Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

The Market Just Figured Out Two HUGE Problems (ObamaNomics DeathWatch™)
Zero Hedge ^ | November 12, 2012 | Graham Summers

Posted on 11/12/2012 1:07:41 PM PST by Zakeet

The US Presidential election ended November 6, 2012. Since that time, the market has fallen 3%.

There are a multitude of reasons for this, but the primary one is the fact that the markets is beginning to realize two key items:

  1. Everything that was a problem in the run up to the US election is still a problem (in fact many issues are now worse than they were a few months ago).

  2. Having engaged in pre-emptive and extreme actions to keep things calm in the run up to the election, the US Fed and ECB have run out of effective monetary bullets.

Regarding #1, according to the ECRI, as of June 2012, the US is back in recession. The ECRI has proven far more accurate and timely in predicting recessions than the NBER. And now that the election is over I expect other US data (the ISM, LEI, and employment numbers) to start moving towards reality (bad).

By the way, the US just hit a new record for food stamp usage.

Across the pond, the European banking and sovereign debt crisis continues to worsen: Greece has to redeem €5 billion worth of bonds on Friday. The country just managed to pass its latest budget proposal (which undoubtedly the country will fail to meet… just like all the others) but the troika has yet to issue its latest report on Greece.

Germany has stated point blank that without the troika report, Greece won’t be getting more funds. Is Germany finally ready to let Greece fail? It’s hard to say. But Germany did put together a special advisory panel to focus exclusively on assessing the cost of a Grexit back in August.

Elsewhere in the EU, Spain continues to implode. The mainstream financial media notes that people are now killing themselves when evicted from their homes. However, things are in fact worse than that. My contacts in the country inform me that in some regions the government hasn’t even paid its pharmacies in six months. Indeed, the region of Valencia owes its pharmacies an insane €500 million.

This is nothing short of a societal shut down. Expect the civil unrest and economic implosion to accelerate in the coming weeks and months.

And finally, France’s private sector is falling to pieces. September’s auto sales numbers were worse than those of September 2008. The country’s PMI reading is back to April 2009 levels. And the French Central Bank has announced the country will re-enter recession before year-end.

Again, nothing has been fixed in the last six months. In fact, things have gotten much much worse.

As for #2, it is now clear that the ECB and US Fed used up their last remaining effective bullets this summer in their efforts to aid the Obama re-election campaign (Romney stated he would fire Bernanke, hence the Fed’s decision… while various EU officials admitted the Obama administration requested that they keep things calm in the build up to November).

Indeed, stocks are now sharply down since QE 3. Gold and Silver, in contrast are up. If this dynamic does not change immediately then the positive consequence of the Fed’s actions (namely stocks rising) is now obsolete while the negative consequence (higher inflation) is about to hit lift off.

What would the market look like without the Fed’s aid? According to the business cycle the S&P 500 would be closer to 1,000.

In the EU, the ECB announced a plan to make unlimited bond purchases for EU nations that meet various reforms and “conditions.” The problem with this is that none of the countries that need money (namely Spain and Italy) want to meet any conditions as their economies are already imploding without additional austerity measures (see the information on Spain above).

Thus, the ECB promise has in fact turned out to be a colossal bluff. At the end of the day, Mario Draghi can say whatever he wants, but unless Germany is willing to go along with the ECB, he can’t do much of anything. Germany demands “conditions” therefore so does the ECB.

So… the global economy continues to slow. Europe is burning (literally in some countries). And the primary Central Banks (the Fed and the ECB) are out of ammo.

Buckle up… things are about to get messy.


TOPICS: Business/Economy; Culture/Society; Extended News; News/Current Events
KEYWORDS: economy; inflation; market; recession
Navigation: use the links below to view more comments.
first 1-5051-52 next last

Before much longer, even these meatheads are going to figure out that elections have consequences!

1 posted on 11/12/2012 1:07:47 PM PST by Zakeet
[ Post Reply | Private Reply | View Replies]

To: Zakeet

Meatheads NEVER think logically, that is why they are meatheads!

