PROTECT “YOURSELF” FIRST:
So what IS going on – OUT THERE?
At 2: pm Tuesday the markets read the Fed minutes. SIX Times the Fed global policy makers cited that the markets – earnings to value – ratio – where over priced against historical norms. A detail we have presented in this blog with charts over and over again to you so you could see just HOW FAR overpriced this market space is today economically. The markets rode downward Weds as well. Here are some reasons why:
The three outcomes are:
- The Congress surprises – and financial policy creates a 30,000 row. Which then who knows. I’d say the crash is larger – SUPER CRASH.
- The market goes sideways with increased volatility between bulls and bears waiting for earnings to catch up if they ever even could.
- The market moves into a BEAR and corrects hurting so many but not a SUPER CRASH.
Long Bear crashes are caused by two events and we are looking at both:
- Rising interest rates reducing circulations against ever higher legal demands banks and institutions keep ever HIGHER RESERVES IN CASH for the pending SUPER CRASH.
- Pending Wars – of which we have many – Syria Putin says today is about to have another major gas attack and Putin says the USA is planning a massive second missile attack on Syria – imminent in Putin’s word’s and we don’t know if he will insult and blow off meeting Tillerson now in Russia over it all.
We also know this: The Bull Market is becoming the longest upward market in recorded history. The cycle time of booms has a relationship to following correction DEPTH and TIME LINE to recover.
In the middle of all this, we have other factors. Lots of them. Consider these as some to PROTECT YOURSELF FIRST ( and we have told you how precisely on this blog over time since last year ) repeatedly:
- China just this weekend trying to control the runaway real estate SUPER BUBBLE with entire cities built but unoccupied – has informed speculators driving the phony Chinese 2008 crash levels yet to come down in China – THAT – starting this weekend you can not buy a home if you are not going to reside in the home for TWO YEARS. The unintended consequence economically of such a policy is the lenders dry it up as desired and builders developers and banks go bankrupt as the SUPER BUBBLE collapses. This can domino to world markets like the wind.
- Student Loans in the USA may be the SUPER CRASH here. We have now 1.4 trillion in student loans – with 40% delinquencies. The SUPER BUBBLE in education pricing just adds to the blood bath. The toppling of the EDUCATION SUPER BUBBLE effects the massive car loan market and ripples into real estate.
- Today the report on massive 2017 ramp up in corporate debt for everything from non-economic stock buybacks to pure speculation bets. The ramp up is so great in 2017 in 100’s of billions you might wish to read the CNBC report on WHICH COMPANIES owe the most as you may investing in their loan ramps.
- US Attack groups moving close to CHINA and offshore of North Korea is a policy change. The unintended consequences of a madman controlling a completely fully militarized nation threatened now with economic isolation from new sanctions are war. War with nuclear weapon’s that can and may escalate to levels humanity has never seen making 100 deaths in Syria and the 200 the USA killed two weeks before that ( by accident ) seem nothing by comparison – and the timeline is quick. Look at your apple watch they need a feature to warn us. Pulse Pulse.
- The EU is showing such signs of falling apart. France may and soon vote in a way to surprise us all and subsequently opt out of the EU by itself a death blow. The 55% poll leadership in Italy for their EXIT from the US is rising fast and Spain is not far behind it. Meanwhile, they have zero real defense today to whatever Russia wishes to do ( really ) and that is a war factor of another blush that makes Syria look like a child’s wading pool. Putin is threatened by Western Sanctions that are killing the growth for their elites and these are scary leaders to be sure. They are starting to fight. It is sure with 80% Approval rating and complete control over the state apparatus that PUTIN is going to win new elections – and with 17 years in absolute power is going nowhere fast. Putin will rally his own fighting factors if he diplomatically wins a grand bargain with Trump and America and gets the wheels of money moving again. IF not he wins by taking the money from war. Either way, he wins.
- Greece has six billion to pay in just July. This tiny economy can not support the debt rising – from borrowing to pay the next bill. Eventually Greece Defaults. Which ripples across the markets of the EU first and world next.
- Oil is not reducing. OPEC is paying 100’s of billions in the loss to allow America and others to grab their market share ( perhaps forever ) as the cut back from Opec is offset by the rise in other producers. Also, Venzuela in riots today and yesterday are in disarray to get investment and production up and Lybia had its main trunk turned off. This is very temporary and these huge supplies will come back online soon and Nigeria will resume its massive output to the upside.
The pressure for destabilized markets includes all these and other factors. The Trump Policy – keep them guessing and keep them unable to predict – is causing a rise in tension and a volatility in markets that can lead to a destabilized entire global market. As the Fed notes report SIX TIMES the markets of today are over valued. We have said based on the same charts the Fed quotes from on price earning ratios the market is HIDEOUS OVERPRICED and the speculation is greater than in 2008. The market could seize up in liquidity globally with a single contagion event. There are so many that can take place as all DEBT BOMB chambers are loaded and a single trigger to fire on DEFAULT series into the bigger markets could have destabilizing to the entire system effects and faster than you can blink at the speed of software.
As the markets move downward we told you last summer and fall SPRING would be the tipping point. Correct again.
Those who took action locked profits at all time highs. Those that are greedy are going to enjoy a bloodbath to follow. PROTECT YOURSELF FIRST.
This blog will help you safe harbor in the developing financial storms.
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— April 13, 2017