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Reversal
Submitted by Mark j. Grant, author of Out of the Box,
The 100% Prediction of a Reversal
A reversal will come. The odds on this are 100%. You cannot have every asset class on the planet in a bubble forever. The world does not operate this way. The disconnect between economic fundamentals and the markets continues but the odds on it continuing forever is Zero. Let us begin the postulate from here.
Corporations, banks, the housing market, borrowers and the securities markets have significantly benefited from the actions of the central banks. Money has been poured, dumped and shoved into the financial markets. The total exceeds $16 trillion to date and perhaps twice that amount if we were given accurate data to be able to count it. It was been a Tsunami of money.
Liquidity has buoyed the world as the central banks acted in concert and in a coordinated effort to provide fresh cash. The balance sheets enlarge but the money has not significantly helped anyone's economy. Europe is in a recession, America is in a muddle and the world's economies, without all of this money, would be in a sinkhole and so it continues. There is nothing else supporting the economies and the markets except the capital provided by the central banks.
Nothing!
The disparity is so large and so universal that something will break the bough as the weight eventually cannot be supported. When this happens it will be Katie bar the door. If you fall from ten feet you get hurt but if you fall from one thousand feet the consequences are quite different.
All of this is knowable but what is not knowable is what will cause the break. It could be the rise of nationalistic political parties in the U.K. or Germany. It could be social unrest, a major bank failure, a major hedge fund blowing up, some sovereign deciding to quit the Euro or a host of other possibilities. The odds on one item are minimal. The odds that a break will happen somewhere are 100%.
The creation of all of this money also has another effect. It causes stupidity. People and institutions rush around to invest their money but when there is too much easy money, such as right before our 2008/2009 debacle, really dumb things are done with money as people search for yield and appreciation. This is another 100% prediction made by me after being in the markets nearly forty years. When too much easy money floats around; stupidity takes its course.
Then there is the made-up fantasy data numbers. Just because you do not count liabilities, or because you do not count people not in the work force or just because you claim exports, in the case of China, that bear no resemblance to reality does not mean that the consequences of the real numbers, and not the phony numbers, do not begin to have serious effects. The lies, let's call it what it really is, that are being produced in Europe, America and in China are in lock-step with the printing of newly minted paper. More money, more lies and virtually every government on the planet hands shovels out more manure and heaps it on its citizens.
Now the central banks have also entered into currency manipulation. I call it "Global Thermonuclear Devaluation." Lower the value of each and every currency so that the cost of goods and services does not cause Inflation though this game is so dangerous, and having never been tried before, you could get quite serious Deflation. No one on the planet really knows how this new game will work but I can tell you this; edgy games often end in disastrous results.
It is quite true that we do not know the "what and the when" of it but my prediction that lacks any "If" will prove to be true. There is no longer an "If." The disparity now is just too great.
Play the game as long as you can. It has gone on to date right in line with the increase in the money and in the lies. Play the game. However if you are smart you will have an exit strategy and a defense lined up well in advance before the man with the scythe shows up and takes a swipe at you. I will tell you this. If you have no plan you will be in danger of losing your head when this fellow smiles at you and sluices in your direction.
It was January 13, 2010 when I predicted Greece would go bankrupt. I looked at the real numbers and not the drivel we were handed out and made my prediction. The yield on the Greek ten year was 4.38% on that day. This is a yield we have never seen again. Money has been made and lost here but history has borne out my prediction.
Later I predicted Ireland, Portugal and Spain. Each country, in my opinion, has gone bankrupt in one form or another. Yes, a giant ruse for Spain with money given to the banks and no admission of guilt from anyone but the charade does not change the reality. Each and every country went over the edge.
We stand on a precipice. There is an avalanche of lies, distortions and currency that has been created and is tumbling all around us. It cannot be dodged forever. Those odds are 100%. That is my prediction.
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The only thing the Fed can do is print money and hand it over to the too big to fail banks in the form of QE. The money which TBTF banks get in the form of QE is used to speculate in currency, stock, commodities and bond exchanges. None of this reaches the main street and hence recovery in the actual economy is not possible through QE. Moreover speculation in commodities like Oil and agriculture products lead to higher prices thus making the lives of the very middle class paying taxes and the poor more miserable.
http://www.marketoracle.co.uk/Article40231.html
It is NOT speculation when they rig the markets. It is a control mechanism.
This limbo state is the fuckin worse...
