These red flags bother me due to the inevitable economic collapse of the artificially supported and indebted US economy.
This is not an article, full of Christmas mood, but there is a very good reason why my family is severely restricted our holidays this year. This is because now all the signs indicate that the US is trying to economic collapse.
It is inevitable, of course. Our economy is artificially supported by the decades, starting with the abandonment of the gold standard. We are in debt of 21 trillion dollars, incomprehensible figure. The fact that other countries still loan us money, is striking. If the US was a man with such a high level of debt, we would not even be able to buy a car with one of these 25% -s ‘ loans, here is no matter how great was our debt.
Not only that, but there are some parties that seem to want to see how the economy is falling apart because of their greedy and nefarious purposes.
These red flags bother me due to the inevitable economic collapse.
Stock market falls
Right now the market is moving in a month, which is equivalent to the crash of 1929, when the Great depression. And Industrial average the Dow Jones (Dow Jones Industrial Average), s & PI 500 (S & P 500) decline by 8% during the month, which is usually not very good. Michael Snyder says:
“The seriousness of the stock market crash stuns many experts, and many investors are starting to panic. In early October, the Dow reached a record high of 26 951,81, but on Monday it closed at 23 592,98. This means that the index fell more than 3300 points from the maximum of the market, and many believe that this stock crash is just beginning”
Dr. Ron Paul told CNBC (and they actually published it!), in the next 12 months there will be depression.
“As soon as this instability will show that we are not going to resume the securities market, people will rush to exit,” Paul said Thursday on CNBC — it could be worse than in 1929″
During this year, the stock market fell by almost 90 percent, leading to a sharp decline in the economy.
Paul, known for libertarian, warns wall street that the massive decline in the market inevitably for many years. Currently he predicts a 50 percent reduction from current levels, citing the ongoing trade war with China as a growing risk factor.
“I don’t think that all of a sudden you solve the problem with the tariffs. I believe that the problem will remain,” he said. “Fees are taxes”
This scenario exacerbates the main reason why Paul was guided by his pessimistic appeal: easy-money policies in the financial crisis of 2008. He argued that quantitative easing of the Federal reserve called “the biggest bubble in the history of mankind.”
The stock market will probably be to monitor closely sitaula over the next few weeks. To learn more about how to survive the collapse of the market, read this article. To learn how to protect your money, even if you don’t invest in the market, read this article.
Market Treasury futures, too, doesn’t look good
Instructive article by Jeffrey Snider of Alhambra Investment Partners, “Alhambra Investment Partners” explains why we need to follow the futures market for Treasury. Here are the highlights:
Treasury futures market controls the situation, but it is not always easy to perform.
What we do know is that December was a total disaster. In the stock market s & P 500 (S & P 500) increased in the beginning of the month. The original liquidation, which began as WTI after October 3 by the end of November, it seemed, was under control. The index rose to almost 2800 for 3 Dec.
Now it has fallen by almost 10% in just a few weeks, and more importantly, set a new low for the year (lower lows). Although it surprised many, the futures market for Treasury bonds issued what may have been the biggest warning for the last week of November …
“Treasury futures is a kind of trap for the overall uncertainty. The busier the market, the more we should look for bad things. When our interest will take off, really bad things…”
“For the week of November 27, the CFTC reports that open interest in Treasury futures exceeded 1.1 million for the first time since the Asian flu in 1998. In recent times the market has expanded to a seven-figure contracts? From January to March 2008 — over a million a week before the exchange failed…”
“In the world warning this way back in the shadows, because he more than anything visible associated with intricate parts that are hidden in them. But this warning was a significant…”
When open interest in the futures UST is approaching 1 million, it’s bad. More than 1 million? Buckle up.
It’s pretty nasty stuff. I urge you to read the entire article here.
But, as is the jeans knife (Ginsu), this is not all.
The volume of corporate, personal and government debt are simply amazing
Brandon Smith is well explained in this must-read article at Alt-Market (“Alt-Market”). Here is an excerpt that perfectly sums up our situation.
