Morbius Glass store - Where Have All the Leaders Gone? (Hardcover) by Lee Iacocca

Our so called leaders have failed.

Missoni Spring 2010 range

I love Missoni clothes, expensive so it's a one piece in a blue moon buy. But worth it, check out the 2010 spring range. Great colours, dampening down excess with great cuts.

Australia unemployment figures comes in stronger than market consensus.

refer to ABS website for August 2009 unemployment

The Australian goverment is walking a precarious line with their goverment statistics on unemployment (they are massaging the figures as most goverments do). Still Australia is sliding into inflation and possibly stagflation re: export market downturn refer Australia - first developed nation showing hallmarks of stagflation. This will exacerbate into 2010 (export market pain) if Australia hits parity with the US dollar.

With the Australian goverment underwriting bank debt, Australian banks can hide (off the balance sheet) decaying debt away from the eyes of the market; but the banking sector should show weakness into 2010 as 'real' unemployment goes up and (commercial/residential defaults) plus rising interest rates (Reserve Bank/retail Banks) carve into the mortgage markets.

Gold price breakout on a 'mini' crisis 2009 (update 2) - the 'mini crisis' could be near term USD dollar collpase

And the mini crisis could be near term US dollar collapse, rumours are circulating of countries already discussing (a future plan) dumping the USD as the trade currency or global base currency, particularly with oil trading. To be replaced by a stable basket of currencies, the rumour is probably more a way of making the US government and Federal reserve aware that US dollar weakness is unacceptable in international trade as USD purchase power diminishes.

So, the only thing/s that can save the USD as discussed on this blog are: A war, another credit crisis (commercial) or a 'trade' war. In the meantime as discussed in The selling of the US dollar - a USD currency crisis within the next 3mths., if the USD collapses through it's supports of 0.71; then government/central bank intervention will occur. But the commercial property crisis may cause a reprieve for any FX intervention as stock markets correct the USD may find a delay (brief) in it's decline. It would be wise to watch for stock market corrections toward the end of 2009 and bank credit losses in 2009 and 2010.

In the meantime the USD weakness is driving up gold (as an inflation hedge) and gold stocks, commodity currencies also have risen significantly more so the Australian Dollar as noted in The Australian dollar may reach parity against the US dollar in 2010.

But gold is the winner in the current climate of USD weakness

Currently overbought from it's trading ranges of 1000 and 1018; there has been reaction buying from USD dollar rumours. Any other rumour of central bank intervention will drive the US dollar higer, must be watched for any goverment/central bank reaction.

*morbius glass doesn't give investment advice, trade at your own risk

Australia - first developed nation showing hallmarks of stagflation.

Nasty.

The Reserve Bank of Australia had no choice but to increase interest rates. The Australian government threw the 'kitchen sink' (metaphorically speaking) at the Australia economy swelling the deficit to $57.6 billion + . The inflationary aspect is the Australian goverment underpinning the housing sector with large home grants which are now dramatically being removed from the economy (completed end year 2009). But even with the 0.25% increase in interest rates now brining the cash rate to 3.25%, on the same day the Australian Bureau of Statistics releases the Terms of Trade for August 2009, with bullish Australian dollar buying which has caused exports to tank at 2%, an ongoing trend of declining credits to Australia's GDP; another cue for the stagflation argument (which is that prices in Australia have NOT decreased significantly even when the global recession hit in 2008) is the imports are slowing which would indicate that consumption is crawling along (even with a high AUD).

Yet the housing market is overheated again (thanks to goverment stimulus) and general costs of living have not decreased. The slight balance would be the higher AUD, but just as noted in imports collapsing at 3%. So consumption in Australia is not partying around a strong AUD. The private sector which is struggling to survive in now hitting a stagflationary environment, as private costs of doing business didn't decrease in fact they went up (if you work in the private sector you'll know this, as of 1st July 2009 - everything went up). It was the credit market freeze of 2008 that killed off a lot of businesses (not deflation), so a deflation argument doesn't ring true that caused business to close up. Australia could be a good bellwether for a global stagflation environment, with the US going into hyperinflation.

Also refer to: Australia caught in unemployment spiral crunch

AUS credits - exports


AUS Debits - imports

Punisher Annual #1 (Marvel comics) written by Rick Remender, art by Jason Pearson

So last Friday night I am bored, I leave work and walk down to the local comic shop and pick up the Punisher Annual #1 (written by Rick Remender) and head home. Prior to settling down for the night, I pick up a burger (vegetarian) from Urban Burger and a lightly salted side dish of fries. Chow all that down and wash it down with a grapefruit Capri. Head home. Pull a chair up and start to read the Punisher Annual.

What a fun comic, two lesbian demonic hit women called Letha and Lascivious are hired too take down the Punisher. So it's rumbustious ride of craziness, these two women are able to insert suggestive (murderous) messages into peoples minds, as they (Letha and Lascivious...don't you love those names!) causing havoc in in NYC to flush out the Punisher. So insteps Spiderman, whom compared to the Punisher (as he is already resides in the reptilian side of the brain...the primitive side, so he can't be controled) is easily suggestive by thought control via Letha and Lascivious. Rapid hate then turns into love as a battle takes place with a three way (Spiderman, Letha and Lascivious) onto the Punisher, then as the two leso killers take off, it turns into a two way love in, as Letha causes Spiderman to fall in love with the Punisher. It's all fun and games, with the coolest art to go with this story courtesy of Jason Pearson.

So there you go.

Stocks correct. Question is: How significant will the correction be?

As discussed in US stocks are now 'phenomenally' overbought, it has been hard to know when the correction will come through. As equity markets have been supported by inflows of liquidity, which of course has created a bubble in stock markets. After markets closed on the 1st October 2009 the Dow lost 203 points (2.09%) the S&P 500 27.23 (2.58%).

The Dow is particularly interesting because I am looking at further falls for American express (as a 'put' option), refer to Dow rallies over 9000 closes at 9069 - July 2009 as this current sell off was lead by JPMorgan Chase & Co., DuPont and American Express , that ended up dragging the index lower.

Can a sustaining correction drop indices to lower levels? This is the big question, when ever we have had drop in stocks a rebound back into trading ranges has occurred. Depending on more band economic news, if supports are broken on the Dow at 9398 and 8993 we will see a collapse back down to July 2009 low (when the market rallied).

So a correction was due, but a bigger one may be pending.

Please click on graph for larger image:
(Note American express. All indicators show further selling. Also refer to tight trading range between supports. Pushing above 10,000 resistance has been wishful in the near term, a sustained breakout only if the USD collapses)