Top 3 Reasons Stocks Will Crash!

in #money7 years ago

The confluence of factors which will generate a shocking stock market crash have come to a head and all things are set in their place, where the smart money will be forced to revalue each investment opportunity according to its weight in this new world order of techno and social factors which I shall describe in the following paragraphs.

Technological Advancement

Just as the buggy and whip manufacturer went into collapse as the Ford motor vehicle took center stage, and as America's domestic textile mills went into a terminal decline as international trade expanded, so will the blockchain technology premiered by Bitcoin put serious and inexorable downward pressure on the profits of several massive companies during these early and middling years of the 21st Century.

Avoidance Of Tax-based Impairment of Capital

Just as Reagan's tax reform of 1986 shifted the attractiveness of certain business arrangements and caused enormous amounts of capital to be impaired were it to stay in the same allocation, so shall Donald Trump's tax reform of 2018 make its weight felt in a similar way. For those who are ignorant of history, I cannot pardon you, but I will mercifully inform you that during August of 1986 the SP500 dumped over 20% of its value before Reagan's tax reforms took effect that October.. And stocks thence leapt into a massive bullmarket which completely eclipsed history's all time bests up to and through the year A.D. 1986.

Inflation In The Cost Of Living

Finally, our third factor, sound and true, must be placed in the spotlight.

The U.S. Dollar is four times as plentiful today as it was in 2008 before America's governing powers bailed out failed big banks & insurers who had specifically exploited the system in order to garner short-term profits at the expense of their very humanity and as these bankers absolutely denigrated the value of moral rectitude in their several years of permitting America's massive underclass to adopt enormous debts the Bush Jr. administration turned a blind eye, and the Obama administration gave the bankers their rape-the-poor stamp of approval by their vociferous - and successful - fight to bail out the mass debt slavemaking banksters.

I just have to remind you of what happened after the bailout.. 2011 bankers' performance bonuses measured in the many billions! That is, just on the heels of their bankruptcy of the very businesses they led, the banksters received multi-million dollar payouts from the future tax obligations of their recently generated debt slaves!

Infact, the 2011 bankers' bonus pool broke all-time compensation records. For any business executive group. Ever.

But how can the bailout of yesteryear be a problem today? The problem coming from the bailout's echo is the financial wing of the economy took all the gains of American productivity from 2001-2017 by getting a free bankruptcy and government funding, while the farmers and laborers of the nation received foreclosure notices and stagnant wages. This result is plainly a massive transfer of wealth from the worker to the crony elite when cast in the light of stagnant or rising consumer good prices and a fourfold increase in the actual dollars flowing throughout the economy, both of which have taken place since 2009's banker bailout! Just because we in America largely haven't felt the effects of inflation over the last 10 years doesn't mean we won't during the next 10.

My somewhat digressive rant against the corrupt establishment aside, the unholy trinity of factors which will result in a massive stockmarket crash are summarized in the following three terms..

WHY THE STOCK MARKET WILL CRASH DURING 2018

The following three reasons will lead people to sell a LOT of certain stocks which were previously being bought a LOT, and the law of supply-and-demand will cause prices to drop precipitously.

  1. Technological obsolence and shifting of opportunity costs: Blockchain will destroy the monopoly on information Google and Apple presently enjoy at the application level. (see: http://www.usv.com/blog/fat-protocols "by replicating and storing user data across an open and decentralized network rather than individual applications controlling access to disparate silos of information, we reduce the barriers to entry for new players and create a more vibrant and competitive ecosystem of products and services on top.")

  2. Tax reformation creating impaired capital and shifting of opportunity costs: Manufacturer outsourcers will still be paying shipping costs to bring products into the U.S.A. while tax plus labor cost savings hardly offset the cost of doing business overseas.
    (see: http://appleinsider.com/articles/17/12/06/apple-ceo-tim-cook-talks-chinese-supply-chain-censorship-and-more-in-interview "There's a confusion about China," Cook said. "The popular conception is that companies come to China because of low labor costs. I'm not sure what part of China they go to, but the truth is China stopped being the low labor cost country years ago. That is not the reason to come to China from a supply point of view, the reason is because of the skill.")

  3. Massive inflationary expansion of the monetary base who's gains labor has not participated in while meanwhile China's now-massive middle class is getting ready to start buying up all of our Beef, causing prices to increase from corn (trough) to ranch and market (butcher shop). This will hurt the American consumers' spending and investing as daily food costs rise through inflation.
    (see: https://www.bloomberg.com/news/articles/2017-11-09/breaking-down-the-250-billion-china-deals-trump-got-for-america "Beef and Pork: JD.com Inc. agreed to buy $1.2 billion of beef from the Montana Stock Growers Association and pork from Smithfield Foods Inc. over the next three years, as part of a deal by the Chinese online retailer to import $2 billion of U.S. goods over that period.")

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