The national debt is approaching 22 trillion dollars, adding more than $ 1 trillion a year for the American taxpayer
Corporate debt is at historical highs since 2008: s & P global (“S & P Global”) reported more than 6.3 trillion dollars, and the largest companies are holding as a hedge only 2.1 trillion U.S. dollars
The debt of households in the U.S. currently stands at about 13.3 trillion dollars, which is 618 billion dollars higher than the last peak in 2008 during the crisis
The credit card debt United States for the first time exceeded $ 1 trillion in 2018, which is the highest amount for the year 2007 (again, we see that the debt levels go out of bounds, Peresecina shortly before the crash of 2008)
So how to use this debt to provoke an economic crisis? Let’s start with home and consumer debt.
You would think that with such a large volume of lending and create the consumer debt we will see a massive expansion on the domestic and automotive markets. And some time we did. The problem was that most purchases of houses was carried out by major corporations such as Blackrock (“Blackrock”) as they absorbed the mortgages by the thousands, and then turned these houses to rent. In the automotive market saw a significant surge in purchases caused by lending, but that lending was carried out using the auto-style arm (ARM), such as loans with poor standards that helped cause the mortgage crisis in 2008.
Today, as the housing market and the automobile market really is a crisis, because the Federal reserve system (fed) increases interest rates and makes storage of these loans even more expensive.
Expected home sales fell to a four-year low as every fourth house on the market now are forced to reduce prices. Debt becomes expensive, and hence demand falls.
Overall car sales in the U.S. in September began a sharp decline, which continued until November, mainly due to higher interest rates.
It is clear that the economic crisis, which some call just a bearish market, manifested in the rapid decline in housing and road transport, the two most important consumer sectors.
But what about corporate debt?
Let’s use GE, GM and Ford as a litmus test.
- General electric (“General Electic”) is currently in negative territory for the sum more than 115 billion dollars. And that doesn’t include its pension promises to workers who make more than $ 100 billion. Given that only 71 billion. USA has been allocated to cover payments, any rate hike by the fed are millstones around the neck of GE. The likely result will be continued layoffs. In December last year, GE announced a reduction of 12,000 jobs by 2018, and probably the decline will continue until 2019.
- GM, with long-term debt of $ 102 billion (as of September) and cash in the amount of about $ 35 billion, now reducing more than 14 000 jobs and close several plants in the United States. This is partly due to a combination of higher interest rates and fees. However, the true turning point -a huge debt, which is responsible for GM. Without such debt no increase in rates or tariffs, trump would not have made such a strong impact on these corporations.
- “Ford” (“Ford”) will announce 25,000 job cuts, though most of them can be implemented in Europe. Ford called the report Morgan Stanley (Morgan Stanley) “premature”, but we saw a lot of this “failsafe failure” of such leaks during the crash of 2008, and most of them turned out to be true. Ford lowered its debt rating Moody in the beginning of this year to one level above junk. With the current obligations in the amount of about $ 100 billion and only $ 25 billion in cash, Ford is another company on the verge of collapse because of the huge liabilities that it cannot afford to pay more interest.
We can see the pressure that the fed can have on corporations if you look at their spending on share buybacks over the past few years. Up until recently low interest rates the fed, the overnight loans and the purchase balance allowed companies to buy back their own shares and, thus, to artificially support the markets. In fact, it can be argued that without the purchase of shares commencing in 2009 bullish rally would have long since died out, and we would go back to crash much earlier.
Well, that’s exactly what is happening today. Share buybacks in the second half of 2018 has been shrinking as the fed tightens policy, and interest rates are approaching a designated “neutral level” of inflation. All this required only a 2% increase to create the crisis, but given the fact that the level of debt has strangled the system, it should be no surprise.
Reducing interest rates to near zero, the fed has created a culture of irresponsible risk, and I think they did this deliberately. Even Donald trump was associated with stock market performance and took debt, advocating that the fed has stopped or reduced interest rates to keep the debt party. However, with the White house trump-infested international banking agents and analytical ghouls can be much more than it seems at first glance.
