ANTIESTABLISHMENTARIAN

Finance, Fuel Prices, Economics, Markets

The Stock Markets Will Crash

The stock markets are getting ready to crash again. And this time around there will be nothing left with which to bail it out except for worthless digital dollars passed out by the Fed to the still insolvent banksters, the megabanks whose bankrupt condition congress allowed to paper over with fantasy asset values. This is a road well traveled and well mapped; it needs no further elaboration.

As I predicted, after the Massachusetts elections, the administration and congress appears to be doing an about face, turning on their masters and biting them. We will see mock inquisitions and show trials before congress, yet before the ink is dry on the Presidents proposals, analysts responses that the proposals are little more than window dressing are pouring out. It really matters not whether the they are serious about reigning in the robber barrons, or the masters of the universe as they are often derided. The damage will be done in the form of the psychology of the market.

The health of the markets is the same as the banks, for the health of the market is phonied up in the same way as bank balance sheets. The economy is not recovering, it is getting worse month by month. Government also cooks its own books. Corporate revenues continue to fall all the while reporting rosy profits. How can this be? They are cannibalizing themselves to create appearances of sound health, that’s how. Here’s the proof:

15 stocks in the S&p have a P/E of over 100

23 have a P/E over 60

67 a P/E over 30

150 a P/E over 20

125 a Negative P/E

The last 125 are no doubt correctly priced, but the first 255, more than half the S&P are grossly overpriced. During all prior recessions P/E’s averaged around 8:1. What is holding this market up are the banks and the Fed and not even they can levitate the markets indefinitely. Sooner or later something happens to topple the house of cards. You may recall there was no big event that sent the markets crashing in August ’07 when the mortgage ponzi scheme finally imploded. The powers that be stopped the crash in the midst of free fall by means of the same sort of fraud and chicanery that caused the collapse in the first place, notably endemic corruption. That halt was only temporary, it will resume in the form of the much predicted second leg down reminiscent of the 1930’s.

The events that will put the final crash in motion have already begun. The epicenter of the shock was Massachusetts last Tuesday. These are shock waves that will ripple around the world.

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January 23, 2010 Posted by | Blowing Steam | , , , | Leave a comment

Stock Markets Crash!

The Dow tanks -776, the S&P -106, the NASDAQ -200. My comment: What took them so long? The Great New York casino games were running on borrowed money that the Fed kept pumping into it. Even though the writing was on the wall. Even after all the Wall Street investment bankers were wiped out in toto.

Even after commercial banks started falling like dominos. Even after the credit markets had been frozen solid as Arctic ice for three weeks. Apparently its the Clint Eastwood mentality at work, “Take these stocks from my cold dead hands.” Never mind, you can tune into CNBC and learn about all the huge bargains available at unprecidented low prices. The liars are not to be deterred, they are still at it. Continue reading

September 29, 2008 Posted by | Economics | , , | Leave a comment