Let's party

Well imagine that we parked, get out of the cars and in to the long awaited party.
When we enter it looks evident the good times, ebullient people chatting and laughing everywhere, get our coats off while being greeted by the hosts though not much attention is being paid to what is said, we just want to get in and finally here we are.

Marvelling at the crystal chandellier from a bygone era is an unspoken tribute to the talent and craftmanship that populated the land around the 1920's, when it was made with the secondary objective to dazzle future generations.

Then it dawn on us when we mingle with all that beautiful and sophisticated people that they talk funny, yeah really really funny. We briefly look disconcerted but just laugh as a way to borrow time regaining our composure and "coolness".It's amazing how engaging the crowd is with all of us.

Their talking funny their utterances the meanings of what is said is lost to us, we don't get it.
Of course we laugh at least we didn't have to pay cover charge. Anyway we are fine comfortable and we even think that we are with the right crowd.
Of course we all shared the body language and that looks like enough to get cozy.We all understand body language so we indulge in checking body language and specially the bodies that come wrapped in flimsy dresses, but I digress.

At certain point after scanning the whole place for more "body language" one of us starts speaking with the objective to introduce ourselves.

And his words sound as unintelligible as with the rest of the crowd. Giddily we start speaking and with all of us the same happens, mesmerized by our own sounds not knowing how to decode it we just happily start conversing and laughing even though nobody can understand a fucking word.

This is what I call our rationality, human rationality.

We pretend that we understand what is being said manufacturing creating words that nobody can understand but us, and just partially because we are not sure if this is an accurate way to represent our inner feelings neither to ourselves nor to others. Not even want to go further and try to imagine what kind of concoctions other people use to create their own words.

In al that caos thank God we have for a fact something more primitive, shared and reliable: body language.

Now think about the foreclosure scandal and it's effect in the equity market, none.
The California budget crisis (this year and the previous one) nope.
Harrisburg, Pennsylvania crisis and Muni bonds in distress, nada.
The bond vigilantes dissatisfied with meager returns, nil.
The employment numbers past week, zero.
The ECRI numbers 3 months ago and the doble dip recession as a sure thing, nilch.
Ireland, Grece? Not either (will see when Spain comes)
Insiders selling at a record level (10, 12 weeks ago) Niet.

That's the drawdown of rationality and the way MSM presents it. At moments work in the way that logic tell us it should and some times don't, yeah...freaking comforting.


Now if we check "body language" what we can get.

Decoupling ridiculed 3 years ago is for real bringing India and China to the place that occupied as GDP world leaders (till the start of the industrial revolution) for centuries.

World GDP around the 2008 high record levels.

Companies cleaning their balance sheets in one of their best moments in the past five decades (and the debt is capital at its disposal for investment, trading, M&A, etc, so not too shabby for having debt if used to generate profits).

Politicians Dem. and Rep. realizing that if they leave 2 million people without unemployment benefits were going to be set ablaze in a short while and for nothing because like I mentioned couple months ago it just not going to happen that they let them die without food in an internment camp in some kind of class cleansing.

Intel as a representative sample made 8-10 times more money the past quarter than in 2008.Which by the numbers doesn't look fantastic but my point is not the amount of money earned instead that someone is buying their stuff. Economic activity.
The world is not in 2008 anymore as a fact.
Of course this doesn't mean at all that we can't go back to that time and even worse, but facts tell me that we are not in 2008.

Currency wars as theater because every nation is going to devalue keeping pace with the rest or slap taxes to foreign capital to neutralize the disparity (think Brazil).

The state (government) ready to absorb the entire house market relieving banksters that can in some way start cleaning their balance sheets.

Banks growing larger and larger, (not a good thing, just a fact) so they are probably planning to sell more and more financial products to the world to keep pace and as a way of feeding a growing base of people who got attracted to that line of business.Meaning everything needs to expand just to get a decent bonus.

So I'm not at ease with rational thinking in the equity markets because one day goes up and with the same information being presented the next day brings it down,

That's my reason for checking only body language, because it doesn't lie.

Dan


(About the markets I have to study this coming couple months before saying more than I did past Tuesday)