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Saturday, November 7, 2020
👉Stocks Mark Best Post Presidential Election Day on Record - The Bubble to End all Bubbles !!
👉Stocks Mark Best Post Presidential Election Day on Record - The Bubble to End all Bubbles !!
Stocks best day after a presidential election on record - The Bubble to End all Bubbles
Stocks finished the session mixed on Friday as investors honed in on an election outcome and an improving economy.
The S&P 500 still posted its second-best performance for any presidential election week on record and its best since the 1932 election.
This is hilarious. The complete economic meltdown in progress and the market is soaring. Zimbabwe had the world's best-performing stock market as it entered hyperinflation; then, it became a sheet-show. So did Venezuela.
This is what happens when you press too many zeroes in your money printer. The bubble to end all bubbles. It's a rigged casino; stay away.
The Senate is back in session on Monday, and Majority Leader Mitch McConnell said Wednesday that the upper chamber would start work on another round of stimulus when it returns.
Congress would need to spend about $4.4 trillion to help shore up struggling businesses and households during the pandemic to help stave off a floundering U.S. economic recovery.
Let's print another 4.4 trillion because Wall Street likes it. What happens to the markets when the crack is taken away? Eventually, we will pay a steep price for money printing and quantitative easing.
Why stop at 4.4 Trillion? Why not 10 Trillion or 100 Trillion.
We know we can buy the market. We don't know how long we can outrun the repo man.
The Feds have put this country in such a corner from excessive QE that our entire economy and the stock market is now just an ongoing House of Cards that likely needs endless life support. Very sad that these experts have opened Pandora's Box and led us down such a rabbit hole. The Fed said that it appears we have avoided a worst-case scenario because of their endless money printing. This is quite false. The worst-case scenario is a dollar crash and a loss of reserve currency status as a result of their policies. Whether we avoid, that remains to be seen.
A pretty huge chunk of the stock market’s rise over the last 11 years is due to QE, according to analysts at Société Générale.
The problem with QE is that it is not a benign process that only inflates asset values. By lowering interest rates throughout the economy, it makes unviable projects viable, misdirecting capital where it should not be invested.
It also destroys pensions, financial services, and insurance.
And the most important thing is that it destroys the currency.
QE also keeps insolvent businesses alive because these businesses can evergreen their loans, although they do not generate enough profit to ever repay the loans. When the risk is obscured throughout the economy, the economy becomes vulnerable to any negative shock, and the only answer the central bank has is to respond to every shock with more QE, kicking the can down the road.
The markets have gained with tax cuts as the output of a higher American deficit and no extra GDP or growth to show for it. Take from the country - give to the capitalists. The Return on Investment for this trade is negative, much like most other deals.
The banks and corporations got their massive bailout with the last stimulus.
Now they just wait till millions of Americans are forced into foreclosure so they can siphon off what is left of the people's wealth for pennies on the dollar.
We are on The Road To Perdition.
A totally fake economy, totally dependent on forever stimulus.
It is just robbing Peter to pay Paul. At any rate, it is not real money.
There is no more QE unless they go into negative interest rates. Then, how deep can they go? This is the problem, and there is nothing to fix it. Rates are at zero, they should have been raising them since 2014, but they don't because all they care about is looking good. This economy is going down either way.
Socialism for the Corporations.
Rugged Capitalism for the People & Entrepreneurs.
There is very little difference between socialism and giving everyone money through some other scheme. $4.4 trillion is giving every person $13,000. If you are giving businesses that kind of benefit, you should be getting 50% of the equity. For many businesses, giving them money is pointless. 40% of the restaurants are going to close. You can throw money at them to delay closure, but they will still close.
We are going to be in Venezuela in less than two years. We cannot print our way out of debt, which is their plan all along. Make people more dependent on the Government.
It's just like 1789 in France- they kept printing money. The bread got so expensive, they revolted. They will keep printing money until inflation starts, at taxpayer expense. We have to pay it back. The great reset is coming- debt cancellation, new currency. Only hard assets will have value.