Someone fan the fire faster so we can get to the next chapter.
.
Just waiting like the monkey in the middle watching the masses soak up the brainwashing...
...while the elites create it.
.
Like seriosuly? WTF are we doing...
... just waiting!?! How pathetic! I see no signs of movements to secede and bypass the central planners in Washington & Brussels!
They've been building this central planning nightmare for 100 years ... yet it could be torn down in months if ACTION was taken ... instead of just w-a-i-t-i-n-g-g-g-g for THEM to impose a far more oppressive NEXT phase!!
Strap in i-dog, they can keep this party going for a long time. If there's one thing I've learned it's that lemmings who listen to and believe whatever they're told outnumber the people who have been 'unplugged' from the Matrix.
There will be a lot more money made, and lost, before things really get ugly.
nugjuice, You are absolutely correct. It will take a massive campaign to bring back those who lost in 2001 and 2008. They are fed up with the crashes (or rather, with the inability of financial managers to develop an exit strategy). Only when everyone goes fully in will the contrarians emerge.
It's not money or market levels, it's power that will determine the timing of the next crisis.
The Game of Thrones has a few more rounds to go. The dominant clique is mopping up right now. They have the power to keep things floating in the short term - but - if there were to be a crash tomorrow there would be a backlash that could not be contained.
Once the dominant clique are completely secure in their position, they'll let things fall...
...knowing that they are completely positioned to catch all the pieces. There will be a flood of human misery and fear and it will flow throught channels which will secure the position of the dominant clique forever.
They will become the masters that all human dynasties dreamed of becoming.
Face it. A child born this year will not expect to survive for seventy years. She may expect to survive for forty...
...or a hundred and forty, depending on what side of the divide she falls on.
Money won't buy what's on the sunny side of that divide; not money as we know it today. Not gold, not fiat, not bits. Nothing.
You will be one of them, or not. It's that simple.
http://www.freemansperspective.com/good-guys-not-coming-to-save-us/
Many thanks for that link ... it's excellent and goes to my point EXACTLY!
One small extract:
Then quit being coy and drop the plan.
This bitch could bubble on for years, until the dollar is more useless than it is now.
Greenspan and Buffet were always taking bubble baths, trying to come with ideas to create more bubbles. Next, the new currency will be bubbles , like tulip bulbs. Edible bubbles, cars that run on bubbles, homes made of bubbles,etc
I tried to take a huge morning crap, but got nothing but stinky bubbles.
Reversal- make that collapse- will not, MUST not happen until the control matrix is fully implemented.
You don't yet have a biometric ID, hence, no reversal.
You don't yet have an implanted RFID chip, hence no reversal.
You still can say "Why am I being detained?" and the cops briefly hesitate to beat you to a bloody pulp simply for vibrating your vocal cords, hence no reversal.
The internet is still somewhat free, although ZeroHedge now has a "racial discrimination" policy (Otherwise known as a "hate-speech" policy- how can I DISCRIMINATE against an avatar?), hence no reversal.
If there is no IF, only a WHEN, when is the WHEN? When the control matrix has reduced you to a virtual straitjacket. Then it can all fall apart.
Don't be silly. The scenario you lay out assumes that the government is efficient and competent, which they are not. The system would collapse long before it got to the state you propose. The Soviet Union had absolute control over their people, or so they thought.
Tend to agree with the idea that governmental stupidity is a major obstacle to true absolute control.
But remember, the technology factor. Technology is increasing at a geometric rate. The old Soviet Union did not have access to the computer technology, databases, cell phone tech, surveillance apparatus, etc. that is available today. And add to that the complete control of the MSM by the Global Banking elite and the situation today is much different.
Technology cannot be smarter than its operators.
Remember 1st law of programming: GIGO !
The Soviets DID have total control over their people, and they did it with essentially 19th century technology, ie card catalogs and informants. It wasn't the control matrix that brought doewn the Soviet Union, it was the centrally planned economy combined with the corruptions of overstretched empire, plus the machinations of the US.
Please read the Gulag Archipelago, especially the first volume, which details the evolution of the control mechanism- essentially the Soviets expanded the legal definition of terrorism, and did away with legal due process. That is the basics of how they established tyranny. Once a person could be indefinitely detained on charges of terrorism, all that needed to be contructed was a system of State terror (CHEKA. NKVD, KGB), and a surviellance network- the last was the easy part. once everyone got scared and shut up, control was established, end-of-story.
