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Is the Stock Market Repeating the 1929 Run Up to the Great Depression?

George Washington's picture




 

Chart courtesy of Tom McClellan of the McClellan Market Report (via Mark Hulbert)

Hulbert notes that the chart “has been making the rounds on Wall Street.”

On the other hand, Martin Armstrong predicts that a worsening economy – and bank deposit confiscation – in Europe will cause people to flood into American stocks as a “safe haven” for a couple of years.

And the Fed has more or less admitted that propping up the stock market is a top priority.

Bonus:

 

 

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Wed, 02/12/2014 - 08:22 | 4427407 Global Observer
Global Observer's picture

The only way the US$ held outside the US will return to the US is when outsiders import something from the US or invest them in buying US assets. Since the US is a net importer, more US$ are accumulating outside the US everyday. Outsiders investing in highly priced US assets is a risky strategy for them. Since the US is far from becoming a net exporter anytime soon, others holding US$ are exposed to the risk of political compulsions within the US for maintaining the value of the US$ or not. I doubt China can afford to or is willing to write off the US$ 3.5 trillion it is holding. This is where creating a fiat currency used exclusively to settle international trade comes in. I am positive the BRICS bank, intention for which was announced some years ago and not heard of since, is being worked out silently awaiting an appropriate time to announce its operations. When the bank is launched and its member countries commit themselves to conduct their internal and external trade using the bank's currency, that currency will become the world's reserve currency.

Tue, 02/11/2014 - 21:57 | 4426320 Wen_Dat
Wen_Dat's picture

Buzz kill bro. I just found out about dr Judy wood and her 911 Theory. After re-watching the collapses, she makes a Lot of sense (basically some kind of energy weapon vaporized the towers). Point is, maybe this was a signal to the rest of world (you fuck with us, you die. We are insane and will vaporize our own people for a laugh). It's probably all theatre and aliens are running shit.

Here's a link for people who are interested. Watch the collapses again, it certainly looks like vaporized ( she calls it dustification) weird shit

http://www.drjudywood.com

It's long

Tue, 02/11/2014 - 19:20 | 4425705 PHantomofthemarkets
PHantomofthemarkets's picture

Do you think that would help convince the rest of the world not to dump the dollar?

I don't think it matters that the ordinary American people have faith or not.

As a matter of fact, I even think the world doesn't turn around USA anymore. Watch out when you are in a from-hero-to-zero position. Imagine that all your enemies suddenly are stronger, while you have been behaving as a real bully...

Tue, 02/11/2014 - 16:49 | 4425021 El Tuco
El Tuco's picture

Folks are brain dead. You can't use the faith in money thing anymore. People are just fucking stupid. The game has changed.

Tue, 02/11/2014 - 16:20 | 4424911 0b1knob
0b1knob's picture

Bullshit.   By using different starting points and scales on the verticle axes you can make almost anything superficially match up.

This is lame even by the low standards of Zerohedge.

Tue, 02/11/2014 - 20:03 | 4425844 20-20 Hindsight
20-20 Hindsight's picture

Exactly.

Whoever is controlling this site wants everyone to panic sell their assets, so they go ahead and BTFD right behind us.  At the same time, they try to hypnotize you into buying fucking PMs, which allows them to keep their ponzi scheme going as well.  In other words, they manage to find ways to fleece their flock of followers not once, but twice.

They had me buying into their constant doom and gloom for almost two years, while everyone else I know remained blissfully ignorant.  As a result, their portfolio gained over 20% over the last year, while I was led to believe that the financial world as we know it was about to end any minute now. I was led to believe that I was the smart one for knowing what others should know.  Well, guess who was the stupid one all along?

Now, here we are today for the umteenth time: "is the stock market repeating the 1929 run up to the Great Depression??"  ooooo... we should all be scared, yet again.  Meanwhile, DOW went up 192 pts. today.  

Based on the old saying: fool me for two years, shame on you... fool me for the next two, shame on me.  

