Leading Expert Points to SUPER Nasdaq Market Crash

The Coming Super-Crash in NASDAQ? The Global Population Implosion and the Decline of Stock Markets

Dr. E. Ted Prince 

 I guess you noticed the swoon last week in the NASDAQ. I’m not bright enough to figure out where it goes next in the short-term. But I do have a couple of ideas about what will happen in the longer-term. The beauty about long-term guesses is that if I’m wrong, I won’t be around to have to take the brickbats

20 years ago the global literati were all up in arms about the coming global population explosion. Now it’s starting to look a lot more like we are going to face a population implosion. Rapidly declining fertility rates, the increasing propensity for educated women to delay childbearing or not to have children at all, are all leading to populations flattening out or even declining.

Most developed countries are in this category. That includes Europe and the US. The US is only managing to increase its population through high rates of immigration. Places like Japan are actually already seeing population declines. China of course is static. India is still rising but as it enters the next phase we can be sure that its population will flatten out too. Russia is heavily declining, although there are special factors at work (vodka, resignation).

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What Investors' Insights says -

Heading For Worst Markets Ever

http://pwa2100.blogspot.ca/2014/04/nasdaq-heading-for-worst-market-ever.html

What the Media says -  

Dangerous TIMES - Fed All Quiet On Rates

Why the Federal Reserve is vague about interest rates

Federal Reserve Chair Janet Yellen can expect questions about interest rates and unemployment when the Fed wraps up its two-day meeting later today.

The Fed had promised to keep interest rates near zero, at least until unemployment hit 6.5 percent. Unemployment is currently at 6.7 percent and dropping (and the Fed has said it will likely look at other factors, too). Yellen is known as a proponent of transparency – but she’s expected to say as little as possible  about what those other factors might be. 

Here's why:

1. Players in the stock and bond markets always want to know exactly what the Fed will do next.  Even when the Fed can’t say for sure.  

"They’re trying to figure out 'What is the Fed telling me about, what are interest rates going to do?'” says Ann Owens, a Hamilton College economics professor and former Fed economist. "There’s a real incentive to figure that out before everybody else does. Because if you can do that, then you can make a profit."  

2. The Fed wants to give some guidance about what it’s thinking, without boxing itself in. Williams College economics professor Kenneth  Kuttner, who also worked for the Fed, says the Fed is like a college professor—with market players as grade-grubbing students.

"You hand out the grading rubric, and some kid says, 'Oh, look, I did X that’s on your grading rubric. Why didn’t I get an A?'" he says.  "You need to be specific enough that they know what to do in the paper, but vague enough that you can say, 'There are these other things I’m taking into account as well.'"

Because if those students get too unruly, it can cause trouble for the whole class.

One day, within the next five years, interest rates will rise in response, most likely, to a sudden surge in oil prices that will create an unprecedented spike in inflation. The US risks losing its status as the "global reserve currency." Hence by not doing so, it could place that status in peril. Major shortages in energy and material elements loom on the horizon that fuels this argument. 

Moreover, rates have been too low for too long. You can only defer the economic implications of limits to growth on a finite planet with crafty money ploys and tricks for so long. Reality bats last  And thus a reversion to the historical mean is in order on all fronts. Asset values are thus exposed to a historic correction - reality remains a cruel mistress! 

Platinum Wealth Partners
April 3, 2014

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Masters of the Universe - Federal Reserve

The Federal Reserve: Masters of the Universe or Trapped Incompetents?

By Charles Hughes Smith  


Suppose the Fed was actually little more than a collection of incompetents trapped in a broken system that is beyond repair.

For a variety of reasons, the Federal Reserve is viewed by many as the financial Master of the Universe. Given how the media hangs on every pronouncement and the visible power of the Fed's policies to move markets, this view is understandable.

But suppose rather than being masters of all things financial, the Fed was actually little more than a collection of incompetents trapped in a broken system that is beyond repair. Many reasons have been proposed to explain the Fed's policies,and most (including my own expressed here) focus on the Fed's need to protect the banking sector and the Status Quo, lest the whole rotten contraption collapses in a heap of worthless derivatives and various Ponzi schemes.

An alternative view is that the members of the Fed have been selected for incompetence by a system that fosters incompetence by its very nature, i.e. a centralized power center.

Longtime correspondent Harun I. recently offered this explanation of the incompetence of those atop the heap:

Regarding the competence of the Deep State and Federal Reserve:

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MARKET ALERT - China in Trouble - Bonds Default!

 

Default of a Chinese Bond:

Isolated event or the beginning of something bigger?

It finally happened. A Chinese domestic bond has defaulted. It was the first default since the Chinese central bank (PBOC) started regulating the market in 1997. The unlucky company was Shanghai Chaori Solar Energy Science and Technology (Chaori). The major question though is this a sign of healthy maturing market or the beginning of a major problem?