Personally, I don't give a shit about the economy. I'll survive. I'm dirt poor. The only gold I own is a wedding ring. My elevator is stuck at the lowest parking level. It can't fall anywhere. Because on the economic level I have nothing to lose, I can see clearly what I DO have to lose, and that is my liberty. Frankly (and I've said it before) the gold-buggery on ZH blinds everyone to the real dangers. Fer fuck's sake if you don't pay your property taxes (rent) the county (the COUNTY!!!) will auction your house on the courthouse steps and the sherrif will kick you the fuck out at gunpoint. So tell me, what do you really OWN, if you don't own your own fucking house? Gold??? Please, don't insult your own intelligence by this sort of fantasy.
The reason the Soviets, North Koreans, Syrians, Cubans and Iranians have huge numbers of secret police is precisely because they are technologically challenged. Yes, surveillance can be maintained on a citizenry but it requires a massive undertaking. It is estimated that upt o 10% of the East German economy was spent on spying and the secret police.
Yep. And I head DHS is HIRING.
"WTF are we doing"
Getting and going mad.
"that's $25,000 an acre in Iowa" with a population of...80 Hungarian chickens. and a farm house. and Franz and his tractor. on Tuesdays. "if it goes to $50,000 an acre" (and i see nothing to prevent that...not even an announcement from the Fed that it IS suspending asset purchases...as in NOW...something i don't believe will happen...but could) then obviously Main Street has MASSIVELY benefited...just "not all Main Streets." but we're working on that too.
That is not quite true. The money does reach Main Street in the form of student loans, car loans, home loans - anything that is guarenteed by the Federal Government. What the banks are doing with all the QE money is putting a claim on the future labor and future income of anyone dumb enough to take those loans.
Bullshit!
DOW 30,000!!!
funny zh posted today the reversal art... I mentioned that yesterday for PM's
http://zysites.com/silververitas/
we'll soon see...
Sure a reversal will come. However, since it is still along way off, the plan is to drain everyone who believes in free markets, fairness and the ultimate triumph of fundamentals of all of their financial power. Then at the appropriate time those who have trusted the system to take care of them will have the rug pulled out from under them and only a select few, who knew when and what was coming will prosper mightily.
It is not as if the market is not completely rigged ... or what were you thinking?
OT: Since we were talking the Doors a few days back, please note that Ray Manzerek died today.
Back OT: See the King World News on the increasing gold shortage and refusal to deliver. Wagon Von Greyertz shows the naked emperor.
Too much cliche, too little substance imo.
Isn't that part of good propaganda?
yep, the squid at least broke out the birinyi ruler and a chart or two.
Iam, well written. like those in a packed night club it's all fun until the fire starts and all the exits have long ago been locked.
"They've got the guns but we've got the numbers" - The Doors
(RIP Ray Manzarek)
Amen. A fine Artist that will be missed. He will wow the angels. RIP Ray Manzarek
But I'm not dead yet
http://youtu.be/dGFXGwHsD_A
No quotes from Socrates today?
The sun will come out tomorrow, bet your bottom dollar ....
OK, serious question:
How much of the stock market is run by algos? What proof do we have?
If you include the algos that run the Market Makers and Specialists then everything except the black pool, backroom deals.
Algos are just a technological extension of a contrived strategy. They are incredibly powerful - and dangerous - because they can be used to effectuate massive movements in prices at a speed that people ("bagholders") cannot match.
Flash-crashing with .01 bids aligned to stop-orders, systemic, off-hour sell orders (aka April 14 gold futures), and so forth are inimitable by humans, and designed to manipulate prices in the short term either to (a) transfer wealth, (b) manufacture a perception, or both.
Algos are tools. Having control over them is like having a gun at a knife fight. But their is still someone(s) pulling the trigger and making sure everyone else is holding just a knife.
If there are any securities regulators out there, three questions:
1. What investigations have you done to satisfy yourselves that HFT / algos are not one big "WASH" trade - i.e. trading back and forth creating volume but, in the end, no ultimate change in ownership among the group.
2. Entering orders with an intention to cancel has always been considered illegal. So why do you allow HFT / algos, which use this as a primary strategy?
3. How do you sleep at night when you have basically abdicated your responsibilities?
How about naked shorts. Criminal.
What goes up must come down, just like night follows day.
