Hemp for those who don’t know is the male of the cannabis plant. The female plant is what contains THC, the substance that gets one high. Hemp is just an amazing industrial product.
If one has ever had a shirt or a piece of rope made from hemp one is struck by its durability. Much more durable than cotton for instance. It is tough but also soft. It has a million uses, from paper to building material. However for years the drug war (not to say cotton producers and producers of chemical based products such as Nylon) have gotten in the way of the legal cultivation of this very useful plant.
Perhaps no longer.
There was a time when this country was filled with hemp fields. In fact at one point in early colonial America it was actually against the law NOT to grow hemp because it was so useful.
The “plunge protection team” (PPT) used to be something which was whispered about. Now it’s openly discussed in the New York Post. Hell will become a frost covered plain before the New York Times will ever mention the PPT of course.
As I have written before, there is an understanding among traders post-2008. If the market heads into a nose dive the Fed will intervene. It will actively buy futures (and likely whatever else it has to) in the market to buoy the market.
The PPT is kind of like the Israeli nuclear program. No one acknowledges it officially but almost everyone thinks it exists and as such this impacts markets.
It’s never time to panic. That is certainly doubly true when it comes to investing. But it takes a disciplined mind to avoid freaking out as shares continue to march lower day after day. And in the midst of the chaos to make wise decisions.
In the attached article from CNBC the point is made that the real bubble is likely an inflated confidence in the Federal Reserve.That come what may, the Fed will intervene in markets and buoy them. So what if stocks are over extended, Yellen and the FOMC will save the banker’s posteriors. As we’ve said before this sounds very much like “housing prices always go up” to us. If sentiment regarding the Fed were to change, if traders were to fear that things were bigger than the Fed, a downdraft could be wicked.
We’ll see. There’ve been many blips over the past 5 years and for the most part the pro-Fed folks have been right as far as equity prices are concerned. (Little else.) Maybe this is just another blip on the way to Dow 20,000 and beyond.
But maybe not.
Interesting things happening in the markets. We’ve had a dozen or so of these flare ups over the last few years so we’ll see how this one goes. But it’s definitely one of those times where brokers aren’t going on vacation.
Take this with a grain of salt, but it is an interesting chart for sure.
The economic tide has been going out for quite a while, but the pace has just quickened in emerging markets – big time. Things have become quite unsteady and no one knows whether the current instability will trigger something broader in the developed economies. China is slowing. Japan has horns locked with China economically and increasingly politically. Europe is catching its breath before another wave rolls through.