If you had to choose allow a bond to default, Chaori was certainly a prime candidate. First it is small. It has only 1,500 employees. Second it is a private company, not a large state owned firm. Third, it is in the struggling solar industry with substantial over capacity. Fourth, its issues were well known. Some sort of default was expected. Trading in the bonds was suspended last June. At that time they were trading at only 50% of their face value. The total issue is $160 million and the missed payment was only $15 million.

China’s premier Li Kequiang warned that Chaori was not the last. He said on 12^th March last week that future defaults of financial products are “unavoidable”. He pointed out that allowing defaults was a natural part of the financial deregulation process. There is also the issue of moral hazard, which the authorities are trying to address. In essence if you don’t allow companies to default, the markets assumes that they will never take place. With the certainty that companies cannot go under, investors will continue to pour money into risky assets.

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   What Me Worry?

 

Our bets are that this is just the beginning, as it was long 

overdue. There are so many cracks in the portfolio that it can 

only get worse. Recently we observed the fall in copper price, a BIG signal that the real economy is suffering. As  goes China - so goes the global economy. Put this at the top of your watchlist - as the walls come tumbling down

Platinum Wealth Partners

March 19, 2014 

The Jim Rogers Blog : I would rather be a Creditor than Debtor

The Jim Rogers Blog : I would rather be a Creditor than Debtor (read more)

Lets see if we can make sense of this. Now let's say China holds 1trillion in 10 year bonds and decides to cash or redeem their whole position. What could possibly happen? The Fed wires a one trillion freshly printed electronic dollars to China and takes back the bonds. So instead of holding an IOU due in ten years it now holds an IUO that is due on demand - albeit it is less less than 10% of  US's GDP or in other words all the goods and services output of the US economy for one month.Not much by some measures.

Anyway, now if China decides to convert these dollars immediately to other currencies it actually shoots itself in the foot because by depressing the US dollar they make their exports substantially more expensive to American consumers. Demand for Chinese goods would collapse in the US, that could shut down China's domestic manufacturing causing massive unemployment, and in turn social unrest followed by political change. Somehow it is hard to find a winner in such drama and both sides are thus inter-dependent - strange bedfellows indeed! .

There is a lesson - the best credit terms maybe negotiated by the creditor's biggest debtor - so borrow a lot! But somehow, Ben Franklin and Shakespeare's  wisdom also seems to ring true: neither a borrower nor lender be...

PLATINUM WEALTH PARTNERS
July 22,2013

Or, just tell them to go fly a kite

In the end, this a funny money game where the on-going idea is to keep the process going, regardless of the final outcomes. The outcome is the same as anyone playing musical chairs - when the music stops someone gets left holding the bag. This is obvious as when resources are depleted money in  all forms won't buy much.

Dr Peter G Kinesa

July 22 ,2013   

MARKET ALERT - Financial Times - Portugal's Bonds Soar 7.9% - MORE Euro Troubles

MARKET ALERT

Europe shifts back into the spotlight this week, as Euro bond yields could soar higher and then reverberating around the globe as jittery traders push the button. Bond Vigilante's may be in for an early Christmas Bonus - long before the.summer is over. It is unlikely that equity markets can protect themselves if the bonds decide to take cover. Safety first, and every man for himself.

First Financial Insights
July 12, 2013

Financial Times - Portugal's Bonds Soar 7.9% -  MORE Euro Troubles  

Just add another country to the list of European nations that are seeking "national salvation" as 10 year bonds rose to 7.9% this past Friday, settling back to 7.27% - up 53 basis points. Again the neo-classical economists have no solutions and no plan, other than to print money and provide bail-outs. Nor do they even remotely understand that the underlying issues stem from physical economic constraints - too many people and too few resources. So the economic cancer that came to the forefront in Greece, is masticating around the continent, remember Cyprus just a few short months ago . 

Here's the real problem - as Europe falls apart and bond yields move to 10% and higher in these "thinly traded markets," the fears will begin to take hold and grip the global markets as well. At the same time, the European economies are also starting to slip into one of the profoundest depressions ever to be experienced, as asset prices deflate and consumer disposal spending is over-burdened with huge increases in debt service costs. A One - Two body blow.

This could the snowball that plunges the bond markets into a long bear-cycle. Expect the turmoil in Europe, to test the nerves of jittery bond traders in Asia and North America this week. And this could also trigger long over due downside actions in the equity markets around the world next week.

Seems like there is no where to run; no where to hide.For now.

INVESTORS INSIGHTS

First Financial Insights

July 11, 2013

Who will pull the trigger?