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callmejoe

Financial crash? : 2017-18 peak / lasting until 2020 -21 ?

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Financial stocks are often a bellwether of a crash or market slide

 

Recently, they have been under-performing the general indices, as this ratio shows

 

RATIO : XLF -to- SPY : Financials to the S&P 500 ... XLF-vs-SPY : XLF : SPY

 

image.png

 

A break in support could happen any day now...

 

You will note that XLF-Financials and JPM have not confirmed the new high in stock

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Like Mannarino, I think Gold may get pulled back briefly by a break in stocks.

 

I read with amusement stories like this in today's Asian WSJ

 

Headline: A Warning on Gold: Fear may be fading

 

Okay.

But what is inside the article? Sentences like these:

 

"Gold could move higher temporarily, but Ms. O'connell says the price is likely to have trouble making significant gains before 2016 because economic confidence has improved."

 

"Sameer Samana, senior international strategist at brokerage firm Wells Fargo Advisors, suggests clients use to sell anything they have left"

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I have posted this Bearish prognosis on Dr.Bubb's Diary

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Is a big slide in stocks about to begin ?

 

Why do I ask this question? Here's why?

 

(1)

FED Racetrack chart is in a peaking area (near 185)

FRT.gif

 

(2)

GEI's Credit bellwether has topped / LQD-to-TLT ratio

LQDrat.png

 

(3)

The Finance/Stocks Ratio is breaking down

image.png

 

In other words, some General stock indices (like SPY) are making an UNCONFIRMED High,

at a time when Finance stocks are well past their high. The Financials often lead the market.

 

Taken together, these technical indicators are providing some important clues to future market direction.

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Jim Marrs on the Financial Meltdown - A look back at a warning from Labor day


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Published on Dec 6, 2013 / Recorded: August


Jim Marrs has a completely unique understanding of these volatile times and our financial and terrorism related problems, and Whitley Strieber's interview of him on this week evokes spectacular information!


The financial crisis of 2007--2008, also known as the Global Financial Crisis and 2008 financial crisis, is considered by many economists the worst financial crisis since the Great Depression of the 1930s. It resulted in the threat of total collapse of large financial institutions, the bailout of banks by national governments, and downturns in stock markets around the world. In many areas, the housing market also suffered, resulting in evictions, foreclosures and prolonged unemployment. The crisis played a significant role in the failure of key businesses, declines in consumer wealth estimated in trillions of U.S. dollars, and a downturn in economic activity leading to the 2008--2012 global recession and contributing to the European sovereign-debt crisis.The active phase of the crisis, which manifested as a liquidity crisis, can be dated from August 9, 2007, when BNP Paribas terminated withdrawals from three hedge funds citing "a complete evaporation of liquidity".


The bursting of the U.S. housing bubble, which peaked in 2006, caused the values of securities tied to U.S. real estate pricing to plummet, damaging financial institutions globally. The financial crisis was triggered by a complex interplay of policies that encouraged home ownership, providing easier access to loans for subprime borrowers, overvaluation of bundled sub-prime mortgages based on the theory that housing prices would continue to escalate, questionable trading practices on behalf of both buyers and sellers, compensation structures that prioritize short-term deal flow over long-term value creation, and a lack of adequate capital holdings from banks and insurance companies to back the financial commitments they were making. Questions regarding bank solvency, declines in credit availability and damaged investor confidence had an impact on global stock markets, where securities suffered large losses during 2008 and early 2009. Economies worldwide slowed during this period, as credit tightened and international trade declined. Governments and central banks responded with unprecedented fiscal stimulus, monetary policy expansion and institutional bailouts. In the U.S., Congress passed the American Recovery and Reinvestment Act of 2009. In the EU, the UK responded with austerity measures of spending cuts and tax increases without export growth.


