S
Sailor_Kenshin
Guest
And when is that likely to occur?
Caesar is already using brutality, lies and thuggery to rob us. It will only get worse.
If you think gold or land is safe from that gang, you are in for a rude awakening.
- Status
Caesar is already using brutality, lies and thuggery to rob us. It will only get worse.
If you think gold or land is safe from that gang, you are in for a rude awakening.
C
CPA2
Guest
I think that we can agree that governments are out of control and are destroying us. I think that we can also agree that we are not safe from a socialist government that does not recognize that natural law and divine law nullify its foolish and unjust civil laws.
However, our job is to survive. If you want to survive financially, then I think you need to do what you can to protect yourself and your family. I do this all the time as a financial planner.
St. Francis had the wisdom and discernment to know the difference between what he could do, and what he could not do.
“It is important to remember that government interference always means either violent action or the threat of such action. The funds that a government spends for whatever purposes are levied by taxation. And taxes are paid because the taxpayers are afraid of offering resistance to the tax gatherers. They know that any disobedience or resistance is hopeless. As long as this the state of affairs, the government is able to collect the money that it wants to spend. Government is the last resort the employment of armed men, of policemen, gendarmes, soldiers, prison guards, and hangmen. The essential feature of government is the enforcement of its decrees by beating, killing, and imprisoning. Those who are asking for more government interference are asking ultimately for more compulsion and less freedom.” Von Misses
M
Monte_RCMS
Guest
Some years ago, the place where I was working hired a specialist to do computer modeling.
I was not involved.
Anyway, some of the high muckety mucks began noticing some strange results coming from the computer models.
After lot of internal wrangling, and since I had no involvement, I was asked to interview the computer modeler. Just a friendly chat. Just to get/provide a disassociated / disinterested perspective.
We had a friendly discussion.
When I asked how the strange output results could be explained, the answer was that the results were correct. “But how do you know?”.
“Oh! I just know”.
“Well, did you use the raw data that was collected or did you adjust the data to feed into the programs?”
“Oh, no, I used my own data.”
“Well, how did you reconcile your own data with the field collected data?”
“I just knew”.
So, we went around and around in delicate circles.
Then the computer modeler asked: “Can I ask you a question?”
“Sure.”
The question I was asked, was this: "What is ‘e’ ? "
This left me confused.
So, I asked why the curiosity about “e”.
The answer was, “Well, ‘e’ appears in a lot of the equations in the various computer models and I don’t know what ‘e’ is.”
"Did you study ‘e’ in math? “No, never had math.”
Never had any science or engineering or math or statistics, in fact. No calculus. Not anything. Managed to get a masters degree in computer science and planning without any technical background. At all.
The computer modeler merely “knew” what the right answers were going to be and adjusted the (name removed by moderator)uts to the models to get the desired results.
The computer modeler was gone shortly thereafter.
A couple of years later, I ran into the computer modeler at a MAJOR government agency, in charge of all computer modeling.
Go figure.
By the way: ln e = 1
It’s really at the basis of all scientific and engineering math. Usually taught on Day 1 of Freshman math.*
I was not involved.
Anyway, some of the high muckety mucks began noticing some strange results coming from the computer models.
After lot of internal wrangling, and since I had no involvement, I was asked to interview the computer modeler. Just a friendly chat. Just to get/provide a disassociated / disinterested perspective.
We had a friendly discussion.
When I asked how the strange output results could be explained, the answer was that the results were correct. “But how do you know?”.
“Oh! I just know”.
“Well, did you use the raw data that was collected or did you adjust the data to feed into the programs?”
“Oh, no, I used my own data.”
“Well, how did you reconcile your own data with the field collected data?”
“I just knew”.
So, we went around and around in delicate circles.
Then the computer modeler asked: “Can I ask you a question?”
“Sure.”
The question I was asked, was this: "What is ‘e’ ? "
This left me confused.
So, I asked why the curiosity about “e”.
The answer was, “Well, ‘e’ appears in a lot of the equations in the various computer models and I don’t know what ‘e’ is.”
"Did you study ‘e’ in math? “No, never had math.”
Never had any science or engineering or math or statistics, in fact. No calculus. Not anything. Managed to get a masters degree in computer science and planning without any technical background. At all.
The computer modeler merely “knew” what the right answers were going to be and adjusted the (name removed by moderator)uts to the models to get the desired results.
The computer modeler was gone shortly thereafter.
