News

With the Fed meeting tomorrow, we are about as excited as mourners at a funeral.

That’s because the Fed really is in something of a no-win position.

As explained in yesterday’s column, the Fed is trying to navigate the same kind of seas that faced the 1928 Fed.  There were modest interest rates and pools of cash had piled up on the sidelines.  And bonds were hot, as well.  But the real place where the action centered was the stock market.

We seem to have overlooked the fact that since the market low in 2009, the Dow has screamed from a weekly close in March of 2009 of 6626.94 to almost three times that number before the current round of “second thoughts” popped up last summer.  Similar gains for the S&P, too.

From an Elliott Wave standpoint, that was where we start counting the current wave down from. The top on 4/15/2011 (on a weekly closing basis) was arguably the end of the Wave 1 up.  Then you run up to last summer.

I work all these numbers using something I call the Aggregate Index because you can’t trust only the S&P or Only the NASDAQ, or for that matter, only the Dow.  Not that they are not of high integrity as data points: they are. 

But what lacks integrity are the market players themselves.  Back in the days of the old University of Colorado Longwaves group, my consigliere (and others who pop up here from time-to-time) noticed the evolution of a phenomena called “hot money.”

This was wire-transferred all over the world and with computer speeds increasing, it became more and more evident that  the behavior of the markets became more like traffic on the freeway.  If there was an accident in Asia, things slowed down on that stretch of the financial highway.  Lookers, gawkers, and bottom-fishers duked it out there.

Halfway around the world, another batch of hot money might land in Europe.  So the markets there might be going up.  And in-between, the market could be going up, down, or sideways, here in the USA.

The ONLY SOLUTION THAT MADE SENSE to me, anyway (being of limited brainpower and all) was to build first a Global Index (which we present on the Peoplenomics side twice weekly) along with the U.S. Aggregate.  A lot of the money comes off the table for weekends, so that’s what matters in our studies.

Again, not that the S&P is bad, neither is the Dow, or for that matter the NASDAQ Composite.  But you see, it’s the fashion in investing that swells or fades.  That’s why in one period of time, say the week of July 23, 1999, the Dow was 10,910.96 while the NASDAQ was 2,864.48. 

If you divided the NASDAQ into the Dow at that weekly close, you’d see it took 3.809 times the NASDAQ to “buy the Dow.”

As always, the fashion in investing goes to extremes.  The the week of April 10, the following year, it took less than 2X the NASDAQ to buy the Dow.  1.96664 if you really want to know.

But you remember what happened next?  Somewhere between $5 and $8-trillion of market cap blew out of the NASDAQ  in The Tech Wreck also known as the Internet Bubble.

We’ve got a chart for Peoplenomics subscribers tomorrow, but if you’re wondering, tech is held today at about the same investing fashion {esteem} level that it was being held in winter of 2000 when the top was in and the big slide was beginning.

You can learn a lot by marking up your own charts.  You can ask logical questions, which we do, now and then.   There’s the ratio of one barrel of WTI (west Texas intermediate crude) to the Dow, for example.  With practice, charts will begin appearing in your head and trading decisions will become obvious. 

So back to the macro view of the run-up since 2009:  After 1 up topped, we did the required 2 down  from  Aggregate 8,816 the week of 8/15/2011,  Since then, our Aggregate screamed ahead to the high last summer to complete Wave 3 up.

Then along came wave 4 down, which to my eye looks like it may be done, but no market goes right to the top again.  We expect the familiar declines and pullbacks along the way.

Which gets us to today’s action.

The early futures were down (about –71 on the Dow) and that’s clearly the market trying a typical “sell the rumor” which should be followed by a “buy the news” by the weekend.

Amidst all this, Tech has been slowly gaining “respect” since 2003 in the aftermath of the Tech Wreck when it took about 6.7 “NASDAQs” to buy the Dow.  One thing you can take to the bank is that with all this hype about the IoT (internet of things) we should, over the course of Wave 5 up (if the Fed policy doesn’t pull the plug on that) witness a retest of the ratio extremes that we saw in 2000.