Don’t wait for the Kenyan’s subjects to see the light, they are lost to communism...they are no longer Americans.


2 posted on 11/12/2012 1:11:52 PM PST by roses of sharon ("Truly I tell you, today you will be with me in paradise." Luke 23:43)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Zakeet

Subtract dollar deflation from the Dow
and the real numbers around high 8870.


3 posted on 11/12/2012 1:14:46 PM PST by Morris70
[ Post Reply | Private Reply | To 1 | View Replies]

To: Zakeet

Collectivism, made up of the emotionally immature, cannot accept responsibility.

It can only blame someone or something else.


4 posted on 11/12/2012 1:16:33 PM PST by lurk
[ Post Reply | Private Reply | To 1 | View Replies]

To: Zakeet

The only thing that was keeping the market going was the perception that Romney might win. With that gone, the run is beginning.


5 posted on 11/12/2012 1:19:22 PM PST by Behind Liberal Lines
[ Post Reply | Private Reply | To 1 | View Replies]

To: Zakeet
Buckle up… things are about to get messy.

Yep. I read on another site a few days ago that some liberal group in Texas is trying to get a law passed. They want the police to go into any ones home without permission and confiscate all their food in case of a crises. They say all confiscated food should be equally shared with others in the area.

They're not even prepping for themselves. They're once again waiting for everyone else to spend all their money and do all the work. They STILL want someone else to steal for them !!

Even after all the damage they've done to this country, they still don't get it. They still think everyone else will be there to wait on them and take care of them if the economy collapses.

6 posted on 11/12/2012 1:24:08 PM PST by concerned about politics ("Get thee behind me, Liberal")
[ Post Reply | Private Reply | To 1 | View Replies]

To: Zakeet

The markets will realize that it cannot survive under communism. We are there and not likely to reverse for many years. The future will see feeble attempts to shore it up.


7 posted on 11/12/2012 1:25:49 PM PST by Logical me
[ Post Reply | Private Reply | To 1 | View Replies]

To: concerned about politics

I’d like to read about that, if you could give me a link or give me something to search with. Thanks


8 posted on 11/12/2012 1:28:21 PM PST by Rusty0604
[ Post Reply | Private Reply | To 6 | View Replies]

To: Zakeet

What they’ll “figure out” is that

“the nasty, greedy, vindictive conservative business owners caused this to happen”.

I really am beyond caring whom they blame, as long as they experience the consequences of their ideology.


9 posted on 11/12/2012 1:29:05 PM PST by MrB (The difference between a Humanist and a Satanist - the latter admits whom he's working for)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Zakeet

Bump


10 posted on 11/12/2012 1:30:07 PM PST by B.O. Plenty (Give war a chance.....)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Zakeet

Conservatives have always understood that bad things would result from Obama’s re-election. We can start to see that Romney would have only delayed the inevitable. The media and the financial markets in this country are completely corrupt. There is no way we can continue function like that

It is all part of God’s plan. The fact that the Democrats seem to own this Goebbel’s like media machine in the US, is a huge problem. The Goldman Sachs-Federal Reserve nepotism and cronyism is too much. Without truth we have nothing. We are living in a strange Orwellian nation, from that standpoint we are no better than China. If it weren’t for our faith we would be completely lost. Prayers Friends, and be glad He is in charge.


11 posted on 11/12/2012 1:32:51 PM PST by mgist
[ Post Reply | Private Reply | To 1 | View Replies]

To: concerned about politics

After the SHTF, any cop that pull onto my spread will get more than he/she bargained for!


12 posted on 11/12/2012 1:35:09 PM PST by clee1 (We use 43 muscles to frown, 17 to smile, and 2 to pull a trigger. I'm lazy and I'm tired of smiling.)
[ Post Reply | Private Reply | To 6 | View Replies]

To: Behind Liberal Lines
The only thing that was keeping the market going was the perception that Romney might win. With that gone, the run is beginning.

