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TO: Republican National Committee

FROM: Larry Kudlow

RE: Victory 2004

 

Ladies and Gentlemen:

 

This will not do.

 

We are repeating the mistakes of the Bush I administration. The economic recovery is coming too late -- and the stock market rise is too insufficient -- to secure electoral victory.

 

This error must not be repeated.

 

Alan Greenspan sank Bush I, and he will sink this administration too. The rate of monetary growth is inadequate.

 

I am speaking of monetary growth in the 20 to 30% range, this year. I am speaking of monetary growth so strong it will make people see colors, the way they did back in 1968 when we regained the White House.

MaxDead.jpg

The way you rescue a sick economy is to follow the prescription of the man whose bust I keep on my mantle:

keynes1.gif

Oh G-d, what a hunk. (Drool!)

 

Greenspan must go. Pull the plug. Ben Shalom Bernanke understands the need to obtain the heroic rates of money growth I have recommended. He has my highest confidence and recommendation:

bernanke_ben.jpg

 

The right wing of the party is in revolt. How do you bring the right wing back within the fold?

 

You print money. You run gold to 500 dollars. Trust me on this.

 

The suburban working class is in revolt. How do you bring them back under the party's wing?

 

You print money. You run the Dow to 12,000 and the Nasdaq to 3,000. You don't pussyfoot around. Trust me on this.

 

One final thing. Think of Nixon. Think of Reagan. California is the Golden State. California is Golden for the Republican party. You cannot win without California.

 

Cheney is from the West, Wyoming -- 400,000 lonely souls -- but he is not Californian. Pull the plug on his pacemaker.

 

You know who is The Man from California:

T1REPR.jpg

 

Can you imagine Arnold blowing into Baghdad in a camo-painted Hummer, crushing the skulls of some delinquent ragheads? OMG, I am popping my rocks over this.

 

This is way to win. PERIOD.

 

I am available to consult with you.

 

I am available to emcee the victory party.

 

Yours in victory,

 

LARRY KUDLOW

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Contrary "contrary"opinion from my good buddy Bernie Schaeffer:

 

Sentiment Cited on Wall Street

New York Times

"Americans Pour Money Into Stock Funds in Near Record Amounts"

Published: 2/13/2004

Brief Summary: Stock inflows returned to the tune of $40 billion last month. The article goes on to discuss the market's performance and several sentiment indicators and cautious outlooks based on those indicators.

 

Contrarian Takeaway:

It is amazing how prevalent sentiment has become. The Schaeffer's Expectational Analysis? appears to be totally ingrained in the Wall Street lexicon. This article even goes so far as to indicate that mutual fund inflows are bad for the market. "But the inflow of $40.8 billion last month may not be as positive as it appears. Some anal cysts consider it a sign that investors may be too bullish, too willing to expect last year's enormous gains to be repeated." Another indicator that has been receiving a lot of attention recently is the Market Vane Bullish Consensus. An anal cyst who works for Market Vane stated that the indicator "is in what we consider nosebleed territory," said Rich Ishida, senior market anal cyst at Market Vane, which compiles a broad range of market indicators. "We are advising anyone who is real bullish to be cautious." We find it ironic that no mention whatsoever is made of valuations, or expectations for earnings former staples of articles such as these. The article is summed up by the following sentence "Despite the stock gains and all the positive indicators of sentiment, many anal cysts see reasons to be cautious." While we are monitoring these sentiment indicators very closely, it is possible that the uptrend will continue as long as articles such as these are being written.

So what gives him the right to be the last contrarian ?

 

It may just be me but Bernie Scheaffer bugs the hell out of me. His grin and wanky hairdo brings the worst in me : For some unknown reason, I have a un-nerving desire to want to punch the living daylights out of him. :(

 

I get his thrice-daily emails and sadly his never ending email promo's about how he beat the markets by 140% / last chance to sign up QQQ swing trades for extortionate prices, yady yada. Get lots of mailshots as well which go straight to the trash unopened.

 

If I was brand manager, I'd pull the smug looking pictures. Instead, have him smoking a cigar and wiping his arse with $100 bills. That would better show how successful he is rather than looking like the class swot. :D

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Relatively serious question?

 

Which school of thought to you subscribe to - accumulate or hold cash vs. buy on credit and hope it gets inflated away?

 

Third choice is that PM's are an option.

