Magic is in the air again. Forget the everyday concerns about stocks, the economy, the price of crude oil, the national debt and the bond market. We will soon know where each of these "conundrums" is headed. It all hinges on a young prep student in England who's about to return for a sixth time.

One of my colleagues commented this week that it was weird to think about the dates that parents had to keep in mind. He wasn't talking about birth dates or doctor appointment dates or piano recital dates. He was talking about the most important date of this summer – July 16, the day that the latest Harry Potter book was to arrive in bookstores. By the time you read this column, J.K. Rowling's Harry Potter and the Half-Blood Prince will be in the hands of millions of children and adults.

As in each of the previous five, this book will begin with the young Harry (about to turn 16 this year) at home during the summer before leaving for his prep school, Hogwarts. It happens to be a school for wizards where students pass their OWLs (Ordinary Wizarding Levels) and NEWTs (Nastily Exhausting Wizarding Tests). And here's some advance news on the seventh and last book. Harry passes his NEWTs to become the greatest financial wizard of them all!

"But, wait," you might say. "I never heard about Harry being a financial wizard." Neither had I until I decided to put on my own magical thinking hat and came up with these interesting (albeit imaginary) observations:

Boil and Bubble

Thanks to his ability to fight the darkest wizard of them all (named Voldemort), Harry will be deemed capable of defeating our darkest fears – in this case, our fear that the housing bubble will burst. Harry will learn how to keep on inflating the bubble whilst pumping out more liquidity so that people can keep on getting larger mortgages. Although you might think that the Federal Reserve is doing an awfully good job of this seemingly impossible task right now, a new wizard will be needed soon to replace the soon-to-retire Greenspan wizard.

A Charm Offensive

Because he's learned some useful magic charms during his school years, Harry will use his considerable talents to charm the rest of the world into continuing to use their savings to buy our debt here in the United States. He will cast a spell to make the Chinese, the Japanese and the other savers in the world continue to believe that they must buy our debt, so that we can keep buying their products.

The president's new chief economist, Ben Bernanke, seems to have figured out a way to re-cast the problem. He gave a speech back in March in which he said: "I will argue that over the past decade a combination of diverse forces has created a significant increase in the global supply of saving – a global saving glut – which helps to explain both the increase in the U.S. current account deficit and the relatively low level of long-term real interest rates in the world today."

In other words, he's found a magic formula to wish the problem away by suggesting that it's not really an over-our-heads-in-debt problem here in the United States, but rather a savings problem for the rest of the world. And goodness knows we're just doing those poor savers a favor to take their money and spend it for them. Some say that Bernanke may end up as the new head wizard at the Fed. He sounds like he's ready to take over now that he's mastered the art of magical thinking. But Harry Potter's services will still be necessary to keep the rest of the world in the dark while we keep spending what isn't ours.

Bullish on Broomsticks

With his ability to speed through the air on his custom-made broomstick while playing the wizard's game of Quidditch (think a combination of rugby and polo played high up in the air), Harry will be just the financial wizard to catch the stock market before it makes a death-defying leap back to the depths of a bear market. He may even already be at work on the task, because, as the July issue of the Elliott Wave Financial Forecast points out:

"One of the most amazing aspects … to date, particularly over the last year and a half, is the bullish bravado that investors have adopted in the wake of the biggest stock market decline since 1929-1932 (for the NASDAQ), 1937-1942 (for the S&P) and 1973-74 (for the Dow). Last week [in late June], the three-week average of Market Vane's Bullish Consensus rose to 69 percent, the same percentage of bulls that existed at the March 2004 high even though the Dow remains several hundred points below that high of 10,695…."

Harry will know just where to maneuver the markets so that no one sees the bear coming. After all, he's a wonderful wizard who can cast magical spells that will keep us all enthralled, happy to think that the markets always, always go up, never down. Who ever heard of a bear market anyway? Have you ever heard of one? Now what was I writing about?… Oh, well, I need to break off anyway to call my broker and buy some of those high-flying, sure-thing stocks he was telling me about.

Susan C. Walker writes for Elliott Wave International, a market forecasting and technical analysis company. She has been an associate editor with Inc. magazine, a newspaper writer and editor, an investor relations executive and a speechwriter for the Federal Reserve Bank of Atlanta. She received her B.A. in Classics from Stanford University.