And the feds are printing $40 Billion per month ( QE3) just to keep our faux economy alive.
They can't keep printing money to keep their social programs going forever.
What they're going to do about all those dependent people when the money runs out is the most frightening part. The parasites will be demanding their "entitlements", but there won't be any.
Even more frightening, the "scientists" at the UN have been screaming for population reduction. An economic collapse would do just that. So, don't expect the pro-UN politicians to try to fix it - or stop it.

13 posted on 11/12/2012 1:37:39 PM PST by concerned about politics ("Get thee behind me, Liberal")
[ Post Reply | Private Reply | To 5 | View Replies]

To: Zakeet

All those things have been known and factored in. I thought the market and betting odds assumed obama would win. What this tells me is many of these investors may have bet that obama would win but held out hope romney would win. Now that it is settled they are cashing in their chits


14 posted on 11/12/2012 1:39:27 PM PST by plain talk
[ Post Reply | Private Reply | To 1 | View Replies]

To: concerned about politics
"They want the police to go into any ones home without permission and confiscate all their food in case of a crises.

they'll get my ammo too

15 posted on 11/12/2012 1:44:50 PM PST by showme_the_Glory (ILLEGAL: prohibited by law. ALIEN: Owing political allegiance to another country or government)
[ Post Reply | Private Reply | To 6 | View Replies]

To: concerned about politics
Even more frightening, the "scientists" at the UN have been screaming for population reduction. An economic collapse would do just that. So, don't expect the pro-UN politicians to try to fix it - or stop it.

The UN is in New York City ... in an economic collapse, that would be zombieland. Even after the recent hurricane and following nor'easter, I think folks don't really understand how desperately fragile cities are.

16 posted on 11/12/2012 1:47:51 PM PST by ArrogantBustard (Western Civilization is Aborting, Buggering, and Contracepting itself out of existence.)
[ Post Reply | Private Reply | To 13 | View Replies]

To: Zakeet
from the article...

“...the negative consequence (higher inflation) is about to hit lift off.”

About to? Gas was $1.86 a gallon when Hussein Obama took office. Now its $3.17 a gallon where I live. That’s a 70% increase.

Last year a baked chicken was $4.99 at my local Walmart. Now it is $5.99. That’s a 20% increase in a year.

With the printing presses running non-stop, this will only get worse. Currency debasement is a cancer that will eventually cause the death of the economy.

17 posted on 11/12/2012 1:55:55 PM PST by Gabrial (The nightmare will continue as long as the nightmare is in the Whitehouse.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: concerned about politics
I read on another site a few days ago that some liberal group in Texas is trying to get a law passed. They want the police to go into any ones home without permission and confiscate all their food in case of a crises. They say all confiscated food should be equally shared with others in the area.

They call it the Dead Police Officers Act of 2012


18 posted on 11/12/2012 1:57:07 PM PST by Buckeye McFrog
[ Post Reply | Private Reply | To 6 | View Replies]

To: Rusty0604
I’d like to read about that, if you could give me a link or give me something to search with. Thanks

It was mentioned on Urbansurvival.com. The site owner, apparently, lives in Texas. That's all the info he gave on it. He's a big time prepper.
His site, and expertise, is economics rather than politics, but he does cover quite a bit of it.
I did a quick search to find more, but this group was just getting started, so I'm sure it's small at this point. Once they gather enough parasites to join them, I'm sure we'll be hearing more about it.

They know good people are preparing, and as usual, they're going to be demanding a piece of everyone elses pie - again, by force - like they always do.

19 posted on 11/12/2012 1:57:58 PM PST by concerned about politics ("Get thee behind me, Liberal")
[ Post Reply | Private Reply | To 8 | View Replies]

To: Zakeet

So the left demonizes the rich as evil and somehow they believe that those evil people will just sit back and eat the increased taxes, increased business regulations, etc.. no they will never pass those costs on to consumers right?

That is the idiocy that defines the American left, but Obama has no more road left to kick the can down.