 

I ask this as a substantial amount of my buddies are out financing anything and everything.

 

I have chosen to keep my debt load to a minimum.....and the PM's

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Another "Late Friday Garbage Dump" by the White House...

 

Release the entire GWB military record, and announce that he'll meet with the 9/11 Commission, and do it ALL on a Friday AFTER the evening network newscasts, knowing that nobody's going to read the Saturday paper...and all will be forgotten by Monday or Tuesday.

 

Unless, of course there's something really ugly that he's trying to hide.

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Relatively serious question?

 

Which school of thought to you subscribe to - accumulate or hold cash vs. buy on credit and hope it gets inflated away?

 

Third choice is that PM's are an option.

 

I ask this as a substantial amount of my buddies are out financing anything and everything.

 

I have chosen to keep my debt load to a minimum.....and the PM's

There's another option. Treat credit as an income and when it comes too much, walk away from it and declare yourself bankrupt. If it happens on mass, J6P will want govt to step in and legislate a clean sheet against the greedy crooks who lent them money in the first place.

 

Look at S.Korea and LG card. Overthere, people extended credit when it became clear govt would step in.

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CS rocks as usual ....spot on analysis by the stoolies...haven t had time to post recently given work constraints ....lets just say lots of weather related casualties here in the midwest....have managed to keep up on the posts this week, including Marks classic from the other evening.

 

Have made some major coin trading GMR last few weeks in and out

 

ASPM 10 to 18 since I brought it to the stoolies attention...hope some of you were along for the ride....will move higher after some consolidation

 

Havent budged on my large GG , EQY and AGT positions

 

Adding to PEAK and OS on pullbacks

 

Very large bullion buys last two weeks

 

Populace still believes stocks are the road to riches....and they are right but not from LTBH strategy

 

Gold going higher then any of us can imagine..... way north of 1000$/oz

 

TRADE SAFE

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Another tale from the real world--

 

At a Christmas party I found myself speaking to an intellectual fellow (husband of an Italian architect, jeans and turtleneck-kind-of-guy). This guy was mentioning all the places he'd been travelling to and from, and bemoaning the expensive airfare of late. My suggestion that exchange rates might be affecting airfare led to a short conversation where I mentioned the triple defecits, and that I could imagine the Euro costing $1.50 by August.

 

This cat said "No way, people want dollars....and anyway doesn't the Gold Standard mean the dollar can only fall so far????????????????????????"

 

:ph34r: :unsure: :ph34r: :unsure: :ph34r: :blink: :( :( :(

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Quotes from Chairman Don Wolanchuk-ignore them at your peril! [Hee Hee!]

 

 

There is nothing to do but just sit tight, relax and just watch everyone else fight the tape.

 

TradeSurfer: 02/11/2004:

Recent Comments from Don Wolunchuck, eye opening comments from market veteran:

 

as far as I know Don in 2003 correctly called for both gold and the broad market to go up.

 

some very recent comments from Don below ... :

 

- people who operate too close to the market tend to be nervous people and are operating with hot money.. the whipsaws are rather big.

 

- There is a once in a lifetime move that is underway. Its going much farther than most can imagine. It is going to make headlines, unimaginable headlines. Headlines that will dwarf any headlines we saw in the 90's

 

- The valueline is screaming. The weekly A/D line is in unchartered territory and is just going exponential.

 

- Copper confirming the original idea that the long awaited worldwide inflationary economic boom of unparalleled proportions is forthcoming. There is nothing to do but just sit tight, relax and just watch everyone else fight the tape.

 

- There are going to be short little swings. Bears generally overplay their hands.

 

The weekly A/D bottomed in march 2000. Because the weekly A/D line continued upward and onward from its bottom in 2000 you knew that any sharp decline in the indexes was false, and the end result would be an exponential rise which really has not gotten here yet. Its a product of two 4 year cycle lows back to back compresing in the same price zone. The rise should move rather dramatically if not a little irregularly to the 16,000 - 17,000 area (DJIA) which is the upper trendline of a huge expanding triangle on the charts. Now expanding triangles from my experience are continuation patterns. Once that trendline is penetrated then the real huge move should begin.

