In this weekend’s “same as it ever was – Bitcoin, gold, and a rapidly changing world,” I expressed my staunch disagreement with Peter Schiff’s views about Bitcoin – whilst simultaneously, commending him for being the best political and economic analyst in the blogosphere; which yesterday, was demonstrated in this must listen analysis of the Trump Administration’s comically pathetic “Trumpcare” proposal. And I do mean must listen – so you can truly understand just how dysfunctional, and destructive, our government has become. Not to mention, to validate what I vehemently espoused in my November 10th Audioblog, “turning on Trump,” just one day after having spent the entire summer and Fall passionately supporting his candidacy (principally, because I viewed Hillary Clinton to be far worse for America) – of how not a single one of Trump’s major campaign “promises” was feasible. Particularly, the “repeal and replace” of Obamacare, as “once the socialism Genie is let out of the bottle, it can never be put back.” I mean, when you listen to just how inane this proposal is, on every imaginable front, it becomes crystal clear that incompetence is destroying America.
Anyhow, I apologize in advance if today’s article appears haphazard, but I have a great many topics to discuss, in a short period of time. I’ll get to today’s principal topic, don’t worry, but for beforehand, there are many other things to discuss. Like for instance, the countless amount of cataclysmic topics I’ve discussed in recent weeks, which are rapidly becoming mainstream fears. Like the Great Depression-like catastrophe that will result from historic overbuilding, overleveraging, and over-speculation on the soon-to-be dead “brick and mortar” retail sector, in the face of the irreversible secular trends of online shopping and artificial intelligence; atop the cyclically worst economy in generations – which, with mathematical certainty, is about to get much worse. Earlier this week, I detailed this cataclysmic trend in great detail – and since then, I have read no less than a half dozen articles about this ominous topic. To that end, no chart I have ever published screams BUBBLE more than this one. This, on a day when I just read how it’s estimated that one-third of all U.S. shopping malls will likely be closed by the end of the decade.
Yesterday’s report that revolving (i.e., credit card) debt dramatically slowed in January – because consumers, the majority of which “don’t have the ability to write a $500 check” are starting to cut back, record high post-election “confidence” and all; whilst simultaneously, non-revolving debt (i.e., student and auto loans) skyrocketed to a new all-time high – as said “consumers” use such taxpayer-funded loans to fund day-to-day costs; should tell you all you need to know of the state of the economy, and where it’s going.
This, on the same day that the Fed itself, despite record-high “soft” economic data readings, reduced its first quarter GDP “growth” rate from the 3.4% rate it was at one month ago to a measly 1.3% – on the heels of the aforementioned plunge in consumer spending, and a catastrophic explosion in the trade deficit to its highest level since 2011. Which, in turn, was caused by the explosion of the dollar since the election; i.e., the perfect example of how technology and incompetence are destroying the world.
Yes, part of the dollar’s surge can be attributed to the accelerating collapse of the global economy (as evidenced by Germany’s 7.2% collapse in January industrial production, and China’s lowest ever GDP forecast) – and subsequently, the political uncertainty it has engendered, as global capital flees to the dollar’s “safe haven” liquidity. However, just as much so, the fraudulent, soon-to-collapse “Trump-Flation” meme; created in the bowels of the Fed, PPT, Exchange Stabilization Fund, and gold Cartels’ back rooms after Trump “shockingly” won the election; and made possible only by history’s largest, and most blatant market manipulation scheme. Which in turn, is possible only due to the proliferation of trading “technologies” like derivatives; and the high-speed trading algorithms that today, account for more than 95% of all stock, bond, currency, and commodity “trades.”
Oh, and did I mention that the benchmark 10-year Treasury yield, in the aftermath of the most globally destructive policy decision in the Fed’s soon-to-end 104-year history (to raise interest rates when the economy is collapsing), has surged to 2.56% as I write, well-above the “economic line in the sand” at 2.5% – above which, all remaining global economic activity will be decimated, due to the unprecedented, parabolically-rising levels of crushing, unpayable debts. Which, due to the Depressionary “accelerant” of a surging dollar – which destroys the ability of foreign debt to be repaid, and annihilates America’s competitive position (this, as the President vehemently, and correctly, complains that the “too strong” dollar is “killing” corporate America); will catalyze an economic and financial cataclysm worse than anything encountered in modern times.
Not to mention, the offshore Yuan exchange rate is nearly up to 6.92/dollar as I write, putting it dangerously in range of the key psychological level of 7.0/dollar; above which, the level of Chinese capital outflows, which are already at systematically dangerous levels, will explode, in preparation for the globally devastating, unprecedentedly deflationary, massive Yuan devaluation we all know is coming, given how, per China’s Premier himself, just three days ago, the world’s largest economy faces unprecedented challenges in the coming months. Or, as I put it in August 2015, just 24 hours before this horrifying devaluation process officially commenced, the “upcoming, cataclysmic, financial big bang to end all big bangs.”
