So, Is It Really About To Hit The Fan? (I'm Back To Normal)

To P3 or not to P3? That is the question. With the apparent topping of the market and the fed now supporting our treasury auctions, is this the beginning of the end? I believe the beginning of the end happened in 2003 with Greenspan's manufactured credit bubble to save the bank's collective asses from all of the mistakes they made in the dot com bubble. You see, if they were not insolvent then, they sure are now. This reflation trade and the recent manufactured rally are last gap efforts to salvage what they can. The great grab you can call it.

Most of you know I think the ratings agencies had a lot to do with the RE debacle. I have spoken to many appraisers that told me about the valuation game they had to play in order to survive and be able to "work" with the banks. Well, are they changing their tune? Have they seen the light? TD at ZeroHedge has this post Moody's Nukes 163 CMBS Classes Due To Maguire Toxic Exposure.

Add to this the post from Calculated risk WSJ: JPMorgan Offering 23 Office Properties For Sale. "J.P. Morgan Chase & Co. is marketing 23 office properties ... with a combined 7.1 million square feet of space, includes four notable towers: One Chase Manhattan Plaza, near Wall Street; Four New York Plaza, also in the Financial District; the former headquarters of Washington Mutual in a downtown Seattle skyscraper that also houses the city's art museum; and a landmarked 1929 Art Deco building in Houston, the former headquarters of Texas Commerce Bank. The portfolio is believed to be the largest single portfolio of office properties to hit the market this year and could raise more than $1 billion." Folks the CRE crash IS coming. There will be no stopping it. This will be the P3 event that kills the REITS and finally brings down the banks that are "to big to fail".

Denninger at The Market Ticker loves to beat on the credit issue (deservedly so). In Banking and Credit: It Is NOT Over Karl has, "We still have banks that are engaged in what amounts to accounting fraud when looked at through any sort of objective lens, but its all "OK" because we have "accounting rules" that say you can claim something is worth more than it really is." Karl takes the verbiage from the Congressional Oversight Panel and puts it nicely in plain English.

Mish has Government Bailouts and the Stock Market - The Seen and the Unseen in which he does a good job explaining many of the problems to come. I like his comparison to Japan since 1990 as to where we are headed. (that is 28 years of hell OBTW). "The worst recession since the 1930's is the payback for the credit boom, while the payback for the bailouts is coming down the line. The likely payback for all these bailouts is structurally high unemployment and a stock market that goes nowhere for years to come."

Pragcap has ROBERT PRECHTER: NEW LOWS ARE COMING where Prechter takes down all the green shoots and explains the EWT side of the story. This is Prechter's count and there are many others. Kenny has us in an ABC while Dan and I agree on the P2 scenario. I am somewhere in between.

And for you people planning on attending a town hall meeting Bloomberg reports How to Speak to an Unruly Crowd. You can read thru this post and learn how to cut off your representative at the pass. The last sentence says it all, "It takes a strong sense of self to face a restless crowd. The operative principle when engaging an audience is control. If you have it, continue; if you lose it, retreat."

Folks, we have realistically insolvent banks with all of the TARP funds not lending to the dead and increasingly unemployed consumer who is busy paying off debt and leaving their upside down mortgages in their past and FRE and FNM holding the bag while having their credit limits cut to the bone and the government is pumping GDP like there is not tomorrow and we all believe the green shoots are so real we'll be able to serve them as a side salad before your last supper.

CRE crash is coming. The banks will have to face the truth (accounting fraud can't go on forever - can it?). HFT manipulation will stop eventually. The market will top, but when? And how deep will it go after reality bites everyone in the butt? I don't think this is "it" yet. They have more tricks up their sleeves. Remember, they can change the rules as they play the game. The insiders are hard at work completing the pump and dump. The marketeers at CNBS and the other outlets will lead you down the path of righteous bull crap. So do not be surprised if this market should make one last pop, but that one will be the last.

I'm back from the beach and back to normal I guess.

GL trading.