Many causes for the financial crisis have been suggested, with varying weight assigned by experts. The U.S. Senate's Levin--Coburn Report asserted that the crisis was the result of "high risk, complex financial products; undisclosed conflicts of interest; the failure of regulators, the credit rating agencies, and the market itself to rein in the excesses of Wall Street". The 1999 repeal of the Glass-Steagall Act effectively removed the separation between investment banks and depository banks in the United States. Critics argued that credit rating agencies and investors failed to accurately price the risk involved with mortgage-related financial products, and that governments did not adjust their regulatory practices to address 21st-century financial markets. Research into the causes of the financial crisis has also focused on the role of interest rate spreads.

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Another update from Ken.

He reckons what we see being played out is like a profession wrestling match (ie choreographed)

It's the old problem - chaos - solution that David Icke likes to talk about

 

 

http://blog.redefininggod.com/2014/03/07/the-imfs-transition-to-brics-control-could-begin-as-early-as-next-month.aspx

The IMF's transition to BRICS control could begin as early as next month

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Could be triggered / or associated with / a big slide in the USD to DXY-$71 or lower

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Another update from Ken.

He reckons what we see being played out is like a profession wrestling match (ie choreographed)

It's the old problem - chaos - solution that David Icke likes to talk about

 

 

http://blog.redefininggod.com/2014/03/07/the-imfs-transition-to-brics-control-could-begin-as-early-as-next-month.aspx

The IMF's transition to BRICS control could begin as early as next month

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Could be.

 

Copper's drop is due to troubles in China, I reckon

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Could be.

 

Copper's drop is due to troubles in China, I reckon

 

Personally I don't associate market action with events. The price will go where it wants to go, and events will be used as the explanation after the fact. (I would like to think you think this way too).

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Personally I don't associate market action with events. The price will go where it wants to go, and events will be used as the explanation after the fact. (I would like to think you think this way too).

 

interesting Van, much like the idea that the majority of our actions are instigated by the unconcious and the concious mind then explains them after the fact

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China has created a monster demand for copper by a monster amount of malinvestment, via a more or less insane amount of bank lending, plus copper has been used to avoid regulations where physical copper was pledged to banks. It now seems the Chinese have been forced to change direction since their investment is not going to where the leadership want it to go and essentially they have lost control of the healthy growth they need to remain in power where the masses are somehow appeased in what appears to be an increasingly corrupt unfair system. That could be one hell of a fundamental change for copper and iron ore.

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Quite an interesting read:

 

http://www.forbes.com/sites/chuckjones/2013/09/30/sp-500s-earnings-growth-is-anemic-and-trending-down/

 

The market is overpriced (no surprises there). Revenue growth has been fairly anaemic, and profits have been driven largely by efficiency gains. Profit margins are now at record levels.

 

IMO any or all of these factors will be unwound at some point, fueling the next bear market.

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An Interested bystander?

 

http://www.zerohedge.com/news/2014-03-14/russians-have-already-quietly-pulled-their-money-west

 

The Russians Have Already Quietly Pulled Their Money From The West

 

.... the ..... Russians .... oligarchs, have already pulled billions from banks in the west thereby essentially making the biggest western gambit - that of going after the wealth of Russia's 0.0001% - moot......

 

What it will also do is force Russia to engage China far more actively in bilateral trade and ultimately to transact using either Rubles or Renminbi, and bypass the dollar....

 

If so, They have nothing to lose, and much to gain from a Crash in the USD and US stocks

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Those have vaulted to new highs, despite the weak economic recovery, on the back of ultra-cheap borrowing (which reduces interest costs which are deducted from earnings), government deficit spending, and low household savings:

Coporate-Profits-2014-02-26_13-36-16.jpg

While the parabolic rise in corporate earnings is quite impressive, they are also historically unprecedented and certainly unsustainable.

When we look at the same chart seen above but on a percent change yr/yr basis we see that they have been slowing down remarkably and aren't that far above the zero mark... » Read more

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"Insider Selling Reaches 25-year High"

 

That sounds very TELLING to me

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Shiller Measure Carries Warning on Stock Values



Spencer_Jakab.jpg : by Spencer Jakab






Updated March 23, 2014 5:55 p.m. ET


Asked to define a bubble, some Wall Street wags say it is a bull market that an investor has missed.



