Fed Braces for Approaching Lehman Moment ~ The Risk Averse Alert

Thursday, September 13, 2012

Fed Braces for Approaching Lehman Moment

Hat tip Bernice for exposing just how close we are to another Lehman moment. So much for math suggesting the Fed is trapped. In the new normal evidently is new math allowing central banks to embrace their own insolvency with no concern whatsoever for the little children who plainly see the emperor has no clothes.

Open ended bailout is certain to accelerate the hyperinflationary shutdown of the physical economy. However, that's tomorrow's problem. Sufficient for the day are the needs of hopelessly insolvent financial albatrosses whose European exposure sits atop insolvent mortgage-backed securities the Fed cannot take onto its balance sheet fast enough. Some of these pigs are about to be slaughtered, while the Fed greases the skids for consolidation of physical and financial assets to satisfy the Fuehrer's plans for global financial dictatorship.

Once a fascist, always a fascist, and Bernice is. Does he really think anyone buys his sophistry suggesting full employment is the Fed's objective? Does he imagine a boom in business demanding chamber maids with masters degrees? How will they even get to work as the price of gas makes the trip prohibitive? Still, criminally incompetent is a label better assigned to a press corp whose questions raised during the Fed chairman's press conference were nowhere in the ballpark located at 1923 Wiemar Germany. That's the game the Fed is playing, and the so-called "free press" evidently hasn't a clue. Or are they paid not to?


The NYSE new 52-week high-low differential decidedly confirms the wave count simplification put forward here Monday. Likewise substantiated is the outlook supposing a "zig-zag" unfolding off March '09 bottom is midstream in forming, whose "c" wave higher awaits completion of the zig-zag's connecting "b" wave, itself nearing the start of its "c" wave lower. Today's best reading of NYSE new 52-week highs-lows since March '09 bottom indicates further gains likely lie ahead.

But not right away. Above is one measure wherein future intentions have been disguised for the longest time. This is unlike index momentum measures, the likes of which I will still contend more likely suggest the market is not about to run away to the upside. Now, much as the NYSE new 52-week high-low differential's consistent expansion leading into the market's peak of April 2010 "signaled" the likelihood the market would extend higher following the May 2010 "flash crash" and its aftermath, the same is being signaled once wave c of (b) completing the middle wave of the a-b-c "zig-zag" off March '09 bottom comes to pass. As the currently forming wave c of b of (b) completes over days/weeks ahead, we will likely see the above measure diverging upon the peak of wave b of (b) being met, this like what occurred as wave 5 of (a) unfolded from July 2010 to February 2011. Chances are, too, during formation of wave c of (b), this as the presently approaching Lehman moment becomes manifest, the NYSE new 52-week high-low differential likely will eclipse its lows of last year.

Fast Money
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