CNBC and Economic Damage Control

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October 26, 2008

SouthAmerica: I wonder if we are going to have on this coming week the most exciting week in Wall Street history. Maybe it will become known as the “Panic Week”.

This is the traditional month and the favorite week that Americans love to commemorate with major stock market crashes. This is the time when Panic spiral out of control and all hell will break lose, and the entire herd starts moving in a very dangerous stampede

This week we have the potential to achieve new historic days that will be remembered in the future by names such as “Black Monday”, “Black Tuesday”, “Black Wednesday”, Black Thursday”, and “Black Friday”.

If the carnage gets out of hand during this week then the US government can throw the towel and close the stock market and the banking system for a few days, and at the same time they would be sending a message to the rest of the world that the US stock market liquidity was just another myth that is also gone.

I wonder if the people who watch CNBC television channel on a regular basis – if these people have realized that CBNC has become just a cheerleading group of people trying to prop up the stock market with a lot of wishful thinking and nothing else.

I guess the central banks from around the world are going to coordinate an interest rate cut in the coming days on their desperate pursuit of a quick fix or just trying to buy some time before most people realizes the reality of all the bad news that is coming regarding their economies and Panic sets in, and finally we have a real stock market meltdown.

On CNBC it is always time to buy – buy, buy, buy – it does not matter what the economic reality is in the United States. The Dow has gone from 14,000 to 8,000 in the last years and at CNBC it was always time to buy.

If you followed the advice given by the usual suspects on CNBC then you probably would have lost your shirt by now.

I am sure that the talking heads at CNBC are going to give all kinds of good advice this entire week how the stock market has finally reached bottom and it is time to buy. Every time the stock market reaches a new low and you keep losing your shirt.

Let’s see if in between stock market crashes they can muster in Wall Street another “Suckers Rally”.

Fasten your seat belts because this week will be a roller coaster ride as never seen before.

Some key words to keep in mind at all times during this week:

Panic, Free Fall, Nightmare, Shock, Stampede, and Meltdown

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October 29, 2008

SouthAmerica: This smells to me as a “Sukers Rally” and nothing else when you consider what is in store for the US dollar in the near future.

I still think the US stock market is going to test the 7,000 level in the coming months.

Only fools don’t understand that the current strength of the US dollar has been caused by hedge funds, mutual funds, pension funds, insurance companies and all kinds of financial institutions selling a large part of their positions on foreign markets including the emerging market economies to cover their margin calls and redemptions from their customers here in the United States.

Since December 31, 2007 Bovespa in Brazil lost 50 percent of its value mostly because of this Panic in the US financial markets and as this outflow of hot money was flowing out of Brazil they created a temporary demand for the US dollar and the real was devalued accordingly.

That is another prove of how the “hot money” flowing around the world can devastate your economy in a very short period of time.

The United States government financial position right now is close to become just a "Junk" rating for all practical purposes.

In a matter of months the US government cumulative debt has gone from $ 10 trillion dollars to approximately $ 13 trillion dollars and growing.

If you consider that the real US GDP is around $ 10 trillion dollars and not the wishful thinking figure of $ 14 trillion then you start realizing the deep trouble that is just ahead for the US economy.

The US government is in the process of nationalizing half of the private sector of the US economy and it is hard for anyone to figure out right now how much these new assets are worth that have been acquired by the US government since they are mostly from collapsing institutions such as Fannie and Freddie, AIG, GM, Ford, Chrysler, and many more.

With everything that is happening around the world in the financial markets and its impact on the economies of many countries - only real FOOLS would think that the US stock market has reached its bottom and it is not to going to continue its decline in the coming months.

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March 2, 2009

SouthAmerica: I can’t believe a company managed by Warren Buffet the earnings would be down by 96 percent.

I still have a lot of respect for Warren Buffet and his long-term investment track record, but at this stage of the game I would not be surprised if he has started to lose his “Midas Touch.”

It is hard for most ageing superstars to know when it is time to leave the game…

In the case of Warren Buffet I still have a soft spot and affection for the old man.


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As I mentioned above I have been an admirer of Mr. Buffett for almost 40 years…

http://www.elitetrader.com/vb/showt...erpage=6&highlight=warren buffet&pagenumber=5


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October 17, 2008

SouthAmerica: I was just turned the TV on to CNBC to check the market averages and they started talking about an article by Warren Buffett that was published on The New York Times today.

First, Mr. Buffett’s credibility has been evaporating during this current financial crisis, he has become just a mouth piece for the $ 700 billion dollars bailout, and in favor of giving Treasury Secretary Paulson a blank check, and he is involved in all kinds of self-interest deals related with all the activities that is going on related to this bailout…

http://www.elitetrader.com/vb/showt...erpage=6&highlight=warren buffet&pagenumber=4

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Dennis Kneale of CNBC’s “Power Lunch” comes across most of the time as a child having a temper tantrum.

I don’t know why CNBC is keeping that guy as one of their talking heads since he is a very irritating person every time he opens his mouth about anything?

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Quote from southamerica:

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Dennis Kneale of CNBC’s “Power Lunch” comes across most of the time as a child having a temper tantrum.

I don’t know why CNBC is keeping that guy as one of their talking heads since he is a very irritating person every time he opens his mouth about anything?

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More...

He's the only one thats a contra indicator. While the other 3 bubbleheads talk about how great everything is... he at least sounds like the voice of the common people. I used to hate him too, but now i think he adds a good voice/commentary to the show (even if he does sound whiney every once in a while)
 
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