Here is the price of Cotton, a monthly chart. Cotton as everyone knows is used to make things we wear. It could not be more clear, that right when the QE process began, this and many other commodities just completely launched upward. If you think this is not going to present some type of gargantuan problem at some point, you are living on another planet.
Here is a monthly chart of Soybeans. Once again you can see the meteoric rise once QE started. I could put up one chart after another, and with the exception of Oil, they almost all look the same. Now we go to the Inflation reports from our good "trusted" friends, and are told inflation is on the very low end. Are you bleeping kidding me? These people are so arrogant it is just beyond belief. The tweak the reports to exclude everything they are deliberately inflating, so they can tell us there is no inflation. Instead of CPI ex autos, food etc, like they tell us, it should be report as CPI ex everything that is rising. With wages not keeping pace with these types of increases, most if not all people, have less disposable income, if they have any at all.
Now we shift to what is going on in Wisconsin, and beginning in Ohio. I have stated in here that I saw no reason why what happened in Greece could not happen here. We are seeing a poor man's version of it right now. Maybe we are too soft to get a real protest going. To think we could have a situation where people who are so specially treated, that they have to pay very little or none of what the average American does for their health care or pensions, reacting like this to these small changes should tell everyone who is asleep at the wheel to wake up. This is a powder keg. Just the verbiage I hear and the anger are to the point where this could erupt into something very scary.
I personally am about ready to go there and drop a couple of these ingrates. They are not even ingrates, they are privileged citizens getting my money taken from me and essentially given to them, and now are complaining that I don't want them to have quite as much of it anymore. Then in the middle of it the state legislators do a late hour duck out to another state? Net net, the crux issue as to whether or not our way of life continues or not is this exact issue. Are we going to be an entitlement society for the minority of the people, while the majority suffer terribly? It is my feeling that the collective will of the people will ultimately decide this be it peacefully or otherwise, and the otherwise is not out of the question. As individuals we all have our principles, and can only be pushed so far. Now is a time where hard decisions and conversations have to be had by politicians who live to avoid them. I heard on a radio show yesterday a woman asked the following question from the host. After he explained that with federal, state and local taxes, he was paying a total of 55% in taxes. He then asked if that was enough, or how much more was enough for her to feel good about them taking enough of what he made to satisfy her. Her answer was " well how much do you have." She felt it was up to her to decide how much of his money to take away from him! It is just shocking to realize a fellow american actually thinks like that. This class warfare is not just talking points, it is here and brought by the great divider, Barry. I am sure his plan was not the create a war over it, he probably felt people would complain some but just go quietly. He was mistaken.
All the while the stock market sails merrily along upward. The P/E ratios are off the charts so from a value standpoint alone, odds do not favor a huge up move from here. As I have said, my indicators do appear to be a long ways away from any sell signals also. This is why I have suggested tightening stops but not getting short. The political commentary above really has nothing to do with executing an actual trade at all. What it does do is factor into the bigger picture perspective on where to have your money. I think people need to be aware of what could potentially happen here and also why it is happening. With all of these things going on this is why the FED is doing what they are. It is one thing to be frustrated but have your retirement relatively safe here with the DOW at 12,320. It is another to have these problems brewing with the DOW at 6500 and half of your retirement vaporized. This is why they have done what they have and are fighting on a daily basis to make sure the stock market does not decline, even a small amount.
These potential conflicts would be a whole lot worse if people had alot less money. This is why getting aggressively short now is a mistake. You are fighting the greatest rigged hand in history and are not going to win. I also would not be suprised if behind closed doors, some of the politicians that want to illegalize shorting are all for continuing this push. They will clean out every short seller who ever read the word if they keep pushing this along. They won't have to outlaw it.
Keep your powder dry here there is going to be good opportunity shortly to make some good money.