The Hollow Victory Lap

The market tracked brilliantly (down) to our expectations this week.  However, the “Bernanke Paradox” is still driving. Down more than 900 points Friday the Dow decline is unlikely to delay an expected rate hike at the Fed’s upcoming meeting.

This morning, a few notes on how the charts – using our Aggregate Index approach – are painting the way ahead.  It’s an interesting game of future-guessing.

Which we will get to after a few headlines to kick-start the neurons.  You’re about to wrap your head around the whole world’s biggest-ever economic problem:  We call it the Bernanke Paradox.

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33 thoughts on “The Hollow Victory Lap”

  1. Nice explanation of the current state of affairs G. Seems like a lot of this could have been avoided by directing the ‘stimulus’ towards rebuilding our manufacturing capabilities instead of paying off big influencers, but, that would take something that’s absent in this rats nest….integrity, principles and a concern for the health of the populace and nation.
    This whipsawing between stimulus and tightening is like a novice docking the supply ship to the ISS with only main thrusters available. When the bump occurs, we’re losing orbit (and a few parts, like the airlock latch).
    The thought of a limited scale nuclear event as a death rattle to save the dollar invokes visions of Slim Pickens riding the bomb yet we seem hell bent on pushing Russia into a brash(er) response. Let’s throw another $1B of surplus weaponry at it and see if the campfire gets bigger!

    • Great observations, but one point Rico should be carefully thought-through.
      Which is IF the Fed is papering over a deflationary depression with counter-acting inflation, it would be massive stimulus in an unstable economic balance.
      While I can make the economic argument for intervention by the MAGA route (onshoring industry)_ the fact is that is at least a 24 month lead-time effort. Corporate planning, build-out, staffing, and more.
      On the other hand the direct stimulus is virtually instant.
      Which could be telling us volumes about degree of financial instability and how deeply fears run.
      We should watch for the next injection scheme soon for the same implied reason.

      • Yeah, I get it George. We’re past the inflection point for rebuilding domestic manufacturing in time. Now we’re on the cheap labor for Amazon program so we can continue to funnel foreign (Chinese) goods profitably. I wonder how president Gonzo and his aviators might have played a role ???

      • Corporate onshoring which requires new facilities and production stuff will require 5+ years to go into production. Tooling where the tool makers are now offshore will be a significant obstruction. To reverse the trend caused by 50 years of looting by MBA’s will require a decade. Is there enough capital available to do the job without going full socialist?

    • ‘We’re losing orbit (and a few parts, like the airlock latch). ‘

      George – no one can mix humor and aerospace technology like you. We need your sense of humor in these times!!

      Thanks for the wit!!

    • Bear in-mind we don’t have “surplus weapons.” We left them all in Afghanistan. Therefore, all the materiel we’re sending Ukraine is freshly-minted, and with appropriate profit margins attached…

    • “The thought of a limited scale nuclear event as a death rattle to save the dollar invokes”

      My fear is it won’t be limited to just their neighborhood..with two of those promoting gold backed currency of t he Juan and rubles out of the picture.. I think everyone behind the plan to undermine the euro and dollar by kicking it out of the picture knows they are targets..
      So far all wars have been made in the backyard of the country that’s coveted..
      puppeteers are very carefull to take their dogs for a walk in someone else’s neighborhood so they let their dogs shizt is in someone else’s back yard and careful not to bring it home..
      Putin and Xi are not stupid and neither is Kim.. which is why Kim is quick to inform them … hey your my target..Putin and Xi are thinking men and would rather not see this escalated.. Kim is the wild one that says screw it, let’s tango..which I believe is why neither Putin or Xi have given him the missiles or technology to build them..
      My fear is that if this escalates.. they will just do a Kim and say enjoy what you wish and give us some hell to deal with here at home instead of keeping it all there just for themselves to deal with..
      IF…. that happens all of us will be in our own area of hell..

      • Out of necessity, Stu had to recently change the password. Send him an email. Once you have the new password, everything works as it should.

      • “LOOB,

        You running a Mac?”

        Nope @Ben.. unfortunately its a three hundred dollar deluxe thrift store model.. didn’t have the funds to buy a super computer.. I do have a nineteen inch flat screen monitor now though the fifteen incher was making it hard to see the screen..

      • LOOB! Keep both monitors. Set the larger one as screen 2 on the right. That’s my favorite setup and it works well with any Windows system(7,8,10). If you use OBS free software, you can capture the full detail of screen one including video or just screenshots, regardless of source. It’s a short learning curve.

      • “LOOB! Keep both monitors. Set the larger one as screen 2 on the right.”

        Dam that is a great idea.. unfortunately I already got rid of the other monitor…

  2. Hey George, how about defaulting this:

    “Save my name, email, and website in this browser for the next time I comment.”

    back to “on?”

