Market Crash

The system is beyond the point where it is merely showing stresses and fractures. Things are now falling apart and there may well be no way of putting them back together again. The media will continue to claim everything is fine, until the day of panic and reckoning when it will suddenly be the "next Greece" or "2008 all over again"... but worse.

Magic ‘Super Mario’, the ECB’s monetary magician, disappointed markets yesterday as continuing and unprecedented monetary easing failed to prevent a sharp sell-off in stock and bond markets yesterday which has continued today.

"We live in a dystopian investment world, whose markets have morphed into an Orwellian backdrop of omnipresent government intervention and manipulation that is increasingly dictated by the quant community -- who worship at the altar of prices and price momentum (and are agnostic on values)."

But just like in 2008, the “experts” at the Federal Reserve are assuring all of us that everything is going to be just fine.  This is the exact same kind of mistake that the Federal Reserve made back in the late 1930s.  They thought that the U.S. economy was finally recovering, and so interest rates were raised.  That turned out to be a tragic mistake.

"Buying" versus "selling" volume has diverged dramatically in the last few weeks creating a dangerous sense of pre-Black-Monday deja-vu.

If this is the case, the next Crash has already begun. This would put us at the equivalent of where the markets were in late 2007: just before the whole mess came crashing down in 2008.

The very first major economic collapse in recorded history occurred in 218-202 BC when the Roman Empire experienced money troubles after the Second Punic War. As a result, bronze and silver currencies were devalued. As HowMuch.net depicts in the video below economic collapses date back thousands of years. While many countries today still feel the effects of the most recent Global Financial Crisis, it is important to note that economic troubles are not unique to the present-day, but rather date back to some of the oldest civilizations.

The global Central Banks have literally bet the financial system that their theories will work.  They haven’t. All they’ve done is set the stage for an even worse crisis in which entire countries will go bankrupt.

The world’s three largest economies, the US, China and Japan are already in recession. These countries represent nearly a third (29%) of global GDP. A stock market crash is coming.

It is vital to give proper consideration to the improper liberties that are being taken by those with “unwarranted influence” and “misplaced power”.   Value extraction has replaced value creation in pursuit of short?term, self?serving benefits at the expense of long?term stability and durability of corporate America and therefore the country as a whole.  As citizens, our obligation is to be well?informed, cognizant, outspoken and to vote. The words of men may temporarily suspend but they do not alter the laws of financial dynamics. The fundamentals always take precedence eventually.

The S&P 500 has completely disconnected from most risk assets, driven by the usual manipulation during options expiration week, performance gaming by hedge funds before end of the month results are posted, and short covering.

Forgotten what 2008 was like? What's coming will be far worse.

Friday's nearly 6% plunge on the SHCOMP left some market participants wondering where the plunge protection team was hiding in the final minutes of trading. As FT reports, Beijing's so-called "national team" now owns 6% of the entire mainland market and as we saw in September, the paper losses on that kind of portfolio can add up quickly when things go south. The question now is whether the PBoC will step back in if we have a few more days like today.

The fact of the matter is that despite public opinion, there are problems that are so big that the Central Banks cannot fix them. We’ve seen this in Switzerland and China and now in Europe. It will be spreading to other countries in the near future.

Risk goes up, yeilds go down... What's that look for? Don't you know how bond pricing works in the new millenium?