 

And this is not unlike the expanding triangle that started in August 1983 and the upper trendline was not breached until 4000 was breached, and was 4000 was penetrated the market doubled and almost tripled. So that is what is coming. Big numbers we know are possible. We are going to dwarf the markets action of the Nikkei in the 90's and will probably happen a lot sooner than most people think.

 

- If you see the SNP blowing out 1170 and the dow blowing out 10800, then this thing is gonna put on a show.

 

- In this kind of market, all surprises are on the upside.

 

- Its a once in a lifetime move. Already the russell and NYSE compositie have gotten a huge head start.

 

End of his comments.

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this is not unlike the expanding triangle that started in August 1983 and the upper trendline was not breached until 4000 was breached, and was 4000 was penetrated the market doubled and almost tripled. So that is what is coming. Big numbers we know are possible. We are going to dwarf the markets action of the Nikkei in the 90's and will probably happen a lot sooner than most people think.

 

- If you see the SNP blowing out 1170 and the dow blowing out 10800, then this thing is gonna put on a show.

 

- In this kind of market, all surprises are on the upside.

oh man

 

don walunchuk is larry kudlow's alter ego

 

we are gonna rock

 

S&P 2K dow 20K sky the limit ride the rails

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- Copper confirming the original idea that the long awaited worldwide inflationary economic boom of unparalleled proportions is forthcoming. There is nothing to do but just sit tight, relax and just watch everyone else fight the tape.

The non-chart related argument is that copper is going higher. So, as long as dollar keep dropping, commodity pricing will be rising, and unparalled economic boom is coming. Kill the dollar, kill the dollar. and all will live happily ever after.

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- There is a once in a lifetime move that is underway. Its going much farther than most can imagine. It is going to make headlines, unimaginable headlines. Headlines that will dwarf any headlines we saw in the 90's

Maybe he is wrong. Maybe he is right. 90's may have been a Crocus bubble, now we are onto tullips.

 

I'm agnostic about the market direction. Being a dogmatic bear has cost me $$$$'s. On other hand, being dogmatic bull in 2002 didn't work either :P !

 

Trying to learn from Livermore - be neither bull nor bear but market up/ Market down.

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Guest libertas
Trying to learn from Livermore - be neither bull nor bear but market up/ Market down.

According to his biography, Jesse spent most of 1929 trying to get short. He was stopped out three times, costing him $250,000 in losses. Which was real money in 1929. Of course the next time was a winner.

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Another tale from the real world--

 

At a Christmas party I found myself speaking to an intellectual fellow (husband of an Italian architect, jeans and turtleneck-kind-of-guy). This guy was mentioning all the places he'd been travelling to and from, and bemoaning the expensive airfare of late. My suggestion that exchange rates might be affecting airfare led to a short conversation where I mentioned the triple defecits, and that I could imagine the Euro costing $1.50 by August.

 

This cat said "No way, people want dollars....and anyway doesn't the Gold Standard mean the dollar can only fall so far????????????????????????"

 

:ph34r: :unsure: :ph34r: :unsure: :ph34r: :blink: :( :( :(

You would be surprised how many believe the Euro is backed by gold, just because the ECB has some gold in their vaults. :lol: :lol:

 

Many also believe the FED is part of the US government, hell its owned by more non-US interests than people realize. What I find strange is our elected officials dont seem to care. Are they really that stupid? lazy? who knows.

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According to his biography, Jesse spent most of 1929 trying to get short. He was stopped out three times, costing him $250,000 in losses. Which was real money in 1929. Of course the next time was a winner.

Livermore's preferred method of picking tops was watching the leaders of the rally make failed highs, while the weaker, lesser known stocks made new highs for the move.

 

Dow Leaders

 

I believe that the Dow must be watched very closely.

 

MSFT and INTC look the weakest.

 

The cyclicals are mixed. Some like MMM are weak, others like UTX still strong.

 

Financials are all looking good.

 

In a nutshell, looks like a mixed bag. Market could go either way from here.

 

Ready for anything.

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Every conversation I've had about gold in the last few years has been like Mark's. No return, hard to trade, no excitement, "just sits there", yada.. When I told 'em at that time I bought 100 oz. at $290, they all had this deer-in-the-headlights look. As the bear progressed, and they unloaded 401k's, same look. Clueless. Only recently have I gotten a nod.

 

Gold is not sexy.

 

Perfect opportunity to buy more. Next week. No stocks. Just shiny metal. Maybe an oil well, too.

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