Which Way Wednesday – Japan’s GDP Plunges 6.8%
by phil - August 13th, 2014 8:21 am
MORE FREE MONEY!!!
That's all this chart says to traders this morning, who are taking the European Markets up over half a point this morning and are goosing our Futures by half a point as well as bad news is good news and TERRIBLE news is even better in this Central Bank-sponsored market.
Private Consumption in Japan fell 5% in April, May and June and wages dropped 1.8% while sales taxes rose 3% and – PRESTO – there's your 5% decline in Private Consumption.
Obviously, giving the workers more money is out of the question in a Conservative Capitalist Economy like Japan and we're certainly not going to tax Corporations when we can raise sales taxes that disproportionately target the poor instead so the only solution is: MORE FREE MONEY!!!
Japan has increased their monetary base by 50% since last year and this year they are on track to add another 25% to pump it up to 270,000,000,000,000 Yen. In March of 2000, there were just 50Tn Yen in circulation so a 5x increase in the money supply and NONE of it ended up in the hands of the bottom 80% who, just like in America, saw their standard of living DECREASE over the past decade and a half.
It's a great race to the bottom in annual GDP growth overall as essentially all of the economic gains in Japan and the US accrue to the top 10% (people and corporations) while the bottom 90% circle the drain on the "Road to Serfdom" that Hayek warned us about 70 years ago:
“It is one of the saddest spectacles of our time to see a great democratic movement support a policy which must lead to the destruction of democracy and which meanwhile can benefit only a minority of the masses who support it. Yet it is this support of the tendencies toward monopoly which make them so irresistible and the prospects of the future so dark.
"If we face a monopolist we are at his absolute mercy. And an authority directing the
Monday Markets are Meaty, Beaty, Big and Bouncy!
by phil - August 11th, 2014 8:22 am
"Thruppence and sixpence every day
Just to drive to my babyI don't care how much I pay (Too much, Magic Bus)
I wanna drive my bus to my baby each day (Too much, Magic Bus)I don't want to cause no fuss (Too much, Magic Bus)
But can I buy your Magic Bus? (Too much, Magic Bus) " – The Who
This is certainly one Magic Bus of a market, flipping on a dime or, more accurately, bouncing off the Dow's 200 day moving average at 16,350 back towards our predicted strong bounce line at 16,650. The Transports are also bouncing right off the 100 dma at 142, down from 152 and. per our 5% Rule™, we expect 146 to be tested this morning. This is not "surprising", this is what we said would happen on Friday morning.
As we discussed all of last week, BALANCE is the key in a choppy market and our Long-Term Portfolio finished Friday at $590K, up exactly 18% for the year, while our Short-Term Portfolio jumped to $136,000, up 36% for the year and together they are $726,000, up over 20% for the year on our two primary virtual portfolios.
Having well-balanced portfolios allowed us to ride out the dip and, in fact, buy more longs while the market was pulling back, rather than panicking out of positions that, for the most part, only went down with the market – rather than because there was any actual weakness in the stock.
Our general strategy of Being the House – Not the Gambler is also a great help in consistently making progress in our portfolios, even when the market has such a choppy week.
For most traders, it's "thruppence and sixpence every day" just to hold on to their positions as they gyrate up and down. As sellers of premium, we own the Magic Bus and we collect those daily pennies instead of selling them and that acts as a tremendous buffer to our long-term investing, where simply hanging on to a position allows us to collect another day's rent!
…