The fed is not going to stop. Why? They have created the perfect bubble. The bubble that covers not only corporate debt, consumer debt and stock markets and also bond markets and the US dollar. If the goal is movement toward centralization of power, the banking elite in the hands of a perfect crisis weapons, and they barely need to lift a finger (or raise rates) to trigger the event.
And he’s not alone in his assertion that this may be intentional.
The fed is trying to bankrupt the market?
Today, Michael Snyder wrote an article that asked whether the Federal reserve is trying to start the stock market crash.
The Federal reserve decided this time not to come to the rescue. All the economic indicators tell us that the economy is slowing and fed Chairman Jerome Powell even admitted that economic conditions are “softened”, but the Federal reserve still raised interest rates. As one of the leading economists, higher interest rates in a recession is “economic negligence”. They know that raising rates will slow the economy down even more, but the fed does not share this step. In fact, it was a unanimous vote for a rate hike. They clearly have an agenda, and this program is definitely not about helping the American people.
Earlier on Wednesday, wall street seemed to believe that the Federal reserve will do the right thing, and the Dow rose nearly 400 points. But then came the announcement, and the market began to fall sharply.
Industrial index Dow Jones has lost 720 points in just two hours, and the Dow finished the day at 351, para. This is the lowest DOE for the entire year, 60 percent of the shares listed on the s & P 500), are located in the bear market, and at the moment, about four trillion dollars of stock market wealth was destroyed.
We haven’t seen anything like this since the last financial crisis. This is officially the worst indicator for the stock market since the last quarter of 2008, and it’s the worst December that wall street has experienced since 1931.
It’s crazy to raise interest rates, when the stock already fall, but the Federal reserve did it anyway.
They knew what reaction it would cause on wall street and other global markets, but that didn’t stop them. The financial world is in complete turmoil, and the move the fed has certainly added fuel to the fire.
Is it possible that they really want the collapse of the stock market?
Some believe that the reason the vote was unanimous, was that they wanted to send a “strong signal” to President Trump. In recent weeks, he is extremely critical of the Federal reserve system, and for the fed this could be the opportunity to show Trump who is really in charge.
The fed is trying to teach the Tramp a lesson? If so, the fed sacrifices Americans for the sake of politics, and of course huge profits for the sake of more scarce.
Looking at other things
Chicago is probably going to stop pension payments because, to do it right, every person , not household , and people in Chicago would have to pay for the account size of $ 140,000.
Almost half of people in the United States are struggling to pay for items such as food and rent. And if someone will make a disturbance in their budget, they can quickly become homeless. Most people are much closer to it than we imagine.
Although the employment figures look respectable, most people don’t look at that as underemployment. This is when people can’t work as much as he would like. Many qualified people are working part-time in fast food restaurants and grocery stores and get more than one low-paying jobs just to make ends meet. Now there is no shame in hard work, but when survival required a few jobs, we’ve definitely reached the point where the cost of our lives rose above a reasonable level. In addition, because of government policies requiring employers to pay for expensive medical care for full-time employees, which they just can’t afford it, employers hire people part-time.
Other countries dropping the dollar. Both China and Japan quietly cut Treasury holdings and purchase. They see what can happen in that time, how many people here don’t seem to see it.
When you put all together, it certainly paints a terrible picture, isn’t it?
What do we do?
First things first, I recommend to follow the instructions in this article to protect any money that you have in the Bank.
At this stage I’m not focused on debt repayment, although it is usually advised not to have debts. Right now I would focus on the supply and lifestyle changes that will help you to survive the collapse of our economy.
If the situation will turn into what’s predicted, nobody is going to pay with credit cards in the near future. I would have jumped at the minimum payments and put their money into tangible assets. If your stocks are in good shape, expect to pay your house or car. Then invest in precious metals. They may not bring you much good during a collapse but when all will look brighter, you protect at least part of his wealth.
What do you think?
Is there any problem in the economy? Are we heading towards a economic collapse in the Venezuelan style? As you prepare for it?
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