October 27, 2011

Markets Up BIG Today. Are We "Out of the Woods"?

We are far from being out of the woods. $1 trillion dollars and change - maybe. That's the amount being bandied about as what is going to be able to "save the EuroZone and the Euro". It's not enough (the most realistic figure that I've seen is $6 trillion).

This amount has bought time and little else. Expect to see more of the Euro countries come to the trough so that they can get their economic medicine over the next several weeks and months. Also, expect that the countries that are doing the heavy lifting and bailing out the undisciplined countries to get increasingly upset as they realize that this is nothing more than a hand-out that is not going to change the behaviors one bit that put Europe in this mess in the first place. Also, expect that China is going to want quite a bit more than most originally thought as they are now involved in this. Ironic, isn't it?

Nothing has changed except the element of time. Oh, I expect the Markets will actually go higher - for a while. But I would be very careful about anything that I buy and the time frame for those purchases. And our government should be ashamed that it is willfully forcing people into the riskiest investments that there are (equities) by effectively eliminating other asset classes through their federal policies. But that may soon change. I sense just a hint of rising interest rates on the horizon. And the Fed has been out of ammo for some time to halt this, if and when it comes about.

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