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STORIES:
Dow will repeat 2007-2008 peak-crash cycle - (www.marketwatch.com) Dow skyrockets near 20,000 by
2014? In two years? Then crashes near 10,000 by 2016 presidential elections?
Possible? You bet. Déjà vu 2007-2008. So what’s your biggest risk as an
investor? Listening and acting on the relentless manipulative B.S. from Wall
Street’s media bulls in the next few years. Last week USA Today suggested the
stock market will soon set a new record high, “How high? How about an all-time
high in six months, 16% higher in 12 months, almost 40% higher two years from
now.” Yes, 40% said one bullish technician with a mega-bullhorn sounding the
rally call for all bulls: “Now is the time to finally break out” of today’s
secular bear market.
America's hidden unemployed: too discouraged to count - (www.reuters.com) When Daniel McCune graduated from college three
years ago, he was optimistic his good grades would earn him a job as an
intelligence analyst with the government. With a Bachelor of Science degree
from Liberty University in Virginia, majoring in government service and
history, McCune applied for jobs at the National Security Agency, the Federal
Bureau of Investigation and other agencies. But after a long hunt that yielded
only two interviews, the 26-year-old threw in the towel last fall, joining
millions of frustrated Americans who have given up looking for work. "There's
nothing out there and there probably won't be anything for a while," said
McCune, from New Concord, Ohio. He has moved back home to live with his
parents, who are helping him pay off his college debt of about $20,000.
Germany Losing Patience With Spain as EU Warns on Crisis -
(www.bloomberg.com) Germany’s governing coalition
showed growing exasperation with Spain,
as a senior ally of Chancellor Angela
Merkel said Prime Minister Mariano
Rajoy must stop prevaricating and decide whether Spain needs a full
rescue. “He must spell out what the
situation is,” Michael Meister, finance spokesman for Merkel’s Christian Democratic Union, said in an
interview in Berlin today. The fact he’s not doing so shows “Rajoy evidently
has a communications problem. If he needs help he must say so.” Meister’s
comments underscore Europe’s crisis-fighting stalemate amid
discord over a banking union, Greece’s ongoing debate on how to meet
bailout commitments and foot-dragging by Spain on a possible aid bid. European
Union President Herman Van Rompuy warned today against
“a tendency of losing the sense of urgency” in fighting the debt crisis three
years after it erupted in Greece.
The US Federal Reserve caused the Great Recession. - (www.telegraph.co.uk) Monetarists from across the world can mostly
agree on one thing. The US Federal Reserve caused the Great Recession. Fed
chair Ben Bernanke kept policy far too tight after the US economy buckled in
early to mid 2008. He allowed a collapse in the money supply to run unchecked,
causing avoidable disasters at Fannie, Freddie, Lehman, and AIG later that
year. Call it the "Bernanke Depression" if you want, a term gaining
traction in elite circles. The indictment is a little unfair. The European
Central Bank was worse. It raised rates into a deflationary oil shock in August
2008, and worsened a run on the dollar that constrained Fed actions.
Bernanke wants you to buy stocks, but risk is high - (finance.yahoo.com) Ben Bernanke hopes his latest
plan to stimulate the economy will get you to buy stocks and other risky
assets. Maybe you should. People who did that after two similar Federal Reserve
efforts are sitting on big gains today. But the odds of fat profits aren't
looking as good this time, and seem to be getting worse. Stocks rose sharply
before the Fed chairman announced his plans Sept. 13 instead of falling, as
they did before the two previous efforts, suggesting less room for gains now. Meanwhile,
the world economy is slowing and Wall Street analysts are cutting estimates for
future corporate profits. They expect them to fall this quarter from a year
earlier, the first drop since just after the Great Recession ended 3½ years
ago.
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