The Wiemar Fed Corollary ~ The Risk Averse Alert

Wednesday, March 27, 2013

The Wiemar Fed Corollary

Just a friendly reminder that, "prices can fall of their own weight, but it takes buying to put them up"...


This is how it looks when it's all over but for the shouting

Maybe the Wiemar Fed corollary should be "...and a lender of last resort without a backstop does capital flee at any price, while at a falling price with alacrity!"

Now, here's what you wanna contemplate. See the 2011 lead up to the moment when capital fled stocks with alacrity, then the very impact of that flight, and this simply in the context of prices falling of their own weight. Consider notably diminished volume during April-June 2011 a disparity in "buying to put them up."

Fast forward to these past fifteen months following the late-2011 central bank fit answering October's shriek imploring, "God save our sinking ship!" Capital positively continues to flee stocks, and this in a manner revealing far, far greater [buying-to-put-them-up] disparity than April-June 2011.

We can objectively conclude, then, these bad boys are muchos well-poised to fall of their own weight and quite possibly in a big, big, grande way at that. Hmmm. What do ya know, our dire Elliott wave-based view warning March 2009 bottom could be blown out this year like it wasn't even there finds more substance in reality than every central bank on the planet is proving capable of summonsing in the capital hungry confidence game these in fact lost a long, long time ago.


Word on the Street
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