I know this won't be a popular post here, but really... fuck the fuckers who keep telling us that we're fucked. They proft from that as much as the banksters, corporate thugs and corrupt politicians that they keep denoucing so self-righteously. 

Wed, 02/12/2014 - 08:53 | 4427443 paint it red ca...
paint it red call it hell's picture

You sleep well at night with petrodollars in the bank, with those line entry stock holdings against your broker's portfolio and that IRA money sunk into nontransparent mutual fund holdings.

Don't you worry your pretty little head cause everything is going to be all right... til it ain't!

Wed, 02/12/2014 - 10:52 | 4427806 20-20 Hindsight
20-20 Hindsight's picture

First of all, I'm not too concerned about the IRA because I don't live in the US, but I think I know what you're trying to say -- although I'm not completely sure.  Truth be told, my "pretty little head" tells me right now that I can't trust anyone, because they're all there for the same reason.  I hope you can get your own head wrapped around this fact, otherwise you're the one who's continuing to get screwed.  

Tue, 02/11/2014 - 22:27 | 4426435 The Fonz
The Fonz's picture

Yes, there are so few refuges for bears that we all come here. There is a saying on Wall St., repetition = franchise. Everyone can be right in what they say about the market, if they only say one thing consistently. 

Tue, 02/11/2014 - 17:57 | 4425297 halfawake
halfawake's picture

I agree. I recently complained about this analog last week. I may make my own, trying to decide what two cycles with which to do so. Hopefully including bowel movements or the like. But this isn't the worst prediction I've heard.. I appreciate the reasonable non-doom-gloom stuff, we have enough of that around here. It is possible the market will go up. Or down. Or sideways. "..predicts that a worsening economy – and bank deposit confiscation – in Europe will cause people to flood into American stocks as a “safe haven” for a couple of years."

Tue, 02/11/2014 - 16:36 | 4424984 moneybots
moneybots's picture

By using different starting points and scales on the verticle axes you can make almost anything superficially match up.

 

It is not a superficial match up.  It is a major topping pattern.  That said, it doesn't mean that a 90% drop is coming.

Tue, 02/11/2014 - 16:58 | 4425058 0b1knob
0b1knob's picture

Lack of pirates causes global warming.

http://biojournalism.com/wp-content/uploads/2012/08/piratesglobalwarming.jpg

Save the pirates!  And don't get me started on the correlation betweet ice cream sales and violent crime/rape.   Ban ice cream NOW!  For the children....

Wed, 02/12/2014 - 01:14 | 4426957 kchrisc
kchrisc's picture

Al "Green Alright" Gore will start a new anti-pirate company in 3...2...

 

"I don't know why they call it 'green' when it will end in 'red'."

Tue, 02/11/2014 - 21:35 | 4426230 DaveyJones
DaveyJones's picture

don't worry, conditions will soon produce lots of pirates

Tue, 02/11/2014 - 17:51 | 4425276 AmericasCicero
AmericasCicero's picture

I believe its just the novelty of the pattern following this chart from before that has us watching it.  It could completely fail to follow it in the near-term, and I think it would actually be scary surprising if it did follow exactly.  Certainly, when posted before on ZH, this chart came with a major disclaimer to the effect of what you have said.  So lay off the Freakonomics statistical preaching and enjoy the wonderful irony this chart is providing.

Tue, 02/11/2014 - 19:42 | 4425778 logicalman
logicalman's picture

Charts can help you understand what's happened.

If they had any real predictive power the world would be a very different place.

Shit, I'd be able to finally retire my crystal ball.

Tue, 02/11/2014 - 16:15 | 4424893 kchrisc
kchrisc's picture

Most people don't realize that the banksters, to prevent a black swan event outside their control, engineered the "crash." It benefited their friends, destroyed their enemies and further plundered the American people.

They will/are doing it again. I.e. if I've figured out that it's not sustainable, then they have too.

 

Sidenote: The "Great Depression" was caused, after the "crash" by the criminals of government and their bankster masters manipulating the economy to their benefit.

