Is the market nearing a window of opportunity for extreme panic? The Fed’s attempted reflation of the credit bubble is meandering along. But is it working? Or is it about to fail and is the bubble about to deflate in true October style?
“Try as they will,” writes Captain Hook at Safehaven.com, “brokers, bankers, and politicos (the ‘authorities’) are attempting to get the borrowing binge back on track, attempting to get companies interested in leveraged buyouts again, anything to keep the credit bubble from collapsing. If you believe the message in a rising gold price, one must consider the possibility they will be more successful than is the conventional wisdom at the moment, making short selling a very dangerous prospect indeed. Outcomes in October will tell the story in this respect.”
Our position is that credit has entered a long-term bear market. You don’t down from the biggest bubble of all time gently. But central banks, beholden to bankers (as most of them are owned or operated by bankers) will do their best to keep the game going. That means a growing money supply and rising commodity prices.
Markets and Money