#Dow #Stocks #bonds #commodities #Economy #politics

The global economic climate today can't be changed by changing national leaders, but you can't tell voters that. They'll be disappointed by every leader they elect and can predictably flip to the other party in any "two party system", which is one of many great arguments for ditching such a system. Current talk in the States is expecting a president to bring down prices as if any open market responds to efforts on price controls. No president or any other official can control prices, and it's been tried before. Doesn't work. But you can't tell voters that.

The latest explainers of both inflation and rising costs of housing (both rental and owned)is commodity prices on building materials, jacked up by the price of the petrol commodity by which they're shipped, and we're back to the oil conundrum as well as revisiting not the Dow Industrials index, but the Dow Transportation Index.

But there's been unusual movement on a couple of other commodities that don't track with historical record in times of inflation, and that's gold and silver. When the Fed raises the prime rate, there's an expected flight from Dow Industrials to 30-year and other Treasuries and so the Dow Industrials usually experience a strong dip...but inflation in general causes a rise in precious metal investment, and that's NOT happening. Those sales are actually down, and surprisingly enough, so is sweet crude. So yeah--you're going to hear the blame going to refineries.

Here's the deal: hedge funds are NOT worried about inflation and in fact are sitting rather smug on their current gold and silver holdings, so quit blaming Yellin on making a bad call on the duration of inflation. Demand for goods continue to outstrip production and the reason we're not getting product to match demand is product bottlenecks between production and market.

Any given company's prosperity is based on increasing customer base--full stop. If the customers are there, it's on the company to deliver the goods and thus make more sales. That's not where they're currently at, though, with their track record of failing to reinvest profits into company operations but instead in artificially jacking up the value of their stocks by buy-backs, AND with those buy-backs executed during the time when they are paying their own jacked up price per share with each buy-back. That's like being an Amway dealer with yourself as your best customer and neither scenario is sustainable.

Thus I'm going all Gail Dudak on you by calling this a long overdue bear market correction, not a recession.