Season’s Greetings

A Year of Turmoil

The team at Acting Man wishes you and your loved ones a Merry Christmas / Happy Holidays and all the best for the new year!

Hopefully our missives helped you navigate the treacherous waters of the financial markets this year. As our low posting frequency attests to, we unfortunately continued to be incapacitated by our poor health. Nevertheless, we did our best to chronicle the growing cracks in the bubble edifice.

Evidently the Bad Santa got hold of the markets this year.

It seemed particularly important to us to keep readers apprised of our market observations this year. Since we were forced to economize in terms of time and energy, we decided to focus on this subject and postponed articles on theory, history and political issues to a later date (we did discuss economic theory from time to time in a financial market context though, such as e.g. in “Capital Structure as a Mirror of the Bubble Era”).

(Click on image to enlarge)

An up-to-date version of the chart our most recent market update ahead of the FOMC announcement started out with. We hereby declare this the most eerie chart pattern comparison of the year. The stock market actually managed to create a near perfect mirror image of its 30-year seasonal pattern. We have never seen anything like this.

It turned out to be quite an interesting and exciting year – in the Chinese curse sense, that is. We have shown the above chart depicting the nearly perfect inversion of the normal seasonal trend many times over recent months and have frequently stressed that the sharp decrease in money supply growth in the US and abroad represented a serious threat for overvalued “risk assets” (the most recent updates on US money supply data in chronological order can be accessed here: “The Liquidity Drain Becomes Serious”, “Liquidity Drain Accelerates” and “The Federal Punch Bowl Removal Agency”; the most recent global update: “A Global Dearth of Liquidity”).

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