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Our Total Debt Cannot Possibly Be Repaid…Now What

daily chart ADecember11 2014

12/11/2014 – A positive day with the Dow Jones up 63 points (+0.36%) and the Nasdaq up  24 points (+0.52%). 

An important macro look at the state of total debt and its impact on our financial markets. It’s a quick read and I highly recommend it.  The World on the Verge of Another Financial Crisis.

Most people don’t comprehend that we are living in a protracted debt crisis with no possible solution, because the majority of money (about 98 per cent) in today’s economies in the U.S., the U.K., Canada and Europe is debt-money, primarily generated by private banks when they issue loans. The problem is that the sum total of these debts—which can never be repaid no matter how much the economy grows

I couldn’t agree more. The problem is, this debt has spread though every level and every sector of our economy. Including our financial markets. And there lies the problem. Over the last few decades this debt explosion has been used to propel our economy and markets higher. Unfortunately, the velocity of credit is now slowing down or non existent. With interest rates close to zero, there is very little the FED can do now. QE or not.

That means we are at a point of inflection. We either let this debt collapse and liquidate through a deflationary depression -OR- it will be inflated away. One thing is certain, whichever scenario plays out, it’s not going to be a pretty picture.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2014-2017 will start (to the day) and its internal composition, please CLICK HERE

(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. December 11th, 2014 InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

Our Total Debt Cannot Possibly Be Repaid…Now What Google

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Should I Invest In Apple? – Podcast

Visitor Question: Would now be a good time to invest in Apple (AAPL)? – Stephanie
Listen to our short 5-10 minute podcast below to get a full answer.

aapl

z33

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Is It Time To Buy Russia & Ruble?

russian market 3

With the Cold War 2 in full swing and with Russian markets and Ruble collapsing, is it time to try and catch a falling knife? Will Russia go from wounded bear to bucking bull

Not so fast. We first looked at the Russian market back in May of this year when it was undergoing a strong bounce from March lows. And after topping out at around $27 the Russian market is now down close to 40%. With that in mind, my view remains the same.

Trying to pick an exact bottom is a fools game. There is very little doubt that the Russian market is selling incredibly cheap. We are talking about below 2009 March bottom for the US market cheap. Yet, it doesn’t mean the RSX cannot go lower. First, we need a technical confirmation that the market has bottomed. As of now, it is nowhere in sight. Not even close.  As a result, Russia should remain on your “watch” list until the bottom is set, technical reversal is achieved and a new bull market begins.

Once that happens, the time would be right to load up on some Russian equities at give away prices …… you know Putin will.

Z31

Is It Time To Buy Russia & Ruble? Google

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How Much Lower Before Santa Claus Rally Hopefuls Begin Panic Selling?

daily chart ADecember10 2014

12/10/2016 – A big down day with the Dow Jones down 267 points  (-1.5%) and the Nasdaq down 82 points (-1.73%). 

If there was one uniform “TRUTH” sold by most of Wall Street throughout all of November and early December it was as follows…..”The Santa Claus rally is in the bag and most markets are likely to finish the year at or near all time highs”.

Perhaps. Yet, seasonality is not a fool proof measure. Sometimes it works and sometimes it backfires…..big time. For instance, Novembers are seasonally net negative and/or one of the worst months to hold stocks. Yet, November of 2014 proved to be net positive. More so, both the S&P and the Dow set multiple all time highs during the month. It is too much to expect that December will be a net negative, despite positive seasonality? I don’t think so.

Here is what I am driving at. As of today’s close the Dow is up YTD just 5.8%. How much lower do the markets have to go from today’s levels before hedge fund and mutual fund managers begin to dump everything in sight in an attempt to lock in annual gains. Any kind of gains to ensure that their 2014 is net positive.

Perhaps another 200 down points on the Dow….. maybe 400. Will there be a short-term panic? I think we are about to find out.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2014-2017 will start (to the day) and its internal composition, please CLICK HERE

(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. December 10th, 2014 InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

How Much Lower Before Santa Claus Rally Hopefuls Begin Panic Selling? Google

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Hussman Expects A 30-50% Drop……Should You?

In early 2007 I started telling everyone I knew that they should go into cash. At that juncture I was about 9 months too early and a few percentage points short of the actual October 2007 top. Yet, people who ended up following my advice were not only able to avoid a massive 2007-2009 drop, preserving their cash, they were able to buy stocks at dirt cheap prices at 2009 bottom.

John Hussman says we are now witnessing the same kind of equity valuation bubble that preceded the last two stock drops of 50 percent or more. Hussman: Dismal Outlook for Stocks — Air Pocket, Free Fall or Crash

“My own view is that stocks are vulnerable to the risk of deep losses over the completion of the present cycle not unlike those it experienced in the two most recent cycles, and are likely to post total returns from present valuations of only about 1.4% annually over the coming decade.”

I couldn’t agree more. Think about it in the following fashion. Given today’s valuation levels, even if we are lucky enough to avoid a crash/decline, the stock market is unlikely to go much higher. In fact, any further upside would simply add to bubble valuation levels, leading to an ultimately crash scenario.  In other words, Mr.Market has already borrowed returns from 5-10 years into the future in order to yield today’s stock prices.

Invest accordingly. 

Z30

Hussman Expects A 30-50% Drop……Should You? Google

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Are We Dealing With A Fantasy Market?

daily chart ADecember9 2014

12/9/2014 – A mixed day with the Dow Jones down 52 points (-0.29%) and the Nasdaq up 26 points (+0.54%). 

Another superb MarketWatch article that I highly recommend.  Investors must believe in magic to buy stocks now

Most of the things discussed in the article match my overall view. Primarily, the fact that today’s stock market is priced beyond perfection and the fact that numerous technical/sentiment indicators are flashing a red light. So much so that I will explore this idea and show through valuation work (in about two weeks) that when adjusted for interest rates and QE, we are now at the highest valuation levels ever. Higher than 2000 and 2007 tops.

Of course, that doesn’t mean the stock market can’t push higher. It simply means that anyone who is investing for the long-term at this juncture is playing a very dangerous game of buying at the top.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2014-2017 will start (to the day) and its internal composition, please CLICK HERE

(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. December 9th, 2014 InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

Are We Dealing With A Fantasy Market? Google

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Shanghai Plunges 5.43%. Let The Bloodbath Begin?

shanghai index

Over the last few weeks a slew of articles detailed how wonderfully the Chinese stock market was performing and how the Chinese people from all walks of life were shifting their hard earned savings to speculate in the stock market. Today, Shanghai composite plunged 5.43%.

So much for that Santa Claus rally everyone was expecting. Yet, the main question remains. Is this the beginning of a larger sell-off or a simple correction? Here is one theory.

THE QUOTE: Hu Guopeng, an analyst at Founder Securities in Beijing, said the plunge in China’s stock markets was a “technical correction” linked to the uncertainty about credit availability created by the change in collateral requirements. It “does not mean the end of the market boom,” Hu said.

Perhaps.  Yet, it is always a “technical correction” until it slowly turns into a 10%…..20%…..30%….etc….bear market correction. The bottom line is this. Investors should not guess or speculate on whether or not this is a technical correction. They should have a clear understanding that most worldwide markets are in a massive speculative bubble driven by imbeciles in power. A massive bubble that will eventually correct. If you would be interested in learning when, please Click Here. 

z33

Shanghai Plunges 5.43%. Let The Bloodbath Begin? Google