A couple of years later, I ran into the computer modeler at a MAJOR government agency, in charge of all computer modeling.
Go figure.
By the way: ln e = 1
It’s really at the basis of all scientific and engineering math. Usually taught on Day 1 of Freshman math.*
S
Sailor_Kenshin
Guest
I’m not trying to fight with you. I’m just pointing out that nothing is safe from Caesar should he decide it’s his–and he has already done so.
C
CPA2
Guest
Fed out of bullets! Recovery falling apart! Time to go “all-in bearish”!
Albert Einstein famously defined insanity as doing the same thing over and over again and expecting different results. But apparently the message hasn’t gotten through to the folks at the Fed’s Eccles Building in Washington. Because the Federal Reserve is at it again!
Yesterday, policymakers met in D.C. and decided to fire up the printing presses. Led by “Helicopter Ben” Bernanke, they pledged to buy new Treasury securities whenever old Treasuries or mortgage securities matured over or were paid off.
That means instead of shrinking its $2.05 trillion portfolio, the Fed will maintain it by purchasing an estimated $10 billion to $20 billion per month in Treasuries. It’s focusing on securities with maturities between two years and ten years.
The stock market was impressed by the move — but only for a couple of hours! Then equities fell again. Why? Because investors know the LAST, even BIGGER round of “quantitative easing” (QE1) was a dismal failure for the real economy!
So why should “QE2” be any different?
You see, starting in early 2009, the Fed vacuumed up $1.25 trillion in mortgage backed securities (MBS) … $175 billion in Fannie Mae and Freddie Mac debt … and $300 billion in long-term Treasuries. The stated goal was to ease credit conditions, make mortgages and other loans cheaper, support economic growth and boost employment.
But lenders still aren’t lending. Consumers still aren’t borrowing. And businesses sure as hell aren’t hiring. The economy shed another 131,000 jobs in July on top of a massive 221,000 jobs lost in June. Private hiring missed forecasts, and the “all-in” unemployment rate, including those forced to accept part-time jobs or giving up entirely, held at a whopping 16.5%.
Heck, the Fed itself all but admitted its efforts have been a dismal failure. In the post-meeting statement on Tuesday, the Fed said: “The pace of recovery has slowed in recent months. Housing starts remain at a depressed level.”
The statement went on to say that household spending “remains constrained by high unemployment, modest income growth, lower housing wealth and tight credit.”
In other words, the economy is rolling over! And, in one of the most UNDER-reported stories of the year, researchers at the San Francisco Fed just announced that there’s a “significant” chance the economy will tip back into recession.
Yet despite all that, Bernanke and his merry band of mad monetary scientists expect us to think another, smaller dose of funny money will do the trick? Seriously? What planet are these guys living on?
My take? The QE2 plan smacks of desperation!
Look …
Policymakers can’t cut the federal funds rate below 0%, where it’s essentially already …
And they’ve already pledged to keep rates low until the cows come home, so more rhetoric on that front is also meaningless.
What about the suggestion that cutting the rate the Fed pays banks on idle reserves from 0.25% to 0% will somehow unleash a flood of lending? That’s one of the dumbest things I’ve heard out of Washington in a long time — and that’s saying something!
What nobody in D.C. will tell you … but I will … is that a big economic slowdown is already baked in. There is nothing the Fed can do … nothing Congress can do … nothing the Obama administration can do … to prevent it.
The massive, reckless credit bubble that built up over the past couple of decades needs to be unwound. If you prefer the jargon term, it’s “deleveraging” — and it’s something we’re just going to have to get used to.
In recent months, I’ve recommended you pare down your equity portfolio to nearly zero to prepare for these trying times. Plus, I’ve gone several steps further — giving you recommendations designed to RISE in value as stocks FALL. Now it’s time to go “all-in bearish” by adding even more inverse ETF exposure.
We could see Treasury prices continue to rise, and gold prices roll over, as the economy weakens and deflation fears increase.
Precisely when and how you act is, of course, up to you. But I would urge you not to delay. If we’re heading into a double-dip recession, as I believe we are, stocks are almost certain to fall swiftly. I would not be surprised in the least if the major averages eventually retest the March 2009 lows. That’s almost 4,000 points lower on the Dow.
Best wishes,
Mike Larson
Albert Einstein famously defined insanity as doing the same thing over and over again and expecting different results. But apparently the message hasn’t gotten through to the folks at the Fed’s Eccles Building in Washington. Because the Federal Reserve is at it again!
