Prepare Now For the Coming Epic Crisis in Central Banking

Phoenix Capital Research's picture

Last year (2014) will likely go down in history as the “beginning of the end” for the current global Central Banking system.

 

What will follow will be a gradual unfolding of the next crisis and very likely the collapse of the Central Banking system as we know it.

 

However, this process will not be fast by any means.

 

Central Banks and the political elite will fight tooth and nail to maintain the status quo, even if this means breaking the law (freezing bank accounts or funds to stop withdrawals) or closing down the markets (the Dow was closed for four and a half months during World War 1).

 

There will be Crashes and sharp drops in asset prices (20%-30%) here and there. However, history has shown us that when a financial system goes down, the overall process takes take several years, if not longer.

 

By way of example let us consider the details surrounding the Tech Bubble: the single largest stock market bubble of the last 100 years.

 

In this case, the Bubble pertained to just one asset class (stocks).  In fact, the bubble was relatively isolated to one specific sector, Tech Stocks.

 

And to top if off, it was absolutely obvious to anyone that it was a Bubble: note that the Cyclical Adjusted Price to Earnings or CAPE ratio for the Tech Bubble dwarfed all other bubbles dating back to 1890 (see the next page).

 

Stocks were so obviously overvalued that it was truly absurd.

 

 

 

And yet, despite the fact that this bubble was absolutely obvious and involved only one asset class, it still took investors well over six months after the initial 20% crash to realize that the top was in and the bubble had burst.

 

 

Moreover, during this six month period in which the single largest stock market bubble of all time burst, stocks did NOT go straight down. In fact, they were an absolute ROLLER COASTER with more than EIGHT price swings of 16% or greater.

 

 

Let that sink in for a moment. Stocks were clearly in a bubble. Indeed, it was literally THE stock bubble of the last 100 years. And yet, when it burst, there was no clear consensus as to where the market was heading.

 

In a six month period, investors moved stocks down 19%, up 8%, then down 27%, then up 21%, then down 22%, then up 34%, then down 17%, then up 16%, then down 28%, then up 16%, and finally down 17%. Only at that point did stocks break their trendline for the bubble (the blue line) and it became obvious that the bubble had burst.

 

My point with all of this is that even when the bubble was both very specific AND obvious, the collapse was neither quick nor clean. There were several large 20%+ crashes, but overall, it was a roller coaster with jarring rallies than gradually wore its way down.

 

This same process has likely begun for the markets again… but this time it will be global in nature as the bubble in question is not just in stocks but in bonds, commodities, real estate… indeed in the very Central Banks themselves.

 

The situation is clear: the 2008 Crisis was the warm up. The next Crisis will be THE REAL Crisis. The Crisis in which Central Banking itself will fail.

 

If you've yet to take action to prepare for this, we offer a FREE investment report called the Financial Crisis "Round Two" Survival Guide that outlines simple, easy to follow strategies you can use to not only protect your portfolio from it, but actually produce profits.

 

We are making 1,000 copies available for FREE the general public.

 

To pick up yours, swing by….

http://www.phoenixcapitalmarketing.com/roundtwo.html

 

Best Regards

Phoenix Capital Research

 

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swmnguy's picture

They'll just keep changing the rules.  Since money is all abstract anyway, they can do that for an amazing length of time.  Eventually it won't work anymore, but that'll be well after most of us are out of dough.  I don't think we'll decline into a Mad Max scenario, but more like a post WWII Eastern Europe.

kchrisc's picture

From high perches the banksters plunder the land and the people with counterfeit and grifts.
A  great collapse will come, and carry the banksters into the people's midst and mitts.
From the ashes, the first Phoenix will rise; the guillotine.
Spreading forth like dragons, the guillotines will consume banksters smelled and seen.
The guillotines' blades purging the land of those that burn the land with money that burns.

Liberty is a demand. Tyranny is submission..

kchrisc's picture

"Prepare Now For the Coming Epic Crisis in Central Banking"

Can I bring my guillotine?

Liberty is a demand. Tyranny is submission..

JRobby's picture

There will be blood.

 

Daniel Plainview and all the other insane people ended.

Goldbugger's picture

When this thing pops it will be a slow bleed to the bottom. They will try everything to prop this up but  will fail. I believe it will take several years to finally hit a bottom. The derivatives will unwind and unwind. Those with physical assets and REAL skills will survive.  I am suspecting the next 3-5 years and whether war hits this time is anyones guess.

the grateful unemployed's picture

the central banbks cant save everybody, somebody gets thrown under the bus, if the crisis is small, maybe just merrill, but this time around it could be china, parts of south america, whole countries, or continents. you might think they would lose credibility but it doesnt seem to happen. the survivors are grateful they just turn their head and go on with business.

Salah's picture

so....you guys trust Congress with the money supply?  That's nuts!  the Fed is simply a [monopolistic] government contractor, same as those guys that manage any number of govt. ops.

what needs to happen is a re-compete of the Fed's management, the same old gang has been running it since 1913

Fun Facts's picture

Central Banking is man's worst invention since religion.

Mayer Amschel Rothschild's picture

My recollection is that Carroll Quigley called central banking one of the greatest achievements of mankind in the last 300 years in Tragedy & Hope So much of what he has written is insightful and genius, but I don't know what to make of that one...

Pliskin's picture

The stock market will look like a roller coaster at Alton Towers.

 

Too soon?

 

Sorry.

Comte d'herblay's picture

Don't waste your time reading the Phoenix blurb.  Here is all you need to read:

"Last year (2014) will likely go down in history as the “beginning of the end” for the current global Central Banking system".

Now. U C that word 'likely' in that sentence??   

That sentence said another equally meaningful way, meaning precisely the same thing would read like this:

"Last year (2014) will NOT likely go down in history as the “beginning of the end” for the current global Central Banking system".

There. Yule thank me later.

Professorlocknload's picture

But you have to admit,,,the market will likely fluctuate.

p00k1e's picture

“breaking the law”

S/B – “Fine tune and tweak current U.S. law allowing new, modern standards”

“but this time it will be global in nature as the bubble”

Theoretically, the U.S. CB will be one of the last to fall.   We’re all good.

doctor10's picture

all centralized hierarchical structuring of society are headed for breakdown this century.  The deficits Western countries run are merely an index of the exteent of failure of hierarchical control and decision-making for the new age upon us.

"central-banking" will be history within most of our lifetimes.  Lateral networking is the natural order at hand.

 

The Hawala financial networks of th emid-east most closely approximate

a potential modern finance system

Baa baa's picture

Fine, just no modern potentate finance system...But then, who cares?

KnuckleDragger-X's picture

I'm not worried, Saint Krugman will protect us. Hubris is truly the most dangerous sin since it can be used to justify any other sin. The only thing left is the entertainment value.......