A student of investment would likely be well-advised to spend less time on the absolute notional values of stock indices, but rather, use them as comparison tools in order to infer what I think of as “standard accounting ratios” the same way one uses ratios – rather thank dollars – in objectified analysis of company financial health.

And that brother or sister, leads us into this morning’s real data.

Press Release Festival

No point me rewriting this…

The Producer Price Index for final demand fell 0.2 percent in February, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today.

Final demand prices advanced 0.1 percent in January and declined 0.2 percent in December.

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Seems like there is always one news story, or another, that puts people in a foul mood or sets off a new “public debate.”

Now, I don’t like debate, because most things become clear if you can momentarily reflect on them and see how they fit in the real scheme of things.

I get a kick out of one of my liberal friends who is qick to jump in and often will introduce extraneous material into the dialog while my natural inclination is to keep things simple and to point.  It’s something I leaned as a journalist:  You can’t be a reporter until you can be a good “summarizer.”  And to be a good summarizer there is a simple technique that will help drain the emotions from any polarizing story and will get down to the gist of things in a rational way.

The way I go around this is to “flip the roles” on stories to see if they make sense if the parties that are making the claims and tossed in the blender and the “other side” is plugged in.

Here’s an example, just to get you started on the concept:

“Sarah Palin slams “punk-a**” protesters who disrupt Donald Trump’s events.”

Hmmm, let’s see here:  We have a conservative female, white, tossing barbs at protesters, who disrupted a white fellow running for President.

How could the story look if it were flipped around?

“Al Sharpton slams “punk-a$$” protesters who disrupt Hillary Clinton events.”  (Or disrupt what’s her name’s).

Of course, there has been no disruption of Clinton, but I think you get the point.

When I read either version of the story, it doesn’t do much for me one way or the other, but since I have a sense of how the other side would be scripted, should the shoe have been on the other foot, I get a sense of serenity about the story.  If a conservative white female can do one then, then a liberal black male taking the opposite side is neither surprising or unexpected.

As far as I know, Sharpton has said no such thing, but he’s definitely in the Clinton camp as it is reported…“Al Sharpton: Bernie Sanders ‘has not resonated’ with black voters.”

A flip-side story would be one where (Fill in the name conservative Christian leader says) Marco Rubio ‘has not resonated with white voters.”  Which would also be true, but that to me offer very little news value.  It’s more like the “packing” in an Amazon box.  Yet, it fills up the thing (and gives news media marketing departments something to sell, but it’s hardly the kind of thing that really changes the world.

The BIAS OF THE MEDIA becomes clear when we see a big story crossing the line Monday like “Putin Orders Start of Syria Withdrawal, Saying Goals Are Achieved.”

The “flip-side” of this story would be for the USA to see a headline like “Obama orders start of Syria support withdrawal, says Goals are Achieved.”

Except that we do not see a headline like that because (and this is complicated) the neocons never were and still are not conservatives (and sham on the Bush family for being so dim-witted about it) and the not only screwed up Iraq, but Afghanistan, and Syria, and with Hillary’s help, Libya.

Still, it would be nice if the West could be a little more conscious of how this “Wearing of the other man’s shoes” does help us see things.

If the U.S.,, for example, started to build islands in the middle of any of the world’s oceans, like, oh, offshore Mexico, for example, or off Honduras, what would the world make of it?

When analyzing things around here, I will often pause and think through not only what is the “headline value” of a story, along with “Does anyone really have skin in this, or is this just hype shuck and jive to sell advertising and drive lambs to advertising (slaughter)?

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(I will politely not ask if you are reading today’s column at the usual time since this weekend was National Gullibility Time.)

As I told Peoplenomics.com subscribers this weekend, Donald Trump should sue because if the shoe were on the other foot, I’m sure the U.S. Department of Just Us would be screaming violation of constitutionally protected free speech by the Chicago thugs.