20 posted on 11/12/2012 1:58:08 PM PST by Typical_Whitey (The political mirage of something for nothing; has ruined many a nation.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: concerned about politics

Sounds like the old fable about the ant & the grasshopper. Although locusts might be a more apropos counterpart to the ant when describing today’s liberals.


21 posted on 11/12/2012 2:00:20 PM PST by mellow velo (Oxymorons: jumbo shrimp, rap music, liberal think-tank)
[ Post Reply | Private Reply | To 6 | View Replies]

To: concerned about politics

Actually, when you think about it, they can keep printing money forever. Well, at least as long as there’s an electrical supply to power the printing presses.

Heck, look at Japan: debt-to-GDP ratio of 233%. They just keep cranking out yen, and pretty much no end in sight. They have to keep their social welfare systems going to care of their increasingly elderly population (demographic implosion).

Simply put, as long as the politicians decide to keep the printing presses going, they’ll crank out the dollars. It’ll debase the currency, to be sure, through devaluation, but as long as the politicians choose to keep printing the greenbacks, they will.

And besides, according to John of Orange Hue, (Boehner), it’s time to “fall into line” and get things done. That’s politics for you.


22 posted on 11/12/2012 2:01:38 PM PST by AnAmericanAbroad (It's all bread and circuses for the future prey of the Morlocks.)
[ Post Reply | Private Reply | To 13 | View Replies]

To: Zakeet

Never, NEVER, go full Democrat!


23 posted on 11/12/2012 2:02:03 PM PST by Darteaus94025
[ Post Reply | Private Reply | To 1 | View Replies]

To: Zakeet
Before much longer, even these meatheads are going to figure out that elections have consequences!

Perhaps, but they'll still blame Bush.

24 posted on 11/12/2012 2:05:19 PM PST by null and void (America - Abducted by Aliens...)
[ Post Reply | Private Reply | To 1 | View Replies]

To: ArrogantBustard
I think folks don't really understand how desperately fragile cities are.

I think that's why Agenda21 wants as many people forced into cities as possible. When people are packed into cages, they're easier to control - and eliminate if the need arises (to save the planet, of course).

25 posted on 11/12/2012 2:07:54 PM PST by concerned about politics ("Get thee behind me, Liberal")
[ Post Reply | Private Reply | To 16 | View Replies]

To: Gabrial

Well, the standard poor man’s protein-peanut butter was $1.00 now it is $2.25. That’s 125%.

Of course, food and gas aren’t included in Cola calculations.

So far the money printing propped up the market. How much longer before a 1929 or 2008 crash or worse?


26 posted on 11/12/2012 2:08:06 PM PST by greeneyes (Moderation in defense of your country is NO virtue. Let Freedom Ring.)
[ Post Reply | Private Reply | To 17 | View Replies]

To: Zakeet

They will not. Obama people are lifers.


27 posted on 11/12/2012 2:09:46 PM PST by SSDecontrol
[ Post Reply | Private Reply | To 1 | View Replies]

To: Morris70
Subtract dollar deflation from the Dow and the real numbers around high 8870.

Subtract inflation since the U.S. switched from the Dollar to the Federal Reserve Note and the Dow is around 8

28 posted on 11/12/2012 2:10:54 PM PST by Sirius Lee (RE SP - Republicans, from Mitt Romney ..to Karl Rove... are said to be concerned she will win.")
[ Post Reply | Private Reply | To 3 | View Replies]

To: Sirius Lee

...80


29 posted on 11/12/2012 2:11:43 PM PST by Sirius Lee (RE SP - Republicans, from Mitt Romney ..to Karl Rove... are said to be concerned she will win.")
[ Post Reply | Private Reply | To 28 | View Replies]

To: Morris70

Look up the term “DOW in gold dollars” (also called “DIG$”) ... that’s how I value the stock market. :)


30 posted on 11/12/2012 2:14:54 PM PST by The Duke
[ Post Reply | Private Reply | To 3 | View Replies]

To: Morris70

That’s interesting. My gut feel for some time has that the Dow should be around 8-9000. Anything above that is just fluff.