Yesterday, policymakers met in D.C. and decided to fire up the printing presses. Led by “Helicopter Ben” Bernanke, they pledged to buy new Treasury securities whenever old Treasuries or mortgage securities matured over or were paid off.
That means instead of shrinking its $2.05 trillion portfolio, the Fed will maintain it by purchasing an estimated $10 billion to $20 billion per month in Treasuries. It’s focusing on securities with maturities between two years and ten years.
The stock market was impressed by the move — but only for a couple of hours! Then equities fell again. Why? Because investors know the LAST, even BIGGER round of “quantitative easing” (QE1) was a dismal failure for the real economy!
So why should “QE2” be any different?
You see, starting in early 2009, the Fed vacuumed up $1.25 trillion in mortgage backed securities (MBS) … $175 billion in Fannie Mae and Freddie Mac debt … and $300 billion in long-term Treasuries. The stated goal was to ease credit conditions, make mortgages and other loans cheaper, support economic growth and boost employment.
But lenders still aren’t lending. Consumers still aren’t borrowing. And businesses sure as hell aren’t hiring. The economy shed another 131,000 jobs in July on top of a massive 221,000 jobs lost in June. Private hiring missed forecasts, and the “all-in” unemployment rate, including those forced to accept part-time jobs or giving up entirely, held at a whopping 16.5%.
Heck, the Fed itself all but admitted its efforts have been a dismal failure. In the post-meeting statement on Tuesday, the Fed said: “The pace of recovery has slowed in recent months. Housing starts remain at a depressed level.”
The statement went on to say that household spending “remains constrained by high unemployment, modest income growth, lower housing wealth and tight credit.”
In other words, the economy is rolling over! And, in one of the most UNDER-reported stories of the year, researchers at the San Francisco Fed just announced that there’s a “significant” chance the economy will tip back into recession.
Yet despite all that, Bernanke and his merry band of mad monetary scientists expect us to think another, smaller dose of funny money will do the trick? Seriously? What planet are these guys living on?
My take? The QE2 plan smacks of desperation!
Look …
Policymakers can’t cut the federal funds rate below 0%, where it’s essentially already …
And they’ve already pledged to keep rates low until the cows come home, so more rhetoric on that front is also meaningless.
What about the suggestion that cutting the rate the Fed pays banks on idle reserves from 0.25% to 0% will somehow unleash a flood of lending? That’s one of the dumbest things I’ve heard out of Washington in a long time — and that’s saying something!
What nobody in D.C. will tell you … but I will … is that a big economic slowdown is already baked in. There is nothing the Fed can do … nothing Congress can do … nothing the Obama administration can do … to prevent it.
The massive, reckless credit bubble that built up over the past couple of decades needs to be unwound. If you prefer the jargon term, it’s “deleveraging” — and it’s something we’re just going to have to get used to.
In recent months, I’ve recommended you pare down your equity portfolio to nearly zero to prepare for these trying times. Plus, I’ve gone several steps further — giving you recommendations designed to RISE in value as stocks FALL. Now it’s time to go “all-in bearish” by adding even more inverse ETF exposure.
We could see Treasury prices continue to rise, and gold prices roll over, as the economy weakens and deflation fears increase.
Precisely when and how you act is, of course, up to you. But I would urge you not to delay. If we’re heading into a double-dip recession, as I believe we are, stocks are almost certain to fall swiftly. I would not be surprised in the least if the major averages eventually retest the March 2009 lows. That’s almost 4,000 points lower on the Dow.
Best wishes,
Mike Larson
E
edwest2
Guest
“The sky is falling! The sky is falling!”
Chicken Little
// satire //
Hello Bob? I just saw this post on the internet that says there’s nothing anyone can do. What about our three houses and our villa in France?
“Don’t you worry none, honey. This is just pre-election rhetoric to make the Administration look bad. Your senator-husband won’t let you down. Shucks, we all gotta do a lotta barkin’ right now or else the regular folks back home will think we’re weak.”
I’m feeling a little frightened right now, Bob.
“Well, hon. Look at it this way. Right now, both sides are playing hardball to get the best deal. Less regulation, lower business taxes and don’t even let me get started with health care costs. Secret is, some companies are comin’ back from China to make stuff here again. All them business types care about is great big tax breaks, and a lot of other perks. It’s as much their fault as the Administration’s.”
