What are the chances of that?!
Spooky!
Pay attention to the hand in the following chart, and the dot under it, and the closing it signifies in small print in the upper right hand corner, which was a Friday three years ago, October 3, 2008, the end of a tumultuous week in American history on which President Bush signed the TARP legislation:
I remember this vividly, because Jim Cramer came on television the following Monday, October 6th, 2008 (after what seemed like a weeks' long freefall in the markets and sheer panic among the politicians trying to get TARP passed to save their donors' bacon on Wall Street) telling people to sell if they needed their money within five years.
Well, here we are, three years later . . . in the same place.
Do you still have your money? 25 million unemployed/underemployed don't.
You'll notice TARP, signed on this date three years ago, did nothing to stop the freefall in the markets. Obama and McCain both were for it. So were Sen. McConnell, Speaker Boehner and Majority Leader Cantor. And most Democrats. The real fight against TARP was in the Republican Party, and we lost, as did they.
TARP's final cost to the taxpayer may end up as much as $37 billion, an amount similar to the paltry one House Speaker John Boehner was proud to report to great fanfare that he and the Republicans saved in the spring of this year on the budget the Democrats never passed as required by law last year.
Nor are the banks really healthy after nearly $80 billion in FDIC payouts for 396 bank failures. And let's not even talk about the housing sector, the vast repository of the wealth of the American people squandered in the "let the good times roll" of HELOCs, refinancing, and flipping.
OK, let's talk about it: household net worth, which for many is all about their homes' value, is about $7.7 trillion off peak, or back at levels last seen in . . . 1997.
As for Jim Cramer, well, telling people to sell in a panic is just stupid, as is telling people to buy in a panic. Those who kept their heads and were patient and held on and invested new sums along the way made some big money in the markets right up to August of this year.
Don't fight the Fed, as the saying goes, until the Fed stops fighting, which it just did . . . sort of.
The significance of today's market is that the S and P 500 is back where it was after all the TARP intervention, all the Federal Reserve emergency lending (massive! trillions! to foreigners too!), stimulus spending and quantitative easing has run its course.
We've declined, we're moving sideways.
I expect more of the same . . . until we decide it is important to do otherwise.
