The Current FReepathon Pays For The Current Quarter's Expenses?
Posted on 11/23/2015 11:05:58 AM PST by blam
Sol_Palha
November 23,2015
Doctor copper, can no longer be viewed as a leading indicator, in fact, a name change might be in order. A change of name from Dr Copper to deadbeat copper might in order, given its dismal record over the years. After the financial crisis of 2008-2009, the economy, the stock markets and copper parted ways; while the markets and the economy trended higher, copper plunged into an abyss, and it is still trying to find its footing.
All Jokes aside, the reason copper is diverging from the markets is because the Feds destroyed the concept of a free market system long ago. Copper is indicating that this economic recovery is nothing but an illusion. However, several rounds of QE, plus interest rates being held down for a record-breaking period, have altered reality. The markets are moving higher because of hot money, and the economic miracle would end without the low-interest rate band aid. Against such a backdrop, copper ceased to work. In this environment, fundamentals and basic technical analysis can lead you astray; in such an environment Mass psychology works the best. The masses have accepted that Fed intervention is the new norm and that the Fed is the saviour. Hence, this is what investors need to pay attention too, as the psychology of the masses is what drives the markets. Given the old historical pattern between, copper and the markets, the stock market should have followed copper into the abyss, but instead we find that several indices are dangerously close from putting in new highs.
The chart below clearly illustrates how copper parted ways with the economy and the markets.
(snip)
(Excerpt) Read more at marketoracle.co.uk ...
Copper Futures Are Getting Destroyed In Another Asian Commodities Rout (Dr Copper)
Anything of any true, usable value is dropping while fairy tale pieces of papers and digits keep going up. What could go wrong?
This is because - due to the ONLY retirement plan left being a stock-funded/stock-forced-buy IRA/401K/company stock-matching - you MUST purchase stocks everyday, every month, every year REGARDLESS of whether the overall price of stocks is going up, going down, or over-priced entirely!
Thus, the PRESENCE OF MONEY (going into the market) is driving the price of stocks up, regardless of whether or not the “worth” of the stocks (the so-called “companies” being purchased as shares) that is being purchased is worth their prices.
The Current FReepathon Pays For The Current Quarter's Expenses?
My BIL, who has done quite well in the market (while I who stayed out got screwed) said it all:
There is no choice but the market, nowhere else to make a return on your money.
Its not Dr. Copper - its Mister Federal Reserve
The market and the economy went out of synch the day the words “I’ve abandoned free market principles to save the free market system” were uttered.
“Thus, the PRESENCE OF MONEY (going into the market) is driving the price of stocks up,”
YUUUUP.
“There is no choice but the market, nowhere else to make a return on your money.”
Timing is everything. Eating a hefty loss isn’t much of a choice either.
Milton Friedman said this 30 years ago
The Feds mandate us to create bubbles. They are very good at it.
Copper, am industrial metal, is under-utilized and under-valued because industrial production has flat-lined. The tidal wave of money from the Fed poured into oil and stocks and not into new structure or business growth. Stocks are a facade for the hollowed husks remaining.
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.