Friday, November 09, 2012

German Exports Fall At Fastest Pace In 2012 And General Remarks About The Global Economy And Financial Markets

I have been beating the drum most of this year that change was coming.  Just not in the form of hope most people believe they are going  to see.  Early this year I remarked of an upcoming turn date.  That date turned out to be the literal tipping point in the European bond market and global equity markets.   Few global equity markets have regained their March 2012 high since.  The American equity indices have been the strongest in the world in the last six months and they marginally regained that March high by just a few percentage points on some of the weakest market internals I have ever seen.  As of today, the S&P is back below that March high.   I expect March 2012 to hold as the turn date to the back end of this crisis but we shall see.   To date, there most certainly is no chance that high will be taken out for any period of time based on market breadth and participation.  

While I am not on my computer to pull and post a graphic right now, the Volume Cycle Count Algorithm I have posted on here quite a few times is signaling the possibility of extreme weakness ahead.  Just as it did before the 2008 collapse.   Of the data points I use to determine the fate of equity markets, the key remaining piece I need to consider this a very high probability correction or worse is for the S&P to finish today below 1372.  I’m dubious that will happen even though we will start today below that level. 

For the last six months we have discussed numerous times that money is draining out of the global economy and off of corporate balance sheets faster than the lead up to the 2008 crisis and faster than at any time in the last dozen years.  ie, The start of this crisis.  Since those many remarks I have a few data points in confirmation.  That includes my September post that Reuters reported corporate earnings revisions were the worst in eleven years.   Confirmation of what I had written  months before Reuters even had the data to make that call.   And, now we see this report out of Germany.  It takes time for changes to be seen in such a complex system, but quantifiable changes are starting to appear. 

Although I most certainly have never told readers how I am able to “predict” with such accuracy, let me just say it takes a lot of hard work and I’m not about to share intellectual property just for the heck of it any more than Apple is going to give away its iPad for free.   

So…  let’s discuss a more esoteric point to consider regarding our future and our fate now that everyone is once again happy their favorite football team has won the election game.  Popularity now determines intelligence and competence in our nation--  

We see a very high degree of desensitization again setting in with all of the carnival barkers in the bubble.  They grow bolder as they perceive this crisis has passed and they have consolidated their power.  Illegitimate power.   Included in that are the politicians who glibly take credit for getting us out of this “recession”.  This is a massive megalomaniacal delusion that exists only in their mind.  They have done nothing but make this ultimate crisis worse as we will eventually find out.   This is not a recession.  A recession is when you decide to double down on bologna once in a while rather than eating steak. 

Like Pavlov’s Dog, the knuckle-dragging lever-pullers in the dumbed-down corporate state have once again become conditioned to a perception of reality that the Federal Reserve is going to save them, their system of looting and the global economy.  Just like before the 2008 crisis.  And, just like I said in 2008 before the collapse, I have again said this year that the Fed won’t be saving anyone.  That their policies were instead coincident with other factors that conspired to stabilize the global economy over the last three years.  And, that current Fed policy will prove ineffectual.  In other words, as noted before, the Fed does not cause Christmas.  But, that doesn’t stop the self from experiencing desensitization due to its own conditioning.

The flip side of this is that society is becoming desensitized as well.  We are becoming desensitized to crisis after crisis after crisis.  That includes economic crisis, the toll this crisis is taking on our societies and our loved ones and the endless crises we see developing in the natural world.  And, with that desensitization, we are becoming much less motivated by fear.  But, fear is the primary tool the corporate state uses to maintain its grip.   My point?  You can only cry wolf so many times without it having almost no effect.  The status quo is losing its ability to strike fear into society; a necessary tool to maintain their grip.   Remember, the same thing happened in Tunisia, Egypt and elsewhere.   There is no greater leverage in the system than the fear and propaganda used by the 1% to maintain its grip over the 99%.   Desensitization diminishes that paper tiger to the point where it eventually will have little intended effect.

I was most certainly concerned about the last few months, especially late September and October, but we passed through those dates easily.  I’ll tell you why I believe why we passed through the last few months without a scratch in a post yet this month.  Let me just say it isn’t a bullish reason but rather a very disconcerting one.  In the mean time, I expect we are due a an attempted stabilization here soon.  Early to mid November volatility isn’t uncommon but we generally bottom and head higher through the end of the year.  That said, the dynamics I have been writing about aren’t getting any better.  

I have what I believe is a really good post on Europe and Germany that I will stick up here by the end of the year as I promised a few months ago.  Everything you are being told by the financial carnival barkers, economists, politicians and the press is nothing more than a big pile of dog poo.   

Title link here.

posted by TimingLogic at 9:27 AM