Paul von Hindenburg, President of Germany, 1925-1934
Posted on 08/23/2010 4:15:18 PM PDT by The Magical Mischief Tour
"The latest trigger of the Hidenburg Omen has prompted the Omen’s creator, Jim Miekka, to exit the market. 'I’m taking it seriously and I’m fully out of the market now,' Miekka, a blind mathematician, said in a telephone interview from his home in Surry, Maine. 'I would’ve probably stayed in until the beginning of September,' depending on how the indicators varied. 'That was my basic plan, until the Hindenburg came along. The Omen has been behind every market crash since 1987,' ” reports WSJ. “ 'It’s sort of like a funnel cloud,' Miekka said. 'It doesn’t mean it’s going to crash, but it’s a high probability. You don’t get a tornado without a funnel cloud.' He added he’s not currently shorting anything, although he may look to short Nasdaq stock index futures in the next few weeks, 'depending on how the technicals go.' ”
Remember, as I reported on my analysis of the HO, the fact that it has empirically forecasted every crash since 1987 is not as important as the fundamentals behind the indicator. Many empirical supports work for long periods of time, then don't. Both Long Term Capital Management and subprime mortgages are examples of investments made purely on the basis of long term empirical support, before they crashed. What you have to do is look behind the numbers to see what they are telling you. HO measures cash flow versus stock momentum. When you have narrowing upward stock momentum on declining cash flow, the stock market is in trouble. That's what HO is flashing now.
The flashing HO coincides with very anemic money supply (M2) growth. Thus the flashing HO warning is not likely to be a warning of a minor downturn easily reversed, but a signal of a downturn that does not have huge money growth to stop the fall. This drop could be a big one.
Dow is going below 10 by Wed.
Not sure what the Hindenburg Omen is, but it sounds ominous!
Considering the publicity this thing is getting, if it was any count, everybody would have gotten out by now and the crash would have already occurred.
ping
Don’t there have to be confirmations after the initial reading?
Dang. How do blind people interface with a computer? Braille keyboard, OK, that’s part of it. But still...
Just did a quick check. I’ve got 2.6% of my assets in the stock market. I’ll hang on and brave the Hindenburg thingie.
...as if someone is trying to crash the markets
Google and weep.
Give it a couple of weeks.
On the other hand, since it has become so well known, market forces may take it down.
But, is it says in the article, “When you have narrowing upward stock momentum on declining cash flow, the stock market is in trouble. That’s what HO is flashing now.” That’s very true.
Wanna get that popcorn ready? LOL!
I read there have been two confirmation days plus the original. This will be a nice test, since we actually have the prediction before the event.
One “caveat emptor” here is how widely advertised this particular Hindenburg Omen signal has become. When such signals get shouted from the roottops, they tend to either not work, or be delayed until the crowd has forgotten about them.
Considering the ‘greatest downturn since the Great Depression’ hasn’t caused the BIG ‘crash’ in order to implement the police state necessary for central command.
Maybe this is another “October Surprise”!!!
I hate being so manipulated.
You know your stuff, Moonman, but everybody didn’t get out when Richard Russell had a cow, and he’s got a large following, unlike this guy. The blind guy did come up with a scary name, got to give him that. I got mostly out after the flash-crash. Sitting on a few dividend payers and closed-end stuff now.
ping
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