THE DOT - if this turns orange or red be alert

Wednesday, December 22, 2010

wednesday brainstorming- part 1

1. Yeah the boys keep it up even with 2 disappointing numbers do not bring the market down for the simple reason they do not want it down as only high indices are the cornerstone for the year-end rip-off sponsored by DC and their best friends the FED. Keep in mind that stock mutual funds are at a 45 year low in cash holdings of 3.4% or in other words as long as it gets.

excerpt 1

Fund Managers End Year Near Highs for Stocks Holdings

U.S. fund managers rebuilt their equity holdings in December to one of the highest points this year on signs of a swifter economic recovery, a Reuters poll showed on Wednesday.

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The poll, which surveyed 13 U.S.-based fund management companies between Dec. 10 and 21, showed firms boosting their equity allocations for the fourth month in a row to an average of 65.0 percent. That is a gain of 2 percentage points since November.

The high for the year was in February, when firms held 66.2 percent of their assets in equities, though that was based on only 11 U.S.-based fund management firms.

The Reuters poll also showed money managers scaling back their exposure to bonds for a fourth consecutive month.

excerpt 2

Fed Has Aided Stocks, Not Rates or Jobs: CNBC Survey


The Federal Reserve’s policy to purchase $600 billion of bonds in a program widely known as QE2 has been mostly ineffective at lowering interest rates and will do little to improve the unemployment rate, according to the exclusive CNBC Fed Survey in December.

Federal Reserve Bank Chairman Ben Bernanke
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Federal Reserve Bank Chairman Ben Bernanke

The survey of 76 economists, bond and stock traders, and analysts, found 63 percent saying the Fed’s program has been ineffective at lowering interest rates.

A similar percentage believes the program will not help lower the unemployment rate.

“I see QE2 as mainly pushing on a string,” wrote Scott Wren, senior equity strategist atWells Fargo [WFC 31.2925 0.4725 (+1.53%) ]Advisors


2. Another effect of the FEDs insane anti stimulus actions is that rising commodities destroy the purchasing power of the regular Americans since their money printing brings all commodities back to record levels and the often discussed hyperinflation is about to kick in despite all the phony low inflation stats. What happens is a 3 way wealth transfer from the middle class to the 2% who own most of the world in USA and outside while the debt burden of coming generations is rising in a steep manner. The biggest robbery ever keeps marching with the help of central banks and te governments who all work for the same puppet masters.

excerpt

WTI spikes and is last seen at $90.64. And as a reminder every $1 rise in oil decreases U.S. GDP by $100 billion per year and every 1 cent increase in gasoline decreases U.S. consumer disposable income by about $600 million per year. The move in oil in the past week alone has almost entirely wiped out the most recent stimulus.Furthermore, as we suggest earlier, now that $90 is in the history books, $100 is coming, and may be here within a few weeks. At that point Bernanke may have some problems explaining how he is "100% confident" that the surge in gasoline prices is completely and totally not as a result of his deranged genocidal tendencies.Don't worry though, hedge fund managers around the world will be more than happy to afford the surging prices. Remember: wealth effect!

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