Friday, June 10, 2011

That's all?

12:29 pm (Hawaii) Really, if the financials are worse off than they were in the subprime mortgage crisis, why don't the charts reflect it? Or is this just the beginning of a new, dreaded chapter? The time spans of these charts tell the tale, and without QE1 and QE2, most of the sector would be dead and buried by now. Instead, they were revived and FAZ wound up hobbling around on one leg. If you believe there will be no QE3, at least not for several more weeks (beyond June 30), then FAZ has plenty of upside. But there will be a bailout/easing plan to save the banksters' collective behinds at some point. That would not be the time to be long FAZ in a large way.

It is, in a quite educational way, for all to learn exactly who runs this nation and the globe. It's all unfolding before our eyes.

FAZ 1-day (1-minute)

FAZ 2-week (daily)

FAZ 2-year (daily)

Crystal Ball: The Fed will let the Euro debt crisis play out. That alone will drag US financials down, i.e. Greece-banksters death dance. Then the jobs numbers prove futile again. And again. Confidence dwindles to a drip. At warp speed, FAZ returns to 60. Good news for the finnies, or at least rumors, hit the street and FAZ sells off briefly. But again, nothing out of the Fed, nothing real, and FAZ blasts off to the next resistance level: 90. That gives FAZ a 2011 run from 30 to 60, then roughly 50 to 90.

What took FAZ nine months to undo (90 to 30) could take just one-third or one-fourth the amount of time to reverse. But I doubt FAZ sees 100. By then, the Fed and Treasury will have completely raided 401k plans. Maybe a new program will be formed, allowing a "loan" to the Fed that doesn't officially permit the printing of more US Dollars. But that's what it will actually be. The market will gradually melt up on low volume, similar to 2010, except it's all cloak and dagger stuff.

If my piece of fiction becomes reality, it's a matter of three choices: a) short the market (FAZ, ZSL, QID, etc), then b) go long the market when the selloff ends, or c) go on vacation from this madness and enjoy sweet, blissful time away thinking of nothing and doing everything fun.

That last notion seems so interesting, don't it?

No comments: