Find Light As Darkness Approaches

An honest broker. Our country has a great example of this in George Washington, the Indispensable Man. Honesty is vitally important as a virtue, but it is equally important in commerce, by individuals, corporations and market makers adhering to contract law.

When contracts are broken, it throws mistrust and uncertainty into the marketplace, creating chaos. Regrettably, the Obama administration, in their efforts to transform this divinely inspired nation, altered the rules of contract law right out of the gate upon taking office in the form of shortchanging the automaker bond holders during the auto bailout. And don't get me started on the sun-setting of the famed Pontiac brand of General Motors!!

While Congress has become seemingly irrelevant and scandals are mounting while the media cheers on the socialist agenda, the stock market, although having ups and downs, is higher than it was in the aftermath of the 2008 crash. With a 9%+ unemployment rate, small business getting clobbered, taxes and regulations increasing, restricted credit and market uncertainty, one has to wonder how the market remains so high.

During the Great Depression, folks with jobs made out fair to midland, but it was those on the outside looking in who suffered the most. Unlike that period, the FED has injected massive levels of cash into the system, and when coupled with governmental stimulus, corporations and unions on the inside have been able to maintain profitable revenue levels. But it is not real, for when the cash influx is removed, the true levels of markets will be identified, and those levels are far lower than present closing ranges.

Not only are the current market levels manufactured, but economic measures of employment, inflation and debt are fabricated. In addition, in part due to the crony capitalism, investors are uncertain of false market indicators, significantly increasing the risk associated with capital investment.

And then, there is the rule of law. The collapse of trading firm MF Global, whose CEO was former New Jersey Democrat Governor Jon Corzine, has lead federal investigators to uncover that the company seems to be missing about 1.2 billion on customer accounts. A Congressional Panel is seeking to question Corzine, who if the allegations prove true, should take up long term residency in the gray bar hotel. Although while Governor Corzine blew a huge hole in the wallet of New Jersey, few think he is dumb enough to get himself in this situation, which leads some to think this is an orchestrated hit.

One could think another Wall Street firm blowing up has little impact on the average American, but this well may. Much of the investor money is currently stuck as investigators sort through the wreckage, but investors may only get back about 40% of their potions and they are far from happy. While this is most unfortunate, far more significant issues concerning the lack of trust in the commodities market, where MF Global provided the market to hedge futures contracts, and the contagion to follow, could severely impact our capital markets.

Investors have signaled the lack of trust in the market, perhaps highlighted in a letter by Ann Barnhardt, a cattle commodities broker, who due to the lack of trust in the market place and an "abject lawlessness and contempt for humanity of the Marxist Obama regime and its cronies", ceased operations of her firm, Barnhardt Capital Management. Please read the letter that she wrote, as Barnhardt speaks a truth you are unaware of and need to be up to speed on.

Investors Business Daily does not care much for Corzine, and neither do I, but there is a much more serious problem brewing here. Trust in the capital markets is essential for investors, and without that you have inefficient markets at best. With the DOW artificially pumped, many thought the commodities markets were where realistic evaluations could be identified.

Not anymore. Perhaps this leads to a market crash, or maybe it is just another in a long line of birth pangs we have been having. If the allegations of malfeasance are true and investors are not made reasonably whole due to the theft by this firm and it's principals, most notably Obama crony Corzine, these folks need to become instant jailbirds.

If they don't, and the rule of law remains absent, the birth pangs will quickly turn into a contraction and the official birth of utter chaos in the US financial markets, something many contend is orchestrated from within the White House, will emerge. Serious as that is and factoring in the EURO fix that won't work, the FED is war gaming worst case scenarios with new stress test of our major banks forecasting potential unemployment levels of 13% and a DOW at 5600.

Reality is a mirage under this administration, and your investment dollars must be protected. As Ms. Barnhardt accurately pontificated, investment is most vulnerable under the socialist and evil regime running our country at present, and hopefully November 2012 will intercept us from the generations of darkness Ronald Reagan warned us about.

Pray we make it that far!