Even Jim Cramer on CNBC has changed his tune. Now it’s -- be careful and markets are overbought and take money off the table. Last week he even said "... there's bubbling everywhere, and it does worry me." He's being a lot more cautious now, as are all the shills because they recognize that values have now gone so overboard. They’ve got themselves trapped in a box, which even the incoming Fed Chair – and Communist Dwarf – Janet Yellen, has effectively so admitted. In other words, they cannot get the Good Ship QE3 turned around.
It appears that CNBC’s Larry Kudlow, on the other hand, is as bullish as he ever was, but now he doesn’t have any credibility. He’s made fun of – even by the other CNBC panelists. Kudlow is exclusively there to hit the old people. That’s his audience. He’s there to reassure them and make sure they continue to buy another 100 shares of their favorite stock to demonstrate that they are patriotic and loyal Americans that continue voting Republican. That’s what he’s there for. He fills that niche.
People forget that Kudlow in his capacity as a Reagan-Bush official was just another falling-down Washington Republican drunk. He was in the Office of Management and Budget for a while and he held a variety of positions in the Reagan-Bush Regime.
That was the time in the 1980s when if you were not a Washington Republican falling down drunk, people thought there was something wrong with you.
When Dick Cheney was Vice President, he fell down in the vice presidential office on the fourth floor of the Executive Building -- which a lot of people don’t even know exists. There’s a big storage room next to it that was full of Wild Turkey and Jack Daniels and scotch etc. It should be remembered that when he fell down, he broke one of the bottles and managed to light a fire. It made national news and it cost about $10 million to fix the damage. That was the White House’s stash --about 10,000 bottles.
The fact was that it was the liquor that somehow got ignited – but they didn’t say that. It came out subsequently that the room in question in the old Executive Building right next to the White House which abuts the vice presidential office which is called the Vice Presidential Conference Office but there’s a large room like a warehouse, which is where they always kept a stash of liquor. During the Bushonian years, the place was chock-a-block full of the stuff. This was not news to anybody in the know in Washington or on the inside.
But now the Fed governors are being more cautious and more truthful because they all want to begin the taper by the end of the year. But what they want to do and what they’re going to have to do are two different things because now equity markets -- not only in the United States, but this is a global phenomenon – are so divorced from underlying fundamental reality – that there is only one prop and that prop is Global QE.
The central banks are in a position where they can’t taper and where they have to continuously increase QE, as Japan has done and Britain is going to do and as the Europeans are going to do either in December or January. The entire planet’s economy is now riding on a cushion of cheap money. This is incessant liquidity that can not be withdrawn because there is no so-called real economic growth ex of inflation, and economic growth is actually a negative number. Also unemployment continues to be a building problem – not a diminishing problem. And deflation as the ECB’s Mario Draghi said last week is also a growing problem.
The only way to counter these problems is for all global central banks to keep their printing presses on 24 hours a day, because without this support, markets are simply going to fall apart.
You see examples of this every other week where either the Fed or the ECB or the Bank of Japan or the Bank of England threaten to reduce or withdraw quantitative stimulus – and what happens? You get these large one-day sell-offs. What the Fed is concerned about is what the market reactions have been to even the mere mention of a reduction in monetary stimulus.
For the rest of this column by Independent Political, Economic & Market Analyst Al Martin, please click here -- Al Martin Raw
* AL MARTIN, author of "The Conspirators: Secrets of an Iran Contra Insider," is an Independent Political-Economic Analyst with 25 years of experience as a trader on NYMEX, CME, CBOT and CFTC. He is also currently trading the commodity futures market day and night and has a teleconferencing service to facilitate transactions in the markets. This is a service for independent experienced traders.
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