Five Real Reasons the Market Could Crash This Fall

Anytime stocks explode higher on next to no volume and crap fundamentals you run the risk of a real collapse. I am officially going on record now and stating that IF the S&P 500 hits 1,000, we will see a full-blown Crash like last year.

SHOOT: It has already. It was at 1005.41 earlier today, and is currently at 994.55. Foregone conclusion.

By the way, the chart is in TRILLIONS of dollars:

As you can see, Goldman Sachs alone has $39 trillion in derivatives outstanding. That’s an amount equal to more than three times total US GDP. Amazing, but nothing compared to JP Morgan (JPM), which has a whopping $80 TRILLION in derivatives on its balance sheet.
SHOOT: Btw 'Fall' is next month. I've been saying the whole 'reovery' thing is a crock of shit. You could have a recovery if they discovered massive oil deposits on the moon, or somewhere in the Pacific Ocean floor. You know, something new, a new resource to base future growth on. The reality is wealth is being wiped out [wealth being credit-based wealth] and we have no resources left to borrow from, but a massive population soon to be unemployed. Nice huh. Even nicer is you have hear this stuff from blogs, 'cos the media ain't going to tell you.

If Wall Street did put $50 trillion at risk… and 10% of that money goes bad (quite a low estimate given defaults on regulated securities) that means $5 trillion in losses: an amount equal to HALF of the total US stock market.

This of course assumes that Wall Street only put 5% of its notional value of derivatives at risk… and only 10% of the derivatives “at risk” go bad.

Do you think those assumptions are a bit… low?

clipped from seekingalpha.com With all this blather about “green shoots” and economic “recovery” and new “bull market,” I thought I’d inject a little reality into the collective financial dialogue. The following are ALL true, all valid, and all horrifying… Enjoy. 1) High Frequency Trading Programs account for 70% of market volume 2) Even counting HFTP volume, market volume has contracted the most since 1989 3) This Latest Market Rally is a Short-Squeeze and Nothing More To date, the stock market is up 48% since its March lows. This is truly incredible when you consider the underlying economic picture: normally when the market rallies 40%+ from a bear market low, the economy is already nine months into recovery mode. 4) 13 Million Americans Exhaust Unemployment by 12/09 5) The $1 QUADRILLION Derivatives Time Bomb What are the odds that Wall Street, when allowed to trade without any regulation, oversight, or audits, put a lot of money at risk?