Inflationary Commodity Super Cycle Bull Market Ready To Rumble In 2010

The colossal V-shaped recovery of the global stock markets in 2009 was indeed, the most remarkable feat, ever engineered by the “Plunge Protection Team,” (PPT).
Step by step, the Federal Reserve, the US Treasury, and its key allies in the “Group-of-20” nations,rescued the world’s top financiers from their own greedy mistakes. The staggering size of the G-20’s rescue package, totaling about $12-trillion, was equal to a fifth of the entire world’s annual economic output.

The G-20 bailout included capital injections pumped into banks in order to rescue them from collapse, the cost of soaking up so-called toxic assets, guarantees over debt, and liquidity support from central banks.
Tossing aside all arguments of “moral hazard,” the PPT utilized all the weapons in its arsenal, to prevent another “Great Depression,” including accounting gimmickry, and the “nuclear option” of central banking – “Quantitative Easing,” (QE), to rescue the global economy.

History will show that the US stock markets reached bottom on March 10th, when Fed chief Ben “Bubbles” Bernanke and influential members of Congress, exerted heavy pressure on FASB to water-down rule #157, thus, allowing American bankers to once again, value their toxic mortgages, at their own discretionary judgment. The switch-back to “mark-to-make-believe” accounting was the most expedient tool allowing the banking elite to essentially cook their books, - concealing losses, and using discredited models to inflate their balance sheets.

Soon after, a spate of better-than-expected earnings reports by US-banking giants, Goldman Sachs, JP-Morgan, Citigroup, Bank of America, and Wells Fargo began to elevate the stock market higher.
On March 15th, 2009, Fed chief Bernanke told CBS’s 60-Minutes, “The green shoots of economic revival are already evident. Much depends on fixing the banking system. We’re working on it.
I think we’ll get it stabilized, and see the recession coming to an end this year,” he said. Asked if the United States had escaped a repeat of the 1930’s Great Depression, Bernanke replied, “I think we’ve averted that risk.”

In order to fuel a V-shaped recovery for the stock market, the Fed unleashed the most powerful weapon in its arsenal, – “nuclear QE,” – by pumping $1.75-trillion into the coffers of Wall Street Oligarchs, such as Goldman Sachs and JP-Morgan, through the monetization of Treasury notes and mortgage bonds.
In a very short period of time, a tidal wave of liquidity began to flow into high-grade corporate and junk bonds, and whetting the speculative appetite for equities.

Wall Street Oligarchs utilized trillions in US-taxpayer bailout money and guarantees, to bolster their balance sheets and generate profits, by speculating in turbulent financial markets. Since March 6th, what’s evolved is a rising US-stock market and inflated bank profits, which in turn, conjures-up hopes that banks will start lending again, to free-up capital for business investment. Angling for the so-called “wealth effect,” the PPT is hopeful that household spending will also rebound.

Many investors were skeptical of the “Green-Shoots” rally, and preferred to call it a “bear-market” suckers’ rally, - destined to fizzle-out and unravel.
Yet last year’s bargain hunters saw an “once-in-a-lifetime” buying opportunity, and were guided by the sagely advice of Sir John Templeton, “Bull-markets are born in pessimism, grow on skepticism, mature on optimism, and die of euphoria.” Most of all, “Bubbles” Bernanke restored the market’s love affair with the Fed’s printing press.

I notice that most if not all of the big bailed-out banks and brokerages have paid back their bailout money. I think the market rally was engineered by Wall Street to allow the banks and brokerages to do just that. Now that they are out from under, I notice the big market rally is petering out.

Coincidence? I think not.

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.