Operation Twist for the Twisted
The central bank chairman with God complex, who arrogantly proclaimed that he could have saved the Great Depression may have been leading us in the same path. His latest ‘twist’ is here – Operation Twist, to be exact. The Twist may be a bit too much to handle for the banking system he and his banking cronies are trying to save from the brink. Some believe that this may be the death knell for the banks.
For now, the treasuries are showing the desired effect – yields on 10-yr and 30-yr treasuries are collapsing. Will this have any positive effect on housing? To early to pass judgment on the latest lunacy of Benank’s Fed. Have to wait and see how this unfolds.
El Arian analyzed the affect of the latest move by the Fed in two lines: “The Fed has revised downwards its economic outlook and also pointed to significant downside risk. The outcome points to an even more divided FOMC.”
I am still thinking that stocks will sell-off hard – regardless of this move by the Fed. [Bank of America, Wells Fargo were downgraded today. Europe troubles haven’t gone away. Run on the European banks has just started. etc. etc.]
Ladies and gentlemen, I believe that now the stage is set for a waterfall like decline in stocks – WORLDWIDE! The time to panic may be NOW. [At pixel time the market was down 75 DOW points. It could be down by over 200 points at close.]
MM–Good call on Sept 21st. I agree sometimes your thoughts on economy. What is your ballpark on s&p in this downward trend. Another question is do you see this downward market trending similar to 2008 sept downtrend?
Thanks
Uday,
Thanks. I will get back to you on your questions later. Actually, this is what I posted on my facebook wall on Sept 15, at 7.57 AM:
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If I were not already short to my eyeballs, I will short the heck out of this market. Come next Thu, I think we are going to witness a waterfall-like decline in all stocks – all around the world. Why Thu? The markets will realize the QE3 (or Op Twist) by the Fed has already been priced in – by not falling much.
THERE IS NOT LIQUIDITY IN THIS MARKET. WHATEVER YOU SEE EVERY AS TRADING, IS A MYTH CREATED BY ALGOS. It is now time – algos are going to wreck havoc. You can blame it on really the best and the brightest who have done dumbest of things with (a) overconfidence and (b) GOD complex. It is high tome some of these people stand in soup lines.
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