Disclaimer: I have no money in the stock market.


31 posted on 11/12/2012 2:15:43 PM PST by upchuck (We are not finished yet. But when nobama chooses some more SCOTUS judges, we will be. For ever.)
[ Post Reply | Private Reply | To 3 | View Replies]

To: concerned about politics

Thanks for the info


32 posted on 11/12/2012 2:16:28 PM PST by Rusty0604
[ Post Reply | Private Reply | To 19 | View Replies]

To: concerned about politics

The Fed is printing $85 Billion a month, 40 Billion to buy Mortgage Backed Securities and $45 Billion to buy US Treasury Bonds (US debt to keep the dream alive).


33 posted on 11/12/2012 2:28:04 PM PST by PMAS (All that is necessary for the triumph of evil is that good men do nothing)
[ Post Reply | Private Reply | To 13 | View Replies]

To: PMAS

If the House of Representatives must initiate ALL taxes, and the Supreme Court has ruled that obamcare is a TAX, why does not the House of Representatives just refuse to implement it??????

I know it is much too simple, but still...


34 posted on 11/12/2012 2:46:39 PM PST by Huebolt (United Socialist States of Amerika. Thank you I.N.S. (Immigration - National Suicide))
[ Post Reply | Private Reply | To 33 | View Replies]

To: Zakeet

             

35 posted on 11/12/2012 2:50:55 PM PST by tomkat (a million tiny cuts .. add yours daily .. be creative)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Typical_Whitey

I saw a Tweet today that may explain why your typical Libs think that way:

@TwitchyTeam when gov, can just keep spending without repercussions, no surprising that there are people who think business can also

Made sense to me! Heck, when you think about it, they see almost no repercussions for ANYONE’S spending habits.


36 posted on 11/12/2012 2:54:44 PM PST by nodumbblonde ("I'm all for helping the helpless, but I don't give a rat's a** about the clueless." - Dennis Miller)
[ Post Reply | Private Reply | To 20 | View Replies]

To: Zakeet

It will be blamed on George W. Bush.


37 posted on 11/12/2012 2:55:41 PM PST by Republican Wildcat
[ Post Reply | Private Reply | To 1 | View Replies]

To: Huebolt
why does not the House of Representatives just refuse to implement it??????

Because the bigger and more powerful the government gets, the more power, and therefore luxuries, the Republicans get when they're in charge.

The Republicans, no matter how many times the American taxpayers vote them in, have never gotten rid of anything the democrats have done. In fact, they've added to it themselves.

The Republicans won't save us, either. We're slaves - sweat equity. Some one has to pay for it all. If the slaves escape, the political elites empire comes crashing down. They'd have to live like.....UGH!....the rest of us "animals."

38 posted on 11/12/2012 2:56:23 PM PST by concerned about politics ("Get thee behind me, Liberal")
[ Post Reply | Private Reply | To 34 | View Replies]

To: Huebolt

Because it is already law.


39 posted on 11/12/2012 2:56:48 PM PST by Republican Wildcat
[ Post Reply | Private Reply | To 34 | View Replies]

To: MrB
I really am beyond caring whom they blame, as long as they experience the consequences of their ideology.

See: Lower Manhattan, New Jersey.

40 posted on 11/12/2012 3:04:48 PM PST by ROCKLOBSTER (Celebrate "Republicans Freed the Slaves" Month)
[ Post Reply | Private Reply | To 9 | View Replies]

To: nodumbblonde

That’s exactly what it is. They have this attitude that businesses have this endless supply of money at their disposal. It’s disgusting.


41 posted on 11/12/2012 3:13:58 PM PST by CommieCutter
[ Post Reply | Private Reply | To 36 | View Replies]

To: Republican Wildcat
Because it is already law.

If it's a tax, no, it's not. Tax bills have to originate in the house. Obomacare is a senate bill. It may have "passed", but it wasn't created following Constitutional procedures. Therefore, it's unconstitutional as a tax if the procedure itself is argued.

