The Flavor of the Market’s Pause

Things are about to get interesting.

The way it becomes interesting is running (like an old TSR program) is in background.  The news events we see swirling about this morning may be interesting, but the REAL IMPORTANT decisions about how things are going to work out are off running out of sight.

What is so important?  Glad you asked.

This is a little corner of one of our Peoplenomics.com charts but I want to show you the problem.

As you can see in the chart below, the market has done a peachy-keen rally since we turned up as I was expecting in February.  And if you’re a fan of Elliott Waves, the general idea is that we should work our way up into a “target zone” and this would (more or less) confirm that wave V – the one that brings new all-time highs and lots of money flowing into the market – is underway.

image

Now, the PROBLEM with this chart is that we are due for some kind of decline in here.  And it could knock the S&P down a bit.

But then comes the question: “Will it stop at a “normal” kind of pull-back, or will be put in another low around where February did, OR will it break on down and in that case, 1.740 on the S&P could be tested.

Oh.  And if THAT fails, then we are in a HUGE MOTHER OF A RECESSION OR DEPRESSION.

(Yes, this is what Donald Trump was likely referring to, but the damn MainStream Sell-Out Media is so busy trying to “influence” the political realm, that they forget that Trump is a Wharton grad with what?  A degree in economics!

Do we heard questions like “What is it that you see ahead that implies a massive recession?”

We STILL haven’t got a good bead on that because the GD effin media is too damn busy trying to influence instead of (wait for it)  REPORT!!!

OK, fine.  The MS(fu)M is not doing it’s job.  That’s fine with me because it leaves a nice niche of intelligent people who really do want to get ahead of the curve, so here we are.

Now, back to point:  This is the HUGE story that is going on in background.  The markets will, in coming weeks, put up a massive rally continuation up to my target zone, or they will drop to the normal pullback level of a strong rally (often around 50% of the advance) and go up from there. 

In this sense, the market is like craps except we have “two ways to make the five” – there’s no easy way, lol.

OR the market pullback will go further until we hit the last-chance to avoid Depression around 1,740 on the S&P.

If THAT fails, then the very bad news (which I believe Trump was getting at) is IF we break below the 1,740 S&P level, then dropping down to the lows of 2009 become something like a 50% possibility.

And there’d also be a chance that we could drop down into the Dow 3,500 area.

Think about that for a sec.  Dow 3,500 and lower than 2009 by a good bit.

There is always good news – and I try to remain balanced in my outlooks.  If we drop down that low, we should set up for a hell of a rally.

In long wave economics, using Elliott tools, we would then see a rally to around 10,250 or so, and then the other shoe drops.  The market could drop down to, oh, pick a number here:  750 on the Dow.

This is not to PREDICT this will happen.  The market future is always changing.  It’s like a snake that comes to a four-way fork in the road – which is where we are this morning.

To summarize, hand me my snake, wouldja?

image

What the Doof Media misses, more often than not, is this is the way our future is always unfolding:  As a set of options (forks in the road)  that will be influenced by current events.

Much as it saddens me to do so, we do have to look at some of the drivers there.

Panama Papers:  Leak-Out Causes Freak-Out

A few headlines will capture the fine essence d’ turd coming out about many of the world’s leaders who are (no surprise) largely rich, mainly corrupt, and keeping money stashed outside of their own countries so it can’t be taken from them when the hangman comes a-calling.

The basic story is:  2.6TB Data Leak Reveals Corruption Among World Leaders

Iceland’s Prime Minister refuses to quit amid mass protest,

Secret offshore accounts help owners evade taxes

And try not to look too surprised when you learn that Global elite’s offshore accounts are revealed in 11.5 million leaked documents.

Bait and Switch!

What’s the global elite to do when the peasants of the (potentially larger than) French Revolution get to milling about in an angry and snarling way?

Get out there and stir things up a bit, of course!

Let’s cue, oh, Christine Legarde who’s the head of the International Monetary Fund to say something like “Lagarde Sees Political Dangers Galore With Global Economy Tepid.”

What she is NOT saying are the two most relevant facts about this mess.

1.  The world’s problems would be a lot smaller IF there was a ban on people banking at these offshore banks with their secrets.  This from a guy who lived in the Cayman Islands for a couple of years. Moi.  I simply saw too much corruption there and met some of the sleaze that were refinancing and bankrupting American real estate assets and then taking the money offshore. 

We tend to forget recent economic events.  But this was commonplace during the 1980’s S&L disaster.  But if you were to tell this kind of “businessman” that they were nothing more than crooks, stealing from the public, they would argue that it was only a coincidence that they just refinanced a massive apartment complex, pulled out $5-million and took it offshore and then the complex went banko.  Stuff happens, they argue.

Yeah…when the building is refi’ed for more than it’s worth and the money is gone…you betcha.

