THE SPRING CORRECTION – WE NAILED IT
This January my tribe of investment bankers thought I had lost my data and my mind. I continued to blog report data to support a Spring 2018 serious correction. January the market ran up more in one month than it runs up in a full year. Is that frothy enough?
We held fast citing error in central bank tightening – too soon too fast – and chart data. While the First Quarter is producing momentum earnings – the financial storm clouds had already taken out the SUNSHINE.
Guidance from those reporting all those earnings continued to note that the first quarter was the 2018 bell weather and forward earnings would be SOFT. The best is behind us now.
The expansion sinking to almost recession grade now – may take us to August when we have an all time historic record TIME FRAME for a growth bubble.
Inside this growth bubble are super bubbles – super bubble in bank loan pools or structured asset pools – super bubbles in asset class’ like Technology where Apple is far too high priced coming out of crises and a failed super cycle launch – losing its reputation in a number of critical brand areas. Brand building takes years. Brand slaughter takes one hour live TIM and you sure did that. Google Face Book and the rest facing regulatory head winds globally and shrinking margins ( if any one tore apart first quarter earnings ) such that forward value needs to moderate from peak – which is being done today.
Speculators will use STOCK BUY BACKS which at today’s ratio was a crime under pre 1999 laws – as manipulating stock price and value by stock buy back sucking up capital that could otherwise be invested for innovation and long term market growth. Capital invests in stock buy backs is a temporary stock price manipulation. Today the market is underwritten by stock ratio – to the all time peak earnings to share price ratio in recorded human history – exceeding all past abuse. Stock buy back in record 100’s of billions is why. Capital used to manipulate price and abuse the system itself at core. Until a RE-REGULATORY RE – THINK unfolds the digital casino capitalism of the world today is without a cop to police greed and abuse of the system price points. Allowing a Wells Fargo or so many others to FIX LIBOR – to commit garden variety fraud and earn 100 billion on those frauds and then pay parking meter money fines – and the criminals who brought you all that crime – they enjoy warm meals and their clubs – and no one goes to jail.
Both are late.
Capitalism can always afford survival.
Today Home Land Security begins with protecting the Financial system of the United States. Without a major congressional upgrade of the SEC and Commodities trading institutions – which should be combined into one SEC SUPER AGENCIES with a budget many times its present budget – to digitally police a digital world today – the system is at RISK. We are all at risk.
The Correction – driven by the largest drop this spring in EU confidence – in investing – in downward GNP adjustments – in Germany leader in EU taking hits and revising GNP down – Asia seeing head winds that are blocking its ability to expand and grow moving forward in 2018 – the profit taking – re-balancing portfolio’s on slightest news all driven BY AI SOFTWARE in the Spring not by Human perspective and judgement – is sinking markets.
Today some of the top TECH Stocks had the big boards suspend trading. In the past that would open Thursday to Friday with a total crash full on flash trade short everything ….
We see the correction – advancing until there is a new bottom floor on value.
Then as earnings entrench – and new normal is understood this summer – and especially if oil crashes back to 50 dollars – the world expansion should move into 2020 with 30,000 DOW.
However if Central banks continue to error and misevaluate as they did last year and this year – and raise interest rates to fast too frequently and by too much- versus patient graduation over a decade minimum and oil stays t 75.00 or above – the double cost to DEBT REFINANCING for every sovereign nation and their companies – and the higher cost of everything for energy and oil products – will create a head wind that derails the FRAGILE global recovery.
A condition then exist for SUPER CRASH say in 2020 when we know the outcome of these forward policies and the mid year election.
SUPER CRASH is a risk to monitor against
- Central bank aggressive and error ridden policy to normalize far to fast against economic demons that no longer are factors at all. Soaring interest creates soaring debt default cascading into the forward markets .
- Oil price manipulated by a few against the many – cartel gangs – for their greed – jacking up the cost of everything for no reason at all. Soaring oil and interest rates push the world into recession and economic contraction. Circulation of capital slows to a trickle.
