Tuesday, April 28, 2020

Market Does Fine, Without Jobs, Without Economic Activity

Markets continue to soar.  Nothing is going down, with the exception of oil.

Stocks, bonds, precious metals all are maintaining strong levels despite the fact that more than 26 million people have lost their jobs in the past month.

But this is my last call for a sell as we move to the .618 Fib level.  Experts contend that moving above that level can signify a trend change.  Once again, I will have been wrong about this market, just as I have been wrong about the market since 2009.  In the end, it doesn't matter, does it?  In reality, your assets are worthless!

This chart exhibits the level of the M1 money supply.  We can see that since 2009, the money supply has more than tripled.  Has your salary?  Not likely.  Unless you control the means of production, which seems to be shifting more and more to the hands of the government and government cronies, we are all in the same boat.  Any wealth that you believe you might have is an illusion.

The fact that the Federal Reserve has been printing unlimited amounts of money now cannot be denied.  Yet the effects of inflation have yet to be seen in obvious ways like in Venezuela.  But while we are blinded by the reality, that is the inevitable outcome.

Seems that any market analysis is pure folly.  There are no markets anymore.

Here is the cost of money, very close to $0.  Soon, like oil, holders of money will have to pay others to take their money!  Hey, that's what is already happening in Europe!


As I discussed in last weekend's writing, we are doing a three month test of the highs, more pronounced in the QQQ instrument that is a proxy for the Nasdaq and tech stocks in general.  In premarket this morning, we are at 217 so a mere 2 points away from the monthly closing high.

The next couple of days will be interesting.  In the end though, whether you win or lose, the money you win or lose is quite worthless.

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