We currently have, or are nearing, all three of these criteria. But this time, the underlying circumstances are different. 18- Weekend Rant: Will Politics Decide The Future of The Financial Markets? Does it ever feel like the financial forex trade life cycle ppt have become heavily intertwined with the current political arena?
Where in many cases natural supply and demand have become irrelevant, and instead asset prices often revolve around the latest gossip about potential Fed or government actions. Unfortunately today’s markets have evolved to the point where the latest political decree can significantly impact what happens. And along those lines, there’s been ample speculation that the powers that be may be planning a financial reset. The economies of the world are at an inflection point. Enough data points have now presented themselves to be able to see the outlines of a major shift in the markets of the world.
We are at a pay attention moment. There comes a time when a successful investor must make some hard decisions to position himself to be able to take advantage of opportunities down the road. The markets are telling us now is such a moment. It’s time to sit up and pay attention to what Mr. Market is trying to tell us. A funny thing happened in the middle of one of Mike Maloney’s deep-research sessions recently.
As you know, he just released a brand new presentation, but while analyzing the stock market he wasn’t satisfied with the way most valuation measures were calculated. With all due respect to Warren Buffet, even his indicator fell short in Mike’s view. Other than the continual drama surrounding the Trump presidency, things have been quite calm for the past couple of years. We have been enjoying a time of peace, safety and relative economic prosperity that a lot of Americans have begun to take for granted. But great trouble has been brewing under the surface, and many are wondering if we are about to reach a major turning point. Investors on Monday continued shrugging off fears that President Trump’s escalation of trade hostilities will put a dent in share prices.
We almost pity the poor fellow — all that egg he had scrape from his face. The Dow Jones tumbled 219 trade-warring points yesterday — and once again turned negative on the year. The Chinese say they will retaliate. Asian markets rallied on Monday, extending their gains at the end of last week, following another strong US jobs report that reinforced confidence in the US economy and helped settle trade war nerves.
COMPLETELY MEDIOCRE AT BEST jobs report as assurance that trade wars are not going to impact the US economy. So many credit crises are brewing, it’s hard to keep track without a scorecard. The mother of all credit crises is coming to China with over a quarter-trillion dollars owed by insolvent banks and state-owned enterprises, not to mention off-the-books liabilities of provincial governments, wealth management products and developers of white elephant infrastructure projects. Then there’s the emerging-markets credit crisis, with Turkey and Argentina leading a parade of potentially bankrupt borrowers vulnerable to hot money capital outflows and a slowdown of growth in developing economies. Before it collapsed, the city of Rome had a population greater than 1,000,000 people. That was an extraordinary accomplishment in the ancient world, made possible by many innovative technologies and the organization of the greatest civilization that the world had ever seen.
Such an incredible urban population depended on capital accumulated over centuries. After the collapse, the population fell to about 8,000 people. Some fled and arrived at safe places, but surely most perished. 18- Experts Warn Of Chaos For The U. Nothing is going to be the same after this. On Friday, the United States hit China with 34 billion dollars in tariffs, and China immediately responded with similar tariffs. If it stopped there, this trade war between the United States and China would not be catastrophic for the global economy.
But it isn’t going to stop there. Several noted economists and distinguished investors are warning of a stock market crash. For example, former budget director for the Reagan White House, David Stockman recently raised a red flag when he declared an economic collapse is imminent. There surely is a doozy just around the bend. The world of finance and investment, as always, faces many uncertainties. The US economy is booming, say some, and others warn that money supply growth has slowed, raising fears of impending deflation. We fret about the banks, with a well-known systemically-important European name in difficulties.
We worry about the disintegration of the Eurozone, with record imbalances and a significant member, Italy, digging in its heels. We have not seen Wall Street this jumpy since just before the great financial crisis of 2008. As I have explained so many times before, when the waters are calm and there is low volatility, markets tend to go up. And when the waters are choppy and volatility starts to spike, markets tend to go down.
That is why the behavior that we have been witnessing from investors during the first two quarters of 2018 is so alarming. The Fourth of July is supposed to be celebrated as Independence Day—the day when the thirteen American colonies officially dissolved the political bands that connected them with Great Britain. For the past few weeks, I’ve been intensely focused on what I believe to be a double cross in COMEX gold futures by JPMorgan of other trading entities, particularly other commercial participants. I would define the double cross as JPMorgan positioning itself so flawlessly so as to be nearly perfect in its execution, including the avoidance of any widespread knowledge of what has occurred. In the US the thing most people think of as inflation is the consumer price index, or CPI, which is now running comfortably above the Fed’s target. And within the PCE universe, core PCE, which strips out energy and food, is the data series that actually motivates Fed action.
That’s when the stock market crash that began in January would take its second big leg down, and global economic cracks would become big enough that few could deny them. A Powerful Signal of Recessions’ Has Wall Street’s Attention You can try to play down a trade war with China. You can brush off the impact of rising oil prices on corporate earnings. But if you’re in the business of making economic predictions, it has become very difficult to disregard an important signal from the bond market. The so-called yield curve is perilously close to predicting a recession — something it has done before with surprising accuracy — and it’s become a big topic on Wall Street. We have written numerous times before about how the East is preparing for a return to some form of a gold standard while the West tries to hang on to a dying system of debt based fiat currency. Ironically it is not completely divided between East and West, as a few European governments have been hedging their bets by repatriating their gold from offshore over the past few years.