Home > Uncategorized > 2011/08/15: AWAY on Holiday Until Later This Week

2011/08/15: AWAY on Holiday Until Later This Week

As we are away on holiday this week, you’ll need to rely upon the post from later on last Wednesday for our background on why the equity market rally is most likely not sustainable. That doesn’t mean it can’t carry on for a while; but in essence the equities are fighting the weaker underlying economic tendencies that are likely to come home to roost for various reasons.

The end of the Fed’s latest round of quantitative easing (QE2) is the least of it. The cumulative effect of global fiscal retrenchment (Yes, Virginia, all the governments are spending less, or will be soon) at the same time that the normal leaders of conspicuous consumption in the US have a regulation-burdened economy is just not good news. With so much more of that background in the previous post, we really don’t want to waste your time (and most certainly don’t want to waste ours) with reviewing it here. Just go back and take a read if you’re interested.

On the other hand, while we won’t be around for the Merkel-Sarkozy Follies tomorrow, we may share a couple of brief thoughts on that relating to the earlier phase of How We Got Here (part III: The Mad Monger Sets the Agenda.) The most interesting part of the Euro-zone (and broader EU) dilemma right now is not so much the lack of harmony as the lack of even being on the same page in the songbook.

[For those who had not already realized that part IV had dropped in out of the blue last week, these views are being articulated in reverse chronological order. We normally detest those sorts of dramatic devices in fiction or cinema. Yet it is suitable for this particular review of recent history, which required a quick dissection last week of why things had ended up so bad in the wake of the US debt ceiling hike and Euro-zone sovereign debt deals.]

We hope you all have a successful time handling the market response to that European meeting tomorrow, and look forward to returning with more active analysis and blog posts soon. In the meantime the EXTENDED TREND IMPLICATIONS from that previous post are still relevant in the current somewhat more upbeat equity market situation.

Thanks for your interest.

  1. August 15, 2011 at 5:25 PM

    Obviously that original headline should have read 2011/08/15 and NOT 2009… apologies for any confusion.

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