Ares
15th April 2010, 12:58 PM
As I predicted, the stock market continues its march toward 12,000 by late summer.
Inventories are being replenished, there's some private sector hiring (largely part-time still), big gains in part-time census hiring are materializing, retail sales are jumping, the Fed is holding down interest rates at an unprecedented 0%, and large federal tax rebates are spurring bullish sentiment.
And it's not just here in America. World markets are surging even more, especially in the BRIC (Brazil, Russia, India, and China) nations. Europe is weak, but the EU/IMF bailout is temporarily assuaging fears and stabilizing the Euro.
Many pundits are declaring a V-shaped recovery.
But, don't be fooled. We are riding a wave of record-breaking monetary and fiscal stimulus, stimulus that will run its course by late summer. The private sector has barely deleveraged from record debt levels, and the public sector has exploded its debt load to unimaginable heights.
We are in the midst of another bubble, similar in many ways leading up to the 2008 panic & early 2009 collapse.
As a result, I am predicting the "Great Slowdown of Fall '10". While a few esteemed trends gurus like Gerald Celente and Robert Prechter are predicting another panic/crash type scenario later this year, I believe August-December will more likely mirror the slowdown of late 2007 to August 2008, a time we know rightly identify as the initial stage of the Great Recession.
Come Fall 2010, we will begin hearing talk of a "Double Dip" recession. Fear will begin to creep back into world markets. Markets could drop 20%. Interest rates will be measurably higher from current levels. Ugly fundamentals and the reality of crushing debt will begin to pressure the stimulus bubble.
Two factors, however, could initiate the "Great Slowdown of Fall '10" a month or two ahead of schedule. First, a double dip in housing could force the Fed to start buying mortgage-backed securities again, and second, massive cuts & tax increases in state budgets could offset stimulus gains to a greater degree than experts predict.
At this time, the only risk I envision for a panic/crash replay later this year would be a real estate bubble burst in China, a trend we will be covering shortly here at the Independent Forum.
http://theindependentforum.blogspot.com/
Inventories are being replenished, there's some private sector hiring (largely part-time still), big gains in part-time census hiring are materializing, retail sales are jumping, the Fed is holding down interest rates at an unprecedented 0%, and large federal tax rebates are spurring bullish sentiment.
And it's not just here in America. World markets are surging even more, especially in the BRIC (Brazil, Russia, India, and China) nations. Europe is weak, but the EU/IMF bailout is temporarily assuaging fears and stabilizing the Euro.
Many pundits are declaring a V-shaped recovery.
But, don't be fooled. We are riding a wave of record-breaking monetary and fiscal stimulus, stimulus that will run its course by late summer. The private sector has barely deleveraged from record debt levels, and the public sector has exploded its debt load to unimaginable heights.
We are in the midst of another bubble, similar in many ways leading up to the 2008 panic & early 2009 collapse.
As a result, I am predicting the "Great Slowdown of Fall '10". While a few esteemed trends gurus like Gerald Celente and Robert Prechter are predicting another panic/crash type scenario later this year, I believe August-December will more likely mirror the slowdown of late 2007 to August 2008, a time we know rightly identify as the initial stage of the Great Recession.
Come Fall 2010, we will begin hearing talk of a "Double Dip" recession. Fear will begin to creep back into world markets. Markets could drop 20%. Interest rates will be measurably higher from current levels. Ugly fundamentals and the reality of crushing debt will begin to pressure the stimulus bubble.
Two factors, however, could initiate the "Great Slowdown of Fall '10" a month or two ahead of schedule. First, a double dip in housing could force the Fed to start buying mortgage-backed securities again, and second, massive cuts & tax increases in state budgets could offset stimulus gains to a greater degree than experts predict.
At this time, the only risk I envision for a panic/crash replay later this year would be a real estate bubble burst in China, a trend we will be covering shortly here at the Independent Forum.
http://theindependentforum.blogspot.com/