And who is organizing the thuggery?  Well, here’s an idea.

That’s an easy thing to fix, though, or at least it should be if Trump’s right to free speech at his own freaking gathering is impeded by knuckle-draggers who try to bust up his rally.

In Ure’s book, free speech is just that: FREE. 

And part of FREE means not having to be there if you don’t happen to agree with the idea.  This is the same kind of Bolshevik tactics we’ve seen elsewhere on the radical Left in the past.  I know because I was one of the reporters who was regularly stampeded and gassed while covering the anti-war activists back then.

No, it was not a just war…but Trump is running for Warmonger in Chief, he’s running for President.

Now, if you want to inspect she-of-whom-we-don’t mention, THERE is your corporate war supporter.

To fill out the commentary, I should mention that over the course of 50-years of serious news-watching, it has been my observation that people’s politics get further Left, the more their incomes go down.  If incomes go too high, then things veer into the ditch on the Right, so there’s really no winning.

Still, we all know that the Right-Left dialectic has nothing to do with a real right and a real left.  It’s just the way the power players at the top keep everyone else in line.

So if you want to push more spending, you dial up the lefty groups in colleges.  If you want to dial it back a bit, you step on the right’s gas pedal.

Except in this case, the UIC promoters of terrorism and stealing Trump’s right to free speech (like at age 25 these kids know shit from Shinola, right?) can be identified.

And if they can be identified, they can be served.  As in with papers.

If it were me – and I might not even be elected county commissioner which I’m running for this fall – I would get a team of lawyers on the case.

My marching orders would be simple:

1.  Find the individuals who organized the Facebook pages and sue the living crap out of them for abrogation of Civil Rights.

2.  Sue the Federal government for the lack of response on the part of their Civil Rights group which while they seem to be able to take care of issues on behalf of the whole alphabet of genders these days, and every illegal sneaking in with a load of drugs, can’t step on the toes of the loving Left that put ‘em in office.

So there you have it.  I’ve read the Art of the Deal (so has Elaine) and this is what A REASONABLE BUSINESS RESPONSE WOULD BE.

When wronged, sue.  Sue Big and Sue Often.  And pay what it takes to win.

Of course, this would only upset the American apple cart more than it already is:  Sure as a reasonable district court judge rules one way, there would be an appeal until sooner, or later, the case would land in the hands of an Obama appointee and then it gets tossed.

But in the meantime, it would teach the kids some manners.  You can’t act irresponsibly in America and get away with it.

Or, at least, that used to be the case.

Guess we will find out in coming months whether it is still the case.

In the meantime, I’m all for raising the voting age to 25, or upon completion of military service with an honorable discharge.  Those are the people who have their feel (or boots) on the ground and have enough sense to make policy.

Spoiled kids on grants and mommy and daddy’s dime getting radicalized by the Olde Chitown Lefties? 

There’s a read Greg Hinz was able to write a fine summary in “Chicago is Still #1 for Public Corruption” last year.

All the liberals hate to be outed like this, but here we are and now we’ve all seen the evidence.

Trump should sue the promoters…pure and simply.  And with lots of significant zeroes.  Even if he were to lose, it would cause a sudden growing up of some folks for whom it is long past time.

You do remember the story from December?  A university in Scotland that had awarded Trump an honorary degree actually revoked it because, said the university, some of the things he was saying in his campaign were not in tune with what the university was peddling.

One of America’s all-time most successful businessmen (and author of the still best-selling Art of the Deal) is finding those hallowed halls of academic are still failing to teach critical thinking either to faculty, administration, or students.

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In our Wednesday report, we looked at “utilization” in a number of areas, such as transportation where Uber and Lyft are quickly turning all of America into a country served by a “rental vehicle utility.”

Today, we will take that concept further.

As we do, a fascinating question arises:  Do utilities arise from technology itself, or is it really driven by high capitalization costs?

In either event, it helps to define this Brave New World because the implications of either technology or high CAPEX driving more socialism begets a soft revolution that no one has yet labeled.

