US banks winning the inflation-creation war.
In the last few weeks of market trading across the entire spectrum we have seen a number of large down moves in various markets, and up moves in the bond markets.
Does anyone find it strange that not ONE down move has confirmed an actual trend change from bull to bear?
Every dip is a buying opportunity...
Every crash only a "correction".
Every key reversal down negated by a higher open, and no re-test the next day.
The earthquake in Japan should be a game changer, but no one wants to change games right now. Even a new crisis in the middle east had to be engineered to prevent the current revolt in Libya from having chance of solving itself in the near future.
The earthquake lowers chances of the ECB hiking next month. You wouldn't think it looking at the storming Euro today that held it's highs, despite the Yen not holding anywhere near its lows. So much for the "intervention"!
With the American citizen more impoverished at a street level than a decade ago, the only ones refusing to allow declines in markets - have to be US investment banks.
Heads they make a huge bonus, tails they lose their investor's cash should an eventual commodity crash come anyway.
It can only be a matter of time until China does any one or more of the following:-
(1) Increases their influence in the middle east by increasing trade, and ignoring UN embargos. One day they'll actually prevent middle east military strikes by the west rather than just abstaining at the UN vote....
(2) China discovers either vast new Oil reserves, OR devises a new form of power that renders their dependance of oil purchased from western markets obsolete.
(3) China decides to prevent the US from exporting any more inflation - either by refusing to buy US debt, or even dumping their current holdings on the market, and shorting rallies should they occur to prevent a recovery in bond prices afterwoulds. They have enough capital to do it - especially if the Yuan becomes correctly valued at some point in the future OR the world goes off the dollar standard. It could even be done with raw cash, although this of course would take the form of a massive hike of interest rates.
(4) China gets a new international trading currency that then allows them to price US buyers out of all the markets they are involved in. This would mean a painful adjustment for Americans that ultimately US investment banks will get the (rightful) blame for.
All this sounds remarkably like the late Weimar republic's actions in the 1920's. After THAT fiasco, a new politician turned the public's hatred of "got away with it at the public's expense" Bankers to a new extreme.
Before that occured, there was a massive commodity bubble rather similar to what we are going through now....
This is all long-term future of course.
In the short term, even Issac Newton lost a fortune thinking he could go against "the madness of people" and shorting south-sea bubble stock.
The uptrend in commodities is here, staying for now.
I would prefer to see Investment Banks brought down rather than huge swathes of the public when the axe finally falls.
If the public fall instead, with the investment banks running off with all the money, then what happened after the fall of the Weimar Republic can happen in America too.
A large number of Americans believe that people like Gadaffi, Bin Laden, and Ahmadinajad are their worst enemies.
None of the above has much chance of either killing or financially harming any Americans compared to those that sit in the Halls of Power dictating such lousy policies that both physically and financially harm MILLIONS of ordinary American Citizens every day - without them even knowing it! Who decides if your Son gets killed in an unjust and unescassary foreign war? Who decides if your mortgage is foreclosed? Who decides if your firm fires you, or even closes it down?
It isn't a foreign dictator, and it isn't someone you can vote out of office either alas.
Economic freedom and Physical freedom - once mainstays of the US - are being shredded with the home currency.