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Just look at Venezuela. Politicians, including the Fed, will do everything they can to fight an economic implosion, depression, and deflation even if it's impossible to win the fight, which is debatable. Anyway, as you know, the Venezuela economy completely collapsed, and yet their major stock market indexes actually moved higher. While this might seem perplexing to an outsider, the reason is quite simple, money printing. Why will it be different in the U.S.? The precedent is already in place; you can watch it happening. If you want to go to cash and sell all stocks, that's fine, but you could be sitting on the sidelines as the market doubles again. If enough people agree it has value, it will go higher, but at the end of the day, these are inherently worthless assets that do not create jobs, create products, pay dividends, or make the world a better place - you could say these are investments for losers. The instruction is to not sit on wealth but to put it to WORK, investing in businesses that earn a profit.
The funny thing is these crooks know that government spending affects GDP with a multiplier effect, but all they want is all risk assets to rally in an almost hyperinflationary fashion, so they grab their fat share of performance premiums at the end of the year.
This whole thing functions on debt, remove it, and the GDP, stock market, and housing market will crash by 90%. Credit card usury is one of the main forces undermining real GDP growth. It only enables imports of cheap junk and makes Communist China more powerful.
Now the good part - the Fed and other central banks have created a debt bomb, and the fuse is lit. Current US debt to GDP is approaching 130%. Add in unfunded liabilities, and it goes to over 750%. There is no way any set of politicians and bureaucrats can ever enact policies to clean up a mess this big - it will be a World Wide crisis, and it's going to be a ding dong dandy.
It amazes me that these politicians ignore the debt house of cards they are creating. The US Debt Clock projects that at the current rate of debt accumulation, the US Government will reach $48 trillion of debt within the next four years. At that amount, just the interest on the debt will become the largest expense in the federal budget!
It's only a question of time when (not if) the house of cards will blow over! Prepare now for the crash! It's coming!
This is shocking how much the stock market has been inflated due to QE. It is ridiculous that stuff like this can continue to happen.
Some of us have known this was going on while others called us crazy. They're the same one's downplaying anyone talking of a market collapse, but the numbers don't lie. We're in a huge bubble.
In a Mickey Mouse stock market, you have Mickey Mouse investors. Still, lots of people believe this is normal and sustainable. Funny, most of them have children and grandchildren
From at least the 2008 crisis to now, the US economy has been supported pretty much solely by stimuli of various kinds. You can look at the TARP bailout of the banks, the GM bailout, declining interest rates to near zero, QE 1-4 (or whatever the number is), the Fed's direct purchases of debt from selected companies, and, of course, the direct stimulus measures taken as a result of the lockdowns. If you took all of this out, you're looking at a completely failed economy. And even with all of this stimulus, you're still looking at an economy that can manage, at best, a meager 2%-3% annual increase in GDP, and that's before adjusting for inflation. Including inflation, GDP has dropped every quarter but one since 2000.
The so-called leaders of this country have put us in an untenable situation where no matter what economic policy is followed, pain follows. Enact more stimulus? Sure. You just increase the debt even more until a point is reached that no one around the world wants to buy your debt or hold your currency. Then you become Venezuela or Zimbabwe. Forget about the stimulus? Sure. And without stimulus money, people can't pay rent, buy food, get medical care, or, as is critical in a consumer economy, buy junk.
The american presidents are all to blame for this. All of them blissfully encouraged the offshoring of US jobs to allow their corporate buddies to reap the benefits of lower labor costs. And for those jobs that weren't offshored, they blissfully issued H1b visas to allow foreign nationals to take jobs on US soil. All of them, along with a complicit Congress, deserve to be punished for bringing the country to where we are today.
Today investors are skittish. That nervousness is leading to heightened volatility in the market. And with a solid third-quarter earnings season now largely in the books, this source of support for equities is fading. In sum upcoming gains on the Street may only come with considerable effort. Conclusion: Investors have faced headwinds before, particularly during this turbulent year. However, those who have stuck it out and not given in to the daily noise have done reasonably well. There seems little reason to shift strategies at this time.
But of course, the artificial nature of the market means that if any moderate-sized portion of equity holders attempted to "bank their profits," the values would plummet. That's how the wealth effect works. Values only stay high, and gains only stay real for so long as no one attempts to realize these gains.
End the fed to fix America.
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Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.Dr. Doom also trades currencies and commodity futures like Gold and Oil.
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