- Geo Political triggers – the mid year election – can by itself married to 1 and 2 push the world into SUPER CRASH and Liquidity Evaporation Day. No nation comes out of LED without re-balancing economic accounts and war.
Why risk it?
Coordinated policy between nations is missing.
Trust was breached by markets moving from paper to digital so fast regulatory frame works could not keep up. Criminal manipulations created billions for a few in 2007 and then SUPER CRASH globally almost sunk the entire system completely. IT was close far closer than any of you truly realize. Read Secretary PAULSON’s BOOK and you’ll learn just how close – the day he cried and prayed in a parking garage.
That tearful day is a CAKE WALK against the speculation ramp up within financial institutions, the consolidate of wealth circulation, and the digital landscape of all markets and asset classes in 2018 versus 2007.
The top don’t see it coming. Why?
They believe their smarty pants internally have invented risk-less risk. A theory of trading ranges digitally. That theory is untested new and we submit flawed code. Buggy virus code. If you believe your buggy code is flawless though – you run it. Till it crashes.
Only this time it crashes all world economic institutions beyond any recovery – a real WORLD WIDE DEPRESSION.
We see that risk.
In audiences I where I survey thousands upon thousands of business owner CEO’s annually – I ask by a show of hands:
- Who believes we did not learn anything from 2007 and they are still doing the same stuff?
- Who believes the markets have gone digital and the regulatory laws are all designed for paper transactions?
- Who believes laws are local and trades fall outside local and exist in the geo politics of the off shore cloud itself?
- Who believes we are seeing unchecked risk rise for a super crash and system collapse?
- Who believe the time frame is five years or less – probably two or less unless things change?
Now when 70% to 80% of hands are raised in affirmation to all five questions – from Main to Seattle from San Diego to Miami from Jamacia to the UK from India to Being – I conclude the CEO small business owners GOT THIS COLD TURKEY.
The smarty pants running everything are deluded as there were in 1907 the the great depression that brought us World War I due to Fed failed policy – and again in 1929 when the Fed free money created the largest speculation bubble in economic history and brought us WORLD WAR II. Again in 2007 when the Fed supported its bank and investment bank shareholder ( thats right the FED is owned as private stock firm by the folks they are suppose to regulate – an insane policy itself ) – THAT the theory was in 2007 Real Estate could never go down really – no models existed for it going downward where in criminal banker models – and then real estate CRASHED.
Tax payers of nations then bailed out with a trillion in grants the inside central bank shareholders so banks would not go bankrupt – as they were all bankrupt in 2008. The Fed bought the worst crap and the worst bets they just gave grants to them.
If you read my blog on this – the Senate asked the FED who got 11 trillion of tax payer money. The Fed Chairman reported – 1000’s of members banks of the Fed. The Senate Chairman asked – will you tell this oversight committee by list who got the money and how much each of your member banks consumed of tax payer funding bail outs? The Fed Chairman said – NO SIR.
The Fed exists outside control accounting veto of oversight. Oversight is a fiction a fraud.
American’s are fed education to keep the truth and facts away from them. Economic education is far from transparent current or of standard and quality to involve voters in power to reform and upgrade.
Ignorance keeps the average income at below 60,000 in America and assures THE CITIZENS OF THE WORLD are wage slaves and just over broke JOB in their j.o.b’s – just over broke. One pay check away from disaster.
Can a modernized system of COOPERATIVE ECONOMICS – paying inflation adjusted incomes to every man and woman separately of today’s value of 65,000 each – so that – folks could work and earn lots more – or explore education arts and pursuits and circulate money creating an economic rebirth of full partnership for all?
Can education upgrade to assure the world celebrates diversity as first thinking art – and by culture dispels any punishment for human diversity. Hate expressions become social outrages – a form of insanity?
The world wakes up and is sane all of a sudden.
The problem is the world is asleep – fully competitive – and practicing insanity from K – 12 to Higher Education. We culture glue insanity.
