Bearish daily extreme estimates:
Bullish daily extreme estimates:
The above video gives you a balanced bullish and bearish view of the coming price action for MQNH23.
I attempted to compare monthly total volume near what was considered “correction” bottoms, but some were bullish, some were bearish, and all had rather variable amounts of total volume. There is nothing one can really glean from that from a technical perspective.
My biggest problem still with this market is that there is a casino mentality that pervades any discussion or consideration of enterprise value and the time value of earnings and assets when compared to the risk-free rate of return, often measured by the 90-day Fed funds return rate which is still below the true rate of inflation.
Added to that problem is the fact that inflation as measured in the 1970s to the way it is measured today makes today’s inflation rate a complete miscalculation. If inflation is 7 to 8% and does not mix in the expansion of food and energy costs, it probably misses the fact that true inflation is around 17%. It may have peaked in August, but it is still running around 15% when using the original inflation calculations in the 1970s. The highest measured inflation rate in the 1970s was 15.5% and we have left that in the dust with many consumer items, particularly food products. Food and energy consume a large part of the average family’s budget annually.
As Allianz chief economist Mohamed El-Erian has stated, most business people and money managers do not buy the terminal point of rate hikes as being 5.1% by the end of next year. I think investors and institutions also secretly wonder if Fed Chairman Jerome Powell really understands the mess our monetary policy is in if that terminal rate is perhaps 10 to 12 percentage points higher than he is projecting next year.
I hate to rely on a podcast to discuss economic issues, but many of the roadblocks both America and the EU face in markets and life, in general, are described in this podcast.
The European Union and this country are on a mass destruction mission against the energy and agricultural infrastructure according to World Economic Forum dictates. What are the two largest components of inflation currency? Can you say food and energy? I know that you could.
The current problems with inflation are all fixable if we stop printing money, and stop spending money insanely, including on an insane war in Ukraine and on the absolute invasion of illegal migrants into the USA. If we simply rely on our own energy infrastructure (including nuclear and hydrocarbon energy sources, price and supply issues go away both for fuel and for food, as nitrogen-based fertilizers would be plentiful (in fact, if we made our own again, those items would both be incredibly cheap AND incredibly plentiful. If we’d lose the psychotic notions of the environmentalist zealots and work our way slowly to technological advancements and not into chaos (something we have seen this year already in Asia and Europe, as described in the podcast I linked, we could easily work our way through any crisis. We need to stop the current band of criminals who run the EU and the USA currently to have a shot at that. The sooner the better.
If you want to understand how screwed up our use of assets and our rate of spending are to what logic would provide, I would give this a good read. It gives a good description of the world we live in now and how politicians and bureaucrats warp it into their own devices for thwarting human progress and true prosperity over time. It is like a discussion of enterprise or human value but on steroids. You can understand it though. You just have to read it.
I haven’t even gotten into the other discussions of central bank digital currencies and other items I have discussed in other posts, but the whole mess is going to be thrown at us, particularly in the EU, starting in January. I don’t think the world or the equity markets, currency markets, or even commodity markets will know how to handle it initially, which is why I am still somewhat bearish about the next 6 to 12 months.
Until we figure out what enterprise valuations should be, what short-term and long-term interest rates should be, what basic currency valuations should be (other than zero, which is what they are in reality now ), and how that relates to domestic and international trade and commerce, we are going to be in the midst of a ton of volatility and confusion. These questions need to be decided conclusively and concisely, or the world will be in tumult for decades, in my opinion. That is just my opinion though.
It is also my opinion that you should have an incredible Hannukah, Christmas, and a Happy New Year 2023 also. Thank you as always for supporting this blog!
More will be coming soon.
