On Wednesday, the International Monetary Fund (IMF) began the selection process for its next managing director to replace Christine Lagarde whose term will expire in early July. She was actually nominated by Obama for they were personal friends. It was Lagarde who effectively began the worldwide assault on tax havens by threatening them with isolation and the removal from the SWIFT system. She was also behind the attack on the Vatican that will force them to report all wires and parties on both sides for the tax nightmare that arrives in 2017.
The Executive Board will select three candidates from the nominations — that is unless Obama directs them to appoint another person against society to hunt down money for wasteful governments to support their pensions. The nominations should be in quickly and the selection process should be complete by March 3. The next member of the Troika governing Europe’s fate will begin their reign of economic terror on July 5.
QUESTION: Marty, now the OECD is predicting a financial crash worse than the 2007-2009 event in Europe because they say there is over €1 trillion in bad loans that cannot be collected. They seem to be also changing their opinion to fit your model. Were they there in Berlin?
ANSWER: We cannot comment on if the OECD is following our model or who is attending a conference. They are the most widely attended and many just want to know where the computer stands.
We see a massive banking crisis. The European banks are in deep trouble. Deutsche Bank posted a shocking €6.7 billion euro loss with its shares falling 10% in a day. HSBC bought Republic National Bank in New York for a bit more than that. Barclay’s is pulling out of all emerging markets cutting 1,000+ jobs.
The collapse in commodities will reek havoc on all emerging market countries, but there is one economy which nobody pays attention to closely. That is Germany. Yes it is the largest economy and main supporter of the Euro. They need open borders and the Euro to maintain their economy which is EXPORT driven. China is advancing more rapidly than Germany and has focused on trying to develop its internal economy. Spain was the richest nation in Europe with all the gold coming in from America. But they failed to develop their internal economy and collapsed. Germany is declining. It cannot be sustain with open borders and the Euro because the rest of Europe is in serious decline. The refugee crisis is a nightmare and now Italydemands taxpayer money to bailout banks fearful that a bail-in will cause a revolution.
Merkel was against allowing in refugees previously, but then changed her position to combat her poor view for the treatment of Greece and then the brilliant idea of bringing in cheap labor again to help Germany. This entire refugee crisis is far beyond control and now the elites are beside themselves for the manipulations.
German Federal Minister Sigmar Gabriel, who is also head of the SPD, warned at the Economic Forum in Davos of a return to border fences and controls. That would be an economic disaster and would be rising unemployment. This is the German EXPORT model – that and the Euro. But it is coming and with it, the further decline of Germany. This will only fuel the dollar rally when Europeans realize that the break-up of the Euro may lead to Deutsche marks, but will they be better? Now even Soros is saying the collapse of the Euro is inevitable. So everyone is now joining the party; a bit late, but as they say, better late than never.
So welcome to the other side of 2015.75. We have a long way to go down into 2020. Here are only the technical projections. They also warn just taking out the 89 level produces a free-fall. This is unfortunately looking more and more like a total disaster of political incompetence and complete self-interest mismanagement.
The career politicians are incapable of saving Europe and instead are the very people pushing it over the edge. All they are focused on is saving their own ass in Brussels with their pensions. Jean-Claude Junckerhas done such a great job destroying Europe, he was given a retroactive pay increase to more than €32,000 PER MONTH. Socrates would do a better job and we would charge based upon performance.
Can a computer be president? Hm. Way of the future?
The Telegraph reported on a shocking new court ruling that may become the final straw that sends the British out of the EU. This ruling has begun the decline into chaos within Britain’s asylum system. This court ruling held that four Syrian migrants should immediately be brought to Britain from what is known as “The Jungle” camp in Calais because they have a right to a family life.
This ruling has very profound implications for it upholds an idea that we are really citizens of the world, and therefore, have a right to live where we want. The borders are maintained politically and through taxes. If we truly recognize human rights in this context, then the power of government should decline.
Alexis Tsipras has to implement pension reform in order to get more loans from Brussels. He is betraying everything the Greek people voted for and is pushing Greece over the edge. Brussels is demanding that the Greeks pay for the shenanigans of Goldman Sachs whom helped Greek politicians cook the books.
Protests against the pension cuts and tax increases in Greece are spreading throughout the country. On Thursday, Greek farmers blocked major roads with their tractors. Among other things, the traffic was hampered on the axis linking western Greece with Turkey. The sailors continued a 48-hour strike. Most ferries remained in port and the rail transport was hampered by work stoppages of railwaymen.
The ONLY solution is to exit the euro. Brussels is totally insane and their actions are designed only to maintain their own jobs. Merkel created this entire refugee mess by trying to show she was human while denying anything to Greece, despite Greece forgiving the German debt after World War II.
It is ironic that Merkel refused to bend for the Greeks, yet she let in hordes of “refugees” who are tearing Europe apart and have resulted in passports checks between member states.
The People’s Bank of China held a seminar yesterday to discuss the
issuance of a digital currency. The Chinese central bank said issuing a digital
currency would have positive implication as it would reduce the high printing
and circulation costs of traditional cash notes, make economic transactions more
convenient and transparent, reduce money laundering and tax evasion and
strengthen the central bank’s control over money supply and circulation. The
Chinese central bank pledged to issue China’s own digital currency as early as
possible.
Speculation is, at last, starting to rise that the HK$/US$ peg could break. The all-powerful governments are suddenly being seen as no so powerful. The massive dollar rally that our model has been forecasting is rather straight-forward. The higher the US$ rises, the more deflation will be exported to economies that are out of sync with the USA.
The dollar haters only talk about the $18 to $19 trillion debt and that is the sole reason, they assume, why commodities must rise and the dollar has to crumble. What they fail to see that it just so happens to be the WORLD. The sea of debt out there has exceeded $200 trillion. When you look at the U.S. government, I hate to say it, but it is a drop in the bucket.
