ECON Stock Market Crash Alert

Spirit Of Truth

Spirit Of Truth

Inactive
My latest blog...

THURSDAY, MAY 20, 2010

Crash Alert?

According to the best wave count using the Elliott Wave Principle, we may be entering "wave 3 of 3 of 3" down in the first intermediate wave of Primary wave 3 down. If correct, this is suggestive of a panic of some sort, particularly if the Dow 10K mark is decisively breached.

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Please read Robert Prechter's most recent Elliott Wave Theorist investment letter so that the point I'm seeking to make is more clear.

In a nutshell, financial economists and Elliott Wave socionomists are both right and wrong. According to the Efficient Market Hypothesis, investors are unemotional and rational and the stock market follows a "random walk" as only unexpected new information, exogenous forces, result in price movements ("news" is completely relevant). According to Robert Prechter, investors are highly emotional and irrational and the stock market follows a deterministic Elliott Wave pattern as endogenous forces, i.e., herd instinct (genetic determinism), shape general price movements ("news" is completely irrelevant):

http://video.google.com/videoplay?docid=-2309167274742993535&hl=en

I believe the explanation for market behavior is in between, i.e., general price movements in the stock market are shaped by the mass emotional responses (endogenous force) to changing external information (exogenous) force. That what results unfolds according to a deterministic wave pattern that apparently underlies perceived reality suggests that collective human experience and the process of change over time is being shaped by an omniscient, omnipresent Creator and this truly is a holographic universe (emerging proof):

http://www.youtube.com/watch?v=4dpRPTwsKJs

In other words, the following Biblical passage is true: "Woe to him who quarrels with his Maker, to him who is but a potsherd among the potsherds on the ground. Does the clay say to the potter, 'What are you making?' Does your work say, 'He has no hands'?" [Isaiah 45:9]

As for what the Creator is creating, I believe the meaning being spelled out for and by creatures in this "uni-verse" (one sentence = a unified form to express meaning) is true love, which unfortunately sometimes requires the discipline of the "Refiner's Fire":

http://www.youtube.com/watch?v=idA6fCAHVzs

The question is whether or not man will at last "get it" at this critical historical juncture.
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B

blueridge

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Should (i.e 'when') a crash occur - it'll provide a wonderful "crisis opportunity" for the despotic rulers in DC to seize investors accounts in the name of 'protecting' them.

The assets will either be "returned to their rightful owners" and/or turned into nearly worthless govt. debt paper similar to that which sits in file cabinets in West Virginia...such paper represents the social sec. 'contributions' that have been similarly seized and spent by the nice folks that run DC.

Ponzi is laughing his a$$ off...
 
China Connection

China Connection

TB Fanatic
I expect Syria / Israel to go first which would involve Iran as they are tied to Syria. This would bring about and oil supply problem. There you have panic.

Korea will go soon after. So roll the printing presses as no one will be lending under war conditions.


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Spirit Of Truth

Spirit Of Truth

Inactive
China Connection said:
I expect Syria / Israel to go first which would involve Iran as they are tied to Syria. This would bring about and oil supply problem. There you have panic.

Korea will go soon after. So roll the printing presses as no one will be lending under war conditions.


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Of course, when Korea goes there's another form of "energy shortage", i.e., the credit spigot.
 
W

Woolly

Inactive
Doomer Doug

Doomer Doug

Deceased
PPT

Looks like the PPT felt the same. The near vertical spike upwards at 3:30 pm EST looks to DOOMER DOUG to show panic buying. The PPT didn't want another down day on the DOW. Wonder why? he he he

never underestimate the ability of the PPT to manipulate the rigged DOW. The PPT cannot reverse the negative psychology at this point. They can, if they are willing to use enough taxpayer bailout money, manipulate the results on a day by day basis. What they cannot do is reverse the downward trend. All they are really doing is letting downward pressure build. This pressure will eventually, at some unknown future point, overwhelm whatever feeble attempts they make to control it. We have a crack in the Grand Coulee Dam of the stock markets. The pressure will increase and then it will take out the concrete and flood downstream in a tsunami of economic chaos.

Looking at the charts on a daily basis as DOOMER DOUG does, you can see the exact time the PPT intervenes. Something about a near vertical spike, looking like a space shuttle take off, in the DOW shows what happens.

At this point, the PPT is reduced to sticking their fingers in the dike and hoping the concrete doesn't explode outwards and crush them. The EU situation is not capable of being dealt with since the vast amount of debt is unpayable. The PPT will eventually be swept away by the debt. It is just a matter of time.
 
U

UncurledA

Inactive
Other people seeing the same thing:


It's Started

Brian Bloom
20May2010

I'm not sure where this will all end, but today we saw a Dow Theory sell signal.

If you look closely at the chart below (courtesy Bigcharts.com) you will see that volumes have been creeping up since the 1000 point fall the week before last. When prices fall on rising volume that is evidence of selling pressure.

"Theory" says we should see a technical bounce and if we do see that then it's probably sensible to sell out of everything except special situations.

A "special situation" is a business that you expect will do well (make strong profits) regardless of what's happening on the stock market. Those businesses will be satisfying "real" needs.

Of course, I can't prove it, but my view is that we are heading for an era of deflation. The governments of the world tried stimulating their respective economies and this unraveling of the stock markets is evidencing that their attempts have failed. In any event, their behaviour did not pass the common sense test. There's no point in going into the theory of it. The subject has been discussed ad nauseam. What we need to focus on is that if the experiment in stimulation failed, there's not much purpose to be served in trying to stimulate a second time. Further, if the governments of the world all try to do this then the entire planet will experience hyperinflation. No one can hide from that. Not even if you own gold. The gold price will need to rise to tens of thousands of dollars an ounce to compensate and it will be impractical to do business by exchanging a fraction of a gram of gold for a loaf of bread, for example.

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Our problems are structural and the structure is decaying. To address that we need to change the way we conduct our lives. If you read Beyond Neanderthal, you might get an insight as to how this might be possible. (Look past the detail and focus on the principles.) If you have already read it, then read it a second time. You will find that what you previously thought was impractical suddenly seems a whole lot more practical. I did not write Beyond Neanderthal because of what I could get out of it. I wrote it because I could.

Brian Bloom
Author, Beyond Neanderthal
www.beyondneanderthal.com
Sydney, Australia, May 20, 2010
 
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