The Debt Expansion Paradigm Is Dying

Imagine for just a moment if any central banker or world leader were to tell the people of the world these truths.

1. The world’s economic engine is dependent upon debt expansion and not wealth creation.

2. That without continually adding more and more debt to the system in greater and greater amounts, we would have a full on collapse of the world financial system.

3. That without continually putting the global monetary system into deeper indebtedness, the world economy would come to a complete halt.

4. That the collapse of this system has already begun, and soon the value of paper currency will be equal to zero, banks will close, and all business activity will cease to function.

The Collapse Of The World Financial System Is Already Here. And Global WAR Is Next.

Today a very good friend asked me when we can expect to see the global financial system collapse?

My answer: it’s happening right now.

The first place to look and see this is the central banks themselves. They have now become so desperate to sustain the collapsing financial system, that zero and even negative interest rates are now the norm.

Further, a full on currency war is underway. The world central banks are broadcasting to the world that they are devaluing their currency to compete in the global markets. Moreover, the European Central Bank has now instituted full on Japan style/Federal Reserve style quantitative easing.

Even more disturbing is the action of the US central bank, the Federal Reserve.

The Federal Reserve is the most desperate central bank of them all.

The Federal Reserve since announcing their “official” ending to QE, has resorted to a backdoor quantitative easing program. The Fed. Is now requiring the banks themselves to buy debt! Exposing each and every depositor (you), to this toxic asset which can never be repaid.

The Federal Reserve is also going a step further by continuing to print cash out of thin air at a blinding pace. (See this in real time by clicking HERE and scrolling down to money creation).

War is the plan.

The world central banks realize that the end game is near with regard to their ability to continue to prop up the corpse known as the “debt based economic model.”

Every developed nation on Earth, under the rule of their respective central bank, has a debt based system.

Here in the United States our debt based system began under President Nixon who forced us off of the established “wealth based gold standard system.”

And why were we here in the United States taken off of the gold standard? To fund the Vietnam War and fight communism-THE BIGGEST LIE EVER SOLD.

We were taken off of a gold standard to establish

1. A fiat (debt based) system and 2. Establish the petrodollar.

Establishing a debt based economic model allowed central banks to dominate the world by making their product (cash printed out of thin air) real money. This is known as a fiat monetary system.

The petrodollar, (an agreement between OPEC nations and the United States) created an ever expanding market for the now “in control” central banks product.

The petrodollar agreement requires any nation wishing to purchase oil from an OPEC nation to first convert their currency into US dollars. This conversion is the reason why the US dollar, a product of the Federal Reserve (a private entity and NOT a part of the US government), is the world reserve currency. And what do the OPEC nations get in return? US military protection of their oil.

The now beginning collapse of the debt based economic model is going to bring human suffering on a Biblical scale, and WAR.

Understanding that by the world central banks using “debt creation” as an economic engine, a financial monster has been created.

In order for this debt based monster to continue functioning, it demands debt to be continually borrowed into existence in greater and greater amounts. Hence here in the US we now have a greater than 18 trillion dollar debt-And it can never stop.

The issue of debt is NOT just a financial problem, it is a resource issue.

This resource issue is the main reason why a loss of human life on a Biblical scale is a mathematical certainty.

WAR.

At this point in time World War III has already started.

The United States and the European Union are already deeply engaged in a full on economic war against Russia, and a full on shooting war is not only not far off-but it is their objective.

A blame game is being set up.

This new global war, being set up on purpose, is going to be blamed for the full on collapse of the world financial system based upon debt. Russia is going to blame the US, and the US is going to blame Russia, but the end result will be the same.

Human suffering on an unimaginable scale.

Fundamental And Technical Bullish Cases For The U.S. Stock Market

I believe that today’s wild ride in the market put stocks on sale big time.

Here are 3 “fundamental” reasons why.

1. The world central banks will not allow natural market forces to determine fair market value for any asset.

2. The Federal Reserve specifically will support this market NO MATTER WHAT the underlying fundamentals may be.

3. This world IS NOT run by Presidents, Kings, Queens, Monarchs, or dictators. IT IS RUN BY WALL STREET.

The Federal Reserve Rhetoric Is Now Laughable

Well today for the first time in 2015 we heard from the Federal Reserve and it’s the same story.

(Federal Reserve Chairwoman Janet Yellen pictured below).

The Federal Reserve will remain patient to normalize rates.

*Please ponder the above short sentence..

Patient to “normalize?”

Does that imply that rates right now are abnormal?

The Fed. Statement went on to say that the US economy is on a strong path.

That’s interesting…

Because if in fact the US economy was on a strong path why is the money velocity still at a 55 year low?

And why does the labor force participation rate remain at a 4 decade low?

