Juggling Dynamite

Inconvenient truths that the stock Perma-bulls will never acknowledge: wave after wave of Kamikaze efforts from global central bankers, and still bond returns have trounced stocks since 2009. No wonder they are growing increasingly depleted and desperate. Just imagine how this chart will look once stocks do suffer their next big cyclical decline which arrives every 3-4 years during secular bear phases. But then again, maybe the bulls are right, maybe another decline will never come! Maybe the central banks will be able to keep stocks at this new “permanently high plateau” indefinitely. Maybe this time is different.

Source: Cory Venable, CMT, Venable Park Investment Counsel Inc.

The US Presidential debate tonight will doubtless spend much breath on Republican and Democrat plans and promises to “create jobs”. The truth (explained in this clip) will most likely be overlooked.

“Professor Antony Davies provides evidence, via empirical data from 1955, that there is no connection between federal spending and economic improvement -it merely adds to government debt.”

Here is a direct link.

Good piece in the Washington Post on the Chinese realty bubble. See: As China’s economy slows…

“As home prices have skyrocketed, many Chinese households have gone all in on real estate by pouring years of savings into buying as many homes as they can.

But as the country’s economy slows to its worst pace in years, China’s dependence on real estate for growth — it’s a bigger driver than even exports now — has put the government in a tough position.

Allow prices to continue rising and help the economy in the near-term, but the real estate bubble gets worse. Cool things off and the entire economy slackens too much…”