US to hit 15.194 trillion debt ceiling soon: TVIX, TZA, ERY, FAZ, VXX

US debt ceiling of 15.194 trillion dollar hitting in 2 days

I posted China emerging as new problem on Dec 1st. Since then, Shanghai composite has lost over 7% till now. I am surprised that US & Europe stock market have completely ignored the downfall of China even though, its the second largest economy. Today, China PMI came out at 48.7 showing further sign of deterioration. The market is currently focusing only on Europe at this moment.

I think US will be new problem to Global Economy in coming month. US debt ceiling was raised to 15.194 trillion dollar during the last US debt ceiling debate. Right now, US debt has reached 15.166 trillion dollar. As per my calculation, US will hit 15.194 trillion dollar soon. http://www.usdebtclock.org/ I am surprised that there is no news on it yet. 

If you think the economy data coming out from US is great and the stock market is pricing it correctly then think twice. Check the real GDP and Real unemployment picture in the article below:

http://www.freefdawatchlist.com/2011/12/five-year-comparison-of-us-gdp-and-dow.html

http://www.freefdawatchlist.com/2011/12/true-picture-of-us-economy-is-it-time.html

Dow is presently above 1213 point where it should be with the kind of economic data coming out. The housing is improving because its at bottom. Jobless claim increased in shortened weekend isn't good a sign either. Today, Continuing claim increased 34k to 3.601 million. Holiday workers are temporary worker and they will be laid off once the holiday season is over. So we can expect rise in Jobless claim in coming month.

It was terrific during this thanksgiving sale, yet SHLD, AMZN, BBY all down by atleast 10%. People have max out their card to buy Gift at tempting huge discounts. When the time will come to make a payment in Jan/Feb, we'll see some adverse effect in the economy as it happened during housing bubble. Last Monday 46 billion worth of Gift item were returned, which means more repacking/restoring for the retailer. It's a lose lose situation for Shopper as well as retailers.

There is no economy data coming out tomorrow. Overall I am still bearish. 

I would still not recommend buying any stocks till Jan 3rd, till FOMC meeting is over to get the right direction of this market.

If the debt celing is not raised in two days, get ready for a big roller coaster ride in stock market.