Desperate Actions, Too, Speak Louder Than Words ~ The Risk Averse Alert

Tuesday, February 12, 2013

Desperate Actions, Too, Speak Louder Than Words

There is no reason to wonder how it is the über levered are the market's best performers. Who better to exploit a broken price discovery mechanism than its managers! Yet all things financial, generally speaking, positively remain hopelessly bankrupt. A cursory look at the Baltic Dry Index confirms their insolvent state a frightful fate sealed. The glorified hedge fund, GE, only the more appears a rickety garbage heap with its sale of NBC-Universal. Oh, cable is a huge cash generator? Too bad it doesn't come in fast enough. "Shocking!" GE is rising in the after hours. Such is how a broken price discovery mechanism is manipulated.

Trot out any number of feckless CEOs among the hopelessly insolvent as might feel compelled to cross-dress an enamored cheerleader, unaltered is the well-stated case made here revealing no one is buying into fantasy fortunes the likes claim are awaiting the bottom rung of the capital structure. There's just not enough capital in the world to continue supporting wildly overpriced valuations assigned to financial assets of every sort. Indeed, GE today gave the world an ages-old, valuable lesson in how actions speak louder than words. Leave it to a captive, woefully unpenetrating media to sing a much different tune.

Notwithstanding the NYSE McClellan Oscillator's apparent similar relative state contrasted to the period leading into late-August 2012, underlying weakness every McClellan measure likewise presently reveals (this coinciding with the market's advance since June 2012) only but adds to exceptionally suspect states of many other technical measures, leaving one to conclude the market is not about to run away to the upside, as the feckless and undiscerning otherwise would have us believe.

Rather, we're more likely to see a bout of weakness set in here, this possibly lasting some weeks and paving the way for the last hurrah leading up to a train wreck for the record books...

Word on the Street
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