HOT READ Issues That Impact Your $$

Are Bears finally Right?  

With markets near all-time highs, following another central-bank induced pump, indicators about euphoria stretched to record levels. 

Wall Street received nearly $600 Billion from the Fed from Sept 16, 2019 through January 2020.  The money was explained by the Fed as 'support' for a short-term financing market of overnight-lending to major financial institutions, effectively hiding major problems and of course the recipients of that money. Effectively that was just another hidden bail-out of financial firms who should have suffered negative consequences from betting on the Fed's already 'loose-money' game.

The 'Coronavirus' perhaps has arrived at a picture-perfect time to get the blame for central bank money-printing hi-jinx that inevitably will go awry.

Unfortunately, there is real human suffering and deaths involved, but it is too early to tell whether the virus is any different from its many recent predecessors (SARs, MERs, bird-flu, pig-flu, Zika and Ebola) and the regular flu virus that causes illness and death annually. 

The media hype is playing its part, and a real negative economic impact already exists.  It remains to be seen what the escalating impact will be, but it will definitely impact corporate revenues and earnings negatively and that impact looks likely to increase in severity.

What is certain behind the scenes is that central banks cannot stop pinning interest rates to the floor and they cannot stop printing money or their system will ultimately fail: when 'investors' lose confidence in a systems integrity, they flee.  That was clearly evident in the last week of February 2020.

'Investors' who choose to chase any central bank induced gains from March 2 2020 onward, will need to stay on top of developments for certain.  We suspect subsequent rallies may be advantageous for aggressive investors to down-shift risk exposure.  Time will tell.

The articles below have been selected to keep readers up to speed with these harsh realities.  Don't forget to check out our Quarterly Letters for more 'color',  and to access archived articles, explore the archives at the bottom.

Top Watches

Our Central Bank Explained in 3 Minutes  -  Josh Owens

Jim Cramer on Market Manipulation - Youtube

The Big Short  - now available on DVD!

The 2020 Sell-Off - Top 5+:

Peace for Our Time  -  Guggenheim Investments

2020 Crash  -  Northman Trader

Markets Lose $4.7Trillion - Can Fed Save It?  -  MarketWatch

Top 5 Reasons Markets Dived - MarketWatch

Technically Speaking, Markets Price in Virus - Real Investment Advice

Bulls Corner - Top 5+:

Trump Talks Middle Class Tax Cuts & Fed Support  - MarketWatch

Pence Says Markets Will Recover - CNBC

Manager Who Sold Top is Buying - Bloomberg

OPEC May Cut Supply to Support Oil Prices  - FoxBusiness

Using the VIX to Find a Low - DataTrek

Countries Best Prepared for Coronavirus  -  ZeroHedge

Bears Corner - Top 5+:

Coronavirus May Hammer US Economy - FoxBusiness

Worlds 10 Richest Men Wealth Exceeds 85% of Countries GDP - ZeroHedge

This Market is NOT Normal - Bloomberg

Who Was Puking During Week from Hell  -  ZeroHedge

Older Hot Issue Reads:

Trump Calls for Fed to Lower Rates to Support Markets - CNBC

Currency Wars: China's PetroYuan will Challenge US Military  -  Global Research

China & Russia Challenge the US Dollar  -  Strategic Culture

'Crash Risk Soaring - this is Where They Lost Their Minds' -  John Hussman

Are Central Banks Losing Control?  -  Charles Hugh Smith



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Prior intro:

Many valuable articles are linked below, but first, let's set the backdrop: unprecedented efforts of Central Banks have greatly distorted markets for the past few decades (in particular this past one), led of course by our own Federal Reserve.  Their support of governments worldwide, enticing them to overspend money that does not exist, has successfully boosted asset prices, but ... artificially, quite obviously.  As of the end of 2018, CBs were just ending their conjuring up of nearly $120 Billion per year. End result?  WILD volatility and a 20%+ drop in stock markets ... a 'bear' market.

Central Bank strategies have succeeded at making the rich richer, yet much of the world's populace is losing wealth under these same Banker-mandated acts of Financial Repression.  We posted the following at the end of 2017:  "We expect a bad ending at some point not too far down the road, perhaps even in 2018"

Negative Interest Rates (NIRP), falsified economic data, movements to ban the use of cash (so it can be trapped and controlled), and direct market manipulations are just a few of the Financial Repression tactics that swepting through governments and central banks worldwide  Now we see 'Yellow Vests' revolting against financial and other repression all over the world.

Since 1970, when the U.S. detached the dollar from gold, IE left the gold-standard, relentless money printing and suppression of interest rates have pushed assets to record highs.  Given the neary 50 year down-trend in rates, it seems unlikely that rates will ever be able to return to 'normal'.  Once again, the U.S. 10 Year Treasury failed in Q4 2018 to lift above a measly 3% yield.  Take note!

Other major super powers are working to lesson the U.S. monopoly on money, a luxury perhaps approaching its last days.  In late March 2018, China launched an Oil Exchange backed by their currency, the Yuan.  Since the early 1970's it was the U.S. Dollar alone that was backed by the world's oil.  This move by China is a potential Game Changer ... and it is but one of many.

Following the wild finish to 2018, investors should keep their eyes on 1) the Central Banks, 2) the challenge to U.S. supremacy by China/Russia/Iran and their allies, and 3) the increasing Geo-political turmoil, including the Yellow Vests.