Well that sounds a little stupid to me.
“It is. It is. But that’s how the game is played. Gotta run. Love you.”
// end satire //
God bless,
Ed
Chicken Little
// satire //
Hello Bob? I just saw this post on the internet that says there’s nothing anyone can do. What about our three houses and our villa in France?
“Don’t you worry none, honey. This is just pre-election rhetoric to make the Administration look bad. Your senator-husband won’t let you down. Shucks, we all gotta do a lotta barkin’ right now or else the regular folks back home will think we’re weak.”
I’m feeling a little frightened right now, Bob.
“Well, hon. Look at it this way. Right now, both sides are playing hardball to get the best deal. Less regulation, lower business taxes and don’t even let me get started with health care costs. Secret is, some companies are comin’ back from China to make stuff here again. All them business types care about is great big tax breaks, and a lot of other perks. It’s as much their fault as the Administration’s.”
Well that sounds a little stupid to me.
“It is. It is. But that’s how the game is played. Gotta run. Love you.”
// end satire //
God bless,
Ed
C
CPA2
Guest
**Fed Policymakers Screw It Up Again! **
by Mike Larson
Albert Einstein famously defined insanity as doing the same thing over and over again and expecting different results. But apparently the message hasn’t gotten through to the folks in the Eccles Building in Washington. Because the Federal Reserve is at it again!
This week, policymakers met in D.C. and decided to fire up the printing presses. Led by “Helicopter Ben” Bernanke, they pledged to buy new Treasury securities whenever old Treasuries or mortgage securities matured or were paid off.
That means instead of shrinking its $2.05 trillion portfolio, the Fed will maintain it by purchasing an estimated $10 billion to $20 billion per month in Treasuries. It’s focusing on securities with maturities between two years and ten years.
The stock market was impressed by the move … for all of a couple hours. Then equities tanked. Why? Because investors know the LAST, even BIGGER round of “quantitative easing” was a dismal failure for the real economy! Why should "QE2
by Mike Larson
Albert Einstein famously defined insanity as doing the same thing over and over again and expecting different results. But apparently the message hasn’t gotten through to the folks in the Eccles Building in Washington. Because the Federal Reserve is at it again!
This week, policymakers met in D.C. and decided to fire up the printing presses. Led by “Helicopter Ben” Bernanke, they pledged to buy new Treasury securities whenever old Treasuries or mortgage securities matured or were paid off.
That means instead of shrinking its $2.05 trillion portfolio, the Fed will maintain it by purchasing an estimated $10 billion to $20 billion per month in Treasuries. It’s focusing on securities with maturities between two years and ten years.
The stock market was impressed by the move … for all of a couple hours. Then equities tanked. Why? Because investors know the LAST, even BIGGER round of “quantitative easing” was a dismal failure for the real economy! Why should "QE2
L
lynnvinc
Guest
There is no evidence of a human-induced financial crisis –
See crikey.com.au/2008/10/01/there-is-no-evidence-of-human-induced-financial-crisis/
See crikey.com.au/2008/10/01/there-is-no-evidence-of-human-induced-financial-crisis/
E
edwest2
Guest
It just happened by itself?
justice.gov/usao/or/PressReleases/2010/20100617_Stolen_Dreams.html
God bless,
Ed
justice.gov/usao/or/PressReleases/2010/20100617_Stolen_Dreams.html
God bless,
Ed
C
CPA2
Guest
Socialist governments are the cause of inflation and the financial crisis. No one is forcing you to believe that. However, you must be prepared to face the financial consequences if you fail to get out of harm’s way.There is no evidence of a human-induced financial crisis –
See crikey.com.au/2008/10/01/there-is-no-evidence-of-human-induced-financial-crisis/
L
lynnvinc
Guest
Not sure what you’re saying – that Australia (which was the origin of my link) is socialist and has caused the financial crisis? Or that acceptance of AGW (which the link implied in its humor) causes socialism, which caused the financial crisis (there are some folks who insist that accepting AGW and turning off lights not in use somehow leads to socialism…no kidding).
