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| As the celebratory screams and high fives of Wall Street take place today the world outside slows until it completely freezes and we are standing still motionless in time. The papers falling off of the desk suspend themselves in mid-air; our complete environment goes motionless with every aspect coming to a complete stop. As we walk through the crowd we notice the contentment and excitement frozen on the faces of the Wall Street crowds as if we were returning home from a triumphant battle fought with swords and shields of epic proportions. The more you look into the eyes of your surroundings the more you come to the realization that despite our vast previous chapters, lessons learned, and healed scars the normalization of our falsely created reality may prove to be our deadliest dose of our favorite drug. Victory..
The cyclical nature to our current position is what Einstein famously referred to as the “definition of insanity”; doing the same thing over and over again yet expecting different results. If the only constant in our universe is change, why is it that our actions and results seem to come around full circle like bell bottoms and skinny jeans?The Italian Bond market takes praise as $6.5 billion Euro’s in new 5 and 10-year bonds are sold at a yield of 4.83% prolonging the inevitable “time to meet your maker scenario”. Bernanke testifies in front of congress that they will continue serving the people their favorite cool aid until the unemployment numbers get below 6.5%. In full understanding this sounds like a great and valiant effort to “save the people from destruction” but who are we really saving?The first quarter of 2013 posted the most recent unemployment levels at 7.9%, much higher than any point during the full year of 2008 by over a half of a percent. In 2012 our lowest point of unemployment reached celebratory level of 7.8%, which is lower than today’s. Sounds like we are on the path to greatness right? At the end of the day despite endless free ink refills for the Federal Reserve our unemployment levels are worse than the best month in 2012. The only difference that can be witnessed is the shortened time period between visits to our favorite dealer, the Too Big To Fail’s profit margins, and a rapid decrease in median home income. There are many lessons to be learned before some can say they have the scars to prove it, but reading through the white noise on Wall Street one would assume that Mr. Bernanke is well aware that the drugs that we have injected into our economy is having less effect and requiring an almost non-stop fix. By keeping this in mind as an experienced investor you will find a glimpse of opportunity hidden in the doom and gloom environment written in this article. We are going to keep printing money like we have been with no end in sight; if we stop we could see serious consequences, so the race to the edge of disaster steams forward. In my opinion there will be grave consequences for every high five and two step dance performed over the last couple of years but who am I to judge? A much more seasoned investor than “I was” is writing this and strategizing an opportunity to make significant profits all the while minimizing my risk and knowing my positions like my left hand. The U.S markets enable many to work from anywhere in the world needing nothing more than a plug for the internet, regardless of the rest of the country’s current unemployment numbers. The Fed will continue to pump liquidity into the economy and markets until they almost single handedly control every aspect of every price reaction taking place in our current markets. This will start to contort many major aspects of the markets such as fundamentals, technical analysis, and the reactions to greed/fear. The market instead will start to react to how you would want it to react on certain days if you were in charge of it! If I were in charge of the “system” and going on T.V, I would want the market up 200 points regardless of a single indicator or emotion on the street then at the end of the day find a headline to tie it to so the history tape makes sense; this is nothing more than a common animal instinct that lies within us all. Taking notice to our environment and situations within the market will assure that we have a strategy for profits playing into such an obvious result. As grand as it feels rewarding ourselves for a huge victory of battle that never took place, we should start to read between the lines and ensure that our senses are intact from this point moving forward while investing. Know that although many things may be pointing straight down as far as sentiment and what the market should be doing as a whole, anyone that gets in front of the Fed will get laid out faster than the old school Kimbo Slice knockouts tapes. This is a great chance to profit, go where the market goes and when it wants to go; if that stops working have a strategy to profit on the right side of the market from that point out. By no means should you take off and run full speed into the woods just yet; trade the markets as you normally would only this time wearing 3D glasses and a strategy in place that ensures consistent profits when we go to our favorite Kool Aid dealer for the next hit, and also when he moves out of town.. It is better to see it coming with one eye open then both eyes closed.
Written By: QuickDraw |