This isn’t like an Arab Spring deal…a headline and flash-in-the-pan.  If the conceptualization is correct, this is the newly arising wave that we’ll all be riding into the future.

Until it breaks. 

And, as we’ll see, no trend is extensible forever…of is it?

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I alluded to what would happen yesterday with the headline about blowing up the Dow with the latest rate decision from the European Central Bank (ECB).

Sit with me here and I’ll walk you though this nice and slowly:  Wikipedia first:

Quantitative easing (QE) is a monetary policy used by central banks to stimulate the economy when standard monetary policy has become ineffective.^[1][2][3][4] A central bank implements quantitative easing by buying financial assets from commercial banks and other financial institutions, thus raising the prices of those financial assets and lowering their yield, while simultaneously increasing the money supply.^[5][6] This differs from the more usual policy of buying or selling short-term government bonds to keep interbank interest rates at a specified target value.

Anyone who follows quantitative easing closely knows that it works with decreasing efficiency.  If you could spike a 100 point move in the S&P with such a policy, first time around, the second time it’s done, look for only 50-75 points.

Each time you do it, it’s less productive.

So, we zip to today’s headlines which reveals the ECB pays banks to take its money and that is driving hot money by the wheelbarrow into U.S. equities.  That’s because the (none) geniuses of the ECB are not quick enough to figure the diminishing impacts of their changes.  EUR/USD Analysis: Flirting with long-term rising trend line..

With all this loose money around, though, you get moments of panic and both the German and French markets are going through just that.  When the ECB decision came out on Thursday, you can see what the German market did in this chart.  Today, it is bounding back, but yesterday was something of a panic. Remember that a 450 point move on the German Market would be about like a 770-point drop on the Dow…so this is quite amusing to watch.

Easy money floats all ships, though.  Which means that the major US markets were set to pop up one percent, or so, at the open.  The most recent influencer being the…

New Trade Data

This is something the Fed will consider carefully, since they will be meeting on the 15th (Tuesday) and 16th (Wednesday) of next week.

“U.S.

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We got one hell of an interesting education on Thursday, although I assure you it was totally by accident.

The day started off with the continuation of torrential rains.  And by the time we passed the 15” of rain mark in 48-hours, the game of bathroom roulette was not exactly (how to say this at breakfast?) coming up winners.  In dice game terms, I guess we were crapping out.

Not that the septic isn’t fine.  It is.

But as one of our readers told us on the comment side Thursday:

“we live near Lindale, TX: just (2 weeks ago) had a new culvert put in over our seasonal creek in the driveway, : 6 loads of crushed rock and many $$ of dirt work…ALL of this is now gone:culvert is downstream in a fallen tree and the rock, dirt , concrete “bridge” fell away into the now roaring creek. WE ARE STRANDED!!! no way out except for a long walk thru the woods to a spot where my neighbor has a wooden footbridge over the creek, and then borrow her car!! Lived here 30 years- these downpours are a new nightmare!! 0ur guest cabin out in the woods on the back 40 is also flooded AGAIN, after a new roof and lots of dirt work(it floods from above AND below the windows) dirt ..starting to become apocalyptic out here in Paradise!”

But there is another side of this, as another reader shared more…

No, it really isn’t.

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We had this discussion the other day in our Coping section about how much of the news is patently useless.  But there’s also a small chance that there is a method to its madness. 

We asked, in so many words (about 1,700 of them) whether there was any POINT to most of what passes as news out there?

Today, we might want to be asking is it all so coincidental what’s in the news?

Do you care that Democratic Debate Takeaways: Tensions Rise as the Race Tightens?  Not I said the little red northern European extraction male of a certain age who could lose a few pounds.

Does it matter that  the “‘Hot felon’ released from federal prison, now entertaining job offers?”

Do you really care that Search on for Suspects in Pa. Shooting That Left 5 Dead? 

