Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
US Economy Has Been in an Economic Depression Since 2008 - 22nd Oct 21
Extreme Ratios Point to Gold and Silver Price Readjustments - 22nd Oct 21
Bitcoin $100K or Ethereum $10K—which happens first? - 22nd Oct 21
This Isn’t Sci-Fi: How AI Is About To Disrupt This $11 Trillion Industry - 22nd Oct 21
Ravencoin RVN About to EXPLODE to NEW HIGHS! Last Chance to Buy Before it goes to the MOON! - 21st Oct 21
Stock Market Animal Spirits Returning - 21st Oct 21
Inflation Advances, and So Does Gold — Except That It Doesn’t - 21st Oct 21
Why A.I. Is About To Trigger The Next Great Medical Breakthrough - 21st Oct 21
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21
How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
The Only way to Crush Inflation (not stocks) - 14th Oct 21
Why "Losses Are the Norm" in the Stock Market - 14th Oct 21
Sub Species Castle Maze at Alton Towers Scarefest 2021 - 14th Oct 21
Which Wallet is Best for Storing NFTs? - 14th Oct 21
Ailing UK Pound Has Global Effects - 14th Oct 21
How to Get 6 Years Life Out of Your Overclocked PC System, Optimum GPU, CPU and MB Performance - 13th Oct 21
The Demand Shock of 2022 - 12th Oct 21
4 Reasons Why NFTs Could Be The Future - 12th Oct 21
Crimex Silver: Murder Most Foul - 12th Oct 21
Bitcoin Rockets In Preparation For Liftoff To $100,000 - 12th Oct 21
INTEL Tech Stock to the MOON! INTC 2000 vs 2021 Market Bubble WARNING - 11th Oct 21
AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
Stock Market Wall of Worry Meets NFPs - 11th Oct 21
Stock Market Intermediate Correction Continues - 11th Oct 21
China / US Stock Markets Divergence - 10th Oct 21
Can US Save Taiwan From China? Taiwan Strait Naval Battle - PLA vs 7th Fleet War Game Simulation - 10th Oct 21
Gold Price Outlook: The Inflation Chasm Between Europe and the US - 10th Oct 21
US Real Estate ETFs React To Rising Housing Market Mortgage Interest Rates - 10th Oct 21
US China War over Taiwan Simulation 2021, Invasion Forecast - Who Will Win? - 9th Oct 21
When Will the Fed Taper? - 9th Oct 21
Dancing with Ghouls and Ghosts at Alton Towers Scarefest 2021 - 9th Oct 21
Stock Market FOMO Going into Crash Season - 8th Oct 21
Scan Computers - Custom Build PC 6 Months Later, Reliability, Issues, Quality of Tech Support Review - 8th Oct 21
Gold and Silver: Your Financial Main Battle Tanks - 8th Oct 21
How to handle the “Twin Crises” Evergrande and Debt Ceiling Threatening Stocks - 8th Oct 21
Why a Peak in US Home Prices May Be Approaching - 8th Oct 21
Alton Towers Scarefest is BACK! Post Pandemic Frights Begin, What it's Like to Enter Scarefest 2021 - 8th Oct 21
AJ Bell vs II Interactive Investor - Which Platform is Best for Buying US FAANG Stocks UK Investing - 7th Oct 21
Gold: Evergrande Investors' Savior - 7th Oct 21
Here's What Really Sets Interest Rates (Not Central Banks) - 7th Oct 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Government Bailouts the Ultimate Ponzi Scheme Heading for Financial Collapse

Stock-Markets / Credit Crisis Bailouts Dec 16, 2008 - 04:14 PM GMT

By: Joseph_Russo

Stock-Markets Diamond Rated - Best Financial Markets Analysis ArticleNotwithstanding the success of a 2nd American Revolution - Politicians, Bankers, Power Brokers, Lobbyists, Wall Street, and Huge Trans-National Corporate Conglomerates have collectively succeeded in delivering their subtle-monopoly deathblows to American Free Market Capitalism. In doing so, they have destroyed the constitutional fortress which once protected and kept shining the beacon of American ideals and free enterprise.