If the Republicans wanted to stop it, they could. They could simply defund it. It's not valid unless it's re-written by the house and brought up by the house for a re-vote.

It's just that Republicans like it (I.E., it's the good 'ol good cop/bad cop routine).

Remember. Washington sees us as a slave force and not as human beings. We're dollar signs. In Washington, it's all about power and money. It has nothing to do with us. We're like the public school kids - slabs of meat on an assembly line. Each one has a dollar value. We're born, we pay, we die.

I believe once a politician spends too much time living in the beltway, they lose all their sense of humanity. When they need our attention for some reason, they become like actors on a stage. They say they're doing everything for us. Yes, it's all for us (and the ignorant audience cheers them on).

42 posted on 11/12/2012 3:18:35 PM PST by concerned about politics ("Get thee behind me, Liberal")
[ Post Reply | Private Reply | To 39 | View Replies]

To: The Duke

I’m in IT so this is really my knowledge area.

I think it’s tied to GDP. And that dollar and QE
Deflates it, among gold .


43 posted on 11/12/2012 3:24:11 PM PST by Morris70
[ Post Reply | Private Reply | To 30 | View Replies]

To: nodumbblonde

Excellent post.

In my view the US govt is like the family in 2007 riding a wave of false prosperity based on maxxed out credit cards and helocs on a house with negative equity.

It can’t end well....


44 posted on 11/12/2012 3:28:28 PM PST by nascarnation (Baraq's bankruptcy: 2016)
[ Post Reply | Private Reply | To 36 | View Replies]

To: CommieCutter

The other day, my daughter said, “Everyone thinks we’re rich because we own a business.”

We live in the same tumble-down, perpetually-being-restored old house we lived in before we started the business. Our newest vehicle is 10 years old, just as before we started the business. We haven’t taken a vacation in 5 years. NOTHING has changed in our lifestyle but suddenly everyone thinks we’re rich.

I just want to bang my head against the wall...


45 posted on 11/12/2012 3:35:21 PM PST by nodumbblonde ("I'm all for helping the helpless, but I don't give a rat's a** about the clueless." - Dennis Miller)
[ Post Reply | Private Reply | To 41 | View Replies]

To: concerned about politics

“The Republicans, no matter how many times the American taxpayers vote them in, have never gotten rid of anything the democrats have done.”

Not quite...Reagan signed the death warrant for the Interstate Commerce Commission, and Clinton executed it in 1995. That means it died at the ripe old age of 108.

:-)


46 posted on 11/12/2012 3:39:56 PM PST by sergeantdave (The FBI has declared war on the Marine Corps)
[ Post Reply | Private Reply | To 38 | View Replies]

To: nascarnation

But they don’t think anything bad is going to happen because not much has happened to the irresponsible big spenders they know.

Credit card debt? File bankruptcy and that’ll all go away. (I know someone on their third bankruptcy. It’s just a get-out-of-jail-free card to them.)

Can’t afford the house? The government will force the lender to let you stay.

Sheesh, they see people that have never held a job in their lives with plenty of food, heat, medical care and enough cash for tattoos and booze.

What could possibly go wrong? Big Daddy has always made everything okay so far!


47 posted on 11/12/2012 3:48:30 PM PST by nodumbblonde ("I'm all for helping the helpless, but I don't give a rat's a** about the clueless." - Dennis Miller)
[ Post Reply | Private Reply | To 44 | View Replies]

To: Zakeet

Don’t count on it.


48 posted on 11/12/2012 4:33:51 PM PST by sarasmom
[ Post Reply | Private Reply | To 1 | View Replies]

To: Logical me

So much for my retirement plans.


49 posted on 11/12/2012 4:56:51 PM PST by MrChips (MrChips)
[ Post Reply | Private Reply | To 7 | View Replies]

To: MrChips

I have started eating my savings.


50 posted on 11/12/2012 5:11:05 PM PST by Wildbill22
[ Post Reply | Private Reply | To 49 | View Replies]


Navigation: use the links below to view more comments.
first 1-5051-52 next last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson