Is The Market Ready For A Rally?

21 thoughts on “Is The Market Ready For A Rally?”

1. Yes Mr. Romero, facts are facts. It is a fact that a President named Clinton signed into law legislation that repealed Glass-Steagall. His Treasury Secretary, one Lawrence Summers, urged Clinton to sign the bill and hailed it as an important step towards moving American financial makets into the 21st Century.

   In 1994 Mr. Clinton also fought for and approved the enabling legislation for NAFTA. In1995, Treasury Secretary Robert Rubin (appointed by President Clinton) and Federal Reserve Chairman Alan Greenspan proposed a plan to allow significant increases in the volume of imports from China. With Rubin's urging, President Clinton approved the plan. It marked the beginning of perpetual and growing trade imbalances between the U.S. and China. Your reference to Nixon's diplomatic visit in '72 is puzzling at best.

   Similarly, cherry picked wiki links that attempt to portray this as a one-sided "R" issue are childish and display a selective ignorance of history. None of this legislation could have become law without the active participation and approval of the leader of the "D" party. Both parties are complicit and share equal blame for the consequences of these bad decisions.

2. Hi Adam
   There is a problem with the audio/video synch on this and the previous post, making it impossible to make sense of your commentary. The aftermath of the storm?

3. I avoid politically based discussions because they are usually viscerally loaded exercises that lead nowhere. In the interest of FACTUAL TRUTH only, I offer the following information related to remarks made above by Mike and TedB

   References:
   [1] http://en.wikipedia.org/wiki/North_American_Free_Trade_Agreement
   [2] http://en.wikipedia.org/wiki/Nixon_visit_to_China_1972
   [3] http://en.wikipedia.org/wiki/World_Trade_Organization
   [4] http://en.wikipedia.org/wiki/Glass-Stegall_Act

   North American Free Trade Agreement [1]
   Negotiation and U.S. ratification

   Following diplomatic negotiations dating back to 1986 among the three nations, the leaders met in San Antonio, Texas, on December 17, 1992, to sign NAFTA. U.S. President George H. W. Bush, Canadian Prime Minister Brian Mulroney and Mexican President Carlos Salinas, each responsible for spearheading and promoting the agreement, ceremonially signed it. The agreement then needed to be ratified by each nation's legislative or parliamentary branch.

   Before the negotiations were finalized, Bill Clinton came into office in the U.S. and Kim Campbell in Canada, and before the agreement became law, Jean Chrétien had taken office in Canada.

   1972 Nixon visit to China [2]
   U.S. President Richard Nixon's 1972 visit to the People's Republic of China was an important step in formally normalizing relations between the United States and the People's Republic of China. It marked the first time a U.S. president had visited the PRC, who at that time considered the U.S. one of its staunchest foes. The visit has become a metaphor for an unexpected or uncharacteristic action by a politician.
   One of the main reasons Richard Nixon became the 1952 Vice-president candidate on the Eisenhower ticket was his strong anti-communism stance. Despite this, in 1972 Nixon became the first U.S. president to visit mainland China while in office.

   GATT and WTO [3]
   The General Agreement on Tariffs and Trade (typically abbreviated GATT) was negotiated during the UN Conference on Trade and Employment and was the outcome of the failure of negotiating governments to create the International Trade Organization (ITO). GATT was signed in 1947 and lasted until 1993, when it was replaced by the World Trade Organization in 1995. The original GATT text (GATT 1947) is still in effect under the WTO framework, subject to the modifications of GATT 1994.

   Glass–Steagall Act [4]
   The Banking Act of 1933, Pub.L. 73-66, 48 Stat. 162, enacted June 16, 1933, was a law that established the Federal Deposit Insurance Corporation (FDIC) in the United States and introduced banking reforms, some of which were designed to control speculation.[1] It is most commonly known as the Glass–Steagall Act, after its legislative sponsors, Senator Carter Glass (D—Va.) and Congressman Henry B. Steagall (D—Ala.-3). Some provisions of the Act, such as Regulation Q, which allowed the Federal Reserve to regulate interest rates in savings accounts, were repealed by the Depository Institutions Deregulation and Monetary Control Act of 1980. Provisions that prohibit a bank holding company from owning other financial companies were repealed on November 12, 1999, by the Gramm–Leach–Bliley Act, named after its co-sponsors Phil Gramm (R, Texas), Rep. Jim Leach (R, Iowa), and Rep. Thomas J. Bliley, Jr. (R, Virginia).[2][3]

   The repeal of provisions of the Glass–Steagall Act of 1933 by the Gramm–Leach–Bliley Act effectively removed the separation that previously existed between investment banking which issued securities and commercial banks which accepted deposits. The deregulation also removed conflict of interest prohibitions between investment bankers serving as officers of commercial banks. Some economists believe this repeal directly contributed to the severity of the Financial crisis of 2007–2011 by allowing Wall Street investment banking firms to gamble with their depositors' money that was held in commercial banks owned or created by the investment firms.[4][5][6][7][8][9]

4. Hey Mike, who was the President that signed the repeal of Glass-Steagall into law? And while you're at it, remind us of the name of the President that pushed NAFTA into law (hint: it's the same guy who opened the flood gates to Chinese products in 1995).

   Your partisan drivel has lost all meaning in our present situation. We are ill-served by both major political parties and it is time to face that fact. Neither serves the best interests of the country, and both are fully-owned subsidiaries of the financial institutions they claim to oversee world-wide. We are no longer a republic, we're a plutocracy that threatens to become a full fledged kleptocracy.

5. Are you as wealthy and smart as Buffett?? If you are, I'll pay attention to your comment.

6. The markets are rigged. We all know that. Fire everyone in Congress and all the representatives too. Then outlaw Short Sales because that is just kicking a company while they are down in the name of greed, and that is just outright theft. Wall Street, with all of their shenanigans has turned the stock market into a crap game. Gambling is not investing in the companies that have made America a great place. So, if you really want to bring America back to it's former glory...fire the 545 people who control the country and change the laws that are hurting most of the Citizens. Then, when you invest in America you know your money won't be stolen.

7. Thanks Mike. I appreciate your comments and agree with what you wrote. As an 83-year-old and WWII vet, I look in my rear view mirror and shake my head. The economy, financial system and The Great Wall Street Casino look like a mine field to me. One wrong step somewhere and BOOM!!!

8. Crashtic,
   Since October 2007, it has been like shooting fish in a barrel..... SELL! When Stimulus is provided, BUY... When stimulus stops, SELL... Check it out.....

9. Your pessimism has cost a lot of lost proffits, and as everybody has seen in the last 3 years, markets can stay oversold for a very long time.

10. Carlos,
    You hit it right on the head.... In 1999, 11 1/2 years ago the Republican veto proof majority removed the Glass-Steagall Act which opened the Pandora's Box of financial lunacy. Now, as you noted we are in roughly the same position which Hoover found himself in 1929 because of much the same behavior..... Only now the problems are compounded by, what is in my opinion, a Republican caused "Perfect Storm" of massive deficits, a manufacturing base that is now in China and the Far East and Mexico thanks to the geniuses who brought us NAFTA and GATT and a middle class that has shrunk considerably thanks to the above.... As I've said before, this will not end well, just as it between 1929 and 1934. Once again, 1934 was when the Democrats passed the Glass-Steagall Act (which separated Banking, Brokerage and Insurance)which returned confidence and a bottom to the stock market crash within roughly four months..... Incidentally, I'm an Independent who tries to vote for the best candidate.....

11. You wait 1 min 22 sec then you complain ? This is a superb free service with outstanding help and information. I am very grateful for the information and tech
    nical insight. Thank you very much for the information.

12. Gold is a good storage place for our money. When the Federal Reserve has issued so much money that is not backed by anything, out money has been so depreciated. The Federal Reserve is the enemy of our economy. We need to go back to backing the Federal reserve notes with Gold. I said that a while back and people thought that I was an crazy. Then the President of the International Monetary Fund who said the same thing after I did.

13. We are entering a political season in the U.S. where billions will be spent to convince seventy million voters that roughly 500 men and women deserve to keep their jobs. We have not seen Congress present a real budget for two years, and deficit spending appears to be baked in the cake for decades. At the "independent" Federal Reserve, negative real interest rates are considered a rational policy tool in a bizarre game of propping up failed financial institutions at all cost.

    In the EU, insolvent banks can borrow money by posting their shares as collateral. The Chinese build empty cities using off balance sheet loans that both parties know will never be repaid.

    Against this background of lunacy, will the "markets" rally? Sure, why not. It's all good in DC, Brussels, Beijing, and NYC.

14. Is it worth it to try to leave a comment? I don't see them appear on the page, maybe I shouldn't waste my time...

15. I don't understand... the CRB index is at +60 score and oil is at -65 score, so basically 2-way CRB and sell oil, but as mentioned, CRB is mostly composed of oil, so talk about mixed signals...

16. Optimistic outlook: Western economies bumping along bottom for decades to come.

    Banks have no cash to lend to homebuyers & businesses.

    It is going to be a long hard road back to "normality" & a real economy.

    ................................

    However, that said, Warren Buffet thinks that the U.S. will be back to normal within 5 years (look it up on Youtube). Unless he has changed his mind.

    Who knows whats around the corner - some people think technology will boost the global economy - robotics.

    The Western economies problem is debt. Japan has still not collapsed under it's debt so why should America?

    We'll see.

17. The problem with the TOILET PAPER (Stock) Market is this: Any NEGATIVE analysis based on fundamentals or charts or the Trade Triangles Technology, can be ARTIFICIALLY defeated by Bernanke (The Fed) by pumping borrowed FREE MONEY (interest rates BELOW the inflation rate) to The Wall Street GAMBLERS (the CARRY TRADE). Today, he pledged to continue the charade for another two years! This is the ONLY detectable effect of all the excess liquidity that has been created over the last 11 1/2 years. It certainly has NOT HELPED housing, the economy or John Q. Public on Main Street, employed or unemployed. The ONLY ONES Bernanke has NOT been able to fool is GOLD and the other precious metals. The reason is that all the excess liquidity with its smoke and mirrors has been bought with currency DEBASEMENT and increasingly HUGE DEBT. The Fed WILL NOT admit that it has converted what would have been a 1 to 2 year SEVERE BUT NECESSARY corrective recession/depression into a 10 to 15 year malingering economy and financial system with a calculated $27 trillion!!!! in DERIVATIVES waiting to blow up!!

18. You're update video is completely out of sync with video and audio. Very confusing!

19. Or should I say, High Frequency Trading (HFT). You know, the fellows that go straight to the market and who's volume doesn't show up on the charts that you and I get. That said, did anyone notice the sell off during the last 30 minutes of trade? Oh to have that kind of power and money.... My bet is that it ends badly, just as it did last time a few controlled the market....

20. Adam,
    I'm going to call this a "Guppy Rally".... Get the Guppies jumping in, then short the whole thing.... Wicked, by the HST are running the markets these days..... Same thing happened in 1929. My slogan is "Buyer Beware"!

21. But, 1/2 weeks ago, you're very pessimistic about the market!

Comments are closed.