Hilarious Complacency

While working on a different post titled the diplomatic language of crisis timing I noticed how much bad news is in this market and how incredible it is that we’ve shrugged it off.

In a weak market, any of these bearish cases could derail a market.  Roughly in chronological order:

Possible double-dip recession

Commercial real estate collapse

Uncertainty on expiring Bush-era tax cuts

Flash crash/loss of investor confidence in markets

Greece is on fire

Ireland is on fire

Euro-zone debt crisis contagion

Korean missile skirmish

Irresponsible US monetary policy

Currency Wars

PIMCO’s new normal

Imminent collapse of fiat currency

The great JP Morgan silver conspiracy

Here’s a look at the Volatility Index for 2010.

Looking at the back-half of 2010, either the market has become beyond complacent and we’re due for an epic pullback or we are in the grip of a strong bull market.

It is my strong belief that due to the lingering feelings of gloom and the overall disbelief in every rally that we are in a bull market.  Seasonally considerations lead me to expect December to close out strong.

2011 is a clean slate but I expect more disappointment on behalf of whatever the prevailing sentiment may be.

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