Emigration
From thestreet.com
What is most likely going on in the European and Asian funds is a readjustment of the US exposure from 45-60% to 35-40%. The latter number is still overweight, BTW. This seemingly minor adjustment would be enough to jam the global engine that has been pumping a billion dollars into America every day. The irony here is that all those vehement denials of any possibility of a foreign pull-back miss the crucial point -- there doesn't need to be a "stampede" to create a crisis. A relatively modest, prudent reallocation from grossly overweight to just overweight would test the entire global financial system to the limit. That is how misshapen and distorted the system became during the boom era. And that's what makes anything more than purely speculative rebound-plays so dangerous -- if the realignment of capital funds is happening, most of the dislocations are ahead of us.
Boy, the trading press -- folks who keep a keener eye on charts than the real world, and a sharp focus on minute to minute, day to day action--, of which the street.com is mainly comproimsed, remains awfully negative on the market, blurting out NASDAQ 1,000, capitulation, bottom and the rest like some liturgical mantra. It seems to be one of the many disconnects in the market these days -- the one between how the economy is (seemingly) recovering and the trevails of the market, the consumer's willingness to spend all the way through the last recession, housing sales and prices and the rest.
I don't know which way we're going, but these things I do know:
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Employment is coming back.
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Business spending is increasing
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Inflation is staying low to immeasurable
Negatives
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The federal budget defeciet is back. (But then, we had most of the 95-2000 boom wiht a budget defeciet bigger than the 100B we'll post this year).
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Market is no damn help -- and eventually that will impact the rest of the economy
Can't count on down
A token observation. I remember a few years ago, during the height of the bull market, talking with a friend of mine who had just had another fantastic day in the market. He said it just seemed "so routine" for the market to keep going up each day. Almost boring! That was March 2000. Today, as the market gets its usually PM pasting, I'm thinking the same thing: it's almost routine now, that the market gets whomped and it's another easy day for the shorts. Anecdotally, I'm not sure this all means we're at a bottom, but I do know the market never makes it that inevitable all the time
12:58:26 PM 
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