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Don’t Hold Your Breath
http://dont-tread-on.me/dont-hold-your-breath/
The above photo is a 1912 Cartoon Against The Coming Federal Reserve.
Financial sanity is returning to the world. The silver bubble has burst. The debt ceiling won’t be raised. The government is going to make trillion dollar cuts in spending. Osama bin Laden is dead, signaling the end to the war on terror. Greece is going to be bailed out. Everything is dollar positive and it is time to dance, right? Don’t hold your breath.
Most bear markets follow the same characteristics. They start with a major wave down, followed by a brief counter trend move to the upside, only to be finished off with an even stronger and final collapse. If you look at the 2008 crash as the first wave down, and the following 3 years after that as the counter trend move, then we are due for the final collapse very soon. The reason is quite simple, none of the problems that caused the crash in 2008, have been corrected. In fact, by all accounts they have gotten much, much worse. Not only are things worse, there is no room for error. A major collapse now would be exacerbated by the fact that all of the safety nets we had in 2008, are destroyed.
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