I think it happens slowly…you go through Life noticing an increasing number of strange synchronicities which reminds me the new edition of C.G. Jung‘s Red Book is finally shipping). and as the synchronistic events mount up, one develops an appreciation for the fine dance of co-creation. And every so often – like this morning, for example – we get a chance to see first hand that not only is out Great Dance partner always leading, but often with a fine-to-wry sense of humor at that.
I refer, however obtusely, to the term “Black Friday” which will not only indicate black as in getting “retailers into the black” (or at least nearer it) but the second meaning that goes back a couple of Friday’s to the Friday the 13th/bad luck meaning grounded in all kinds of history including numerology, Norse legends, and just so they don’t feel slighted, the mass arrest of Knights Templar in 1307 by King Philip. A kind of ultra-bad-luck day as the price of gold has tumbled more than $30 in the early going which (by the Ure Ratio of gold moves times ten approximates Dow moves) suggests a 300 point (or more) tumble in the Dow at some point in today’s trading.
The range on gold has been pretty impressive, too: A spread from high to low of just under $60 an ounce. Don’t know about where you live, but here in sensible East Texas, nearly 6% moves in any commodity over the course of a single day pretty much defines ‘volatility’.
European markets are trying to put on a little bounce early this morning – most of the serious damage was before and just at the open. The Brit’s ‘Footsie’ had been up around 5370 earlier in the week but it managed to blow down to the 5,104 area before rallying this morning.
Take that kind of 5% move and apply it to the Dow and we have the potential to break down as low as 9,941 or thereabouts, but that’s not the real story yet.
The real story is that such a move would penetrate the ascending trend line, below which technicians by the presumed boatload would jump over to the short side of the markets and you’d be able to kiss goodbye to the sugar plum fairy dreams of a Dow making new highs – at least till late spring since the technical gates would be open for a retest of March’s lows which are would put us 3,800 Dow points lower than where we left things before Turkey Day.
It’s a safe bet that one faction of the PowersThatBe will try to paint the tape pretty hard in order to keep above that trend channel, and therein lies the most interesting question of all: Can they do it?
It’s always hard to beat the team with the printing press, so I’m not even trying on this one. The goal-line stand around 10,000 should be amusingl, but a move under 10,000 on a weekly basis it is a prerequisite for me to even think about put-buying, although that trend support lines will keep moving up over time.
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So What’s Causing This? If you thought it was the oft repeated/forwarded rumors on the net about how some central bank gold is alleged to have been filled with similar weights of tungsten, wrong. If you thought it was because of a grim retail outlook and the prospect of taxation gone berserk because of the latest act of own slapstick government, wrong again.
Nope: Let’s back up. Did you ever get the email that went around, oh maybe a year ago with the pictures of the new winter skiing facility in Dubai? It’s been all over the net – and with some good reviews as well. But, if you’re like me, an alarm bell may have gone off in the back of your head asking “Why would these good people build a Western-style skiing operation in the midst of a country which is largely desert, oil, and flattish? Does this seem, oh, you know…like malinvestment?” We leave that to markets to decide…
Which they did after the carefully timed announcement that development projects presumed to include the prestigious “The World” project, would need to postpone payment on $60 billion in debt.
I distinctly recall thinking at the time of watching The World’s artificial islands being built in high profile TV documentaries wondering “How long they will be able to keep going at this burn rate through their cash? Maybe they don’t get enough rain to have really internalized the concept of ‘saving for a rainy day’…”
Well, it’s now raining in the financial sense…or the the Times Online headlines it “Dubai in deep water as ripples from debt crisis spread“.
Not that this hasn’t been expected: I’ve heard rumblings that the whole game in the American oil patch was to get the price of oil really high a couple of years back (remember $5 gas reports?) which would get a lot of the Middle East investment houses and projects depending on high prices. Then, by pushing down prices, drive many OPEC members to the brink – or in this case – just beyond. It’s really quite artistic from a grand tactics perspective. Either that or stuff happens.
Best guess: the troubles in Dubai may be only a precursor to tougher times ahead in that region. From a Big Chess Game perspective, one has to wonder how much demand there will be in the post-Madoff, post-Bush, post-Bailouts world for uneconomic malinvestment. “Not much?” you’re thinking. You’re a frigging genius…no stopping you, is there…
So we begin trading this morning in a fine world-as-a-classroom setting where the main lesson seems to be “If you live in a desert and someone shows up selling winter sports gear funded by presumptions about high oil prices forever, be suspicious. Mighty damn suspicious.”
That the West may be successful in its latest “Conquest By Business Model”. Wasn’t it Shakespeare who wrote “A fool and his proven reserves are sooner or later parted”?
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“Is this a web bot hit?” wondered a reader as the London Stock Exchange hit a ‘technical hitch’ in Thursday’s heavy trading. Let’s see how trading systems hold up in the next week or three and how that 10,000 line holds.
Black Friday, II
Depending on who you care to quote, you can find both sides on the question of whether this year’s outbreak of SSD (season shopping disorder) will be better or worse than last year. The WaPo headlines “This Black Friday may top last year’s“. A Barron’s blog wonders if the deals will be enough to pry money from consumers.
Except for a few stocking stuffers, we’re not buying much until January sales again this year. Holding the event observance is fine for this month. If someone said to you “If you can wait a month, you can get 25-40% off many items.” do you think you could keep your credit card holstered for a few weeks? Surprisingly, most folks can’t…which I suppose is why there are so many average people in the world, huh? Herd instincts are strong, I ‘spose.
The Wall St. Cheat Sheet has been tallying up 20098 retailer store closings - worth a look to see where the belt-tightening is happening.
It’s a shame Kwanzaa isn’t a couple of weeks later….would have been the perfect sale-oriented commercial holiday. Oh well…maybe Groundhog Day (Feb 2) or Valentine’s Day (Feb 14) will work out. Oh how about Chinese New Year on February 10th? Just pondering, sorry.
Sticks and Stones
With word that the International Atomic Energy Agency has voted to censure Iran for its nuclear program, I’m left wondering “So what?”
The resolution also asks Iran to, in effect, rat itself out about any other hidden nuclear resources, but that doesn’t seem any more likely than winning the Power Ball Lottery this week.
Climategate
Five MP’s in Australia have tossed in the towel now that climategate makes it clear that junk science and academic/PTB strong-arming was more the source of global warning. Implications of rigging the data are still being felt.
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But no, don’t let the trip by president O to Copenhagen get interrupted. Gotta keep up appearances for the still gullible…or silent majority – call it what you will.
Criminal Coddling
You saw where Roman “Polanski prepares for luxury Alpine house arrest“? Why is it in a world run crooked by the cadre of elites that justice is pronounced Just Us.