Investment Inspiration Of The Day Google
Shocking: China’s Collapse Is Accelerating
We have been talking about China’s “ponzi” economy for well over a year now. Here is just a small sample of our previous work China’s Housing Collapse Is Already In Full Swing. It now appears that China’s massive fraud is beginning to unravels. Consider the news flow.
- China’s 2014 economic growth slowest in more than 2 decades
-
China’s $20 Trillion Headache Underscored by Stock Swings
- The Scale Of The Chinese Real Estate Crash Is Terrifying
Here are just a few more bits that should scare the bejeezus out of you.
- Chinese corporate borrowers owed $14.2 trillion at the end of 2013 Vs $13.1 trillion owed by U.S. corporations.
- This means that as much as 10 percent of global corporate debt is exposed to the risk of a contraction in China’s informal banking sector.
- Cash flows and leverage at Chinese corporations are the worst among global peers, having deteriorated from being the best in 2009.
As I have mentioned in the past, most of China’s economic growth over the last 5-6 years has been financed by massive credit expansion. The likes of which we have never seen before. The result?
- $21 Trillion Debt Mountain. Roughly the same size as the entire US Banking Sector. It took the US 220 years to get to that number, it took China just 5 years of explosive credit growth.
- $6 Trillion In Shadow Banking. Actually, no one knows how large this number is. I have read good data/reports putting this number at $10-15 Trillion range.
- Empty cities, shopping centers, massive speculative bubble in real estate, built out infrastructure, rising cost of labor and export driven economy.
How much longer can this go on? Well, that’s a Trillion dollar question…..or a $40 Trillion dollar question. Apparently, it is already unraveling. Either way, one thing is for sure, this will not end well nor will it end in an orderly fashion.
Are We In A Bear Market Already?
1/29/2015 – A positive day with the Dow Jones up 225 points (+1.31%) and the Nasdaq up 45 points (+0.98%).
A number of articles worth your time today……
- Too late: We’re already in a bear market
- Here’s Why Investors Are Now Facing Another ‘Lost Decade’ in The Stock Market
I agree with both authors. Here is another good way to look at today’s market. As you know, I don’t make it a secret that based on my mathematical and timing work the stock market will compete it’s secular bear market in 2017 (2000-2017). I have very little doubt about that.
Now, given the upcoming bear leg of 2014/15-2017 do you think it is possible that the Dow will end 2017 below 2007 top of 14,280?
Based on my mathematical work not only it is possible, it is almost a certainty. Yielding another decade of no returns for long-term investors. In other words, given today’s massive valuation levels most investors would be well advised to sell now and go into cash. And while this might not sound as attractive as the stock market gaining 10% this year, it’s a hell of a lot better than taking a 20-40% haircut over the next 2 years.
This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014/15-2017. 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 2014/15-2017 will start (to the day) and its internal composition, please CLICK HERE.
(***Please Note: A bear market might have started already, I am simply not disclosing this information. 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. January 28th, 2015 InvestWithAlex.com
Any New Thoughts On Apple After Earnings? – Daily Podcast
Listener Question:Any New Thoughts On Apple After Earnings? – Daily Podcast – Listen to our short 5-10 minute podcast to find out. Plus, don’t forget to email me your questions.
Chinese Diplomacy – Investment Grin Of The Day
Shiller Thinks You Are Scared & What Does The Dow Transports Index Tell Us
Nobel Prize winning economist Robert Shiller thinks you are scared and that’s the primary reason the yields are collapsing. Scared of what might you ask? Well, the future, AI, terrorist, etc…basically everything. Everyone is scared: Nobel Prize winner Shiller
“I think fears have been growing for years that represent the willingness of people to bid up bond prices,” he told CNBC Wednesday.” They are worried about their future. They are worried not just about next year, they are worried about the next twenty years, the next forty years. So they are desperately trying to provide for that, they’ll even accept negative yields.”