  3. I’m not sure onshoring is even possible now. If I live in Michigan (I don’t, BTW) and want to lay a new concrete sidewalk or retaining wall between my house and my garage, in the middle of my hundred acre woods, where it’ll NEVER be seen, except by drone, to be legal I have to file environmental impact statements (plus watershed, habitat, wild animal, etc., if I understand correctly) and wait out the cooling (public response) period before I can fork out the hundo (plus additions) for the damn’ building permit.

    I know there are States that’re even more draconian, and when I see “Homestead Rescue” visit a homestead in some places, I wonder how it can even exist, let alone be rescued.

    I would guess that a building permit for a factory, of any kind, in any location, would attract a swarm of environazis who’d sue and injunct it out of existence before it even hit the drawing board. Along with the governments (as in plural) bureaucratic hurdles, a Company, intent on building a Factory, would have the green pee nutjobs wetting on their plans whenever possible…

    • This is the crux of the problem and endemic to our formerly great nation. It could be fixed in a moment with sufficient political will and honest politicians(fat chance). If 90% of regulations and “enforcement” agencies were removed and all regulators were required to issue any remaining permits within a week(or suffer massive penalties to be paid TO the applicant), we’d be moving toward the beginning of the American Renaissance! I have much of the equipment to start a small factory, lab, or other business where I am yet have no incentive whatsoever to get involved. No doubt, you’re as well equipped as you wish to be also. The marginal dollar return for the work and angst involved in business or other ventures is simply not worth it to me or many others. Our government could change that by actually caring about the producers rather than the rabble, but that’s highly unlikely. I learned that in depth from my last business venture, though at least it worked out in my favor(through raw defiance, effort and luck). I’m of the opinion now that any non-proxy war that we got involved with would result in an American defeat. I just wish it wasn’t so!

  4. In the morning I go first to UrbanSur
    Site then I go check out Stu site but my old password doesn’t work (have bought multiple books and sent email but still no new password…but at least I can still read George ( makes my day!)

  5. Why the f you give any airtime to bernanke ? Your hero ? You go to the right department in hospital . Yep changed or a leopard never changes its spots . Bernanke please . Paradox ? Cornflakes

  6. Moscow and Tel Aviv are on the same time table.

    Less than 6 hours before another nuclear exchange free Orthodox Easter passes. But there’s always Washington time….

  7. George, thanks for the ebook link! I’m downloading it to a flash drive since I’m not at my regular computer and the net is never guaranteed! I still have exabytes left to download the net, but at least I’ve begun.

  8. wrt the NEW passwords:

    I got mine via email, but I caught the fact there was a new one within a couple of hours of him implementing that change and emailed him immediately and he got back to me quickly. At the moment he may now be backed up at getting the new passwords out, but he is working on it of that I am certain.

    One thing I did note is that the OLD posts that were password protected still used the OLD password, at least the ones I went to look at. It was only the newer posts that utilized the NEW password (and that may have been changed by now, or may change in the future).

    FINALLY Easter is over with in Ukraine /Russia (5 hour time difference and I am writing this at 8 pm ESDT Sunday evening) so I am breathing a bit better, but I do think there are some behind Putin who are pushing him hard to use a tactical nuke or two IN Ukraine (NOT on a Nato country). By utilizing a nuke in a NON Nato country the various Nato countries would have to scratch their heads a bit, at least one would hope so though I am sure Nuland and Blinken wouldn’t, before doing any sort of Reply in Kind. (which would then bring the entire weight of the Russian Nuclear Arsenal down on THEM). Dicey times wrt Ukraine.

    fwiw I noticed this afternoon that 2 of our 3 E-4B’s Command Planes came out of Wright Patt and went back to Lincoln Neb where they are based (usually one is in for maintenance, so 2 are always flyable – we have 4 but one is used full time by the Sec of Defense for when he travels and he went to Europe for that meeting today with Zelinsky so I assume he flew on that 4th one).

    SOMETHING BIG was going on in Dayton, BIG BIG BIG for the head muckety mucks to fly in BOTH of the E-4B’s on flight status to Dayton for a Meeting!! (one went in on Saturday, I watched it leave Lincoln and arrive in Dayton … not sure when the other one went over)

    I have also noted other flights of an E-4B to Dayton from Lincoln over the last couple of weeks … so some serious planning is definitely going on.

    2nd fwiw: a week ago Friday an E-4B left Lincoln and flew down to the Gulf and just did circles over the Gulf for some time. At the same time a E-6B was also airborne, western US as I recall …. AND 32 tankers were up over the US /Southern Canada, most over the middle of the country!! Since they all had their transponders on I figured it was just a “Practice Run” … but it did give me pause when I first noticed all that activity. Definitely NOT normal behavior for those mobile command posts and definitely NOT normal behavior for our tanker fleet.

    On the Nuclear War clock I would move the hands to 11:59:50. We are right on the cusp of one potentially starting.

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