I don’t really doubt that the financial crisis is manmade – whether by capitalist greed or socialist incompetancies, or both (I think maybe both). For instance, we were buying some investment property about 4 years ago, and the strategy used to sell it to us led us to understand later that (1) they fooled us into thinking the interest rate was much much lower than it turned out to be; (2) they (realtors, mortgage brokers, etc.) make nice percentages off the sales, and the mortgage companies have basically farmed out their sales to unscrupulous greedy people who don’t care whether a person actually has money to pay the mortgage or not – they are only into the commissions and profits for themselves. Now my husband and I are both Ph.D.s in the social sciences, and I suppose we should have KNOWN the complete ins & outs, esp since we’ve purchased some 5 homes over the past 40 years and have gone thru the process. However the process was different then, esp in the pre-Regan era before dereguation. The S&L made the loans, and they REALLY MADE SURE a person could afford the mortgage payments, and the payments were well within the earnings, and the downpayment was hefty.
Well, as it turns out, we did have enough money, so we were never at any risk after the downturn, but I can see where more inexperienced people trying to buy the best home possible for themselves (and not aware of the $1000s extra you usually have to pay at closing), would have been hoodwinked by mortgage brokers trying to make bucks off their backs, not caring that they may lose their homes.
At least that is part of the financial problem with which I have some direct experience.
So I do really think this current financial crisis is purely manmade, not due to threats to productivity, tho the downturn harms productivity.
However, in the future there could actually be real threats to productivity that will harm the economy and life (which is much more important than money). There are so many threats, where to start. Peak oil (do you know how much our economy and food production relies on oil, which has reached its peak and is on the decline – see CRUDE AWAKENING, where oil CEOs explain this); diminishing finite resources; global warming; acid rain; ocean acidifcation; local pollution (look at the economic aspects of the recent BP spill, and that’s only one of 1000s, which did not get media coverage); wars for resources.
So we have fake problems – like the ones that caused the Great Depression and this current crisis, and what about the S&L scam and bailout in the 80s for which we are still paying, or Star Wars program for which we are still paying $billions. And then we have REAL PROBLEMS that will become ever more evident in the future.
Note GW is expected to cause increasing heatwaves, droughts, floods, wildfires, sea rise, agri & seafood decline; and possibly end all life on planet earth (tho this is cutting edge science, and has not yet been accepted by the bulk of climate scientists). Imagine what all life on planet earth dying out will do to the economy. Is “it will be bad” an understatement.
Here’s the link to that article re the venus syndrome by NASA’s top climate scientist, Dr. James Hansen – see esp. page 24: columbia.edu/~jeh1/2008/AGUBjerknes_20081217.pdf
Here’s a more holistic approach to environmental threats, since GW is just one threat out of many: stockholmresilience.org/planetary-boundaries
So it’s pretty much eventual doomsday (these global enviro processes take decades and centuries and millennia to play out), unless…unless (as the Lorax said).
C
CPA2
Guest
$5,657,492 to create a single job!
Has Washington lost its MIND?
by Martin D. Weiss, Ph.D.
According to the Special Inspector General for TARP, Washington has spent a total of $3.7 trillion on bailouts and Fed money-printing — NOT including trillions in other government guarantees — to fight this recession so far.
Meanwhile, since the labor market began recovering a bit this year, a total of 654,000 jobs have been created.
So let’s do the math: Just divide $3.7 trillion spent by the 654,000 jobs that were created, and you’ll see that
Every one of those new jobs cost a staggering $5,657,492 to create!
That’s more than an outrage; it’s patently idiotic: The median income for full-time American workers is only about $45,000. At that rate, it will take nearly 126 long years for each new job to generate paychecks worth over $5.6 million!
And with an average tax rate of 25 percent, it will take the government about five hundred years to recoup the money from income taxes.
Worse: Despite the fact that Washington has thrown money at this recession like there’s no tomorrow, nearly TEN MILLION Americans are still relying on unemployment checks to put food on the table:
Right now, 4.45 million American workers are receiving regular unemployment insurance. Plus,
Another 5.28 million are receiving emergency benefits just extended again by Congress.
If all this truly could plant the seed for a healthy recovery, it might pay off someday, somehow. But it’s not working, and, just as the government’s political and financial capital is running out, unemployment is RISING again: Just last week, initial jobless claims were expected to drop. Instead, they surged: A staggering 484,000 workers filed for unemployment benefits for the first time!
Just as we’ve been warning you, this much-vaunted recovery is proving to be a sham. And what we’re seeing in the cards for the months ahead is equally astounding.
Good luck and God bless!
Martin
Has Washington lost its MIND?
by Martin D. Weiss, Ph.D.