Actually, the correct answer on this last story is sort of.  And the reason has to do with your meds because it is all soooo similar to the killing of five people up in Kansas. (Here is where the conspiracy genes kick in…)  Why would we be interested in a shadow murder like today’s?  Simple:  It covers up the memory that the man who was charged with the five murders in Kansas was AND FREAKING ILLEGAL IMMIGRANT.

The U.S. Department of Mind Control sure as hell doesn’t want people figuring out that the border being wide open and with the Obamanation putting the brakes on actually having a BORDER leads to horrible social consequences.

No way to prove anything, except to note that while the illegal immigrant killed four, the killing of five by what the Department of Mind Control might script as a gang or drug hit so when people recall Kansas and this latest killing spree, they will fog out on the details and that is the whole point, is it not?  (It would be even more in line with the notion of a Department of Mind Control to make the latest attacks somehow racially connected.  You know, to keep the public stirred up and ready to submit to…oh, don’t get me started…)

Now, of course, we don’t know that there is a Department of Mind Control, but when we watch stories come along like this, we can’t help but wonder sometimes. And if the perps in the kill-five deal in Pennsylvania turn out to be tools to further inflame race relations, while covering up the ILLEGAL ALIEN KILLING THE FOUR IN THE MIDWEST incident, do remember where you heard it first.

In case you didn’t get the memo:  We’re also supposed to forget who was a big Clinton bundler who blew up a major financial outfit…that kind of thing.  If you or I had done that sort of thing, we’d be doing hard time, for sure.

Another Prediction Ready to Arrive

Now, I have to admit this is coming much, much later than I would have expected, but remember where you heard it first?

Back on December 3, 2015,.

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Although the market was up yesterday, for a few minutes this morning, it seemed as though the market might be ready to turn-tail and run for the hills.  The futures at one point were down more than 120.

Now?  Not so down.  70, or so.

Here’s what is going on – although most people don’t get it this clearly.  One of our Peoplenomics.com subscribers summed it up beautifully in a posted comment overnight:

“…money has to move out of bonds when rates go up…… some goes to the market, and the scared money goes to gold while the Central Banks restock the larder with gold (real money). Gold has bottomed imo…

To my (slightly twisted) way of looking at the world, this subscriber has it exactly right. 

We are not in crash and burn mode, at least not yet.  There are several areas where there is evidence that the market still has one more “final run at the top” due…and a new all-time high this year seems likely.

Here’s a note that just passed on the wires this morning:  The National Federation of Independent Business is out with its small business economic trends and business optimism report.  If I can quote from the trends part of their report (which is online over here):

“The Index of Small Business Optimism fell 1 point from January, falling to 92.9. None of the 10 Index components posted a gain, six posted small declines, and four were unchanged. Overall, a “ho hum” outcome, confirming that the small business sector is not headed up with any strength, just treading water waiting for a good reason to invest in the future.”

What’s going on at the macro level for another month, or few weeks, anyway, is that people are not sure about the future.

But when we look at what the investment alternatives area, consider this:

1. In our work, which focuses on how past policy errors tend to be repeated, the odds are very high that the Fed will move to bump rates again.
2. This, in turn, will make bonds look like doggie doo, so where is a returns-hungry investor to park money? 
3. This gets us to the stock market, one of the two options.  And the market has been showing remarkable strength lately, and in my work, this is just the tip of the iceberg.  The optimism (that we might see REAL change in the elections this fall) should begin to add to investor confidence, but ONLY until the election.  Then the mood should sour – again.
4. At the same time, gold (bullion/coins) is viewed as a way to keep “money” out of the electronic system.  People like that.

On this last point, there is a reason people should love physical assets for the next year:  THIS IS THE MOST IMPORTANT STORY OF THE DAY, SO LISTEN UP:

Federal Reserve Bank Hacked, Possible $100 Million Theft

It doesn’t take a rocket surgeon (or Mensa membership) to figure out that “Hey!  If the FED can be robbed electronically…well, hell…SO CAN i!!!!!!”