Today insane smarty pants brains believe casino capitalism is safe, is risk-less risk – and is taking up to 50 to 1 leverage never known before to leverage the market price via manipulation in speculations. The speculation market is now the base of the pyramid many many times the point now upside down of economic stake holders – buying real assets and holding real assets. This wholly upside down pyramid smarty pants build and continue to consolidate base by 100’s of trillions in 10,000 super money pools – looks like 1907 and 1929 only far far worse in system abuse globally.
In past abuse of systems the inter-link between capital money pools was far more isolated. Today the risk link is shared and if China for example hard lands into debt default cascading – DDC – the entire system can go bankrupt.
The IMF has warned about this risk 15 times in 24 months.
The smarty pants running all the money think that is old foggies who have zero currency into the evolving AI markets.
Today the world in competition and distrust and negotiation – versus cooperation trust and collaborations – is unfolding a multi trillion dollar global AI WAR. President Putin correctly stated that THE NATION THAT CONTROLS AI will control the world.
Russia – just alerted our team they have stolen a current cruise missile and are using our technology to hammer us back now.
Today we ramp into SUPER SONCI WARS. In the past 70 years destruction was assured by counter strikes by super powers. It would take several hours.
Today with modern AI consider real eelf aware self learning AI that can steal all data base information because it simply smart enough to do that. It accelerates the super sonic war so strikes can and will in the evolving model:
- Strike total devastation first in 30 minutes then in three minutes.
- Somewhere in the three minute strike if AI can with new sensors in 3 minutes take out all enemy counter strike capacity – then that AI wins and rules the world.
Which is why we have lobbied for MARS. Mutually Assured RECONSTRUCTION that assures a 30 day rebuild of nation from any and all such strikes. MADD IS OBSOLETE moving forward without MARS.
But the smarty pants have the buggy software – THATS THE WAY WE HAVE ALWAYS DONE IT – marching through their brain computer.
The world order post WORLD WAR II is now in SUPER CHANGE.
No one can predict who the leaders on the other side of SUPER CHANGE are going to be.
In a global reframe into COOPERATIVE CAPITALISM we sanely collaborate to get to the future together – no nation left behind. SANITY.
Without a Global Reframe it is every nation for itself – marching toward unknown risks – and the old system may collapse and require a new system on the other side of war – versus doing it all peace fully.
Now consider the likely short term:
- The Correction bottoms in the Spring.
- The summer claws back values.
- The 18 month rise up soars with one election outcome crashes with another.
- The RISK of SUPER CRASH to follow that elevates or moderates depending on Central Bank and election outcomes.
- Geo-gpolitics are a wild card like China Debt.
Mis-steps are so dangerous today.
Our advances in AI are ripped off by digital warfare and sovereign nations at digital war with the USA. The 2008 crash was a sovereign nation digital weapon fired at our markets. in case you did not know that and read that data the hour the attack began right here on this blog.
Could another economic weapon only worse be fired at the West Say all power and data disappears and no power comes back on. What happens ? If you think we are ready for that – think again. Smarty pants believe that can never happen.
We believe the Trojans are all planted waited for a digital firing switch.
We’ll see who is right.
Meanwhile we think what WILL happen is:
- Growing cooperation between nations.
- Correction of this Spring ends at a new bottom.
- Claw back up is steady and on going.
- With election and infrastructure legislation the boom can go on for years.
- Without Both – a serious recession in late 2019/2020 early – with a volatility roller coaster in between.
So thats the view and the date to consider carefully.
We have suggested exploring getting OUT of the DIGITAL CASINO at the next peak high – and move everything into diversified insurance investing. Explore that option with your licensed professionals and shop shop shop – as plans vary wildly on quality and returns. Get your best proposal and act.
Or ….join the majority who report…..why they told us and told us.
Berny Dohrmann – TELLING YOU ALL OVER AGAIN
PS: The smarty pants on Wallstreet and in lobbies are smart to be sure they are just plain consistently WRONG and the cost is what they never pay for…..we all pay for that error…..