Buffett Bear buy is bull. Bull’s buying perseveres besides

As suspected, the rumored cash infusion by Warren Buffett and others in flailing brokerage firm, Bear Stearns (BSC) was discredited by David Faber of CNBC early this afternoon. Faber, incidentally, is about the only journalist associated with CNBC US that likes to actually confirm the validity of his information before reporting it as news. Faber confirmed this afternoon that the rumored buy-in of Bear Stearns (BSC) was indeed, bull. It’s a shame that the established media allows themselves to be played like a drum by those interested parties that may have indeed benefited from yesterday’s rumored 20-percent investment by Warren Buffett among others. I doubt that yesterday’s action in Bear Stearns shares will elicit anything more than a sideways glance by Christopher Cox and the SEC. This oversight agency is about as useful as I am in policing this kind of stuff. In spite of the apparent hoax, only about a-third of yesterday’s gains in Bear Stearns shares were given back today. Also, the broader market has already moved onto other things even as news of the now debunked Bear Stearns rumor ignited an across the board rally in nearly everything yesterday. As news of the hoax gently wafted over the market today, it was summarily dismissed as a reason to give back even an inch of yesterday’s broad gains. It’s almost as if the market is unable to discern the change of events as being a catalyst to offset the prior day’s gains as logic might suggest it should. It was useful as a catalyst that got us here. That’s all that matters. Thank you, but we’ll no longer be in need your Bear Stearns rumor now that we’re already here. We don’t care that what got us here has since been fully debunked. We’re here and that’s all that matters. Of course, the additional rally today on top of yesterday’s now debunked Buffet Bear buying rally sets us up for a mere 88-point gain tomorrow in the Dow Industrials and a 16-point gain in the Nasdaq for a 3Q closing that would put us at their respective all-time and 52-week highs---even with everything thing that transpired between June 30th and tomorrow’s final day of the third quarter. Yea, makes sense, huh? Just imagine how bullish a global nuclear war might have been for stocks during the quarter? Nice ramp-job, Fed. I mean, it’s obvious that the world’s central banks were sent into panic mode this quarter given the deep freeze of credit, subprime mortgage markets, hedge funds and bank and mortgage bailouts. I can only imagine how much fiat money was thrown at the problem if we had an accurate way accounting for all of it. But did they have to make it so obvious? It just simply defies logic that all that is need tomorrow is just a moderately positive day for both of these indexes to peg their 52-week highs on the final day of a quarter that witnessed a plethora of such disturbing market events. I can only imagine that whatever the size of the liquidity injection and all of the ancillary moral hazard that it eventually fosters; a sum that is capable of papering-over such serious issues in such short order is also going to show-up as some pretty serious inflationary pressure in coming months. You might want to top-off your gas tanks at the next fill-up.