Services no longer needed thank you

Like washed-up streetwalkers, instead of crack-cocaine, global governments and their fascist subtle monopoly interests are helplessly addicted to power by debt-creation, fiat currency, never-ending denials, and shameless empty promises of ongoing change and reform. This fatally flawed generational power-structure-legacy has “tricked” for far too long, and has now reached its point of no return. 

Failure of State – The American Nightmare

For nearly one hundred-years, a trusting citizenry of hard-working immigrants, blinded by visions of “The American Dream”, fear, and false incentive traps have unknowingly empowered their elected officials to turn a blind eye in their sworn bids to uphold the principles of the United States Constitution. The present and unequivocal result is a decisive, intractable failure-of-state from which there is no way out. 

A Colossal Failure of the Big-Three Failure (X-Autos)

Far worse than GM, Ford, and Chrysler combined, Congress, the Treasury Department, and the Federal Reserve Board can no longer stand on their own two feet. Like the automakers, it is only a matter of time before they will be coming back to the table begging for more taxpayer money, while in their next breath pleading false promise of emergency solutions and better days ahead. For all intent and purpose, all three arms of government are worthless, and very much dead in the water.

First item in the rulebook of Centrally Planned Fascist Governments

If we have 100% monopoly on money creation, we can fool them ALL THE TIME. Talk about the fraud of the century. At the end of the day, the result of our Big-3's (X-autos) decades of cumulative and collective actions will fair similar results to Wall Street's latest 50b fraud engineered by Bernard Madoff , former chairman of the NASDAQ stock exchange – “ nothing but a giant Ponzi scheme .” Only time will tell, but maybe this time will turn out to be different, perhaps this time, we will not be fooled again.

Americas Government is Bankrupt, Insolvent, and at the Mercy of its Creditors

As the grand-super-sized Ponzi scheme grinds to a screeching halt, all government can to do is try to perpetuate new-deal variations of past failed schemes and bailouts from which America's Nightmare became terminal reality. Under the current system, and over the long haul, no matter how long or high such rallies go - every rally is destined to be a sucker's rally. 

Simple as A-B-C - the Triangulated Root Cause

To arrive expediently at the root cause of this complex problem, one need not look any further than the cumulative historic actions of Treasury, Federal Reserve, and Congress. Bursting bubbles, subprime, deflation, inflation, falling prices, rising prices, job losses, and every other imaginable “financial-sphere-generated” crises are all SYMPTOMS rooted exclusively from the decades of cumulative action within these three branches of failed government.

Each Fork in the Road Leads to Ruin

Should America follow in the footsteps of Japan, it shall toil in the throes of deflation for decades to come. Should America follow the current “Bernanke” model of fighting the last war, she will seize and convulse amid the turmoil of civil unrest and hyperinflation.

Unless governments openly admit their epic failure and methodically repent by embarking upon a massive constitutional revitalization effort via a severe and radical reformation, America will inevitably forfeit all of its powers, and fall victim to those with sounder minds and stronger hands.

The first two elements to tear down and rebuild are the destructive fractional reserve banking system and its flawed debt-based irredeemable currency to which there is no standardized weight, value, or measure. Without a balanced currency, valuation metrics across every sphere of finance and economy are useless.

Building Bridges to a Sustainable Future

Governments, Economies, and Banking systems ought to be built like bridges, not like houses of cards.

Consider for a moment, how one could possibly engineer and construct a secure mega-suspension bridge spanning 7,000 feet, if during the design and construction phases, all rules associated with the laws of standard measurement changed values on a daily basis? The architect using one scale, the engineer another and the construction crews yet another scale. Each have similar tools to measure and project, but each set of measuring tools has an inherent floating variable, which deliver different value readings from one day to the next. In other words, all measuring devices are unstable. One-inch today may well be 3-inches tomorrow and only ¼” the day after. The result of which is that ALL VALUES ascertained from such measuring instruments are erroneous and of no practical utility.

Well, that is exactly how global central bankers and governments expect small business and the balance of humankind to plan for their futures and day-to-day lives - with a floating, un-pegged measure of “debt” vs. that of a hard redeemable currency with stable value. Therein lays all the “root cause” one needs to explore in understanding how the global economy arrived at its present impasse.