So if the stock market is making new highs you can guess whats going to happen at some point (reality will meet gravity).
I am 100% positive that things will reverse and go horribly wrong too. Now tell us something we don't know.
"in fact it won't."
A greater effort that was assembled to fight Hitler and Nazi Germany and Japan will be needed for a reversal this time. This time the world will be fighting the CIA, DHS, NATO and the Central Banksters. Although come to think of it Ben Bernanke and Paul Krugman don't seem like fighters to me. Maybe the globalists will simply run and hide as things shake out.
http://www.marketwatch.com/story/get-ready-to-pay-more-to-fly-2013-05-20...
Very Bullish.
I paid $250 to change my flight last week - China to USA! So if you were talking domestic flights please say so!
Netflix Bitchez!
The following info by Roger Simon, if true, may contribute to a reversal:
More whistleblowers will emerge shortly in the escalating Benghazi scandal, according to two former U.S. diplomats who spoke with PJ Media Monday afternoon.
These whistleblowers, colleagues of the former diplomats, are currently securing legal counsel because they work in areas not fully protected by the Whistleblower law.
According to the diplomats, what these whistleblowers will say will be at least as explosive as what we have already learned about the scandal, including details about what really transpired in Benghazi that are potentially devastating to both Barack Obama and Hillary Clinton.
The former diplomats inform PJM the new revelations concentrate in two areas — what Ambassador Chris Stevens was actually doing in Benghazi and the pressure put on General Carter Ham, then in command of U.S. Africa Command (AFRICOM) and therefore responsible for Libya, not to act to protect jeopardized U.S. personnel.
Stevens’ mission in Benghazi, they will say, was to buy back Stinger missiles from al-Qaeda groups issued to them by the State Department, not by the CIA. Such a mission would usually be a CIA effort, but the intelligence agency had opposed the idea because of the high risk involved in arming “insurgents” with powerful weapons that endanger civilian aircraft.
Hillary Clinton still wanted to proceed because, in part, as one of the diplomats said, she wanted “to overthrow Gaddafi on the cheap.”
This left Stevens in the position of having to clean up the scandalous enterprise when it became clear that the “insurgents” actually were al-Qaeda – indeed, in the view of one of the diplomats, the same group that attacked the consulate and ended up killing Stevens.
The former diplomat who spoke with PJ Media regarded the whole enterprise as totally amateurish and likened it to the Mike Nichols film Charlie Wilson’s War about a clueless congressman who supplies Stingers to the Afghan guerrillas. “It’s as if Hillary and the others just watched that movie and said ‘Hey, let’s do that!’” the diplomat said.
He added that he and his colleagues think the leaking of General David Petraeus’ affair with his biographer Paula Broadwell was timed to silence the former CIA chief on these matters.
Regarding General Ham, military contacts of the diplomats tell them that AFRICOM had Special Ops “assets in place that could have come to the aid of the Benghazi consulate immediately (not in six hours).”
Ham was told by the White House not to send the aid to the trapped men, but Ham decided to disobey and did so anyway, whereupon the White House “called his deputy and had the deputy threaten to relieve Ham of his command.”
The White House motivation in all this is as yet unclear, but it is known the Ham retired quietly in April 2013 as head of AFRICOM.
PJ Media recognizes this is largely hearsay, but the two diplomats sounded quite credible. One of them was in a position of responsibility in a dangerous area of Iraq in 2004.
We will report more as we learn it.
It's irrelevant what contributes to the "reversal", and frankly a distraction to get caught up trying to predict it. When it has come to pass, it will be known.
With each potential "black swan" that passes by and fails to trigger the much-anticipated reset, we risk complacency; and complacency is the arch-enemy of preparedness.
Just sayin'
Politically irrelevant to Obama supporters, and therefore politically irrelevant. He's got a lot more to worry about subverting his buddies in the press, or wringing tax money out of the Silicon Valley crowd.
CB's can "arrange (for high bonusses) needed liquidity"as long as the big IB's want. More interesting to know, who is giving instructions to do so.
If rigging markets is so easy (and legal / Constitutional) why hasn't it been done before...?
You're kidding, right?
Because there wasn't Globalization and Internet technology before, if you're talking about on a global scale. On smaller scales, of course markets have frequently been rigged through human history, obviously.
The relentless smackdown of PMs (real money) is to me the most ominous sign that those who are pulling the strings are preparing for things to crash. There is no other reason to suppress PMs other than to enable cheap acquisition while maintaining the fallacy of fiat.
