The collision of global markets and social mood

Thursday, March 28, 2013

Searching For Leadership

So the Bank of Japan's new governor, Haruhiko Kuroda, has warned that  Japan's debt levels are unsustainable.

Japan's public debt stands at about 230% of its gross domestic product (GDP), the highest among industrialized countries.

"I too believe that is extremely high, and this situation is abnormal and not sustainable," Mr Kuroda said at a parliamentary session.

But today, he said the bank needed to deliver on its promises.

"We need to follow through on what we say and deliver bold monetary easing so as not to betray market expectations," he said.

So essentially he's saying even though it's not sustainable, they have to do it because the market expects it.

That's a fine bit of leadership.

This is the same sort of "leadership" that is putting the financial system at risk all over the planet. The "system" is fractional reserve banking, which means there is a fraction of actual cash backing up the electronic digits in each of our bank accounts.

These electronic digits are nothing more than make pretend credits against debts so enormous that they will never be repaid.

Hence the plan to get it anyway, even if it means stealing it. Because even after you earn it, politicians still think it's theirs.

Power will shift in our lifetimes to countries that treat money the best. Start your search for them now.

I still see the potential for a small hiccup or shakeout before a new high in the S&P. The 1556 area looks ripe. There is a clear rising trend line from 1538.57 that should not be broken.

Options will lose a day of time value on Friday, but I will hold them anyway. The 157 calls that I've had will expire today, most likely worthless. But I've been in 'n' out of 156s enough to have more than paid for the loss, and am still holding some.

Today I may buy more depending on whether there is a dip. Otherwise I'm not letting go until at least a new high above 1564.91, preferably 1567, or possibly the 1576 all-time high. Since I'm a scale-in-scale-out trader, I'll shoot for each one with a tight stop.

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