The rally is over and volatility is high.

AIG employees given police protection in Konnekticut

Outraged Obama Brownshirt and death reaper dressed ACORN thugs and vandals have forced Connecticut to have to continue to provide special police protection for rich people. AIG was in a lockdown mode again on Friday. Many other Connecticut workers were affected because AIG shares office buildings with other companies. Yes, NAZIS got outraged very easily, as did KGB and other socialist who got whipped into frenzy by earlier "community activists". That is what community activists are trained to do. Outraged socialists don't usually know how to solve problems they would rather just kill them.

Obama plans to fire the GM president today or pull the plug on GM. Obama is wasting so much money showing how authoritative he is that it is becoming likely that America will eventually default and US treasuries will become worthless. Obama knows that Bob Brinker and others have advised the rich to go into "safe" US Treasuries so Obama is trying to make Treasuries worthless. Spending the USA into socialism is becoming more attractive to the socialists each day. This weekend Bob Brinker said that if interest rates rise to 5% the USA would be unable to finance all the debt Obama is creating.

America seems like it is being run by an administration that believes in socialism, global warming, and possibly the tooth fairy.

Market forces

The world is becoming more alarmed each day with the Obama Administration. This week the British "Economist" magazine expressed its disappointment with the lack of maturity of the financial advisors Obama has selected. The world is seeing that Obama is incompetent and say he is learning by making mistake after mistake because he has no experience or knowledge of financial matters. That is what a nation gets when it elects a teleprompter or a man with a wire in his ear being told what to say. This week will likely see the US stock markets collapse at an alarming rate.

Treasuries were falling all of last week indicating that worried buyers of treasuries want higher interest rates due to perceived higher risk. The FED therefore has been buying Treasuries to try to keep rates lower by increasing demand. But that shows the incompetence of the Obama administration because it means the US is printing money to make up for the fall off in treasury purchases.

That also shows the ignorance of the Obama administration because that is what Germany did before the Nationalist Socialists took over Germany in the 1930's. Hyperinflation in Germany outraged the Brownshirt thugs because the rich then profited buying diamonds and gold. The collapse and default of the German economy became the pretext for the democratic election of Adolf Hitler as their "Supreme Leader." Perhaps USA hyperinflation will allow Obama to consolidate his socialist power too.

The collapse of treasuries would drive interest rates higher. Hyperinflation would then be the only way to keep interest rates lower. In effect hyperinflation is a slow method for defaulting on all national debt obligations. We must not delude ourselves into thinking that buying gold is a way to avoid bankruptcy along with the socialist government. The socialists confiscated the wealth of everyone in the end. Germany is still paying reparations for the wealth the Nazis stole from the rich. When a nation steals from the producers to give to the non-producers everyone goes either into poverty or into a concentration camp.

Market Outlook

U.S. stocks faltered on Friday. This rally appears to be over. This is a trader's market not a long-term investors market.

Asian shares were down last night with Shanghai down 0.7%, India down 4.8%, Japan down 4.5% and Hong Kong down 4.8%.

European markets are down now in the range of -2.1% to -3.2% mid way through their day.

US futures indicate the DJI will down about 100 points at the start with all the American equities markets in serious over bought situations after a 21% run up in prices.

Trillions of dollars from the stock market value has evaporated and the loss of millions of additional jobs looms as Americans worry if Obama intends to transform the recession he inherited into a depression. Since the recession began in December 2007, the Federal Reserve has vastly expanded its balance sheet and cut rates to the lowest levels on record while lawmakers have signed off on trillions of dollars in spending. That is what FDR did and thus became mired in a “lost decade” with little to no growth. That would mean millions being homeless.

“My analysis indicates that something like a depression is more likely than not,” said James Rickards, senior managing director for market intelligence at Omnis Inc. He bases his assessment on his belief that the deleveraging process is only 25% complete and on unintended consequences stemming from incompetent monetary and fiscal policy.

While opinions vary, there is a general consensus that with a socialist leaning administration like the ones America and Germany elected in the 1930's the chances of a depression are greater now than they have been since then. And experts agree there are clear warning signs that precede a depression. The rise of Democratic Socialism is the biggest warning sign. Expecting a communist country like China to lead the world out of a depression is another sign of "The End".

“Consumers are panicked. Let’s face it. They are increasing their savings but they could do a lot more belt tightening,” said Hufbauer. The stock market could suffer another meltdown if consumer spending does to rise with congress's "Pork Bills." A Japanese type experience could also cause another slide in the nation’s already-weak housing market, which would put more pressure on the teetering financial sector. A “lost Obama decade” could very well be in the cards much like the lost decade of Franklin Roosevelt or of Japan.

The models for a lost decade is the 1930s under socialist leaning FDR, and Japan in the 1990s where a financial crisis lingered leading to very little or no growth. “It could haunt the whole Obama administration,” said Hufbauer

President Barack Obama seems unaware of this danger. “A lost decade is probably the best outcome we can expect,” said Rickards, who called for eliminating the capital gains tax and corporate income tax two things (unlike reckless spending) that could help our economy. Obama just does not get it!

When a nation is heavily in debt and the debt bubble explodes the solution is not to spend more. The solution is to stimulate confidence, mutual trust, respect, community spirit, and productivity. Germany's socialist type solution was not sustainable and brought about World War II.

Yet Obama is taking Adolf's approach that stimulated wasteful spending, outrage/distrust, class hatred, and envy of producers with his mean spirited ACORN thugs and other political hacks.