👉Wall Street is Fiddling While the US Economy Burns !!
With record new cases in major states, the reopening experiment is proving to be a flop. No matter what the Fed does, since we never contained the pandemic in the first place, and most people don't take it seriously enough, we're looking at a long road ahead. A 2nd round of lockdowns very likely. This is a great time to invest. Don't worry about the $10 Trillion on the Fed balance sheet. Don't worry about the $30 Trillion in corporate debt. Don't worry about a possible second wave. Don't worry about permanent layoffs from business closures and bankruptcies. Don't worry about the Shiller P/E ratio at historical highs predicting average annual returns of negative 1.5% for the next eight years with a downside possibility of negative 9% and an upper range of 3%. Don't worry about the $600 billion in annual government interest payments .$27 trillion in government debt. $147 trillion in unfunded liabilities. $40,000 in average debt per student. $3.5 trillion federal government met deficit .$62,000 in personal debt per citizen. Stagnant/declining wages for the foreseeable future. Inflated asset prices. Social unrest. Covid-19. This time is different. Pump up the stock market, so companies can just issue more shares and bonds to get the capital they need near term. FED won't give you the money directly now, but retail or company buybacks will happen down the road in hopes we can get a return on our 8 trillion we have been pumping in markets for the last four months. This is nuts! The Fed and Government will ensure that millionaires and billionaires don't lose a dime...ever...regardless of circumstances and happenings in the economy and that they'll even profit from this crisis. The remaining 99% can eat cake. When you see stories about how we all need to jump into the market, or we'll miss out, you know we're close to the top. Was UBS saying this at the March lows when people could actually get a return on investments? Nope. They just want retail investors to dive in now so that the big boys can start liquidating their positions. The scam continues. Not only are they convincing folks to put all their money in stocks at market highs, but also convincing people to buy houses at extremely high prices just to get a low-interest rate. Wall Street is fiddling while the US economy burns. What is “unambiguous” is the rapid rise of the national debt and balance sheet that the Chair of the Federal Reserve Bank told us not to worry about. Also, companies' existence is not for making a profit, but for creating employment and take assistance from the government. If this is the new paradigm, America is in trouble. It is time to look elsewhere for investment. The government can hype and overlook COVID-19, but more citizens are still getting sick and perish from it. As far as the stock market is concerned, expect it to go down considerably back to normal values, which is far lower than it is now. Take a look at the dire condition of the real economy - unemployment, less cash to spend, and more debt than ever to pay (at private bank interest rates that are frankly morally and ethically unreasonable in the current climate). Get ready for the biggest stock market collapse in the history of trading. Move your capital to safer stores of value now, or you'll probably regret it come winter. The case for "real economy individual debt write-offs" is getting stronger. Helicopter money hasn't saved the day. Now the central bank buy-up of company bonds is getting risky. By putting more money into ordinary peoples' pockets immediately, you'll boost spending and return the world economy to growth, higher inflation, and higher interest rates. Head towards negative central bank rates, and you'll prolong the agony of low inflation and low-interest rates for decades to come, and cause more QE than ever to add debt to an already overwhelmed tax-payer. Take care, boys and girls, this global economic game we are now playing are getting very dangerous. There is very little room for error now. It would be sensible that volatility in the market should continue for quite a while. When someone looks at the crazy debt situation, so many corporations are in, it is clear that they have been mismanaged. Why? The real goal of the board of directors and top executives has been to increase beyond any reason their personal compensation. If it took "destructive capitalism," fine, it took borrowing against the corporate assets, fine. Now earning is down and will be down. Who is really buying? The millions that are out of work, many permanently? This is a global problem. Those who fail to remember the past. Meanwhile, the very rich/elite/corporate causes of these economic troubles continue to cash out. There is no personal responsibility if a business is fraudulent, poorly run, or simply has assets sold a little at a time. Ultimately, it is the common shareholder, the citizen with a retirement fund/plan, or the community that suffers. This virus, or another, will come back. This is also another history lesson. It has been since 2008 since I have played at the stock market casino. It still has terrible odds. Pump up futures, drop at open, buy the dip. Same story every day. Day action will see at least 2 to 3 dips with BTFD, and the last 15 minutes will be based on leaked news, possibly for the next day or overnight. No, if we only could all make money on this pattern. Only 30 % of Americans have stock, but Trump is pumping trillions into the market to keep 30% whole and the heck with the 70% that will pay the debt. Trump is playing the masses. The vast majority of people have little to nothing in stocks, and the vast majority of stocks are owned by the wealthy, so propping up the markets isn't as relevant as an income, healthcare, and job security to most. Forty million unemployed Americans during this crisis. You think they'd rather have a job or the stock market propped up? Sooner or later, the Fed money mill will have to stop. And it's getting sooner each day. We can't be adding trillions annually to the debt. Nobody will buy bonds at negative interest rates. All debt earns interest, and