Tue, 02/11/2014 - 16:43 | 4424877 Ham-bone
Ham-bone's picture

According to St. Louis Fed, the Monetary Base has halted it's $100 B/mo growth and as of Jan, added just over $10 B/mo...bout to go negative???  Big change in trajectory since November...prior to taper $10B (now $20B/mo taper)???  Somebody draining the pool???

http://research.stlouisfed.org/fred2/series/AMBNS

click on 1yr or 5yr chart to see big change

http://research.stlouisfed.org/fred2/graph/?chart_type=line&s[1][id]=AMBNS&s[1][range]=1yr

http://research.stlouisfed.org/fred2/graph/?chart_type=line&s[1][id]=AMBNS&s[1][range]=5yrs

During periods since '09 when the monetary base was flat, equities have been down / flat and then lifted by anticipation of QE / QE execution.  If this pattern holds (particularly w/ record leverage) stocks bout to get clobbered.

Also notable is that golds big upside runs happened during the flat periods or QE runoff periods...

Tue, 02/11/2014 - 16:06 | 4424863 Colonel Klink
Colonel Klink's picture

Please wake me as it's passing 8000 on the Dow or 666 for the Stalin and Poorski.

Tue, 02/11/2014 - 16:01 | 4424851 Racer
Racer's picture

I'm extremely surprised that they allowed that Harvard study to be published!

Tue, 02/11/2014 - 16:47 | 4425014 chunga
chunga's picture

Me too, I'm still waiting for one on amalgams.

No mercury allowed in thermostats but in your mouth it's fine.

Tue, 02/11/2014 - 17:52 | 4425277 Pure Evil
Pure Evil's picture

And don't forget your flu shots.

Everyone needs a good dose of mercury with their flu shot.

Thimerosal

Wed, 02/12/2014 - 03:39 | 4427165 kurt
kurt's picture

9 out of 10 Antidepressants have heady doses of Flouride! 

Yes, Homer, they are trying to kill you which I find depressing.

Tue, 02/11/2014 - 20:31 | 4425999 max2205
max2205's picture

Great now that it's out there it'll never happen....ie hindenburg

Tue, 02/11/2014 - 16:03 | 4424849 cynicalskeptic
cynicalskeptic's picture

We're already IN something akin to (or worse than) the Great Depression.  REAL unemployment is higher than the 1932 peak of 23.4%

The stock market has been propped up by all that surplus cash flowing ot the banks and POMO activity. 

Tue, 02/11/2014 - 21:37 | 4426222 DaveyJones
DaveyJones's picture

and we had a lot more oil and other raw resources left, agriculture was spread out among the people and not poison in the hands of Monsanto, there was not 7 billion people to feed and compete with what's left, the topsoil and aquifers were not destroyed, the US was in much better shape, still believed in the Constitution, and hated by a lot less people.... 

Wed, 02/12/2014 - 05:35 | 4427254 dreadnaught
dreadnaught's picture

and debt....we were not nearly so bankrupt in 1929

Wed, 02/12/2014 - 10:06 | 4427642 new game
new game's picture

would be curious of an overlay of germany stock prices during pre wwII as compared to fiat merica...

same pattern i presume...

Wed, 02/12/2014 - 13:06 | 4428333 nofluer
nofluer's picture

German stock prices at what specific point in time? Germany pre-Weimar? Germany under Weimar? Or perhaps Germany early Hitler? Or post WWII? What is commonly called the "Weimar hyperinflation" actually was started even before WW I by the Imperial government's decisions on how to pay for the war. Then the deep hyper-inflation of the early '20s was mostly in the very early '20s... and when Hitler took over (after the economy was somewhat stabilized) he began to ramp up inflation again. And when you seek to compare prices then to prices now - your question fails at finding any kind of consistent metric to do so. Would you consider the 20 to 30% hyper-inflation that the US has been experiencing for the last 5 years or so and adjust both Germany's prices and America's prices to achieve comparability??

A very complicated question...

Tue, 02/11/2014 - 15:13 | 4424612 They_Live
They_Live's picture

This sucker's going down.

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