You see, that’s the kind of shit that happens all over the world now.  Crooks take money which would have to be disclosed and which would be subject to recourse if it were domiciled in a bank within their country or origin…but which becomes untouchable money when it goes offshore.

(Do I sound rather disgusted with the kinda pricks who take the money and flee?  Why ‘magine that!)

2.  There is NO JUSTIFICATION other than fraud, tax avoidance, and so on, that I’ve ever heard for the existence of offshore banks.

Period.

Secrecy in offshore banking is a scam to hide money from tax authorities, plain and simple. 

And setting up front companies in tax havens is the same thing:  A tax avoiding scam.

I figure you’ve thought this out, and yeah, yeah, I hear all the time from tax scammers how it is a “right” under the Constitution and yada, yada.  But in the end, the people who have offshore accounts are (with no exceptions I ever met) trying to be two-bit chiselers who want to stick you with the dinner tab because you’re dumb enough to be honest and keep your money home.

So is Christine Legarde of the IMF pure as the driven snow?  Ha!!

Go read IMF head Lagarde to face French trial over Tapie affair and decide for yourself.  When in trouble, make yourself indispensible and unimpeachable, says I.  Argghhh.

Cutting to the Chase

JP Morgan Chase has set up a limit on how much cash non-bank customers can take from their ATMs.  They’ve been rolling from the $20-bill dispensers to the $100-bill size and people like BIG money better than SMALL money, seems. 

So they line up to get Big Money.  D’uh.

Already, there are people using the term “bank run” (keep this Google news search handy) but is it the end of the world? 

Nope.

Besides, in Ure’s alternate reality is that if there ever ARE bank runs, the place to go would not be to the bank, but to the grocery store and load up on long-term food items to top off your prepper plans. 

Paper doesn’t taste very good and when comes down to really awful times, ask yourself this:  Would I trade food for paper?  And if yes,  under any conditions?

Data Munch

This next item is more for Peoplenomics.com readers.  Remember I said a while back that I could see where we might actually see a decrease in the BOT (balance of trade) deficit?

Well, it is not here yet…

The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that the goods and services deficit was $47.1 billion in February, up $1.2 billion from $45.9 billion in January, revised.  February exports were $178.1 billion, $1.8 billion more than January exports. February imports were $225.1 billion, $3.0 billion more than January imports. 

The February increase in the goods and services deficit reflected an increase in the goods deficit of $0.9 billion to $64.7 billion and a decrease in the services surplus of $0.3 billion to $17.7 billion. 

Year-to-date, the goods and services deficit increased $10.8 billion, or 13.1 percent, from the same period in 2015. Exports decreased $20.5 billion or 5.5 percent. Imports decreased $9.7 billion or 2.1 percent.

Here’s what the long-term trend looks like…

image

I’m still hopeful, based on economic activity that things will improve, but hasn’t happened yes, at least so’s you’d notice.  Obama and the PTB are still shoveling up deeper into the dung.

Yessir…all that TPP hype (including from sellout Paul Ryan) is just what?  (Take a whiff…)

A kind of coincident indicator just out:  The Gallup Economic Confidence Indicator improved a bit to a –10 reading for the past month.

Futures show the Dow should open down about 100 and a close down 150 would be about right.

Flight to safety of gold is getting legs again:  Up $21 when I looked and Bitcoins are still fetching $422 per.

Comments

The Flavor of the Market’s Pause — 27 Comments

  1. Something will happen that will cause the stocks to crumble and what ever it is going to be, it wont be our governments fault. This way they can maintain the power after the fact. You wont be able to sell your stocks or gold or anything else you have. You meaning we, will have to eat it. There’s only so many ways to pull it off. I wonder what it will be and I wonder if I’ll want to be around to even deal with it. I love my family.

    ps George was against BTC from the start. I played in BTC from 88$ all sold out now. If the net goes down btc’s are worthless.

    One of the ways the world economy could go by by is all computer systems are hacked and well that could make for some fun. Russian banks hacked and didnt even know it until “hey wheres are money?”

    • George was against BTCs when they were in a wave 1 bubble. Now, it looks like Wave ii is complete so nibbling on a possible wave iii isn’t a bad thing. Unless computers go down.

  2. I think it was Shakespeare who said; “First we hang all the attorneys.” If politics is corrupted, and it it is, it’s because the law has been corrupted into a priesthood which has enabled legalized theft and murder under the guise of bureaucratic rules and regulations. Law should never be so complex that evil can twist good to it’s deeds and yet this is what we have today. It’s no wonder that the scum of the earth gravitate to politics, but it is a wonder that people still seem to think they need either of these establishments.

  3. “Would I trade food for paper? And if yes, under any conditions?”

    ?Is the paper bleached or unbleached? And what preservatives, flavor enhancers and vitamins have been added before I answer…?