According to the Special Inspector General for TARP, Washington has spent a total of $3.7 trillion on bailouts and Fed money-printing — NOT including trillions in other government guarantees — to fight this recession so far.
Meanwhile, since the labor market began recovering a bit this year, a total of 654,000 jobs have been created.
So let’s do the math: Just divide $3.7 trillion spent by the 654,000 jobs that were created, and you’ll see that
Every one of those new jobs cost a staggering $5,657,492 to create!
That’s more than an outrage; it’s patently idiotic: The median income for full-time American workers is only about $45,000. At that rate, it will take nearly 126 long years for each new job to generate paychecks worth over $5.6 million!
And with an average tax rate of 25 percent, it will take the government about five hundred years to recoup the money from income taxes.
Worse: Despite the fact that Washington has thrown money at this recession like there’s no tomorrow, nearly TEN MILLION Americans are still relying on unemployment checks to put food on the table:
Right now, 4.45 million American workers are receiving regular unemployment insurance. Plus,
Another 5.28 million are receiving emergency benefits just extended again by Congress.
If all this truly could plant the seed for a healthy recovery, it might pay off someday, somehow. But it’s not working, and, just as the government’s political and financial capital is running out, unemployment is RISING again: Just last week, initial jobless claims were expected to drop. Instead, they surged: A staggering 484,000 workers filed for unemployment benefits for the first time!
Just as we’ve been warning you, this much-vaunted recovery is proving to be a sham. And what we’re seeing in the cards for the months ahead is equally astounding.
Good luck and God bless!
Martin
E
edwest2
Guest
More fear mongering. So why not move to Canada? Or better yet, why doesn’t Canada just buy the US?
//satire//
Hurry, Hurry, Hurry!
Get your patented Economic Snake Oil here.
Pardon me, sir. Don’t you know the U S of A is about to go bust? That we’ll all be living in Hoovervilles and living off the land where we can?
“What? What are you talking about?”
The government has spent itself into a hole it can’t crawl out of. Gloom and doom as far as the eye can see.
“And what will that snake oil do for me?”
Why it’ll make you vote straight Republican in November.
“I don’t need that stuff. I’ll make up my own mind, thank you very much.”
// end satire //
Think straight. Ignore the prophets of fear.
God bless,
Ed
//satire//
Hurry, Hurry, Hurry!
Get your patented Economic Snake Oil here.
Pardon me, sir. Don’t you know the U S of A is about to go bust? That we’ll all be living in Hoovervilles and living off the land where we can?
“What? What are you talking about?”
The government has spent itself into a hole it can’t crawl out of. Gloom and doom as far as the eye can see.
“And what will that snake oil do for me?”
Why it’ll make you vote straight Republican in November.
“I don’t need that stuff. I’ll make up my own mind, thank you very much.”
// end satire //
Think straight. Ignore the prophets of fear.
God bless,
Ed
C
CPA2
Guest
Ignore the prophets of false optimism who fail to deal with reality. The sources that I have posted are objective. You will not find their financial analysis in the media. Their only income is investment advice. I have been paying for their investment advice for the past 20 years, and Martin Weiss, etc. been correct in their analysis. Ignore them at your own peril!
C
CPA2
Guest
The Bond Market Is Signaling Trouble Ahead
by Claus Vogt
My outlook for the economy and the stock market has steadily and significantly deteriorated since March 2010. That’s when monetary indicators started to signal renewed emerging stress in the financial system, and leading economic indicators started heading south.
The stock market was richly valued in terms of dividend yield and price/earnings ratios. And I predicted a topping formation followed by a new bear market. Since then the market has moved nowhere.
Price movement since last October looks like a well-formed topping formation. Longer term trend-following instruments like the 200-day moving average have turned sideways, thus confirming the topping process.
The Stock Market Is on
the Verge of a Break Down
The most likely scenario now is a breakout below the lower boundaries of this topping formation — below the 1,010 level the S&P 500 reached on July 1. Such a move would definitely make clear that April’s high was THE high for the huge bear market rally that started in March 2009.
This bear market rally was indeed a huge affair. But still not out of the realms of former bear market rallies, which are mostly forgotten today. A prime example is the rally following the 1929 crash …
Stock prices rose more than 50 percent, and contemporary economists declared the crisis over. But the crash was only the prelude to the devastating bear market that got going after the bear market rally of early 1930.
