Dow 4,000 by Summer

Evans-Pritchard: Dow 4,000 by Summer

Friday, March 6, 2009 12:05 PM
By: Gene J. Koprowski

Global trade and economic output are collapsing at rates that outpace the Depression of the 1930s, and "shock and awe" policies are required from the U.S. government to revive global growth, says Daily Telegraph International Business Editor Ambrose Evans-Pritchard.

"This terrifying fall has been concentrated in the last five months. The job slaughter has barely begun," Evans-Pritchard writes. "Social mayhem comes with a 12-month lag."

According to a survey by Merrill Lynch, Taiwan's exports to China fell 55 percent in January, Japan's fell 45 percent. Manufacturing output in the Shanghai region fell 12 percent in January.

"By comparison, industrial output in core-Europe fell 2.8 percent in 1930, 5.1 percent in 1931 and 3.9 percent in 1932," wrote Evans-Pritchard.

The economic situation is dire. But, the visual cues from John Steinbeck's terrifying characterization of Depression-era America have not yet arrived, as workers are not lining up at soup kitchens across the land.

Evans-Pritchard writes that the lowest interest rates in history are failing to gain traction globally.

A flurry of bond issues from the U.S. Treasury is swamping the debt market. The yield on 10-year Treasuries has climbed from 2 percent to 3.04 percent in eight weeks.

"The real cost of money is rising as deflation gathers pace," warns Evans-Pritchard.

U.S. house prices have fallen 27 percent, according to the Case-Shiller index. "The pace of descent is accelerating," said Evans-Pritchard.

The Dow could fall to 4,000 by this summer unless there is a quantum reduction in mortgage interest rates, says Evans-Pritchard.

Other “shock and awe” policies needed include forcing 10-year Treasury bills down to 1 percent and mortgage rates to 2.5 percent.

"This remedy is fraught with risk, but all options are ghastly at this point. That is the legacy we have been left by the Greenspan doctrine," says Evans-Pritchard.

"We are at the moment of extreme danger."

Nevertheless, other global economics experts see a recovery, albeit a slow one.

A statistical rebound in the second half of this year could be driven by a number of factors, according to Morgan Stanley Asia CEO Stephen Roach, including the Obama administration's stimulus bill.

But don't count on anything serious, Roach says.

Any 2009 upturn is likely to be anemic at best and not strong enough to keep the unemployment rate from rising to near 10 percent over the next year and a half.

“Since it's hard to call that a recovery, it looks to me as if this recession won't end until late 2010 or early 2011," Roach writes in The New York Times.

http://moneynews.newsmax.com/streettalk/evans_pritchard_dow/2009/03/06/189228.html

so many numbers and statistics... details which can
be spun every which way, i begin to glaze over...

the state of our financial situation can be seen more
clearly by observing the foreclosure signs, for lease
commercial spaces, for sale signs on every block, people
standing in line for food stamps and/or unemployment,
people sleeping under bridges and bushes or in their
cars, pets being abandoned (sorry, zuni), retail sales
way down, utilities being shut off..... my heart goes
out to anyone still sleeping (sheeping?), they are in for one
helluva nightmare - at least i have had time to get used
to the idea

I'm afraid this is going to be a common site across North America sooner than later. This pic was in Sacramento ca.

micjer wrote:

I'm afraid this is going to be a common site across North America sooner than later. This pic was in Sacramento ca.

my sweet lord, i forgot to mention tent cities
and here i am, living in a tent!

The frustrating thing is.., we already know all this crap, the stuff that's happening and what's going to happen. But we can't get our friends and family to wake up to it.., therefore, it's imperative that we strengthen ourselves, both spiritually and physically for the times that lie ahead.
Time to get 'selfish'.., concentrate on building our strength to help our loved ones when the time comes, and it is coming. They want us to think they have all the power. Therefore they'll try to make us feel weak by their media and disinformation sites....,Thats how scared THEY are.!! They are frightened of us listening to us..,ourselves!!
How do we do that? Don't get paranoid., don't listen to 'gurus' that will fill your head with non-sensical rubbish..be practical and do what is in your means. Keep clear of fear-mongering sites (they need to build an atmosphere of gloom to succeed.. ) Prepare what you can in a practical manner. If you feel the need to store food..then store it with things you would normally eat. But believe in yourself and your innate being.
Things will change in the coming months and years, how you react to the changes is the important part. Believe in yourself., think for yourself.., seek information and make your own decision. Take in all the information available and then make an informed choice in conjunction with your intuition, that which is trying to tell you the truth, LISTEN to it! It is the real you.

