11/3/2014 – A mixed day with the Dow Jones down 24 points (-0.14%) and the Nasdaq up 8 points (+0.18%).
If you study Kondratieff cycle/wave you soon realize that periods of deflation are not only unavoidable, they are quite good for the overall Economy. A simple fact most central bankers and the FED Economists seem to dismiss. Even at the cost of destroying their own currencies and national economies in the process (yeah I am talking about you Japan).
Over the last few years I have maintained that we are in a “stealth deflationary environment”. That is to say, the real deflation was being masked by ZERO Interest Rates and Trillions of Worldwide QE stimulus. Bill Gross tends to agree Deflation is a growing possibility: Bill Gross
This is rather simple to understand. Massive worldwide stimulus is the only thing hiding real deflation. If taken away under “Normal Monetary Policy Guidelines” you would see most asset prices (real estate, stocks, commodities, etc….) declining in value. Given massive over investment and/or malinvestment in most productive sectors of the economy over the last 35 years, it would be the only logical outcome.
And no matter how much central bankers would like to avoid deflation at the cost of devaluing their own currencies, the final collapse and debt liquidation is unavoidable. Given today’s zero interest rates and maxed our QE/Credit velocity, I fathom we are about to finally witness true deflation. Well, either that or an all out currency war that Japan started on Friday.
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. November 3rd, 2014 InvestWithAlex.com
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