97bfe8f0151d87a449095033e95d63ca.jpg



But with first-quarter earnings season soon to begin and the S&P 500 again near its record high, investors may turn more attention to the stock market's overall health rather than just that of its components. According to a valuation measure associated with the most famous living student of investment bubbles, stocks are undeniably expensive.



Many have quibbled with Yale professor Robert Shiller's use of a cyclically adjusted price/earnings ratio. Few can fault his timing in calling out perhaps the greatest stock mania of all time with the publication of "Irrational Exuberance" in the spring of 2000, though.



Mr. Shiller's technique uses a decade of inflation-adjusted earnings to derive a P/E ratio. That is in contrast to the more common practice of basing it on a year of analyst forecasts. By his measure, stocks now trade at 25.5 times earnings, 54% above the average going back to 1881.



Peaks in this measure have come before downturns in 1929, 2000 and 2007, but also many times in between. The Shiller P/E is thus no market-timing tool. Still, a look at the big picture should give pause.



The ratio is now in the top tenth of historical observations. Previously, at such levels, real compound annual changes in the S&P 500 have averaged negative 1.4% over the next 10 years. At the other extreme, the change has been a positive 6.4% when P/E ratios were in the cheapest tenth of observations.



Until recently, critics complained that the 10-year sweep of the Shiller P/E covered two market washouts, early and late last decade, which was unusual. That argument has expired now. But some still insist write-downs during the financial crisis skewed even a 10-year average P/E.



Furthermore, some Wall Street strategists argue that historically high profit margins at the moment are sustainable. Don't get complacent, though. Since profit margins also were inflated during the housing boom, the Shiller P/E actually might be understated.


Perhaps investment firms that were caught out by recent debacles are right this time and not the man who identified the housing and tech bubbles. Not just 14 but 140 years of market history say otherwise.


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> http://online.wsj.com/news/articles/SB30001424052702304026304579453841970603008?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB30001424052702304026304579453841970603008.html



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http://www.waykiwayki.com/2014/03/know-what-is-coming.html

 

Also what is coming is a rare Cardinal Cross in the sky in mid April while the sun is in Aries. Leading up to this we have a nasty T-Square too.
....so expect a some sort of war (modern war is usually economic nowadays) on a world scale, and watch for volatility and irrational conflict on a micro level.

 

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Warning: Stocks Will Collapse by 50% in 2014

 

( an Advertorial )

Saturday, 12 Apr 2014 08:18 PM

 

It is only a matter of time before the stock market plunges by 50% or more, according to several reputable experts.

“We have no right to be surprised by a severe and imminent stock market crash,” explains Mark Spitznagel, a hedge fund manager who is notorious for his hugely profitable billion-dollar bet on the 2008 crisis. “In fact, we must absolutely expect it."

Unfortunately Spitznagel isn’t alone.

“We are in a gigantic financial asset bubble,” warns Swiss adviser and fund manager Marc Faber. “It could burst any day.”

Faber doesn’t hesitate to put the blame squarely on President Obama’s big government policies and the Federal Reserve’s risky low-rate policies, which, he says, “penalize the income earners, the savers who save, your parents — why should your parents be forced to speculate in stocks and in real estate and everything under the sun?”

Billion-dollar investor Warren Buffett is rumored to be preparing for a crash as well. The “Warren Buffett Indicator,” also known as the “Total-Market-Cap to GDP Ratio,” is breaching sell-alert status and a collapse may happen at any moment.

Read

http://www.moneynews.com/MKTNewsIntl/Stock-market-recession-alert/2014/02/10/id/551985/?promo_code=166D4-1&utm_source=taboola&utm_medium=referral

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An Update from Martin Armstrong

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He gave an interview on 18 April

http://www.trunews.com/listen/

 

An excellent interview - lots of history too.