Excellent post Tom!

Yes, THINK for yourself, go with your intuition and then LISTEN to it.

I have also never followed any guru and why should I? They don't know one single thing about MY life, MY thoughts, MY dreams or MY abilities.

I decide how I will think and how I will react and how I will feel. Yes, there will be a lot of changes in the next few months, we can all feel it.
I choose to remain calm, be prepared and live each day as if it is my last...like I have always done.

I choose to never live in fear and to help those in need when I can. I choose to be FREE and to never become a victim.
Many of us are becoming more spiritually awakened and we know that we are here for a reason. I know I can feel the LOVE that's here in this forum.

My heart breaks for all the suffering many families are going through. I shall do everything I can to try and help in my own way and I will continue to pray for the children who didn't deserve this kind of life.
That's what MY intuition tells me to do.

@ pilgrim - good post mate :)

that being said, how many will continue to do what the "news" tells them?

i too have been told that the shite has only just started to hit the fan, by people who are in a position to see such things.

IMO many are playing straight into the hands of the opposition.

yes the market is in trouble, and shall continue to fall, but when every single person on the trading floor is expecting a bear, a bear they shall get.

more than once i have tried to tell these guys about what is happening, and almost to a man(sic) they laugh and say 'what the fcuk would you know stal?' once in a blue moon one of them will give me a look that says they agree, but no-one ever actualy says anything.

IMO bottom line, you want to pay off that new car, mortgage that flash house, keep putting 8balls on your visa, and keep getting those $1000 lunches, you will continue to do what your boss tells you. and he does what his boss tells him. and so on and so on.

doesnt stop me from trying though....

I also still see people in denial when they say the market will come back and you just have to have some patience.

Just today a friend told me she did a short sale on a place in Rancho Santa Fe, CA for a desperate seller who just lost 2 other properties to foreclosure. The mortgages were $16,000 a month!

Another friend is in trouble who travels to Dubai and Mexico raising cash for Angel investors but the money has dried up.
Even the very wealthy are starting to panic. Guess they will have to try and sell their horses and give up their golf memberships because they never bothered to save up for emergencies.

We are in for some very rough times......it's going to get very ugly and real dangerous.

Speaking for the wanderers here...

Our job, being, in our different measures aware of what is going on, is to be beacons of light and radiant love.

In non-esoteric terms: we will hold the pole! We will be the anchors in the storm, and we will help as many people as possible to get through this in one piece.

In doing this, we will be tested to the limits of our capacity, but what we shall experience and learn will be unique and unprecedented in all the manifested universe. Earth is a special case. A new way of doing this shift.

Linda speaks of dangers - I agree, it will be very dangerous. Following inner guidance and having a prepared mind/body and spirit, and having made the choice to survive and maintained the intent to survive, should see everyone right.

I see the main danger is fellow humans who cannot adjust to rapid changes in environment and energy. They will act irrationally, unpredictably and potentially violently. They will be "beside themselves" and that connection to their inner guidance will be unavailable to them - the exact state the elite wanted us all to be in! If it is safe to do so, we may be able to help these people heal and recover. It is a sad possibility that many such people will be destroyed as this cycle works itself out.

Other dangers may be posed from the Earth herself. Those who decide to survive will be in places that are safe when they need to be.

In this way each of us will know when we are called to action and we will know what to do.

A..

We can thank guys like this for what happened to the market. Remember, what was good is now bad and what was bad is now good.
It's in your face now.

The host of Mad Money says he regularly manipulated the market when he ran his hedge fund. He calls it "a fun game, and it's a lucrative game." He suggests all hedge fund managers do the same. "No one else in the world would ever admit that, but I could care. I am not going to say it on TV," he quips in the video.

He also calls Wall Street Journal reporters "bozos" and says behaving illegally is okay because the SEC doesn't understand it anyway.

http://www.alternet.org/blogs/video/131334/busted%3A_cnbc_sleaze_jim_cramer_blabs_on_how_he_shorted_stocks_and_manipulated_markets/