And this is all really cool for a couple of reasons:  The main one is that there are still two factions of the coming World Disorder who are duking out the control scenarios.

One is the criminal families, cartels, and so forth.  They LOVE having the ability to pile up rooms full of money (like you’ve seen when cartel safe-houses get popped and they bring in forklifts to move the ill-gotten-gains (IGG) around.

This side of the equation plays on the sentiments of constitutionalists and people who hold to the idea that it’s none of government’s bee’s-wax what you have in the way of assets.

The FLIP side of this is the big government crowd and the people heading this faction would love nothing more than to turn the whole world into an all-electronic jungle when they can easily implement Cyprus-like bail-ins and rob people at will with things like negative interest rates when the mood strikes the,  Remember, negative rates essentially charges you money for having money.  Which is the most inane crock of shit in banking…ever…. But that don’t stop this faction from pressing forward.

This faction waves the gun control and “dangers of crime and pools of ill-gotten money going to TERRORISM” to they get the other side of the public whipped up on this, to counter Faction One.

There is a media war on, therefore, with several “moving pieces” in play.

The big money interests want to continue their slow-motion stampede into government uber alles and Hillary would be their candidate.

But here are some of the problems the e-money in banks crowd is having:  People like us.

We know (because the NY Times Never Lies) that Sweden is a failing poster-child for the left-leaning policy wonks.  So how is Sweden doing?

“In Sweden, a Cash-Free Future Nears.”

But now remember, I’m telling you Sweden is the test-case for what?  Giving the bankster class a way to syphon money out of real workers for doing NOTHING except storing electrons!

“Sweden Cuts Rates Deeper into Negative Territory, Says May Go Further…”

According to Ure’s Invincible Theory of Everything (UIToE), the Swedes were stampeded into the cashless/socialist dreams by the 2010 Stockholm bombings which coincidentally set up the press to get cash into banks.  And since then, the press hasn’t let up with stories easily found about “Why Sweden’s terror threat is a game changer…” a story from late last year.

And the left-leaners in Sweden has done their absolute damnedest to pack the country with people invading from the Muslim countries (because it fits with soft-think and expansion of government powers), we see that stories are beginning to surface like “As Migrants Flow In, Sweden Begins To Rethink Its Open-Door Policy.”

So the take-away here is what?  I mean besides the fact that those old Swede jokes may have had some basis in fact because not only did the Stockholm-based Nobel outfit give a Peace Prize to someone who hadn’t done anything, but it has also taken the country six years to figure out they are being made slave-bitches of the central banksters. 

The same thing is playing out in America, so any open-border presidential candidate is likely to back (remember where you read this first because we tend to run 10-years ahead of events) that stampede of commoners into electronic-only “money.”

The Flip side is not much better.  Because the strong nationalism, which would shut down the border and would interdict drugs, build walls, and what have you, is also likely to dictate a lot more than border security.  The problem is that these people tend to want to dictate a lot more:  Things like locking people up for having a gram of weed, telling women what they can and cannot do with their own bodies, and an urge to dictate public morals after their own line of thinking which sometimes goes way right of what logic and the Constitution provide for.

We wryly note that weed was not mentioned in Federal Law (going from memory here) until the Harrison Act, or so. 

But here’s how this group of folks tends to think:  THEY make up new government empires by imposing regulations on the rest of us and pursing wars of aggression which ensure terrorism as blowback, and that becomes a self-fulfilling circular reference that leads to getting my junk-checked at airports.  I mean WTF, we all see through this BS…

I apologize for this being a nearly-cogent discussion, of the sort we generally hold for Peoplenomics subscribers, but once you kinda/sorta figure out where markets are and how we’re doing a replay of the Great Depression lead-in, then it becomes a simple task to figure out the big picture stuff for what lies ahead.

And that part in simple:  The Master Plan for the Second Depression in the USA is to blow over the economic House of Cards.  Force everyone into electronic money (gold and silver and other fungibles will likely be made illegal and possibly cryptomoney, too.

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