 

The Downwards part of the Cycle will begin on Sept. 30, 2015

 

And continue downwards into 2020.

The troubles in the US will be led by those in Europe, which is "ahead in the cycle."

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http://philosophyofmetrics.com/2014/04/21/the-greatest-game/#more-532

 

The Greatest Game

The Coming Stock and Precious Metals Collapse

 

....Returning to gold, I content that the spot rate has not been manipulated down but manipulated upward. The mass movement of gold is always preceded by a sharp increase in the spot price. Once the gold has been moved, the spot price always adjusted downwards.....

 

The price of gold and silver do not need to keep moving upward to compensate for the level of sovereign debt in the world when that very same sovereign debt will be reduced through a mechanism of debt restructuring in the IMF.....

 

.... the financial systems of the world are being readied for a major debt restructuring and consolidation which will be followed by the full transition to a true multilateral system dominated and denominated in an SDR supra-sovereign bond.

 

All gold, silver, oil, and other commodities and currencies will be pegged and anchored to the SDR. As such, it is reasonable to expect that the prices which have been pushed upward to facilitate dollar debt creation will now be able to move back to a more balanced and workable range.
Unfortunately, both the mainstream media and alternative media are controlled by the same source and will ensure that the system is rigged to capture the full wealth transfer from the large disorganized massed to the small organized elite....
...once a full peg to SDR’s becomes a reality, many will see windfalls as exchange rates are adjusted to reflect the economic reality of production volumes and marketability.
Those who follow the mainstream news sources will take massive losses in the stock market and those who follow the alternative media will take massive losses in the precious metals and commodities markets.
It will be a full spectrum wealth transfer. All peoples are being played in the greatest game their ever was.
And that game is setup to ensure the largest transfer of wealth in the history of the world and the introduction of a full on multilateral financial system.
The old system was designed to feed on human greed and desire, as both are mandatory to support a debt based system..... we are moving towards a production based system.

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Some Bank shares stay weak yesterday, despite the full recovery in SPX

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Stocks finish strong after morning drama
CNNMoney-2 hours ago
In its latest earnings report, the company announced a seven-to-one stock split, which will take effect on June 9th and make the price of a single ...
It started as an ugly day on Wall Street, but the day ended with some Cinco de Mayo cheer.

The Dow closed in the green Monday -- up 0.11% -- after dropping 120 points early in the trading session. The S&P 500 and Nasdaq also recovered from early losses, and ended up slightly for the day.

The Dow hit an all-time high last week, and the S&P 500 is close to new heights.

US Stocks Advance as Services Data Offset Bank Declines
Bloomberg-7 hours ago

 

JP Morgan (JPM) shares dipped about 2.5% Monday after the nation's largest bank by assets said Friday that it expects a 20% drop in trading revenue in the second quarter. Like many of its rivals, the Wall Street behemoth has seen a sharp slowdown in its bonds, currencies, and commodities units as low interest rates and soft demand from emerging markets has put a damper on those previously lucrative businesses.

 

JPM ... update // banks set to go lower, if JPM slide continues? : XLF : C : BAC : WFC : GS : MS

 

JPM_zps5ff0fe0b.gif

 

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Here we go !? / USD testing LOW of the Year

 

US Dollar Weak - down almost 0.3% - Testing key Support near 79.25

 

idx24_usd_en_2.gif

 

DXY ... update

DXY_zps3a9d6986.gif

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CONCENTRATED OWNERSHIP may make Global Economy more fragile

 

" ... The structure of the ownership network is a good proxy for that of the financial network, this implies that the global financial network is also very intricate. Recent works have shown that when a financial network is very densely connected it is prone to systemic risk. Indeed, while in good times the network is seemingly robust, in bad times firms go into distress simultaneously. This knife-edge property was witnessed during the recent financial turmoil... "

 

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> as contributed by Karen Hudes: The "Bow-Tie" Financial structure of ownership

http://arxiv.org/PS_cache/arxiv/pdf/1107/1107.5728v2.pdf

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