Back to the bridge; imagine the quality, safety, and durability issues surrounding a mega-bridge designed and constructed with such flawed protocol. Would you drive your family over its 7000' span? If such a bridge managed to stand at all, it would certainly fail all counts of inspection. If such a bridge were opened, and certified for passage despite its flaws, traversing its span would pose fatal threat to those without knowledge of its structural defects, or daring enough to risk it anyway.

People of the World – This one's a Tear-Down

In the case of our bridge analogy, if such a physical blunder should manifest in the real world, once discovered, engineers would have no choice but to order a controlled demolition of the structure, and prepare a new set of engineered blueprints for its replacement. The new replacement structure, designed and constructed from fixed standards of measurement, calibrated with strict uniformity protocols and built with matching precision would then provide optimum assurance of the structures soundness, and long-term security. To avoid its inevitable day of Armageddon, this is precisely the type of structural reengineering that must take place in the global financial system.

We submit, there is a time and a place for everything, however any realized benefits associated with debt-based economies and currencies have long outlived their practical utility. In fact, they now pose more of a hindrance and systemic threat to progress than just about anything else does.

Mr. Bernanke, Mr. Paulson, Mr. President – Game Over

If the esteemed Mr. Bernanke is banking on his 30-year old PHD thesis on the “last great depression” to steer our economy through its current malaise, all that Mr. Bernanke will achieve is to prove that figuring out how to win the last war provides little in the way of effectiveness in dealing with the current set of conditions. That was then Ben, and this is now, there are no do-over's – what we have here is a drastically different set of variables, a completely new league – new world, with a unique set of global dynamics. One cannot solve today's dilemma with a hypothetical solution to an old puzzle.

Reversal of Polarity

Financial markets are supposed to reflect and measure economic reality. The real economy should not be hostage to the health, stability, or risks associated with financial markets. If one agrees with this fundamental concept, one will conclude that for decades, the global financial sphere has usurped all power from real economies, and has in-effect held such economies hostage to its will and ambition in destructively exponential fashion.

Taking this line of thinking one-step further, the urgent necessity for the recent $700-billion US banking bailout was unequivocal proof that cumulatively, the United States Department of Treasury, the Federal Reserve Board, and the United States Congress have collectively failed in stewardship of their fiduciary responsibilities and constitutional mandates.

Sadly, thus far, this crisis is turning out to be a lost opportunity for the people and the “real economy” to reassume control of fraudulent banking systems, mortgage lending practices, pension fund schemes, and other widespread Wall Street fraud.

One critical opportunity this crisis should yield is to force the (now quasi-national) banking/finance/credit systems to restructure as permanent non-profit public utilities. Such a forced restructuring would impose a strict set of regulated fiduciary obligation to which banks, lenders, and pension funds must comply in order to survive and receive the subsidized mercy of taxpayer support. All financial, government, and lobby-related entities refusing such explicit terms of adequately regulated compliance would become extinct.

A global victory for all people, small business, and the real economy

The result of such a major restructuring of the financial sphere will engender a sustainable banking, mortgage, and retirement system to serve the long-term interest of global societies vs. leaving such stewardship to the globally interconnected Wall Street casino operators, bankers, politicians, behemoth corporate interests, central bankers, and all of their respective lobbies.

A Second Coup d'état in progress

So far, instead of seizing this immense opportunity, it is likely that Paulson of Treasury, and Bernanke of the Federal Reserve, scared the living daylights out of Congress with absolute guarantees of widespread anarchy, civil unrest, rioting, and the certain collapse of the United States as a viable union.

What they told Congress behind closed doors was too alarming for anyone in Congress to share with the public. We shall never know the extent of the doomsday scenarios presented by the Fed and Treasury. What we do know is that Congress was severely shaken, and buckled to the dire warnings of consequence from Treasury, and the Fed. The results are now unfolding before us, and the future has never been more uncertain.

How Might Investors React

Simple - STOP INVESTING for the long haul, and START TRADING! Seriously, what are the long-term viable prospects for the United States, or any of its globally interconnected markets? Short of radical change, which transforms social security, retirement/pension funds, and the entire national banking system into highly regulated (non-profit) public utilities – there is no sound reason to invest in securities ANYWHERE for the long haul. Occurring with shorter and shorter intervals of illusory reflation results, the inherent architecture of the present system (as illustrated by current events) will continue to decompose indefinitely under its ever-growing weight.

