Yes dear reader, the recession is officially over now, as the Dow close above 11,000 for the second day in a row. Happy days are here again! The jobless people are back too work now, as Intel must have hired them, causing the great earnings report announced after the bell this afternoon.
Quote... "Intel Corp. says its net income in the first quarter nearly quadrupled over last year. Intel's latest profit was lifted by sales of new chips for computer servers as well as an overall bump in technology spending. And in the comparable period last year the company took a big charge to write down the value of an investment." End Quote.
Hmmm... Did Goldman Sachs need newer and fastest super chips for their computers, that they use to manipulate the market with? Yeah... that must be it! That's why Intel beat estimates this quarter. Regardless of how they did it, (if it's actually an accurate report), we pretty much knew that all the earnings reports this week are going to be positive.
No company is going to go against Uncle Sam and tell the market that they had a horrible last quarter, as no one bought their junk because of the bad weather. Instead, they are going to make up whatever they want, (positive of course) and the government is going to clap and applaud their report.
We are so far from reality that INSANE isn't a strong enough word anymore. Anyone that lives in the larger cities can drive up and down the road and see stores and restaurants still closed... and they will never reopen. You can drive though many of the new sub-divisions and see house after house for sale.
The real unemployment is around 17%, not the 10% the government tells you. No one is spending money now. In fact, there is a large shift now to "pay down debt" by most Americans. Where is the spending coming from to create the great earnings? The government didn't send me a check in the mail, with instructions to go spend it and simulate the economy. Did they send you one?
Everywhere I look, and all the people I talk too... are struggling now. People are hurting. They are moving in together to share expenses as most are losing their jobs, or getting pay cuts. My mother and father are at that age where they are retired and like to travel around in a motor home. My mother is very conservative, and doesn't look at all the corruption and stuff... like I do.
In the past year I've noticed her mention the government many times, speaking specifically about how crooked they are. Coming from my mother... to hear that was a shock! She is definitely a "Blue Pill" taker... if you know what I mean.
Of course I took the Red Pill. But anyway, she was telling me how many homes she saw up for sale, and how many businesses were closed down, as she and my father were driving around in Florida. Of course I already knew that, but hearing it from her just reaffirmed how huge the disconnect is between the stock market and the real world.
So, I guess we will continue rallying up a little bit each day, until all the bears are dead, (or in hibernation), and the bulls are sleeping. Then one day, out the blue, BAM! ...a loud gun goes off as the farmer decides it's time to kill the bull, and eat some steak.
As all the other sleeping bulls awake, they will all run for the exits to escape the farmers rifle. But, it will be too late for many, as the farmer is an excellent shot, and many bulls will be slaughtered. But for now, the bulls can graze peacefully knowing that Obama and the gang are paying the farmer quite well to keep them alive.