Explaining the unexplainable.

Market doesn't make sense until you realize it is just a casino for business people. Earlier this week the stock market in the US rallied as all Indexes climbed up from the lows of a week ago in anticipation of Ben Bernanke's speech this morning. Most talking heads on CNBC and other business news outlets suggested the market rise was because Bernanke was going to announce QE3. Then yesterday they questioned if the markets weren't setting themselves up for a big disappointment if Bernanke didn't announce QE3. Well today we got the answer. He didn't even mention QE3 or Quantitative Easing as a possibility. How have the markets responded so far? You guessed it, there is a big rally. The Dow is up 170 points right now after being down over 200. That's almost a 400 point swing.

Anyone who thinks they know how to explain these moves as rational, is crazy. Europe still has massive problems and yesterday's action in the DAX the past 2 days is worry-some to sober rationalists.

Now some are suggesting the rally is because of the Hurricane Irene. They suggest the purchasing of batteries and emergency supplies will help the economy. My God, are they suggesting we just need a disaster to solve our economic problems. We don't really have the money to repair whatever gets damaged from this storm.

Market comments for Aug. 25th 2011

There are two major news pieces affecting the market this morning. First was the unexpected announcement that Steve Jobs had resigned as Apple's CEO. The second piece of news was that Initial Jobless Claims were up 5,000 to 417K for the past week. While Continuing Claims are down again this week, the fact may be that many people have been out of work for so long that they are no longer eligible for any unemployment benefits. Therefore they are not counted as Unemployed. Bizzaro!

On Friday, Fed Chairman Bernanke will be speaking at a Jackson Hole, Wyoming Conference. Many are looking for his announcement of QE3 in the speech.

Also Friday will be the release of Michigan Sentiment for August. Expectations are for a 55.8 reading. July's reading was miserable at 54.9, so many are expecting a move back up.

Gold continues down after yesterday's drop of about $100/ounce. In early trading it is down again $19/ounce to $1738/ounce now and down from its intraday high of just over $1900.