Build Anew

The only way to break free from the shackles of a failing monetary system and securities industry is to first design an entirely new system, and then tear down the old. The first place to begin is with a brand-new redeemable currency system of standard weight and measure. Until signs of the above are firmly in place, all long-term bets on securities with no standard of redeemable valuation measure should remain PERMANENTLY OFF LIMITS for the long-term.

Trade On

Instead, TRADERS with proper guidance should assume no guilt in extracting steady streams of trading returns from the crumbling system. Without bias, it matters not which side of the market one trades, only that one's trading posture and time-frame properly align with the current set of market dynamics.

Case in point is the three-year crash, another symptom of a failing financial system. Despite the NASDAQ's complete failure defined by the tech-heavy index registering a near 90% wipeout by 2002, five-years later, its headline counterpart, the Dow Jones Industrial average, nominally reflated in a contrived bull market to the tune of almost a 100% gain from its 2002 lows. From the Industrial's peak in October of 2007, in just 13-months, the near 100% contrived gain in the Dow had completely vanished by November 2008. Shorter intervals of bull market sustainability exemplify yet another symptom of a rapidly failing financial system.

Where do we go from here?

Have we just marked another contrived cyclical low in November? Will the Dow, S&P, and NASDAQ quickly return to their respective 2007 highs or beyond? With a hyperinflation, the answer could be yes. However should deflation stick around, those chances are slim. Symptomatic of either outcome, both are undesirable, as each would contribute to the continued destruction of small business, individuals, and real economies all over the world.

Unlike the fixed permutations and singular “right-answers” deducible in a Sudoku puzzle, accurately deciphering the markets Elliott Wave structures requires patience and flexibility in applying complex sequential logic to the highest probabilities in solving a dynamic market puzzle void of a singular fixed outcome.

Since it is not possible for 100% of all clues derived from our technical analysis to deliver precisely as anticipated, some level of trial and error is necessary in putting all of the moving parts together. In concert with traditional chart analysis, maintaining disciplines of logical permutation provided by Elliott Wave Theory yields far more profitable outcomes vs. simply guessing, or employing the facility of emotion or hope to enter and exit trades.

When it comes to strategically trading broad market indices, there is simply no match for Elliott Wave Technology's Near Term Outlook . We respectfully challenge any short-term advisory service or software generated algorithms that claim to outperform our consistent and impartial mapping of the price action in the Dow, S&P, or NDX.

Over the past four years, we have perfected the art of dispatching tactical trade set-ups and market forecasting to a consistent, impartial, and immensely profitable endeavor for those who take the time to embrace it.

The express focus of Elliott Wave Technology's charting and forecasting service is to help traders anticipate price direction and amplitude of broad market indices over the short, intermediate, and long-term.

We deliver this unique blend of proprietary charting protocol daily, with the express intent to convey timely and profitable information. Our daily reports impart strategy-specific guidance , which strives to forecast, monitor, and calibrate market impact relative to a multitude of signals that are in direct alignment with eight distinct trading strategies set forth in the members NTO essentials file.

Regardless of one's level of experience, users must allow sufficient time to become acquainted with the authors charting protocol, strategies, and tactical narratives prior to entering positions or developing discretionary trading strategies.

If you trade in today's increasingly uncertain and volatile markets, you need a reliable and consistent edge you can count on. If you want the very best, there is no better short-term advisory than the Near Term Outlook.

Trade Better / Invest Smarter...

By Joseph Russo
Chief Editor and Technical Analyst
Elliott Wave Technology
Email Author

Copyright © 2008 Elliott Wave Technology. All Rights Reserved.
Joseph Russo, presently the Publisher and Chief Market analyst for Elliott Wave Technology, has been studying Elliott Wave Theory, and the Technical Analysis of Financial Markets since 1991 and currently maintains active member status in the "Market Technicians Association." Joe continues to expand his body of knowledge through the MTA's accredited CMT program.

Joseph Russo 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