Like the scene in the Hunger Games...don't follow the masses into the cornucopia - it will be a blood-bath in there; grab the essentials you need to survive and run for cover.
Is Just BTFD stupdity? what can go wrong?
Ben says you are wrong....
Ben actually said "that's interesting"
Wow Mr grant you are so smart calling for a reversal...noo shit....in the history of markets there have always been reversals....that is not the issue....its whether the next reversal will be the one that breaks the back of Bernanke....
Better get your timing right. In this biz early = wrong. It's already gone on much longer than I thought possible.
Thank God I haven't been shorting this market. Getting caught flat-footed in cash for brief periods here and there the last 4 years has been costly enough.
Gold is looking more attractive than it has in a while (the real stuff, not GLD). Might be time to pick up some more.
When the lights go out everybody shouts.
Not all asset classes are in a bubble. Bad money is being used to keep down good in the gold and silver markets.
Why does it have to crash? Generally, my SDOW and short HD, SBUX positions will drive the market zimbabwe style. When they run out of zeros they will have the 'great' reset. those that have will still have and those that don't will have less.
he's right what will cause it; i think italy when? i have no idea
Maybe the game has been rigged all along. Like, forever. Its only now, with the internet, cell phones, chat rooms, and comments sections everywhere, that the masses are waking up to this reality. There have been SAC Cohens stealing massive amounts of monehy forever. And they never got in trouble because they owned the politicans. How is that different from today? Unemployment numbers, food stamp numbers, etc. You think they were accurate before? They weren't manipulated? The whole game is rigged. Always has been. As long as they keep half the population working for the government, on some type of defined pension system with great healthcare, and the people that don't want to work on some decent freebies, the only way this thing will blow is if the rest of stand up and revolt. I don't see that happening any time soon....
Yes. Things that can't last forever, don't. Like me for example: I can safely predict that I will be dead at some point. Meanwhile, I would like to do more than plan my own funeral. I think on ZH there are two types of articles: ones that state the obvious (like I am going to die), and ones that provide some helpful ideas or insight about how to live.
ZHers don't want that. They just want some suuport for their gloom and doom prognostications of the future.
Could it be that the reversal will result in a capitulation by the bank cartels, a free planet, and worldwide prosperity? Don't see that idea kicked around too much on this site.
Maybe that's because that's one of the dumbest ideas ever floated on this site, eh wot?
Could it be that the reversal will allow the TBTF to scoop up assets with their reserves at bargain basement prices?
Now clean up your fucking cage or you get the hose again.
IF- moot point, not if, but when.
WHEN- As mentioned before, the banker/elite would like to establish total control grid (tyranny) before a collapse.
But Jesus said, "If those days are not shortened, no flesh would be saved."
WHAT then is the question- all aspects under human control can (and will) be controlled. Ponzi schemes that are controlled at the top cannot fail by definition. That leaves those things beyond human control:
Earthquakes, meteors, comets, tornados, hurricanes, etc.
I think one (or more) of these will take the system down. Atlantis was on the verge of winning the World War, but was taken down (literally) by a cataclysm. As it was in the days of Noah, so shall it be with the coming of the Son of Man.
That is what they said about Obama career....
Stop bashing Mr. Grant. We know he's just stating the obvious, but it's still better than CNBC or the cramer guy.
Long way to say Crash. Where is the bottom? 666 or less?
Take your pick...
Dow:Gold 1:1 ... 2:1 ... 3:1
M1 = Debt ... $16t ... $250t ... $800-1,200t
"The creation of all of this money also has another effect. It causes stupidity."
The stupidity was there all along, this just helps bring it to the fore.
Stupidity. Rigged markets. Planned economy. Favored sectors. No consumer loans. Privileged class. Elites. USSR lasted some 70 years with these factors, scared the pants off of us with MiGs, gave us a run for our money, made global allies, and put the first man in to space. You think we might be able to carry on for a bit longer under these conditions? I'd say "yes". Oh, there'd have to be a rebellion or two to crush here & there, assets to seize, laws to reinterpret, intimidations to make, but we can carry on & "keep afloat" for a very long time. Especially in an emergency. It takes a shift in the "center of gravity" to impact someone in our position. Something we can not control. That center is shifting. Shifting East. But it will take a long time. Or so it seems.
color it crimson.