Best of the Week
Most Popular
1. US Housing Market House Prices Bull Market Trend Current State - Nadeem_Walayat
2.Gold and Silver End of Week Technical, CoT and Fundamental Status - Gary_Tanashian
3.Stock Market Dow Trend Forecast - April Update - Nadeem_Walayat
4.When Will the Stock Market’s Rally Stop? - Troy_Bombardia
5.Russia and China Intend to Drain the West of Its Gold - MoneyMetals
6.BAIDU (BIDU) - Top 10 Artificial Intelligence Stocks Investing To Profit from AI Mega-trend - Nadeem_Walayat
7.Stop Feeding the Chinese Empire - ‘Belt and Road’ Trojan Horse - Richard_Mills
8.Stock Market US China Trade War Panic! Trend Forecast May 2019 Update - Nadeem_Walayat
9.US China Trade Impasse Threatens US Lithium, Rare Earth Imports - Richard_Mills
10.How to Invest in AI Stocks to Profit from the Machine Intelligence Mega-trend - Nadeem_Walayat
Last 7 days
Facebook's Libra Crypto currency vs Bitcoin: Five Key Differences - 19th June 19
Fed May Trigger Wild Swing In Stock Index and Precious Metals - 19th June 19
How Long Do Land Rover Discovery Sport Brake Pads Last? - 19th June 19
Gold Golden 'Moment of Truth' Is Upon Us: $1,400-Plus or Not? - 18th June 19
Exceptional Times for Gold Warrant Special Attention - 18th June 19
The Stock Market Has Gone Nowhere and Volume is Low. What’s Next - 18th June 19
Silver Long-Term Trend Analysis - 18th June 19
IBM - Watson Deep Learning - AI Stocks Investing - Video - 18th June 19
Investors are Confident, Bullish and Buying Stocks, but… - 18th June 19
Gold and Silver Reversals – Impossible Not to Notice - 18th June 19
S&P 500 Stuck at 2,900, Still No Clear Direction - 17th June 19
Is Boris set to be the next Conservation leader? - 17th June 19
Clock’s Ticking on Your Chance to Profit from the Yield Curve Inversion - 17th June 19
Stock Market Rally Faltering? - 17th June 19
Johnson Vs Gove Tory Leadership Contest Grudge Match Betfair Betting - 17th June 19
Nasdaq Stock Index Prediction System Is Telling Us A Very Different Story - 17th June 19
King Dollar Rides Higher Creating Pressures On Foreign Economies - 17th June 19
Land Rover Discovery Sport Tailgate Not Working Problems Fix (70) - 17th June 19
Stock Market Outlook: is the S&P today just like 2007 or 2016? - 17th June 19
US China War - Thucydides Trap and gold - 16th June 19
Gold Stocks Bull Upleg Mounting - 16th June 19
Gold Price Seasonal Trend Analysis - Video - 16th June 19
Fethiye Market Fruit, Veg, Spices and Turkish Delight Tourist Shopping - 16th June 19
US Dollar Gold Trend Analysis - 15th June 19
Gold Stocks “Launch” is in Line With Fundamentals - 15th June 19
The Rise of Silver and Major Economic Decline - 15th June 19
Fire Insurance Claims: What Are the Things a Fire Claim Adjuster Does? - 15th June 19
How To Find A Trustworthy Casino? - 15th June 19
Boris Johnson Vs Michael Gove Tory Leadership Grudge Match - Video - 14th June 19
Gold and Silver, Precious Metals: T-Minus 3 Seconds To Liftoff! - 14th June 19
Silver Investing Trend Analysis - Video - 14th June 19
The American Dream Is Alive and Well - in China - 14th June 19
Keeping the Online Gaming Industry in Line - 14th June 19
How Acquisitions Affect Global Stocks - 14th June 19
Please Don’t Buy the Dip in Nvidia or Other Chip Stocks - 14th June 19
A Big Thing in Investor Education is Explainer Videos - 14th June 19
IRAN - The Next American War - 13th June 19
Boris Johnson Vs Michael Gove Tory Leadership Grudge Match Contest - 13th June 19
Top Best VPN Services You Can Choose For Your iPhone - 13th June 19
Tory Leadership Contest Betting Markets Forecast - Betfair - 13th June 19
US Stock Market Setting Up A Pennant Formation - 13th June 19
Which Stocks Will Lead The Cannabis Rebound? - 13th June 19
The Privatization of US Indo-Pacific Vision - Project 2049, Armitage, Budget Ploys and Taiwan Nexus - 12th June 19
Gold Price Breaks to the Upside - 12th June 19
Top Publicly Traded Casino Company Stocks for 2019 - 12th June 19
Silver Investing Trend Analysis - 12th June 19
Why Blue-Chip Dividend Stocks Aren’t as Safe as You Think - 12th June 19
Technical Analysis Shows Aug/Sept Stock Market Top Pattern Should Form - 12th June 19
FTSE 100: A Top European Index - 12th June 19
Gold Surprise! - 11th June 19
How Forex Indicators are Getting Even More Attention in the Market? - 11th June 19
Stock Market Storm Clouds on the Horizon - 11th June 19
Is Your Financial Security Based On A Double Aberration? - 11th June 19
What If Stocks Are Wrong About Interest Rate Cuts? - 11th June 19
US House Prices Yield Curve, Debt, QE4EVER! - 11th June 19
Natural Gas Moves Into Basing Zone - 11th June 19
U.S. Dollar Stall is Good for Commodities - 11th June 19
Fed Running Out of Time and Conventional Weapons - 11th June 19
Trade Wars Propelling Stock Markets to New Highs - 11th June 19
Best Travel Bags for Summer Holidays 2019, Back Sling packs, water proof, money belt, tactical - 11th June 19

