Puetz (Pitts) meint:

verfasst von Emerald, 22.05.2004, 06:46

-->BEST OF STEVE PUETZ

May 18, 2004


The Fed is boxed into a corner. Unlike prior bubbles, the Fed has done nothing to stop the multitude of bubbles that have emerged. Simple math proves that every bubble must eventually burst - regardless of central bank policy. Examining the situation in the US, the credit bubble has grown to such an enormous size that the Fed’s easy-credit policy is no longer providing desirable results. Instead, consumer price inflation is rising (especially in the gasoline market), the bond market is declining, profits from the carry-trade are eroding, the job market is not improving, and the economy is still burdened with repaying the $35 trillion in debt used to create the bubble. In short, the Fed has lost control, and a massive depression looms.


Recognizing the formation of a bubble, central banks usually burst a bubble before it gets completely out of control. But the Fed has proved to be the exception. The Fed has let the multitude of bubbles form with complete indifference. The damage from a bubble is always in future years. Given the magnitude of the current bubbles, the damage will likely translate into a total collapse of the US financial system.


In short, any economy based on ever-expanding credit is doomed in the long-term. The size of the bubble dictates the following pain. Judging by the current bubbles, the coming pain will be unprecedented. The Great Depression of the 1930s will be mild in comparison.


All major US stock market indices have broken below important support levels. Because all previous bubbles have ended with crashes, the odds are almost certain that the current credit-market bubble will end with a crash. The US markets now stand at the critical"panic phase" of the crash. The short-term over-bought situation increases the odds that the"panic phase" of the crash will start soon.


Maintain a maximum bearish strategy. Use 75% of your funds for short positions in S&P 500 futures. Allocate the rest to S&P 500 puts with June expirations and strike prices of 700, 800, and 900.

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gesamter Thread:

• Puetz (Pitts) meint: - Emerald, 22.05.2004, 06:46
  • @Emerald: Was hat Puetz denn für einen Track-Record: 75% Short S&P, Rest Puts... - Heller, 23.05.2004, 21:41
    • habe ich aus einem US-Forum übernommen, wo er kotiert wurde - Emerald, 25.05.2004, 06:50
      • merci vielmal. (o.Text) - Heller, 25.05.2004, 16:20