The Bond Market Confirms
This Bearish View
Both the bond market and the stock market are to some degree leading indicators. But the bond market is said to be the smarter one because bond traders are generally more vigilant in looking for trends in the economy.
Already the bond market is conveying an important economic message …
As you can see on the chart below, the 10-year Treasury bond yield has dramatically declined since early April. In fact, 10-year yields are as low as in December 2008, during the depth of a severe economic and financial crisis.
This pronounced slump in yields is sending a frightening message: It’s anticipating a recessionary economy.
That message fits perfectly with other leading economic indicators and with my own big-picture economic model showing that the economy is again on its way into a recession. And the picture is getting clearer by the day.
As I’ve said in past Money and Markets columns, **every recession in history has been accompanied by a severe bear market … **
And I wouldn’t be surprised if the March 2009 lows were broken at some point during the next two years.
Best wishes,
Claus
by Claus Vogt
My outlook for the economy and the stock market has steadily and significantly deteriorated since March 2010. That’s when monetary indicators started to signal renewed emerging stress in the financial system, and leading economic indicators started heading south.
The stock market was richly valued in terms of dividend yield and price/earnings ratios. And I predicted a topping formation followed by a new bear market. Since then the market has moved nowhere.
Price movement since last October looks like a well-formed topping formation. Longer term trend-following instruments like the 200-day moving average have turned sideways, thus confirming the topping process.
The Stock Market Is on
the Verge of a Break Down
The most likely scenario now is a breakout below the lower boundaries of this topping formation — below the 1,010 level the S&P 500 reached on July 1. Such a move would definitely make clear that April’s high was THE high for the huge bear market rally that started in March 2009.
This bear market rally was indeed a huge affair. But still not out of the realms of former bear market rallies, which are mostly forgotten today. A prime example is the rally following the 1929 crash …
Stock prices rose more than 50 percent, and contemporary economists declared the crisis over. But the crash was only the prelude to the devastating bear market that got going after the bear market rally of early 1930.
The Bond Market Confirms
This Bearish View
Both the bond market and the stock market are to some degree leading indicators. But the bond market is said to be the smarter one because bond traders are generally more vigilant in looking for trends in the economy.
Already the bond market is conveying an important economic message …
As you can see on the chart below, the 10-year Treasury bond yield has dramatically declined since early April. In fact, 10-year yields are as low as in December 2008, during the depth of a severe economic and financial crisis.
This pronounced slump in yields is sending a frightening message: It’s anticipating a recessionary economy.
That message fits perfectly with other leading economic indicators and with my own big-picture economic model showing that the economy is again on its way into a recession. And the picture is getting clearer by the day.
As I’ve said in past Money and Markets columns, **every recession in history has been accompanied by a severe bear market … **
And I wouldn’t be surprised if the March 2009 lows were broken at some point during the next two years.
Best wishes,
Claus
C
CPA2
Guest
Gold will soon be giving you the ultimate opportunity to buy — before it heads to way north of $2,000 an ounce. The short-term cycles in gold point down into late August, when I expect gold to fall below $1,100 an ounce. It should, however, hold the $1,000 mark.
But no matter what, thereafter, gold should explode to new record highs, most likely by the end of the year — and then, through 2011 and 2012, march to at least $2,300 an ounce.
By 2015, I expect to see gold at near $5,000 an ounce.
The driving force will NOT be inflation. That will come later, and will show up in the CPI, but not for at least another couple of years.
The driving force instead, will be the final recognition that **the U.S. is broke beyond repair … that the Fed will print however many trillions of dollars it wants to paper over the mess and retain control for as long as possible … **
Larry Edelson
But no matter what, thereafter, gold should explode to new record highs, most likely by the end of the year — and then, through 2011 and 2012, march to at least $2,300 an ounce.
By 2015, I expect to see gold at near $5,000 an ounce.
The driving force will NOT be inflation. That will come later, and will show up in the CPI, but not for at least another couple of years.
The driving force instead, will be the final recognition that **the U.S. is broke beyond repair … that the Fed will print however many trillions of dollars it wants to paper over the mess and retain control for as long as possible … **
Larry Edelson
T
Tomster
Guest
Well, the wife has been after me to wallpaper the bedrooms and the family room for a while now. Now I have an excuse to wait until inflation really kicks in. I can then use Obama-Bucks to cover the walls.
Just a little humor L.E. I am aware of the gravity of the situation.