Then we have China in a contractionary decline, Europe being torn apart thanks to the refugee crisis that will only get far worse, and emerging markets who assumed China would buy every commodity in sight forever. There is little hope of anything rising right now to offer any sort of an alternative to the US$ federal debt. Believe it or not, there is a SHORTAGE of federal debt when the entire world has only one place to park BIG MONEY.
Consequently, we will see virtually EVERY currency pegged to the dollar break from Hong Kong to the Middle East. Welcome to BIG BANG.
The most telling sign that we are headed into a real political-economic shit storm is the fact that “TRUST” is collapsing on all sides. Every chance Obama gets he wants to disarm Americans. Why? This is simply because government is in trouble and they no longer “trust” the people. Likewise, the “rich” are starting to withdraw their money from investment that would create jobs because they too are worried about the rising discontent among the majority of the population. Then we have the collapse in
trust” among the people of anyone who is a career politician. So welcome to the theme of Davos – the collapse in “trust”.
President Francois Hollande has publicly stated that the French economy is now in a state of “economic emergency”. He set out a €2bn job creation scheme in a desperate attempt to lift France out economic death spiral created by his socialistic policies that have raised taxes and chased out those who create wealth and jobs.
Hollande’s scheme he proposes will be a two-year plan where firms with less than 250 staff will get subsidies if they take on a young or unemployed persons for six months or more. In addition, Hollande says he will create 500,000 vocational training courses but that is pointless without firms hiring.
France’s unemployment rate is officially 10.6%, compared to a European Union average of 9.8% and 4.2% in Germany. However, this numbers are modest and do not properly reflect the students who cannot get a job to even start. He also says that this program will be paid “without any new taxes of any kind.” I suppose he is finally realizing that rising taxes shrinks the private sector and than means less jobs are available.
Right now, the fear has been that Iran will start dumping oil now that the sanctions have been lifted. Thus, crude has been falling out of bed in a nightmare scenario. The fact that Crude was below $35 and then rallied to close above it for the 2015 year-end closing was a warning that the long-term may not be as bearish as it appears at first glance. Crude still elected a year-end sell signal at $41. So that meant lower lows. But our other two numbers were $35 and $25. Breaking $30 certainly focuses our attention on the $25 level as support on a system basis. Technically, the $25 area is also showing up as support during January.
Cyclically, this collapse in price has been on target since our timing projections have been January, March, and June here in early 2016. We have warned that 2016 was the target for at least the intraday low.
When we start to look at what the computer is projecting in time, indeed 2016 is a Directional Change. It appears choppy until about 2018. From there out into 2022 to 2023/2024, which will be the next top in the Economic Confidence Model, we see a sharp rise in volatility. This is lining up with two primary factors – WAR and a MONETARY CRISIS.
So for now, we should focus on the $24-$25 area as the next psychological support zone. Our two key areas of target support for 2016 are $25 and $16. Looking forward, we employed our WHAT IF models to try to forecast where the Yearly Bullish Reversal (buy signal) will be generated from a low at either position in 2016. Interesting enough, in both scenarios, we end up with $40-$41.50. This will clearly become the major resistance moving forward. It does not appear that crude will ever make new intraday highs. It must fight again
Please correct and expand my understanding of a Sovereign Debt Crisis as it pertains to leveraged accounts. If global economies are leveraged because of too much debt with no plans to pay, then what are the pros and cons to leveraged short investments when economies are deleveraging? Might they be dangerous at times?
Thanks in advance for your incredible knowledge and willingness to educate others wanting to learn and understand.
Sincerely,
BB
ANSWER: Leverage seems to be the buzz word everyone relies upon to predict the end of times. All we hear about is the leverage in derivatives and the issue that will collapse society. Quite frankly, that is a lot of hype. They are quoting the total gross without looking at the net because so much of this is offset.
Because of these scenarios, the predictions people tout is always inflation. They keep the German hyperinflation in mind even if they do not explain their base reasoning. Within this idea is the fact there is a basic assumption government is GOOD and will attempt to honor its debts like bailouts when in fact they will NOT; i.e. bail-ins. Nevertheless, like a horse race, the doomsayers are betting on the wrong horse. LEVERAGE has existed since ancient times. Here is a Babylonian tablet recording the earliest futures market. Sorry, but LEVERAGE has been around a very long time. It is inevitable government will collapse for NEVER has a single one ever survived.
Careful correlations of historical data we have gathered which even include the money supply determined by the number of known dies for coins and the average 25,000 coins which can be struck before a die breaks. When I say we put together the largest collection of coinage providing a complete run back to 600BC to recreate the monetary system of the world, it is no exaggeration.
We even have Roman dies that were used to strike coins shown above and to the right. You cannot ascertain what the future will bring without a road-map of the past. Forecasting the future demands a database – not merely theories. By assembling the hardcore evidence of history tracing the footsteps of humankind throughout the centuries, only then can you speak with any pretense of authority that is not qualified with “I think”.
The battle has always been not with LEVERAGE, but with Government. The larger government grows, the more wealth they consume. Government produces nothing, but they ultimately consume everything. This is why they ALWAYS collapse. We are in a DEFLATIONARY spiral because they continue to suck in more and more money. LEVERAGE only adds to volatility. Government is like a BLACK HOLE, sucking in everything including the light of the future. Nothing can escape until its collapses.
This is the present HUNT FOR MONEY because they are going broke. It is not the quantity of money that counts; it is what crumbs are left on the table at the end of the day. Government is indistinguishable from any criminal organization engaged in the “protection business”. You pay up to be protected or they themselves rob you.
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