Skip to comments.DOUG KASS: Four Reasons The Stock Market Is Ready To Surge
Posted on 04/25/2012 5:17:16 AM PDT by lbryce
Doug KassEarlier we mentioned a tweet from Doug Kass where he said that "frankly" the bears might be screwed.
The reason? It was all looking bad for the market a few days ago, but suddenly the bearish momentum has stopped. And if the bearish momentum can't continue in this environment, then there's really no hope for those on the short-side.
In a post up at RealMoney, Kass identifies 4 things that have changed.
Overall earnings and forward guidance were far better than many of the pessimists expected. Apple remains a pivotal stock and an important contributor to aggregate corporate profits, and its blowout results cannot be overstated in consequence and on investor sentiment. The general concerns regarding domestic economic weakness might have been overstated -- my baseline expectation of a muddle-through 2% real GDP trajectory still seems likely. Lower market prices began to discount the known economic and market headwinds and threats
(Excerpt) Read more at businessinsider.com ...
Impossible! We all know the world will end any day now, dogs and cats will get along, Jews will finally recognize Jesus, and Obama will resign!
“Apple remains a pivotal stock and an important contributor to aggregate corporate profits, and its blowout results cannot be overstated in consequence and on investor sentiment. “
Apples factories are in communist China, so Apple success will be good for America’s stock market ... how?
more jobs for American managers willing to learn Chinese and move to China?
More jobs for American coal miners to dig our coal to ship to China? and for union contracts to build highways and railroads to ship our coal to Chinese ships waiting in our ports?
More jobs for Americans to work on agro-cooperatives to grow food to ship to China?
maybe all of the above
With all due respect to your own, genuinely held beliefs no doubt...
“Free trade” is to otherwise sensible conservatives, what “Tolerance” is for liberals:
Groupthink. Indoctrination even.
“Free trade” (as practiced - disregarding that nearly all other nations practice protectionism in return) is destructive to America.
1. China is moving into a recession right now. This has multiple effects.
2. Manufacturing is slowly making a come back in the U.S. despite Obama’s best intentions.
China this, China that. That dog is already long beaten to death. The tide is turning much as it did with Japan.
China is not Japan.
Japan is a relatively tiny, population-small nation relative to the USA. Lacking natural resources. Yet recall, the challenge Imperial Japan presented last century.
China is equal to America in area, with nearly 5 times our population!
This is a whole new, much more formidable challenge America faces. Never before have we faced an opponent, “bigger” than us.
We’re not in the little leagues. The sooner everyone wakes up and realizes it’s important for us to prepare for a real contest, the better our chances to do well.
Pretending otherwise helps only those who would sell out America.
And what about the mess in Europe?
How leveraged is America’s financials to that looming disaster?
Or, conversely, does that make us, for all our debt, and pending bankrupt entitlements and Obama stupidity, still “the prettiest girl at the dance”?
It's easy for the PRT to pump up the prices on low volume.
Ready to surge...downward (aka dive).
The stock market is like playing solitaire. It’s only a matter of timing and quickness of trade. Everything is punched in and out in random fashion using dubious algorithms and software helping the trader track and punch in the trades. It is garbage in and garbage out computation gallore.
What is real, however, is that the banks are going to KNOW that the money they get back from their loans and the government agent being paid in cash, is going to be bogus.
THe government agent (Obama having a UBS convict account for governments exploiting people in Africa) is going to hoard in Switzerland metals, technologies and what not, while the rest will be starving. Then they will blame the hoarding on your next door neighbor trying to make a survival buck on the “black market”, hanging him for being a capitalist.
It is no accident that Stalin was a failed law student and lawyer in Switzerland... and that the monster story of the Elders of Zion meeting in Switzerland was concocted by communists in France and elsewhere for Hitler to drink like milk. Interesting also that Napoleon wanted to take Russia and that Hitler went to the Caucasus to see his Aryan friends, trying to take the place/world from both ends.
