Monday, January 31, 2011

Bulls Dance with Bernanke (the Bernank) through January

Apparently, in this new world order, international crises affect stocks for only one day.

And that day was Friday. Today's trade was "risk on" again, even as the situation in Egypt crept closer to complete anarchy, rioting and food shortages.

Not to worry, Ben Bernanke, according to the schedule, furnished the Primary Dealers with between $6 and $8 billion through outright purchase to grease the skids... er, goose, pump, ah, well, you get the picture.

Stocks went on another tear ahead, leaving Friday's sudden decline for the losers who sold. As all great analysts of today know, you don't fight the Fed or sell the dip. You buy the F-ing dip.

Since there was no news - good or bad - upon which to move markets, we find the tenor of today's trading most appropriate, since CNBC or any other financial journalist doesn't seem to feel a need to mention the beneficial nature of the Fed's QE2 program to stocks, nor the fact that it is inherently inflationary, destructive to capital and a huge Ponzi scheme.

Since this is the final day of trading for the month of January, there was probably some degree of window dressing being done by fund managers and also large dosages of red Kool-aid for all.

Wall Street is drunk with the power of money and fractional reserve banking and is officially in another universe, divorced completely from reality and interested only in fattening the wallets of their directors, themselves and their largest clients.

Egypt will fall, and maybe Saudi Arabia next, but the masters of the universe will still need to keep the stock market going higher, if only to delude millions of Americans that everything is all right. The party will go on as long as nobody removes the punch bowl from which they all drink, and making matters worse is the Ben Bernanke is both designated driver and punch bowl spiker. He has the keys to everyone's cars and an unlimited supply of monetary booze.

Party on! The Bulls are loving the frozen tundra of January, which, by way of reference, we bring the January Barometer, which preaches, "as goes January, so goes the year." And we have no reason to argue with the logic, at least until June, when QE2 is supposed to expire. Besides, the January Barometer has been wrong the past two years, so it should come back for a win in 2011, no?

Dow 11,891.93, +68.23 (0.58%)
NASDAQ 2,700.08, +13.19 (0.49%)
S&P 500 1,286.12, +9.78 (0.77%)
NYSE Composite 8,139.16, +76.52 (0.95%)

Advancing issues beat decliners 4230-2265. Oddly enough, there were only 68 new highs and 39 new lows on the NASDAQ. On the NYSE, new highs beat new lows, 125-18. Volume was well short of Friday's big number, but that's the norm here and has been for some time. Ask yourself, if there's more selling than buying, why are stocks going higher? Then hit yourself in the head with a hammer a few times. That should give you an idea of how convoluted our national markets really are.

NASDAQ Volume 1,991,840,000.00
NYSE Volume 4,939,404,000

Of course, the situation in Egypt, while good for stocks, apparently, is also good for screwing consumers at the pump. Crude futures started the day in the red, but quickly reversed course and ended the day more than 4% higher, up $4.32, to $92.19, even though the Suez Canal remains open and oil continues to flow to its destinations without interruption. There are no disruptions, except for those in the heads of people who believe we must pay more per gallon for gas, no matter what, forever and ever, amen.

And since there's an international crisis, gold should be bid up, but of course, the elitists controlling the precious metals can't have that (they want to buy more at low prices), so they sent the glittering metal down another %10.70, to $1,333.80. Silver also is desirable, though not as much, so it was allowed to rise 85 cents, to $28.17. These commodity trades make no sense unless you have your tin-foil hat firmly attached and antennae up. Otherwise, you don't get it.

While Cairo devolves into a weeping slog of hungry humanity, Wall Streeters will be anxiously awaiting the most current estimate of national shame, Friday's non-farm payroll report. We'll get the highly-discredited ADP report on Wednesday and there will be much speculation. The market experts expect the US to have added between 125,000 and 150,000 jobs in January. That number might be enough to keep up with population growth, and it's well short of anything even suggesting "growth" in job creation, but, if it falls short of the desired result, the very same experts will blame it on the weather, or snowfall, or just ignore it altogether as they usually do.

Because Uncle Benji will be delivering more Bernanke Bucks, and everything will be just fine, you just wait and see.

BTW: The Dow is up more than 300 points this month and since September 1, 2010, it's up almost 1900 points, good for a 19% gain in just five months. See? Everything is just fine.

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