    Yeah, yeah, yeah pure silliness on my part. The only thing good about it is, it’s pure… (insert short drum roll and symbol crash).

  4. Secret offshore accounts help owners evade taxes. George you have missed the obvious here. It is the east that are named not the west, pretty clear it is a set up to achieve something we are yet to learn about.
    David Jenkins

  5. LaGarde reads like a modern day Marie Antoinette- and delusional.

    Panama Papers like (global) Watergate gets me scratching my head (again). These ‘hot’ issues, like dandruff derive from ’cause’ and then effect, which is curable.

    So, I asked mySelf just now, “WHY must they take their $$$ offshore to protect it- from whom? Their OWN creations?”

    answer:
    Simple, it is the snake eating its own head.
    Yes- to avoid the snake pit they created a hundred years ago for everyone but themselves.

    The snakes (tax laws and regs) have proliferated under their pen; piled so high they just crawl out to bite their creator’s asses after this leak and the a**holes didn’t see it coming. Too busy jet setting?

    In short, IF YOU DON’T WANT THE TAXES, STOP CREATING THEM !!!

    That should cure the dandruff for all of us… and balancing a budget.
    Focus on necessary basics, like roads.
    Well this goes down a deep rabbit hole.

    Ever do a (research) list of how many taxes have been instituted and imposed since 1908?

    They deserve Panama’s microscope.

  6. it won’t take much for a bank run because they no longer carry much cash… they get mad if people want to take out 1500-2000 bucks, giving people a difficult time… more than that they want you to plan ahead and tell them what you’ll be needing, because they just don’t have the cash. Everyone has their story of lately. Here is one Dave wrote about last week.

    http://www.thecommonsenseshow.com/2016/03/25/what-happened-when-i-tried-to-take-1500-cash-out-of-bank-of-america-bank-holiday-is-near/

    • Agreed. I take cash out of the bank after being paid as a matter of habit now. Years back as a teenager, I remember asking my old man why he didn’t have direct deposit, but instead received a paper check, and went through the weekly process of depositing some, and taking some in cash. “I want to remember that I’m working for something” was his reply. Seemed logical enough to me.

  7. “….and then the other shoe drops. The market could drop down to, oh, pick a number here: 750 on the Dow.”

    Come on George, you are not being ‘spritual.’ lol! You/we will never see 750 on the ‘D’ ever agian, for one reason. Not becase the market wont go in the crapper, but because long before then, if the PTB thinks that it will go down that much, they will some type of artificially crated ‘event’ (blamed on terroism) will occur to shut down the market altogther.

  8. I got involved in Bitcoins due to a mention by you. It’s one of those things that snowballed dramatically. I have 20kw of solar with batteries. I figured the power company only gives me about $500 per year for my excess power after powering 4 electric cars and heating my garages and chicken coop, I might as well see if I could get more for my power with Bitcoin Miners. I bought 2 Antminer S7 Bitcoin miners, the latest and greatest Miner. 4 times the TeraHash power on less electricity than the S5. They use 30kw hours per day…EACH! I had 10 Megawatts in the bank, did the math, and figured I could power 2 Miners in perpetuity. The Miners started paying $28 a day, every day! Not only that, they heated the cellar and a free standing garage to 76 degrees! Heat rises, you can’t stop it! The house floors became 76 degrees…we were barefooting it all winter! One thing led to another, of course. I bought VIP Shares at a Mining outfit called Mining Sweden. They run and maintain miners for you, using their electricity. You get the profits hourly. I put in about $36,000 and get about half a BTC per day (a couple hundred bucks a day at todays BTC price). I take the profits weekly, putting 3/4 “in the bank in USD”. The other quarter I put in Hashnest, which also rents their S7 miners out. So, warm floors, warm cars, warm chickens and a couple grand a month in income all due to you Ure. Thanks. I think you should hook up with that guy that used to scan the net for clues to the future again…it’s time!

  9. Who’s right, the Donald economist or the other economists? Who has succeeded with their knowledge of the economy more, the Donald or them. Follow the succeeder.

  10. It’s about time someone with a microphone and hundreds of “reporters” (and the real reporters with their phones set to record) brought the economic mess to the forefront and used the authentic terminology: Recession and/or Depression. And yeah, it ought to scare the bejeezus out of everyone.

    Say what you want to about Donald Trump, and boy do they have a number of dirty words for him, at least we know he will say it and has a set of heavy brass ones that could care less if it’s PC.

    A little saying I’d like to mention: A lie by omission is still a lie. And the majority of the distasteful politicians are guilty of this by not speaking the truth about the disaster that is our “economic recovery.” So, thank you Trump for outing it, and thank you G for passing it along.

