Promises Broken and Trust Betrayed

To add insult to injury, every politician has betrayed the trust of the people and sold us into tax slavery.  The most recent report shows the US deficit now at $11T dollars.  I’d stop there because that’s an obscene number.  But there’s more.  Failed businesses, whether literal (Bear Stearns, WaMu, Lehman Brothers) or figurative (GM, AIG, Citi, BoA,…) have paid, from the PUBLIC TRUST outrageous bonuses to executives.  Oh, I’m not completely hacked about that but CONGRESS and THE FED were complicit.  There’s no shame anymore.

 

I Don’t Buy Because I Don’t Trust ‘em

Again, I’m looking for reasons to change my mind.  I just don’t see any.  The books are cooked.  The consumer is gone.  Earnings will continue to sink.  Prices will continue to drop on almost everything, certainly housing.  As a result, share prices will continue to fall.  GM’s talking bankruptcy again.  It must be time to threaten Washington for some more cash.  Heck, Toyota just announced they were going to drop the price of their vaunted Prius.  The only products appreciating in price are Ammunition, Rifles, Pistols, and Shotguns.  Either people are actually more concerned about their safety or they don’t trust their government…neither outlook reflects well.  Count me in both camps.  Guns and ammo aside, it looks like deflation.  It smells like deflation.  I’m of the opinion we’re in for further price drops for at least another quarter.  So, I’m not buying anything over $200 new.  I don’t think others should either.  Inflation requires an active consumer.

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