I just want to throw up.....

"The country has been sold an illusion of itself"

Bruce Springsteen circa 1985


The quote I used to use was "Someday we'll look back and it will all seem funny, " from Springteen's Rosalita. I felt that quote got me through a lot of rough spots that one I will look back at laugh. Like the time in South Korea where I had the two prostitutes and one was a guy..... No not really, but you get my drift.

Anyhoo, I look around at the country's situation and I shake my head as no one with any sense of responsibility is in charge. Stagflation is running rampant, oil is at $116, gas is at $3.75 a gallon (oh but silly me, oil was down $3 today, that problem is now served), unemployment is very under reported, the housing crisis is getting worse by the day. Yet, all you here is how good things are. Hell, since the Bear Stearns debacle the market has gone on a tear. This was the shortest recession/bump in the road in history. How long did it last, three months? Oh....the pain. Just think if the current bunch of morons were running things during the Depression, would it have ever happened, or would it have been just a bad couple of weeks?

Lately, I have been on a rant about CNBC as I really can't take that station's "all things are good, all the time" mentality. Everything is good in the long run. It makes me throw up in my mouth.

The current mantra on the station is the Fed is done, the dollar has bottomed, fuck commodities (especially gold) the crisis is over, and get ready to party like it's 1999. IMO, the situation is so far from the truth, the station should be held for libel.

CNBC, likes to champion brash, bold new ideas that for the most part are just wishful thinking. Remember about two months ago during the dollar's last dead cat bounce? CNBC's reasoning then was the dollar was rallying as the Fed cuts were going to spur the economy in a few months. I had a few laughs over that one as it would have been the first time in recorded history that a currency ever got stronger because the Central Bank was cutting interest rates. Hey, whatever sounds good right?

Now the mantra is the Fed might be done cutting so the dollar has bottomed and commodities, especially the dirty, evil gold, have topped out. Sell now. From a fundamental basis that is so far off base it's comical. The following is from Lance Lewis over at Minyanville.com:

"Will the Fed pause tomorrow? I suspect it will. But will that "act" magically bottom the dollar and cause inflation to go to zero overnight? That's lunacy.

People need to remember that by pausing, the Fed is merely ending the process of feeding inflation (assuming it isn't forced by weak economy to ease again). This is not "getting tough on inflation" That would be like saying the police are getting tough on crime by no longer giving out free handguns to crooks. Once an inflationary trend begins and becomes embedded like this one is, it doesn't just stop overnight. Only monetary tightening will stop it.

However, with the economy in recession, and the financial system still crippled, the Fed can't tighten. And tightening is the only thing that will bring down inflation. "Talking tough" about inflation is meaningless.....

And if the dollar continued its bounce the Fed pausing won't be the reason. In fact, when the last easing cycle ended on June 25, 2003, the dollar index was down 0.4 percent three months later. Six months later, it was down 5.9%.

Make no bones about it, the economy is in shitty shape. How shitty you ask? So shitty, that there is talk about a second round of economic stimulus is already being talked about in Congress. (Prolly just vote getting, but the fact that they are discussing it is interesting.)

Is housing coming back? Not for a long time. The dollar "bottoming" has spurred interest rates to the point where anyone who needs to refi, now can't. You now need stellar credit, at 20% down, and a stamp on your ass from the queen herself to get a new mortgage. The conditions are even tighter for a refi.

Gasoline and oil with the exception of some declines here and there, are not coming down meaningfully any time soon, IMO. Yes, demand in the US, might be shrinking, but think outside the country, China is exploding for oil consumption, along with India. And when there is no meaningful energy program, prices in this country, will go higher when the demand does come back.

Surely, you have noticed the rampant inflation that is all around. Food, energy, insurance, basic materials, etc. Sorry, but that doesn't get cured just because the Fed stopped cutting; temporarily.

Things are a mess unless you live in the CNBC world where things are good all the time as the next bull market is hear or around the corner.

For me, all roads lead to gold, regardless of what CNBS says.