E
edwest2
Guest
// satire ///
This Doctor B. Bob Bobb.
Let’s get things straight. Wall Street caused this mess. Not to mention their partners who artificially inflated home prices. And the American public had to bail them out because they had little actual cash when the whole house of cards came down.
portland.fbi.gov/dojpressrel/pressrel10/pd061710.htm
Meanwhile, Lehman Brother’s art collection is going up for auction. Who’s gonna buy it? Your broke, homeless neighbor living in his car? And where’s the money gonna go? Huh?
And how about that Summer Break our Senators get? Yeah, they get to play golf or whatever it is they do while the rest of us worry about paying our bills.
thehill.com/homenews/senate/96473-senate-may-not-break-for-summer
And they complain if they might miss out. I mean, what’s more important? Summer break or fixing things?
Nobody “predicted” the so-called “housing bubble.” It was all carefully planned. They knew that offering mortgages to people who could barely pay the minimum on their credit card bill every month was a bad idea, but who cares when your job is to get as much cash into circulation as possible so you could leverage it into fake money that you could use to buy other things?
Greed. Nothing else. Greed created this mess.
So go ahead. Buy a tent, stock up on C-rations, pick up some weapons and ammo, and fortify an abandoned house. Learn how to catch and filter rainwater. You’ll be fine.
// satire off //
God bless,
Ed
This Doctor B. Bob Bobb.
Let’s get things straight. Wall Street caused this mess. Not to mention their partners who artificially inflated home prices. And the American public had to bail them out because they had little actual cash when the whole house of cards came down.
portland.fbi.gov/dojpressrel/pressrel10/pd061710.htm
Meanwhile, Lehman Brother’s art collection is going up for auction. Who’s gonna buy it? Your broke, homeless neighbor living in his car? And where’s the money gonna go? Huh?
And how about that Summer Break our Senators get? Yeah, they get to play golf or whatever it is they do while the rest of us worry about paying our bills.
thehill.com/homenews/senate/96473-senate-may-not-break-for-summer
And they complain if they might miss out. I mean, what’s more important? Summer break or fixing things?
Nobody “predicted” the so-called “housing bubble.” It was all carefully planned. They knew that offering mortgages to people who could barely pay the minimum on their credit card bill every month was a bad idea, but who cares when your job is to get as much cash into circulation as possible so you could leverage it into fake money that you could use to buy other things?
Greed. Nothing else. Greed created this mess.
So go ahead. Buy a tent, stock up on C-rations, pick up some weapons and ammo, and fortify an abandoned house. Learn how to catch and filter rainwater. You’ll be fine.
// satire off //
God bless,
Ed
R
Ridgerunner
Guest
I don’t know what gold will be in 2015, any more than you, or anyone else does. I’m going to comment here only because you have touted gold on a number of threads, and I’m not sure adequate caveats have been given.
People need to be advised that you can also lose your shirt investing in gold. People have. I remember people who went broke back in the early 1980s when the economy that had been inflated, was disinflated. Right now, Bernanke is “pushing on a string”. Lots of liquidity being provided, with not so many takers. Velocity of money also matters, and right now it’s not impressive. I’ll agree it will be tricky to drain it whenever the economy turns around. But it can be done if the Fed retains some degree of independence from the government.
Right now, gold is about $1200. I remember when it was about $1,000 almost 30 years ago. Then it dropped like a stone and remained pretty low until fairly recently. Personally, I don’t like that kind of investment. It pays nothing. Recognizing that it all depends on your “starting point”, but if one starts in the early 1980s for a baseline, that’s 20% in 30 years. Not too good.
Having said all of that, I hope those who invest in gold get rich on it. But anybody thinking about it needs to be warned that there’s no guarantee in it.
Me, I’ll stick with cattle. Maybe today’s $1,000 cow will be $5,000 in 2015 as well. But if it’s $250, I can at least eat it. Can’t eat those gold doubloons.
C
CPA2
Guest
It is good to hear from you again. Your post about cattle as an investment reminds me of my courses in animal science and dairy science. What kind of cattle do you breed?
At some point you will want to sell your cattle. I hope that you are open to the possibility that at some point in the future you may not want to accept dollars, which is government monopoly money. Additionally, if no one else is accepting dollars, you definitely will not accept dollars for your cattle.
Our nation has already experienced worthless government monopoly money in 1776. **All government money that is not backed by something of value, like gold, will eventually become worthless. **
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