Could the third quarter of 2010 be a Double Dip or not?

Going back to my previous Post and bringing the two together in this update. My previous warnings, appear to be shared by a number of analysts, in this period ahead. Mark Faber whose view I value, does not share my views, he is of the opinion, that whilst there may be some movement to the down-side, governments are happy to intervene and carry-on with new infusions, as and when required.

I have great respect for Marc Faber's views, as he is one of the world's consummate global macro economists, whose interpretations and analysis of the markets are excellent. Marc states that if the S & P 500 hits 950 governments will re-inflate. I don't doubt his rational or his evaluation. I feel however, they (governments), will hesitate in their action to re-inflate, as a result, re-inflation will not take effect quickly enough. During which time the momentum will drive down the S & P 500 and a convulsion is likely to follow. This will proceed another period of manipulation for those like Goldman Sachs and others, where their consolidation of the market and previous bets against the markets, will return their dividends for the end of this year -and planning, for next.


Deflation has historically been viewed as very good for the group's psychological confidence, that is to say, the Merchant, Private and Investment banks (as they are referred to) and, who are in the loop. As they are less concerned for Deposit and only in recent times, in Commercial Banks as they have digressed into the market. Deflation may not help economies but Governments and Merchant banks can make use of such periods to support debt issues and improve the Merchant's assets, which for this group are, EXPORT VALUES and CASH VALUE. As the system of finance knows, banks are insolvent entities from the moment they are born. Yes, this group will have plenty of debt hidden in the OTC and Shadow and Dark Pool Markets, last but not least, the big brother, incorporating many of these, the Derivatives Market. There is very little information or facts open to governments and the public, as to the specific location and amounts of debt and leverage positions, leaning on these banking conglomerates' balance sheets.


These two Graphs express the continued sideways motion of the market, which for myself, exposes the failure of the West's Markets to continue in their extraordinary growth pattern which existed during their re-inflation. The period of the fulcrum of market stimulus is now beginning give-way -and, the leverage and debt issues are continuing to expose themselves to the reality that the West will continue to deflate.

Looking at the objects noted on a daily chart, will give you access to some of the variables and the concerns I have for this period ahead. I don't buy into the stabilization argument. That the system expresses recovery because some banks and states feel they are resolving the crisis with bank profits and austerity public policies. Those responsible are continuing with business as usual, (especially the to big to fail group), as a result, no change to their overall approach to profit making has changed. The fraud still exists and the Oligarchs are repositioning the Geo-Political and Finance System. The groups who have control of which, as previously stated, the BIS have a fundamental position, along with others I have listed in the past. And on the subject of the future of the Western economies, growth, in the near future will belong to the East predominately, as I stated back in 2008. In my Look to the East Post. And deflation is still holding the Western economies with very few exceptions.