Unemployment

At 2 p.m. EST, the only thing the financial world will care about and discuss will be the Fed's [first rate hike in 9 years|epic disappointment]. So for those who still haven't made up their mind about what the Fed's [dovish|non-dovish] rate hike means, here is all you need to know.

The writing has been on the wall since the S&P "junking" in September, and now Fitch has jumped on the bandwagon, cutting Brazil to BB+, outlook negative. 

With economic growth currently running at THE LOWEST average growth rate in American history, the time frame between the first rate and next recession will not be long. For investors, there is little “reward” in the current environment for taking on excess exposure to risk assets. The deteriorating junk bond market, declining profitability and weak economic underpinnings suggest that the clock has already begun ticking. The only question is how much time is left.

"For those who think Fed hikes are “good” for economic confidence, it would also be odd for the Fed to suggest, implicitly via a lowering of the dots that things were not quite so rosy. On balance the Fed therefore looks set for effectively “insisting” on their median dots – closer to a hawkish rather than dovish hike."

Wall Street’s proclivity to create serial equity bubbles off the back of cheap credit has once again set up the middle class for disaster. The warning signs of this next correction have now clearly manifested, but are being skillfully obfuscated and trivialized by financial institutions. Nevertheless, here are ten salient warning signs that astute investors should heed as we roll into 2016.

Despite the low interest rate regime, there are a number of similarities between now and the period running up to the 2008 crisis……

The real "data" that The Fed is "dependent" on...

Those in power never understand markets. They are very myopic in their view of the world. The assumption that lowering interest rates will “stimulate” the economy has NEVER worked, not even once. Nevertheless, they assume they can manipulate society in the Marxist-Keynesian ideal world, but what if they are wrong?

"either the Fed achieves its goals quickly to a very low terminal Funds rate. Buy bonds. Or they need to be even more aggressive. Buy even longer duration bonds. The choice is more about where to put the long leg of the curve flattener not about whether to steepen or flatten the curve."

Jim Cramer - of all people - warned about this in 2007: watch the video inside!

- Watch video - “Monetary insanity” of ECB and Fed is “frightening”
- “Absolutely nothing has been learned” since financial crisis
- “Financial hypocrisy on a grand scale”
- Ireland was vassal of Bank of England and now ECB
- Ireland needs to get “financial and monetary independence”
- Huge demand for gold and yet prices manipulated lower
- Real unemployment is U.S. probably 15-20%
- Dollar may rally in short term but vulnerable in long term
- Russia, China may monetise gold as geopolitical weapon
- Gold and silver are “hedges for you in local currency terms”

"In short, the age of unconventional monetary policy begun by the 2007-09 financial crisis might not be ending."

- Jon Hilsenrath

This is where the Fed. now finds itself. Here they were. Just holding policy lines doing what they in their Ivory Tower contemplated and the so-called “smart crowd” insisted they do. And now the saying of “Between a rock and a hard place” might be an understatement. The world sits atop a tinderbox fueled by monetary policies that created them and awaits a match that could set it off in a blaze of who knows what. All in short order. Unless they don’t do anything except try their best Draghi impersonation and declare, “They too are once again at the ready to do what ever it takes!” Except – just not now.

Canada will be in an extremely horrible shape from next year on...

While the world patiently waits for Janet Yellen to raise interest rates this month, the markets have been unable to decide as of yet whether such an event is good or bad thing.