July 28, 2011 nsl Macro Economic Viewpoint So, a balanced budget is good for savers and bad for the heavily indebted and the banks… To me, the default risk is not as serious as the risk of the bubble going even further into the stratosphere.
The higher the NASDAQ goes, the more “innovation” is used to shift our economy into a fully automated online model which needs no employees to function. If the current tech bubble is modelled after a business model which is made up with one guy, a website, and a billion dollar valuation nothing could be better for the stock market than a severe bear market.
Tech looks ridiculously overpriced here, and I view a 30% correction as a boost to the US economy which last time I checked is still made up of far more ditch diggers (unemployed ones) than it is billion dollar bloggers. The disconnect between small web firms selling on the private market on Flippa.com and the valuations of a LNKD are absolutely insane.
We need to see a 50% decline in these issues before investors should be forced into stocks again via QE3. I applaud Ron Paul and the Tea Party for holding their line here, because the last thing we need is more PPT and Fed manipulation of the technology bubble… Keep in mind, the Nasdaq is hitting major support at the 50 day moving average. Hopefully, the Tea Party sticks it to the Man here, and we get a bear market for automation, IPO banksters, and enslavement and a bull market for day laborers!
To view TA on the Nasdaq go to www.hedgephone.com