Stock Market Update - What Comes Next
After yesterday's WARNING following the FOMC meeting and subsequent interest rake hike, markets followed through in a big way closing down more than 700pts today. I anticipate at least another 700 points to the downside as the markets catch up with the next major resistance level (the daily 200 moving average or weekly 50 period moving average respectively).
Credit markets across the board a signalling a crash is imminent. LIBOR, High Yield (HYG), and now Investment Grade Credit Credit are all setting off recession alarms.
What we are witnessing now is the next wave down of the market drop that began in early February where we had 1000 point drops and major volatility swings (which we predicted).
I am not at all confident that the major moving averages mentioned above (support levels) are going to hold. The ONLY thing that can keep these markets from crashing is the Central Banks as they are the ones responsible for this "everything bubble". I don't think they want to stop it. Defaults are already rising and there is only so much they can do to stop interest rates from rising. The market needs to correct and they have the perfect person to pit all of the years of reckless fiscal policy on... with Trump. He took credit for it. Now HE owns it. They will burn him at the stake with it. They they will grind his bones to make their bread. They will vilify him and use the suffering and anger they created to their advantage while pretending to be the saviors of humanity.
Regarding Trump, I have been meaning to say something about the so called "trade wars" that the media keeps bashing him about. For a long time I have been critical of FREE MARKETS as it is the working class of countries who cannot compete at the same level due to uneven wages, labor protections, or environmental regulations. Countries that don't mind exploiting their people and environment have an unfair advantage and it's the working class in the wealthier nations who suffer. I've personally witnessed the success of FAIR trade practices that protect the working class in countries like Switzerland who have a higher cost of living but a much higher standard of living and better wealth equality than anything we have here.
Tariffs can be a good thing but the problem is that it's way too much, way to late. Tariffs should have been in place from the onset but greedy corporations didn't mind screwing over the middle class in order to make their companies even more profitable. There were no protections for the middle class esp. in the manufacturing sector. Now it's really too late. The Asian pivot is already well underway. The US does not have enough buffer left to sustain the economic downturn and re-balancing effect that enacting tariffs would inevitably cause. Systemic risk in the markets and rampant government corruption combined with a mainstream media propaganda machine all orchestrated and controlled by the ruling class elite make implementing fair trade impossible. In other words, the damage has already been done. The tinder is already there to be ignited. We just need the spark.
Honestly, it's not the impending market crash that scares me the most. It's what likely happens next. As the ruling class elite allow the "Greater Depression" to take hold, we will witness Orwell's vision come to fruition at a much greater pace than anything previously observed. We will see a massive crackdown on civil liberties in a way that we have yet to fully understand. The Bill of Rights will be gutted like a pig. People will be rounded up and held without charge or trial - that legislation has already been passed. Police will become executioners like in the comic "Judge Dredd" (we're already well no our way in that regard). Martial law will become the norm. People will be tracked and monitored in every way possible. Anyone capable of critical thinking or questioning their government will be deemed an enemy of the STATE, labelled a terrorist, and will disappear (this is already happening in countries like Turkey and Saudi Arabia). Free speech will be abolished in order to protect us from hate speech and radical Islam. And many people will support these actions as most folks do not have the ability to think for themselves and will OBEY what they are told via the MSM. It will be a dark day indeed.
All the while, the US will do what it does best and will continue to create global conflict (one of our only major exports btw). I am not at all confident that the ruling class elite won't lead us directly into WWIII in the process. If you pay attention to the MSM at all, it's nothing but "Russian Aggression" these days. I can assure you that while the Russian government is far from perfect, they are not the real aggressors. All you have to do is see for yourself how NATO is lined up along Russia's borders and research into how the US facilitated a CIA backed coup in Ukraine (something we covered years ago). Just look at who has military bases all over the world. See for yourself how the MSM ejaculated all over themselves when Trump launched cruise missiles at Syria as a result of unverified claims that the Syrian government used chemical weapons. Look at the history regarding the massive number of false flag attacks or shoddy CIA intelligence used to justify bringing "freedom" to the countries we attack. Look at the human suffering that follows. See for yourself how many civilians we rape and murder. See if that "freedom" ever arrived to these people. Learn to think critically, research the facts, and follow the money. The truth will set you free... but first it will piss you off.
FWIW, I'm not a fan of Trump. The guy is an egomaniac and is pathological. At the same time he's not pure evil. He did kill the TPP (and if you don't know what that is then SHAME ON YOU!). His fair trade tariffs are not ill intentioned but they will be catastrophic. He will take the blame of the world. The deep state will see to it that he will end up in a jail cell or worse. They have many arms and they are more powerful than you can possibly imagine. Trump is no threat to them... but he is the perfect scapegoat.
Perhaps, after it's all said and done, humanity will rediscover itself and rise from the ashes. We will learn to celebrate intelligence instead of opulence. We will reward kindness instead of greed and ruthlessness. We will hold psychopaths accountable to their actions and not promote them to the highest levels of power. We will restore government to the people instead of the rich and powerful. We will learn to live in peace with each other and in balance with nature.
Or... we will go extinct like the White Rhino. Sadly, I think this is probably what comes next. But one can dream.
Act Accordingly,
The Market Vigilante