One Goal: Inflate Asset Prices

Gary Kaltbaum is an investment adviser with over 18 years experience, and a Fox News Channel Business Contributor. Gary is the author of The Investors Edge. Mr. Kaltbaum is also the host of the nationally syndicated radio show "Investors Edge" on over 50 radio stations. Gary is also editor and publisher of "Gary Kaltbaum's Trendwatch"... a weekly and monthly technical analysis research report for the institutional investor. If you would like a free trial to Gary's Daily Market Alerts click here or call 888.484.8220 ext. 1.

I want to wish each and every one of you a safe and Happy Thanksgiving.

Well...we got the breakdown - and the rally - but I must tell you...I am scared - very scared - not about the markets today but what our government is doing. You see - all this money is being thrown around is not cash - it is FUTURE OBLIGATIONS. $300 billion to CITI and today another $800 billion...read this:

WASHINGTON, Nov 25 (Reuters) - The U.S. Federal Reserve, in another massive life-support intervention for the U.S. financial system, on Tuesday announced a $600 billion program to buy mortgage-related debt and securities and a $200 billion facility to buy consumer debt securities, The U.S. central bank said it would buy up to $100 billion in debt issued by Fannie Mae, Freddie Mac, and the Federal Home Loan Banks, the government-sponsored mortgage finance enterprises. The Fed also said it would buy up to $500 billion in mortgage-backed securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae. (Reporting by Mark Felsenthal, Editing by Chizu Nomiyama)

The problem is that this is being engineered by someone who was great at using other people's money (Hank Paulson)! But look at what all the leverage ultimately did...you got it...got us to where we are today. So, this one man is just putting off the inevitable. Government just does not have this money they are using. I am reminded of a quote from Wimpy from the Popeye cartoons: "I'd gladly pay you Tuesday for a hamburger today."

Is it no wonder bank stocks have lifted the market in the past couple of days? All these moves will tend to inflate assets but for how long? The bad guys are literally being handed the money. CITI was a goner. The government is taking all their bad (hidden) assets away from them. It is a simple forgiven loan.

The next problem is Obama...here comes another $2 trillion of money we don't have...brought to you by whom? Yup...Bob Rubin...another dude who made billions using other people's money. I don't blame Obama. He is new at this game. This is just more repetition...which takes me back to my original thought, from months ago, of all this fake money being thrown around. HOW WILL THE MARKET REACT WHEN IT REALIZES IT IS NO LONGER FREE?

Well...you have seen it over the past year. Let's just hope the markets react better going forward. So far, for me, just another government induced pop to the upside. Every one of these government induced pops faded badly within days/weeks. I don't have a clue about this one...but will be watching. One has to believe that eventually, one of these rallies will stick....I think!

Lastly, I give you the following article...UK going to soak the "privileged few." This country is next. Pre-Budget report: National Insurance rise adds to high earners' woes - Telegraph

Disclaimer: The opinions expressed herein are those of the writer and may not reflect those of Wunderlich Securities, Inc. or any of its affiliates. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.