Further. Why is the Federal Reserve requiring banks to buy debt? And why is the Federal Reserve continuing to print cash out of thin air at a blinding pace?

It is clear to me that the Federal Reserve is determined to keep EVERYTHING regarding monetary policy and the truth “abnormal.”

Just like their theme of “normalizing” rates..

US Dollar Continues To Strengthen On Speculation Of Mid-Year Rate Hike

There is no way, let me say that again, NO WAY that the Federal Reserve is going to raise rates mid-2015.

In fact I still do not believe it will happen at all this year.

Have a look at the chart below.

At this time we are in a global currency war, and in order for the US to compete unfortunately the Fed is going to have to act and quell the dollars strength at one point.

The strong dollars toll on multinational companies is already being seen in their revenue reports, and this will not only hurt these companies bottom lines, but it will also kill jobs.

The strong dollar continues to put pressure on commodities, (which are priced in US dollars), and this is going to increase strain on huge swaths of the global economy.

Again, the Federal Reserve will have to act.

For now I expect that the dollar strength will continue, but you can rest assured that there will be NO rate hike anytime soon.

DOW Plunges, Trend Is Still Higher

At the moment I am writing this article the Dow Jones Industrial Average is down over 340 points however, unless we close below the trend as demonstrated on the chart below I am still expecting this market to move higher.

Below is ticker (NYSEARCA:DIA) which shows the current symmetrical triangle still in play as we have, (as of yet), not broken the lower trendline.

For a comparison of the price action over the past few days, have a look at this chart below. This is also of ticker (DIA) on the 23rd of this month.

Until we close solidly below this lower line, I still believe this market is moving higher.

I will write an update to this article as this plays out.

The Bond Market Is Telling Us To Buy Stocks Now

The signs are everywhere if you just know where to look, and the bond market is sending us a big tell.

If you follow my work at all, then you know I always say “watch the bond market” for tells as to where stocks may be going. People invariably look to the stock market itself for signs as to where it may be going, and this also invariably leads to often very wrong signals.

As a trader you need to watch the movement of cash throughout these markets, and it looks to me that an exodus of cash from the bond market is about to occur and where will it go? Into stocks.

Despite this stock market being ridiculously overvalued by historical norms, in the short run this market is going higher based upon central bank management/support.

Have a look at the chart below, ticker (NYSEARCA:BND).

It looks to me that this trade (above) is getting old, and if this plays out as I believe we are going to see cash move into stocks and soon.

We will also likely see cash move out of other “safe” assets and into risk as well, (see my last two articles).

As individuals who are seeking to capitalize on all this well, I hope that I am making this simple.

Why The DOW May Reach New All Time Record Highs Very Soon.

If you are familiar with my work as of late, especially in light of the current situation involving world central banks who appear to be determined to create a “risk on” environment for traders, I have been saying this market IS going higher.

Lets look at a chart.

Below is the price action of SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA) for the last year.

If you observe the red pattern (circled in black), it appears that a clear symmetrical triangle is forming.

The current (deliberate) “risk on” environment being supported by the world central banks makes me believe a breakout to the upside is likely.

Is it possible that a breakout to the downside could also occur as demonstrated by the following?

Sure it is, but again the game now in my opinion is “risk on.”

If you are interested, click the following link to see what Investopedia has to say about a Symmetrical Triangle like the one I outlined for you on the chart of (DIA).

What’s your take?

SLV May Be About To Fall. Capitalize On It!

Despite a roaring US dollar as of late, we have seen the price action of (NYSEARCA:GLD) and (NYSEARCA:SLV) rise along with it.

But this may be about to change.

Below is a 1yr chart of ticker (SLV).

Take notice of the recent price action which has gone up nearly parabolic since the beginning of the year. Now when I see price action like this, I begin to think about a reversal with regard to the current trend.

If you take a closer look at this chart you will notice the area I circled in purple. This upward momentum just hit it’s 200 day MA, (red line), and I believe this may act as resistance.

With this knowledge now may be the time to take advantage of a pullback which could pay off nicely.

History Is Made As ECB Begins Full On QE: Enter A New Phase Of Currency Wars

In a very desperate move the ECB joined the ranks of the BOJ, the Federal Reserve, and the BOE in full on quantitative easing as they too become a lender of last resort.

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Of course this will not work, as you cannot fix any debt problem by adding monumentally more debt onto the issue which is debt itself.

This move by the ECB has now pushed the Euro to a multi-year low, and the global currency wars have now entered a new phase.

Any talks of the Federal Reserve raising rates anytime soon should now be met with laughter. We can now rest assured that the Federal Reserve will not be raising rates, but will soon begin to print more cash out of thin air than ever before to “compete” in this new phase of the war on currencies from within.