Volume? Who Needs It?

by Larry Levin


I used to think that the markets were bigger than the Federal Reserve. Oh sure, the Fed can move markets, but in the end I thought the market would get it right. Said another way, the scams pulled by central banks would be short lived. I am seriously considering changing my opinion now. The Federal Reserve is clearly above the law and without reproach; nobody but us bloggers will criticize the Fed. Congress is incapable of it. As I recently reported, the "Audit the Fed" bill was gutted by a gutless scumbag in Congress so that the financial game of "kick the can" will continue.

Today we found out that volume is no longer needed for a market rally. Actually this has been going on since the Fed rigged this rally, but it hasn't been more apparent than over the past few days. In just 3-days the market has rallied about 4.5% and in this time we have had the lowest volume days of the previous three WEEKS. Moreover, today's Dow explosion came with new daily, weekly, monthly, and yearly highs...with poor volume! This is NOT NORMAL. This is very, VERY, abnormal and is courtesy of the Federal Reserve.

Volume? Who needs it?

Come to think of it, the market doesn't need a lot of things any more. Here is a quick list I thought of...

? Jobs! Just last Friday we learned that 17.5% of average Americans are unemployed or severely underemployed. That number, however, is the data used since the Clinton administration molested the data to make its administration look as good as possible. If one simply used the same metric used just a few years ago, the unemployment rate is actually 22%! By the way, nearly all administrations have done this, both the left and the right, starting with JFK. Politicians don't give a damn about the truth - just whatever makes them look good. Job? Who needs them?

? Banks! Banks are "put down" via lethal FDIC injections every Friday. Banks? Who needs them?

? FDIC! Speaking of the FDIC, it is INSOLVENT, as admitted by its Chairwoman Sheila Bair herself. FDIC? Who needs the FDIC?

? Accounting! Insane valuations can only be given to terribly run companies via dodgy accounting standards. Proper truthful accounting? Who needs good accounting standards?

? Housing! Housing values have dropped and are only coming back slightly thanks to more government handouts; therefore, I can argue that the so-called bottom in housing is a mirage: when it's gone, so is the bottom. Housing? Who needs a healthy housing market devoid of real estate hustlers, appraisal pimps, and CDO salesmen/whores?

? Commercial real estate! Got CMBS? No? Good for you! Commercial real estate values have dropped...and are going to fall a lot further. The government cheese hasn't been handed out yet in this sector - but it will be. Commercial real estate? Who needs a healthy commercial real estate market devoid of real estate hustlers, appraisal pimps, and CMBS salesmen/whores?

? Congressional ethics! Uh-huh, who needs that?

? Fiscal sanity! This goes hand in hand with the low-life clown-posse selling you, your kids, and your grandkids down the river. Including unfunded federal pensions, social security, Medicare, and Medicaid the debt of the USA is $111,000,000,000,000.00. That would be $111-TRILLION! Fiscal sanity in Washington DC? Who needs that?

? A strong currency! The US dollar is getting destroyed on the open market at the direction of the White House, Treasury, Congress, and of course the Federal Reserve. Every day that the dollar declines you LOSE PURCHASING POWER! A strong currency? Who needs a strong currency?

? Volume! Finally I touch on volume again. Volume is like the strong foundation on which a well built home or sound fundamentals of a strong economy rests. Without a strong foundation, you have an edifice that can be blown down by the gas emanating from the clown-posse in D.C. *** Over my entire career trading stocks and futures I have never before seen a market rally on nearly a daily basis on such fetid volume. Volume? Who needs it? The market certainly doesn't need volume or anything above to rally but the Fed & Treasury.



What we have learned since March is that the Federal Reserve may in fact be bigger than the markets. The rally is rigged, but it is what it is - and it is certainly going up.

In fact, the US dollar decline is what the Federal Reserve has purposely engineered in order to manipulate the stock market higher. The Fed knew that after the Japanese Yen carry trade had unwound, if it kept interest rates at ZERO (for the anointed few only) for a long time it would wheedle the risk crowd to start a new "carry trade." They are now doing it in massive quantities: borrowing then selling US dollars and using the proceeds to buy stocks - pocketing the interest rate differential. When it ends, it will be a catastrophe. The Fed is just blowing more bubbles.

When the Japanese did this they were straight forward about it: Japan wanted a weaker Yen. Ask anyone in the Fed, Treasury, or White House and every lying scumbag asked will lie to your face saying: We want a strong dollar. However, 100% of their actions argue otherwise. At least the Japanese have character - something severely lacking in D.C.

In the end, the Fed doesn't give a damn about you. The White House doesn't give a damn about you. Congress doesn't give a damn about you...or your kids/grandkids. All they care about are reelections and the banking sector; no matter if it is achieved through your lower standard of living, a lack of ethics, insolvency, no jobs, and no savings rates paid at banks - nothing.

Truth, sound fundamentals, strong/real currency are pass? - all which matters is rigging equities higher - the free market be damned.

Just keep electing them and they'll keep pissing down your leg and tell you it's raining...and you will continue to believe it.



Previous Day's Trading Room Results:

Trade Date: 11/9/09

E-Mini S&P Trades*
(before fees and commissions):


1) No SOT trades were filled today.

2) Algorithm positions (1)

3) "Reading the Tape" positions (0) ...combined Secret's, Algo, & "Reading the Tape" total...-1.00



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