Market Oracle FREE Newsletter

Gold Price Trend Forecast Summer 2019

U.S. Bankrupt Democracy, Government Bureaucracy Backfire

Politics / US Politics Apr 26, 2010 - 01:42 PM GMT

By: Captain_Hook


Best Financial Markets Analysis ArticleAs with Rome, that became the globally unchallenged center of power and finance in its time, so to is the American Empire visibly rotting from inside now as well, which will be its undoing. The elitists steer the bureaucracy to do their bidding in an effort to increase the power of the machine, and this can go on for some time, which it has.

However again, as with all such fascist like episodes in history, the bureaucracy grow past sustainable mass and eventually must feed on itself, playing the blame game in an attempt to maintain a semblance of credibility with the public they intend to keep raping. That’s what the financial crisis hearings are suppose to do. They are suppose to make an increasingly besieged and weary public feel better about continued gang rape by the bureaucracy via increasing taxes, loss of liberties, and confiscation of wealth.

The following is commentary that originally appeared at Treasure Chests for the benefit of subscribers on Tuesday, April 13th, 2010.

Of course even a corrupt bureaucracy as big as the Western Alliance led by Bilderburg Group illuminists need a functioning currency system to maintain the fraud, which was also Rome’s undoing in the end as the Denarius failed, the fate of all unbridled fiat currency based economies such as the one we have today. You see the problem is in the managing of swings that become more profound as increasing inflation (printing of fiat currency) is required to keep such economies from collapsing as they are hollowed out and plundered by the illuminists and its bureaucracy. Right now, with stocks (equities) on the cusp of going into another extreme mania state (see Figure 2), as explained in our last meeting, they have reacted by managing the growth rates of broad money measures down, along with curbing monetization practices in an attempt to cool the economy.

With the real economy falling into increasingly worse shape in spite of the bureaucracy’s best efforts to stave off collapse however, this could be viewed as a risky exercise, especially if the swing lower were to taste anything like a prolonged deflation Japanese style. Apparently Paul Volcker thinks this is a distinct possibility, or he would not be recommending a value added tax (VAT-Tax) moving forward, which when translated means the government thinks they will need to make up for falling revenue in other areas. So taxes are going to increase for all Americans sooner or later, not just for the rich, which is counter to Obama’s election promise; unemployment is up despite exploding deficits and reckless spending; and, government revenues are cascading lower, which is worst at State and municipal levels. In this respect, California, which is the seventh largest economy in the world and multiplies of Greece, is now less than a month from insolvency.   

I bring this up because as you will see below, in terms of post crash bounces, we are at the point where they have been halted historically, measured by manias occurring both before and after the accelerated inflation phase that is separated by Nixon’s closing of the gold window in 1971. More specifically, we are of course referring to the post crash patterns in the Dow following the ’29 to ’32 Super-Cycle collapse, and that of the Nikki through the ‘90’s into the new millennium. In the first comparison to present patterning, one can see that the S&P 500 (SPX) is now at a point that is similar to the Dow in ’38 from a duration, pattern, and magnitude perspective, which is difficult to ignore. Why is this difficult to ignore? Because exercises in human psychology within manias tend to repeat, which would create the above noted similarities. (See Figure 1)

Figure 1

Interestingly, because as mentioned above we also have an example of this that falls within the post gold window era as well, one can observe the same similarities mentioned above when comparing the post crash Nikki of the 90’s to the aftermath of the tech wreck that topped the NASDAQ in 2000, except that the bounces in the latter were more profound. (i.e. they have a tendency to go higher and last longer, which could be the case again if the present bounce extends past this trading day comparison.) Still however, it goes without saying the fact we essentially have such stunning similarities when not only making the analog comparisons between the markets on each respective plot, but also between Figures 1 and 2, timing a turn at present could prove to be pivotal. Please note that both Figures 1 and 2 are trading day comparisons. (See Figure 2)