we are nearing the end of our debt financing limit, especially with $27 trillion of debt. We may never pay off the principal, but interest payments must be made. At just 1% interest, that is $270 billion in annual interest payment alone, which will eat tax revenues. How is the Fed going to make up for double-digit unemployment and less money flowing into the economy? This is so stupid. This market is also a bubble from the Trump tax cuts. Same stagnant growth, but the market doubled. If the market sees Biden winning and those stupid tax cuts being reversed, this balloon is going to lose air quickly. The more money the Fed pours into the markets to hold them up, the less your money is worth. There is no happy ending in this for you. The Feds have declared it a Christmas market all year. They just keep pumping the market every day. It goes up every day, and you believe that this is just business as usual when all brokers are screaming somethings wrong, and half of the brokers are cashed out. The big drop is coming soon to pay attention to people. The Fed can buy as many securities as it wants. But that won't overcome the fact that consumers have stopped spending. All that will end up happening is they will drive the prices to heights that are so divorced from the underlying earning that when the bubble pops, it will be the greatest crash of all time. The stock market is NOT the economy. It barely counts as an indicator. The Feds dumped Trillions into the stock market to boost it. With 30% of Americans skipping/missing their housing payment. It did nothing for people that have to work for a living. It was completely unnecessary to float Trillions of dollars directly to business owners. If those same dollars had been given to workers and the unemployed, the economy would get by just fine. Welcome back to The Atlantis Report. You are here for your daily dose of the truth, the whole truth, and nothing but the truth. Please take a second to smash that like button. Thank You. Ever since Greenspan, there has been a ferocious expansion of credit and/or printing of money. It is a fools' errand. The bond market has been predicting deflation/stagflation for 20 years. Consider Real Estate: when GIs came back from the war, they paid no more than $10,000 for their houses. Those same houses go for $500,000 or more. Those houses are not 50 times improved. Since Greenspan, our dollar buying power is 1/4 or 1/5th of what it was. This is false prosperity. The longer we put off a price adjustment, the harder, the longer it will be. All this money is pumping up asset prices/profits that must fall. The Federal Reserve is the pump that powers Trickle-down economics. Another stimulus is coming. A couple trillion dollars to the rich and their corporations will pump that market up big time. Once the stimulus stops and the bills come due (either as more taxes or devalued dollar), the party will be over, and most likely, it won't be the rich fat cats who will lose the most; it will be the little guys who didn't see it coming. Trickle-down economics has never, ever worked and never will. It is a theory that has been thoroughly busted and debunked based on real-life experience, and it should be relegated to the dustbin of economic history. Dumping large amounts of cash into the hands of large multinational corporations and expecting them to act as conduits for the cash to flow down to the middle class and the poor is ludicrous. Every Republican President, since Reagan, has subscribed to this theory, and the middle class has been shafted each and every time. Trickle-down economics is a smokescreen for keeping the wealth of this country in the hands of the very few at the expense of everyone else. Workers need to wake up and realize that they have power, the power of their sweat and labor. Unions served a purpose once, and the time is ripe for a resurgence of the labor movement. This is not news. This is the problem with Fed policy for 12 years or more. Using the usual Keynesian policy that is government policy, the Federal Reserve assumed the trickle-down approach would work. Keynesian economics always requires trickle down. In this case, it is not working. Companies know that they are not compensating their employees enough to allow them to generate demand as consumers. They have no illusions about the future. The business executives know that employees as consumers are constrained by the amount of debt they can get to generate effective demand. If there is no demand, there is no reason to expand production. There is no reason to invest in real plant and equipment. Low-interest rates and plentiful credit availability are too good to waste. Since the executives are rewarded for stock price increases--and there is no way to generate stock price increase the honest way through production; the executives buy back the company's stock with cheap money. The Federal Reserve and the Federal Government are stuck between a rock and a hard place. They cannot let stock prices fall for one reason: Boomer retirement. Pension funds and 401k funds would be devastated if stock prices fell to their true value. We are witnessing the total collapse of the Keynesian economy. We are witnessing demand destruction. We will soon witness the loss of control by the Fed and the destruction of the US dollar. Enjoy the show. The Fed might keep pumping for several more months. I think Trump wants a record high (which has no connection to reality, but either does Trump, so there you go). The market will drop pre-election, maybe by Labor Day, maybe later. This was The Atlantis Report. Please Like. Share. Leave me a comment. Subscribe. And please take some time to subscribe to my back up channels, I do upload videos there too. You'll find the links in the description box. You will also find a PayPal link if you want to make a donation. Thank you wholeheartedly to all those of you who have already donated. Stay safe and healthy friends!
Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.Dr. Doom also trades currencies and commodity futures like Gold and Oil.
Contrarian Investor Dr.Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.