That’s quite an analysis. I have a different view. The yields are collapsing and the yield curve is flattening because quite a few smart investors see a massive asset bubble in equities, deflation, another ultimate round of QE, a big upcoming recession and at least a double bottom in a 10-Year Note. I don’t think they are scared, on the contrary, I think they are smart.
Also, quite an interesting way to think about what the Dow Transportation Index is doing, its impact on the Dow theory and the overall economy can be found here. What the oldest stock market index is telling us
The author is absolutely correct. Despite the oil being down over 50% over the last 6-9 months, the Dow Transports Index had failed to move higher. Even though the companies within the index should be the primary beneficiaries of cheaper oil. This brings up a number of questions.
First, will oil prices have a net positive impact on our overall economy, just as most financial analyst believe? Thus far, the Dow Transportation Average is saying NO. Second, the Transports tend to be a leading indicator of economic downturns. Could it lack of enthusiasm for lower oil prices be considered as an ominous sign for the overall US Economy and the stock market? I think you know the answer to that.
Shiller Thinks You Are Scared & What Does The Dow Transports Index Tell Us Google
The FED Decision, Apple, Yields & What The Market Is About To Do
1/28/2015 – A big down day with the Dow Jones down 195 points (-1.12%) and the Nasdaq down 43 points (-0.93%).
The stock market continues to behave as forecasted. If you would like to find out what happens next, please Click Here.
A number of very important things to consider today. First, a very important fundamental/technical look at today’s market. Forbes: Watch These Interesting Stock Market Patterns Forming Right Now I highly encourage you to study the article in great detail.
Second, today’s market action is incredibly important considering….
- The FED decision to not change course.
- Plunging yields.
- Market’s inability to rally despite Apple’s blow out quarter.
You can look at all of the above in a number of different ways. It can be debated that the FED decision not to alter their eventual interest rate hike plan bodes well for the overall US Economy. At the same time, neither the yields nor the stock market are buying that premise. If anything they are flashing a red warning light. And since there is are no fundamental reasons for this massively overpriced stock market to rally, as earnings are not very good and the US Economy is rolling over,……….I wonder what happens next.
This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014/15-2017. 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 2014/15-2017 will start (to the day) and its internal composition, please CLICK HERE.
(***Please Note: A bear market might have started already, I am simply not disclosing this information. 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. January 28th, 2015 InvestWithAlex.com
Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!
The FED Decision, Apple, Yields & What The Market Is About To Do Google
Is It Time To Buy The Russian Market & Ruble?
Listener Question: Is It Time To Buy The Russian Market & Ruble? – Daily Podcast – Listen to our short 5-10 minute podcast to find out. Plus, don’t forget to email me your questions.
Investment Grin Of The Day
NATO Mercenaries Are Fighting In Ukraine & The Game Of Nuclear Chicken
I continue to write about Russia and the situation in Ukraine because I believe it is the most important macro economic development in at least 200 years. Not only will this impact the US stock market in a negative way, it might change all of our lives forever. In fact, it might very well be that when the history books are written 50 years from now, this issue might be viewed as the most significant in human history. In the very same fashion the treaty of versailles is viewed today.
I assure you, the intelligence level of today’s politicians did not improve one iota from the idiots who started World War I and then created perfect conditions for World War II.
Do you want the real story of what is happening in Ukraine? I highly recommend the following article by MISH Email From US Special Forces Veteran; 500 US Blackwater Mercenaries in Ukraine? US Backs Ukrainian Neo-Nazis He did a wonderful job putting things together.
In addition, consider the following news flow……
- U.S. ‘Cannot Stop’ Russian Nuclear Missiles — Deputy Prime Minister
-
Russia scorns ‘politically motivated’ downgrade to junk rating
-
Putin brands Ukraine army a NATO proxy as fighting flares
Did you catch the first article? Things are now getting very serious. Russia feels under attack and the US/EU/NATO are now playing a dangerous game of Nuclear Chicken. A game that I am afraid all of us will have to pay for. Sooner or later.
NATO Mercenaries Are Fighting In Ukraine & The Game Of Nuclear Chicken Google