  11. I hope you have rights to “rigor economicus” . The term may be widespread before too long.Well done.

    • Mr. Ure came up with “wizened market participant” a few years ago; I was so delighted with the triple meaning (in my case) of stockmarket/supermarket/old lady, that I put it on a grocery shopping bag! Never got a reaction, though; I figured that not too many people here in the upper south heart-attack belt know what “wizened” means…

  12. BTW, the article noted that these arent all tax evasion cases: they could be hiding legal assets from relatives, or trying to avoid the “appearance of impropriety” should legally-obtained assets be exposed. Last year I ‘d read that George Soros was investing in the Aussie dollar. But since then China hasnt been buying natural resources as much, so maybe their dollar may not be as attractive as it once was.

  13. An article I’d read yesterday was explaining that the absence of Americans on that Panama list was due to our much lower tax rates for millionaires. And to top it off, it appeared that the “leak” may have been a way for the Rothschilds or some other elite group to eliminate the competition for tax havens. Interestingly, this family supposedly created a tax haven in Reno. It really ticks me off that our government makes me report my tiny, still-in-Australia bank account, makes FATCA laws for other countries to follow (and subsequently kicks US citizens out of having accounts)..and then creates tax havens for the rich. Oh, and attacks the countries who refuse to allow Rothschild/Rockefeller banks- only 2 or 3 countries remain.

  14. re: Panama Papers: Leak-Out Causes Freak-Out

    my axiom – if MSM got the information, and not the public at large, it’s not a leak

  15. I’ll give you a prediction. Being an honest man while living in a den of thieves who possess not a shred of integrity will not end well.

    Keep in mind that included in obamacare is a clause that allows the IRS to directly access anyone’s bank account and take what they think they are owed. Shortly after the act passed, the IRS purchased 2500 fully automatic weapons, and requested funds to hire additional personnel to handle the “obamacare tax.”

    But not worry, the USA weather service and the social security administration also purchased weapons, so you should feel really safe from those Muslim terrorists like the ones that did the 9/11 arrack.

    George, you still haven’t told us where you are holding all those winnings from playing the markets. Brokerage account, bank account, both considered LOANS to their respective institutions. Subject to bail in. Sounds like a business model to me. And I’m sure you are holding stock certificates for your long term holdings.

    Those folks with offshore accounts are simply people paying all the federal taxes the constitution says they owe. If you don’t hide your money from the IRS, they will extort money from you that you don’t legally owe. Why you consider that exposure an act of honesty escapes me.

  16. I kind of like your theory of new short-term high.

    But eventual oscillation down to Dow at 750? That happens the day they announce the possibility of either a 4-mile wide asteroid headed for NYC or some kind of nasty solar flare that will melt the electric grids of N.A. and Europe. Either way – those would be quite a sell-off. So, they would never announce either of those :)

    I think there is a balance of good and bad out there but the reliance on an always increasing global GDP is a bad thing.

    “Any economy that requires constant growth to survive will eventually do neither.”

    Except that the above sentence does not relate to the Amish. They are growing every year and they survive based on what they grow. I am talking about an economy of printed paper, fractional reserve banking, leveraged derivatives, CDS, ARM mortgages and sub-prime loans. And please, people, try not to get into “Reverse Mortgages”.

  17. George,

    There are a number of quite legitimate and necessary reasons to have an offshore bank account! Unfortunately, you saw the worst and most egregious misuse of such accounts and perhaps you were influenced accordingly.

    I didn’t say then needed to be secret, but they do need to exist. For some of us who cannot fulfill personal, social, or other non-financial desires in the USA, it may be necessary to move overseas, and for residency there it may be necessary to have significant money invested locally. Persons working overseas also need access to a local account and the monetary system. People who wish to invest in certain instruments overseas must have a corporate entity domiciled there, using a local account. All of these reasons, and perhaps others, are legitimate reasons to have an overseas account. All may well exist with no desire or intent to defraud anyone, not even the tax folks.

    Many people wish to split their assets between countries so that if one country fails(such as the Soviet Union, Zimbabwe, etc.), they will have a bolthole. That seems legitimate. Redundancy matters.

    Taxes are not the only reason for leaving a nation. Most people have greater concerns. If we take away freedom in the name of saving it, what have we accomplished?

  18. George you are very good at what you do ,I am really amazed in fact ,I got a smile on my face and when the time comes around to reenlist in your peoplenomics ,I guess ,I will be at the front door wanting more. Have a good day and may the force be with you

    • today is the release , thanks for reminding me. May the force be with you..

  19. “OR & IF” are the real issues, imho. ;-) Otherwise, I very much admire your intellect and your ‘on spot observation’ in so many subjects.

    • … and btw. When I look at the monthly, quarterly, and yearly charts of the S&P I concluded that we have passed the 5th Elliot wave already. But that is just one’s person opinion, and I’m too old to explain in detail. ;)

      May the force be with all you readers!