And oh yeah, that little thing known as the crude oil price; which, care of maniacal, in-your-face “oil PPT” manipulation is trading way above its equilibrium level. This, as with each passing day, more and more evidence of the historic oil glut that may never reverse swamps the imploding “Trump-flation” meme. Like yesterday’s news that Russia hasn’t cut a single barrel of production, despite promising OPEC it would do so three months ago; and yesterday’s massive crude oil inventory build, putting U.S. inventories well above previous all-time highs. This, whilst the rig count continues to surge; and with it, oil production, which everyone from the IEA to Fitch ratings service expects to explode higher in the coming years; at least, as long as the “oil PPT” holds prices above $50 per barrel. Remember, oil production is the world’s largest business, with more debt attached to it (much of it, of the junk variety) than any other industry, both corporate and sovereign-wise. I mean, the dislocations caused by a combination of market manipulation and economic collapse have broken new historic ground – as evidenced by Goldman Sachs itself being “stunned” by the recessionary collapse of gasoline demand – while at the same time, California gasoline prices surged above $3/gallon for the first time in more than two years!
Yes, the Fed; which, care of of the aforementioned market manipulating “technologies” that have created financial bubbles comparable to Tulipmania, the South Seas Bubble, and Dotcom-mania (like the “VIX-crusher algo,” which supports the stock market ever time it attempts to decline), thinks it can raise rates into a globally collapsing economy. I mean, what part of the below two charts doesn’t scream insanity? The first, of the Dow’s complete dislocation with economic reality since Election Day; and the second, I kid you not, of a nearly 100% correlation between economic collapse, and the odds of a March rate hike. In other words, the worse the economy gets, the higher the odds of a rate increase!
Much less, a cauldron of political unrest – which could explode at any time; here, abroad, or in both. And certainly will, as America’s internal civil war intensifies – pitting the Trump Administration against forces of socialistic, sociopathic evil unlike any America has ever witnessed; whilst overseas, equally historic unrest is unseating political regimes at a faster pace than any time in modern history. Particularly in Europe, where Marine Le Pen’s likely victory just two months hence may well spell the end of not just the European Union, but the world’s second largest currency itself. And with it, the catastrophic default of trillions of unpayable debts, from “first world” nations like France, Italy, and Spain; to “second worlders” like Greece; and the borderline “third worlders” on Europe’s fringes. And who owns the majority of such debts? Why, “too big to fail” banks like Deutsche Bank and France’s “Big Three”; the ECB itself (i.e., European taxpayers); and, via, the proliferation of the financial “technology” known as derivatives, the largest banks in the U.S., the UK, Japan, and all of the world’s “leading” economies. But don’t worry, as of yesterday, Germany’s “technology-fueled” (i.e., PPT-supported) DAX stock index is amidst its longest-ever bull run, so what could possibly go wrong?
No article more succinctly describes the Fed’s motivations – and inherent evil – than this one by Craig Hemke, titled “endless Fed deceit.” In it, he describes how patently obvious the Fed’s anti-American objectives are. Or better put, “anti-99.9%” – as opposed to the 0.1% that benefit from its hyperinflationary policies, market manipulations, and endless supply of inside information to its masters on Wall Street and in Washington. To that end, inside this article is embedded a horrifying video, produced in 2015, by a fantastic analyst named John Titus – titled “Fed Audit Shocker – they come from Planet Klepto.” In which, Titus deciphers the minutes of the FOMC’s June 2009 meeting, after they finally became available for public consumption following their standard (and patently ridiculous) five-year publication embargo. Which can best be described by the comment of one particularly incompetent Fed “governor,” after realizing that the Fed’s hyper-inflationary “strategy” was mathematically irreversible. I.e., “we need to convince (investors) that we have an exit strategy, and that we are prepared to execute it in a timely way.”
In other words, my friends, technology and incompetence have destroyed the world. Which I assure you, if it hasn’t negatively impacted your life yet, will do so in dramatic fashion in the coming months and years. Which is why now, more than ever, the time to PROTECT YOURSELF from what’s coming has never been more urgent – particularly in light of the historically “subsidized” prices said “technologies” have afforded, via unprecedentedly suppressed gold and silver prices.
P.S. As I was about to hit “send,” ADP just reported an astonishing 298,000 new “jobs” were created in February. Given the dramatic decline in “hard” economic data; and explosion in debt of all kinds; there simply aren’t words to describe this unprecedented dislocation from economic reality – even if it’s a given that whatever new “jobs” were created weren’t good ones. In other words, the unprecedented bubble in “jobs numbers” relative to economic reality has never been larger; and thus, like historically overvalued financial assets, ripe for an historic – and perhaps, imminent – crash.