Now that America is being Zimbabwe-ed as I had predicted years ago, the Euro commies all too happy to put a damper on accademic and technologic and moral achievement in America, the game is on, with the GOP-E covering up the tracks and the bad things liberals and crooks do, TARP and stimulus style.
As a result, US banks will fail, along with the FED, while the IMF and other Swiss banks and crooked eastern alternatives intimidating them all over the world will do fine... at least for a time, in that monster campus of school students who don’t have to pay consequences for immorality in front of a boss...
Little pedophile daddy’s little boy like these do not last long, however, at the Gulag this is going to turn into.
And regarding the relative health of the U.S. sovereign problems I like to describe us as “the tallest midget in the room”.
Not only America but Japan and Korea and Indonesia and Malaysia and Thailand and maybe the Philippines. and of course Taiwan must be included.
Then there is the GCC with the freshly minted vibrant Dubai and Abu Dhabi portals.
Sitting on top is Singapore where the real enrichment will continue
All the above will eat Europe alive.
Debt OF nations. Oops.
This is not an intuitive conservative idea but one has to follow use logic and money trailing to see the veracity of it.
I am watching the coup/murder/purge story from China. Communist rule is so inefficient and corrupt. Even as we try to beat ourselves I think they will implode first.
For being so corrupt and inefficient, they’re doing a darn good job eating our lunch.
Don’t rely on the Chinese citizenry to demand freedom. It’s not how their culture is built. Chinese do not yearn for individual rights, it’s just not that high on their scale of what’s important. Certainly not enough, to risk opposing their government.
The Chinese people have always had top-down government.
Before the communist party - it was the Emperor.
Not much difference, really.
America needs to operate on the assumption China will (not) implode, and will (not) spontaneously turn into a democracy.
We need to plan for how America deals with a non-stop, relentless, uninterrupted long-term Chinese strategy to take away American power, and replace it with Chinese power.
Anything less by conservatives and our so-called “leadership” is malpractice.
One reason for low volume is the absence of so much 401k and IRA money.
5. George Soros has greenlighted Operation Kenyan Glockenspiel to swing into action.
That’s what I was asking...could it be enough to derail the stock market.
I know it wouldn’t change cash on hand for investing, but it could affect financials depending on how leveraged our institutions are to that debacle.
And you know how the market tends to “worry” itself out of rallies.
The prettiest girl at the dance could be ugly, but not as ugly as the others.
So, different imagery to your “tallest midget in the room”, same idea.
Any discussion of our nation’s financial health without any mention of “debt” can be safely ignored. If stocks surge again (and yes, they might do so), it will not be due to corporate earnings or projected GDP growth - it will happen when the Fed announces the next round of quantitative easing (CTRL+P; rinse, later, and repeat).
Interesting! 20 some odd responses and almost uniform bearishness. Sounds like Mr. Kass might well be right . . . after all, contrarian investing is usually the best approach! The market will continue to rise if Obama’s re-election continues to look unlikely, which I believe it is.
I agree with almost everything you said. There are only 2 things where I do NOT agree with you.
#1: “Eating our lunch”: IMHO this is a vast exaggeration. They are barely the #2 economy in the world, just edging out Japan. Yes, Japan. 10 years in the toilet Japan. They are growing leaps and bounds economically but have a long way to go before they out-produce our GDP, which by all rights they SHOULD with about 4 times our population and about the same land mass.
#2: “Chinese do not yearn for individual rights”: There have been many, many documented “events” (riots) in China. Yes, the military comes in and basically kills them all. But they keep happening. There was a sea-side town last year that kicked the party leaders out and barricaded the roads; they wanted to be left alone. No word from that place for some time now; I’m sure they are all dead. But the “events” keep happening. IMHO it is a matter of time before the old leaders either die or there is some sort of change. This change might not be pretty, and it might not be Democracy or a Republic, but I don’t think the status quo lasts forever. Of course, I could be wrong, but that’s my opinion.