The blogosphere is abuzz with news that market indicators met the requirements of the Hindenburg Omen twice this month, only 8 days apart.

Glenn Beck does a fair job of explaining the implications of the phenomena:

Looking back at history — the probability of all these things happening means that there is a market move greater than 5 percent to the downside after confirmed Hindenburg Omen. That means we’re going to have a market go down at least 5 percent and the chances of that, with all of these things happening, is about 77 percent.

So, a “market crash” is not a “mortal lock” when the omen is in effect, but every New York Stock Exchange crash since 1985 has been preceded by the Hindenburg Omen. And the 5 percent move usually takes place within the next 40 days.

Forty days — 40 days, why does that sound — you know? We’ll almost be in October in 40 days. October — October, why does that one ring a bell?

I remember! The last time the Hindenburg Omen conditions were met in a big way was October 2008, when the market crashed. And then before that, it was October of 1987 and then October of ’29. Oh, the humanity!

I don’t suggest reading the whole thing, because there is some empty rhetoric, not to mention that the unemployment numbers that he quotes are too low (I prefer the seasonally-adjusted SGS Alternate Unemployment Rate rather than U-6).

For those wishing an alternative view of the accuracy of this particular Hindenburg Omen, read MarketWatch and (even better) iStock Analyst.

One thing is certain: the Fed has little to no idea what it’s doing. Bernanke is using a “majority rules” strategy with a deeply divided committee of bankers.

The talking heads are little better. Martin Sosnoff, writing for Forbes in the excellently-titled piece Bernanke’s Fed Full Of Blind Mice, calls for a “huge shot of quantitative easing”. Charles Hugh Smith, writing for Daily Finance, makes the eminently sensible suggestion of dropping the quantitative easing and instead dropping money into household bank accounts. Goldman Sach’s Jan Hatzius wants the Fed to pour another $1 trillion into the economy in an effort to further ease monetary policy, yet predicts unemployment rising to 10 percent next year. But former IMF chief economist Raghuram Rajan wants the Fed to boost interest rates by as much as 2 percentage points to avoid fanning asset bubbles or propping up inefficient companies (what would that do to unemployment rates?).

And if the Hindenburg Omen occurs again by September 22nd, there will be panic on Wall Street. Or, at least, in the media which – in the end – usually means the same thing.

Related topics:

• Federal Reserve Bank of Chicago President Charles Evans says
  the likelihood of a double-dip recession is not high, although
  admitting that it is higher than it was six months ago.
• My favorite Fed, Kansas City
  Federal Reserve Bank President Thomas Hoenig, declares “too big to fail”
  places smaller banks at a competitive disadvantage and tells investors
  to stay away from the housing market.

Technorati Tags: Hindenburg Omen, Bankrupting America, Bernanke’s Folly, Jobless Recovery, Double Dip Recession, Rising Unemployment in America, Stagnant Economic Conditions, Barack Hussein Obama the Dangerous Choice, Obama the Amatuer in Charge