The Stock Market Crash of 1999 repeats in 2013 by John Galt

[johngaltfla]

The Stock Market Crash of 1999 repeats in 2013


by John Galt
February 20, 2013 19:30 ET

Hmmm, heard this before?


(click on the link above to watch the evil Satan, er, Lloyd Blankfein video via CNBC)


Nah, it’s the 1920′s ladies, Kwamer said so:


(click on the link above to watch the hilarious Cramer video via CNBC)


Wait a second. Oil prices going up are bad? Didn’t we hear in 2007 and 2008 that this indicated a bull market was going to extend all the way to Dow 20,000?
Nah, people are not stupid enough to get washed, laundered, rinsed, and raped again are they?


Ah, uh, yeah, from the New York Times on January 25, 2013:

As Worries Ebb, Small Investors Propel Markets

Been there, done that, seen the sick sorry movie when the .com’s started to fall to hell in a hand basket after the investment banksters raped the stupid “small investors” who thought that the concept of getting 50 lb. bags of Gravy Train shipped to their homes was “brilliant” and a sure fire money maker.





Thus we watched the markets implode and to give one some perspective, here is the chart of the S&P 500 from July 1998 to the end of May 2001 courtesy of StockCharts.com:





Does today’s current market with over 500 days and counting without any significant correction look familiar to anyone?





But don’t look at the numbers, read the headlines and understand that Obama would never lie to the citizens and the stock market will go up forever because the Bernank will print bull-crap until the dollar appears to look like some African banana republic’s paper fiat crappola:





So what happened after the initial crash of 1999 to 2001? Did the markets bounce back and rally up to September 11, 2001 as many “experts” projected after the initial correction?


Uh, no. Here is the chart from December 1, 1999 until September 7, 2001:





The initial 30%+ correction was nasty, sharp, and caught most “small investors” blaming their brokers for ineptitude, fraud, and refusing to answer the phone to desperate retirees convinced that Netscape and other .com ventures would never, ever, ever, ever, ever, ever, ever, go bankrupt and that they were as strong as Apple Computer (Symbol: AAPL).





Since I’ve taken a bite out of the Apple and looked at what the S&P 500 did, why not a quick look at Professor Dollar during the same 1998-2001 time period:





Not saying that this could happen again, but do not be shocked if the USD moves from the 81 level to above 89 in very, very short order, especially if the Middle East blows up with short notice.


Over the next month or two, many of my readers will hear the following:

“It can’t happen here.”
“This time it’s different.”
“The Fed has the stock market’s back.”
“The economy is so well managed, crashes are rare if not impossible thanks to our modern system of regulation and the Federal Reserve.” (or words to that effect)

Prepare for the impossible, different, and disastrous as once again the lemming behavior of man, as guided by computer programs that man created, create an untenable market situation that was theoretically never suppose to happen again after 1929; or 1987; or 2008; or 2010…..

[firebird]

Thanks John, I think.........

[forfreedom]

Short!!

[johngaltfla]

Short!!

Damned straight. 120's look REAL good now.

[naegling62]

Great article! Tell me this, they said gold went down today because the fed thinks the economy is turning around. So why would Platinum and Paladium drop which acctually rise on good economic news? Why did oil drop? I'm smellin' MSM B.S. on this.

[timbo]

Never claimed nor will ever claim I'm in your prognostication category JohnG.

I'm lucky if I can find my socks in the morning.

But I do observe. Business and people's moods and what goes on in daily life.
Not good. Maybe people were feeling a little more confident when the idiot in chief finished out his first rendition of destroying our country, but just in a short time, people lost a lot of air out of their balloon.

One, gas prices............way too fast going up. Scares people into inaction.
Two, food prices..........just plain crazy and so quick as well!

Confidence is on it's way back down again. Might take awhile for that to sink in but it will pave the way for.............what? Well somebody stole my chicken guts so I'm screwed.

Thanks JohnG.

[johngaltfla]

Great article! Tell me this, they said gold went down today because the fed thinks the economy is turning around. So why would Platinum and Paladium drop which acctually rise on good economic news? Why did oil drop? I'm smellin' MSM B.S. on this.

THAT article will be up 0500 in the morning...doing the charts now.

[Sleeping Cobra1]

This will scare the sheep. With this Depression, the Stock Market should not be where it is at.

[Yoda]

This will scare the sheep. With this Depression, the Stock Market should not be where it is at.

If the economy were not being manipulated, that would be true. But...

1) consider Greenspan's remarks about the stock market being the only benchmark that counts, i.e. the Fed is printing money like there is no tomorrow in order to reinflate the bubble and ignoring the effects on savers.

2) The Fed also has gamed interest rates absurdly low in order to avoid turning our catastrophic (short term) debt levels into a meltdown. They have to maintain low rates as long as possible, which is good for the Market, or else game-over vis vis the national debt, which as I understand it was financed by the geniuses-in-charge with short term debt at a time of absurdly low interest rates which could only go up. Assuming that eventually the farcical economic stats are recognized for what they are, and once serious inflation does take hold, cash/corporate bonds/T-bills/fixed rate instruments will plummet in value. Stocks are defensive with against a backdrop of inflation.

3) So, where else to put money? You can either fight the Fed and go with precious metals, or you can assume there is more life in the bubble. John is clearly saying there isn't. But for those who got into the right stocks this year, there have been some impressive paper gains. And that may be the strongest argument for predicting impending profit taking and rotation into defensive sectors.

4) And there is an argument that if indeed the market is being gamed, better to go with the gamesters than against them, for they have the tools at their disposal, as well as many of the Presstitutes.

[johngaltfla]

If the economy were not being manipulated, that would be true. But...

1) consider Greenspan's remarks about the stock market being the only benchmark that counts, i.e. the Fed is printing money like there is no tomorrow in order to reinflate the bubble and ignoring the effects on savers.

2) The Fed also has gamed interest rates absurdly low in order to avoid turning our catastrophic (short term) debt levels into a meltdown. They have to maintain low rates as long as possible, which is good for the Market, or else game-over vis vis the national debt, which as I understand it was financed by the geniuses-in-charge with short term debt at a time of absurdly low interest rates which could only go up. Assuming that eventually the farcical economic stats are recognized for what they are, and once serious inflation does take hold, cash/corporate bonds/T-bills/fixed rate instruments will plummet in value. Stocks are defensive with against a backdrop of inflation.

3) So, where else to put money? You can either fight the Fed and go with precious metals, or you can assume there is more life in the bubble. John is clearly saying there isn't. But for those who got into the right stocks this year, there have been some impressive paper gains. And that may be the strongest argument for predicting impending profit taking and rotation into defensive sectors.

4) And there is an argument that if indeed the market is being gamed, better to go with the gamesters than against them, for they have the tools at their disposal, as well as many of the Presstitutes.

There is a time, in every casino game rigged or not, to take profits. Sometimes the most intelligent move is to defy the gangsters, take profits, watch the collapse then buy at the lows. Because the next level of QE will be well over $250 billion per month or the economy will contract at an accelerated rate due to economic instability worldwide.