Figure 2

And in extending the above comparison to a calendar day exercise (see below) we in fact get the message this bounce can indeed last longer. Such an outcome would allow US stocks to move back into the extreme mania state mentioned in our opening remarks, which would cause further pain for the short sellers. Of course it’s not as if there is any shortage of reasons for traders / speculators to be bearish on future prospects for stocks. The one that many commentators are citing at the moment is the Fed’s supposed exit from Quantitative Easing (QE) in the debt / mortgage markets, which is propaganda you should know. You may remember me discussing that on Christmas Eve, where when few were looking, Obama (who is largely controlled by the elitists mentioned above) gave Freddie Mac and Fannie Mae blank checks to ensure this move on the part of the Fed would not collapse the mortgage market. (See Figure 3)

Figure 3

So rest assured, there is no end to QE in either the mortgage or bond markets, where this latest move by the Fed is just part of the propaganda to support the debt (and equity) markets (getting people thinking this is an effective tightening), and control gold, which needs controlling before it busts a move higher. Goldman Sachs was out with their contribution to the propaganda machine yesterday in calling a top in gold here because once the metal of kings makes it through resistance at $1162 (now $1168 because of the surge yesterday) on a lasting basis, the only remaining hurdle will be at the December high. Then it’s blue sky potential after that, which is why the bureaucracy’s price managers will pull out all the stops moving forward to stop an advance in precious metals. As you likely know, that’s how important gold is, where it would destroy the credibility of claims QE is ending if the yellow metal were to explode higher in price right now.

Fast forward to today (26-04-10) and we now have the bureaucracy feeding on itself wholesale in the States at present with Wall Street reform, where Washington politicians are attempting to eat New York bankers, which should bring the capital markets (and access to credit) to a grind halt eventually. In the meantime however, all the bad news, which includes the threat of a EU (Euro) breakup, are just more reasons to buy increasing amounts of puts by a wider scope of speculators / hedgers, which should keep equities supported believe it or not. With this in mind, and knowing precious metals like a firm equity complex to move higher, after Comex / CME options expiry tomorrow gold and silver could see some extraordinary price action. Treasury auctions have been an issue in the past, however this influence might be set to become deferential given the significance of other factors on deck at the moment.

Unfortunately we cannot carry on past this point, as the remainder of this analysis is reserved for our subscribers. Of course if the above is the kind of analysis you are looking for this is easily remedied by visiting our web site to discover more about how our service can help you in not only this regard, but also in achieving your financial goals. As you will find, our recently reconstructed site includes such improvements as automated subscriptions, improvements to trend identifying / professionally annotated charts, to the more detailed quote pages exclusively designed for independent investors who like to stay on top of things. Here, in addition to improving our advisory service, our aim is to also provide a resource center, one where you have access to well presented 'key' information concerning the markets we cover.
And if you are interested in finding out more about how our advisory service would have kept you on the right side of the equity and precious metals markets these past years, please take some time to review a publicly available and extensive archive located here, where you will find our track record speaks for itself.

Naturally if you have any questions, comments, or criticisms regarding the above, please feel free to drop us a line. We very much enjoy hearing from you on these matters.

Good investing all.

By Captain Hook

Special Note: Figure Source: Schaeffer Research

Treasure Chests is a market timing service specializing in value-based position trading in the precious metals and equity markets with an orientation geared to identifying intermediate-term swing trading opportunities. Specific opportunities are identified utilizing a combination of fundamental, technical, and inter-market analysis. This style of investing has proven very successful for wealthy and sophisticated investors, as it reduces risk and enhances returns when the methodology is applied effectively. Those interested in discovering more about how the strategies described above can enhance your wealth should visit our web site at Treasure Chests

Disclaimer: The above is a matter of opinion and is not intended as investment advice. Information and analysis above are derived from sources and utilizing methods believed reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Comments within the text should not be construed as specific recommendations to buy or sell securities. Individuals should consult with their broker and personal financial advisors before engaging in any trading activities, as we are not registered brokers or advisors. Certain statements included herein may constitute "forward-looking statements" with the meaning of certain securities legislative measures. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the above mentioned companies, and / or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Do your own due diligence.

Copyright © 2010 Inc. All rights reserved.

Unless otherwise indicated, all materials on these pages are copyrighted by Inc. No part of these pages, either text or image may be used for any purpose other than personal use. Therefore, reproduction, modification, storage in a retrieval system or retransmission, in any form or by any means, electronic, mechanical or otherwise, for reasons other than personal use, is strictly prohibited without prior written permission.

Captain Hook Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules