Thursday, February 4, 2010

The Scott Brown Bounce

The Scott Brown bounce continued today with the DOW up again as his swearing in established the new Republican majority in the Senate and heralded the return of economic prosperity… (oops) back to reality, 29 of 30 DOW components declined today, dragging the market down 2.5% and the broader markets dropped 3% as the economy continues to slip. The market has given up everything it has gained in the past three months and as the USD continues to strengthen, you can expect further declines.

China has frozen the issuance of new stock by companies and that signals that they are very serious about controlling their economy and avoiding bubbles. Greece may default on its debt and other southern European countries that embraced elements of Reaganomics are increasingly in trouble with Portugal and Spain close to default as well. Ireland is included in a group of countries that went in heavily for USD investments, known in Europe as the PIGS (Portugal, Ireland, Greece and Spain) are in deep trouble as the Euro plunges against the Dollar. Ironic since it is the US that is really in trouble but with the trillions that Wall Street banks were able to pump into world markets in the past year, it is the USD that is pulling it all down.

Meanwhile back in the USA, according to the job placement firm Challenger, Gray & Christmas, layoffs scheduled by major corporations have jumped 59% from December to January. The number is still much lower than a year ago but is moving in the wrong direction and picking up speed. Weekly unemployment claims are up again and there is wide spread apprehension about the monthly job report that comes out tomorrow.

There is word from the Obama Adm. that the report will also provide details about how the Bush Crime Family understated job losses in the lead up to the 08 election. It seems that there were a million more people unemployed than reported. Republicans continue brag about how many jobs they created during the Bush reign even though there had been a net loss of jobs even before this revelation.

The Fed has announced that it will stop buying home mortgages (it didn’t buy any last week) and the effect that will have on the economy can only be guessed at. If you guess higher interest rates, plunging home values and a collapsing real estate market you may well be right. It’s always darkest before the dawn, unless you go blind. www.prairie2.com

3 comments:

Anonymous said...

Been following you recently, having been led here by Mike Malloy's plugging. Good stuff.

Ed Encho said...

I was encouraged by the market plunge Thursday, perhaps now the illusion of 'recovery' can now be laid to rest once and for all. It was all a big scam to begin with, a massive coordinated propaganda campaign combined with outright manipulation of accounting rules to allow the Wall Street scum to value their toilet paper at a figure that would justify their obscene bonuses.

There is NO fixing of this mess now, whatever chance may have existed has vanished along with the corporate sellouts by Rahm Emanuel and the rest of the crooks in the Obama administration. The real problem, even more so that the bankrupt economy is that the war machine continues to be fed and from all indications by all of the al CIAda fearmongering as of late there is war coming and coming very soon.

Perhaps the real jobs creation plan is the reinstitution of the draft to provide cannon fodder for the only U.S. growth industry - DEATH.

Great work man, keep it up, I can't wait to see today's post if the market plunges again when those jobs figures come out.

EE

RobertM said...

Came here via Malloy as well. It appears that the EURUSD doesn't know what to make of the report...just sorta ranging right now. Bush absolutely fudged the numbers just as every President for the last 30 years, including USA,Inc. CEO Obama, has.
Higher interest rates? Maybe but the US has been screwing savers for quite a while now and I don't see any change in that coming (unless the bond market forces it). Plus the banksters are having so much fun robbing the taxpayers by borrowing at near zero and buying treasuries at 3% (or whatever it is now).