Phoenix Capital Research's blog

True, the world faces issues today… so it’s not odd for bond yields to be lower… but are those issues on par with a disease that wiped out 25%+ of Europe’s population… or the single largest military conflict in history?

There are in fact problems that are too big for Central Banks to manage.

 The US stock market is trading at 1929-bubblesque valuations, with a CAPE of 27.34 (the 1929 CAPE was only slightly higher at 30. And when that bubble burst, stocks lost over 90% of their value in the span of 24 months.

This is why Bernanke said rates won’t normalize in his lifetime: any normalization means a crisis magnitudes larger than the 2008 crash.

Historically, both times stocks registered similar readings, the markets plunged 50%-90% in the next two years.

As usual, US stocks are the last to “get it.” But this won’t last for long. The S&P 500 is sitting on the ledge of a massive cliff. And when it finally tumbles, the move will be both fast and violent.

In short, Bernanke bankrupted the US and most Americans in the span of ten years. He created the biggest housing bubble in 100 years and also casue the greatest Crash in 100 years. A few blog entries won’t change this.

Why QE will never induce consumers to spend and is in fact DE-flationary.

Put another way, the financial landscape is now so screwed up by the Central Planners, that investors are actually INCINERATING their money by lending it to Governments.

And against this disatsrous backdrop… investors are completely bullish!

This is true going back even to 1870.

The Fed may engage in a symbolic rate hike... but we will not enter a truly hawkish period... not when the TBTFs have $551 trillion in interest rate based derivatives outstanding.

Put simply, corporate profits are at a record high relative to the economy… and they just began to roll over.

This situation will result in a Crash far larger than 2008. The markets involved are larger as is the risk and the leverage.

All of these are signs of a top forming.