Tomorrow’s Stock Market

In 2005 I began to notice chart patterns which were previously useful were turning into traps, For example, when a head and shoulders top  pattern was  completed, a short squeeze would ensue. Every now and then this is normal.  But on every single trading, it is not.

In spring of 2006, Henry Paulson became the first activist Treasury Secretary in history. From spring of that year on, the market had an invisible floor under it.

The lower volume was, the stronger the market would be. The volume chart began making a perfect parabola pattern with few exceptions. Then there was the emergence of the snake pattern, on minute by minute charts patterns, never seen in history  before. All action occurred in the first and last hours. Could there be a conspiracy, devoted to elevating asset prices? Would it even be possible? Could it be done? The 100 or so richest folks in the world  certainly have enough money and power to do it. Would they? A better question to ask is Why wouldn’t they? But, Woo, James, that is conspiracy theory, therefore it couldn’t be true. Right?

Adam Smith, is well thought of, but his observations are routinely treated as platitudes..Some of us take his wisdom to heart. If Adam Smith is to be believed, it is nearly impossible that stock prices are not thoroughly manipulated. So. who should we trust here?

 

 

Lets look at a chart of the Dow along with the percent of stocks over their 200 day moving averages. Around 26 percent are above their 200 day moving averages. This is the level that would be expected at the bottom of a bear market. Is this the bottom? I am betting that the bottom is about to fall out instead.

This is based on the whole bull market being phony from the beginning. The ingredients .necessary to move it higher are missing. There is one caveat, That doesn’t mean nothing will be done to try and save it. I made a similar point in the article below. In 1987, the market did suddenly crumble but there was a recovery. If we experience that kind of event this year, it will keep on dropping. Any recovery won’t start for at least two years. Our system is so corrupt, any recovery at all should not be taken for granted.

A One Day Stock Market Crumble

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The Case For Deflation

The Case For Deflation PDF Version
Inflation is the current problem and fear. That is fine for mainstream economics. But, thinking is not allowed in economics. First, deflation is not bad for an economy. Inflation favors the wealthy, government and others who have borrowed. Deflation favors the working class. In a free market, economy power naturally shifts back and forth from one sector to the other. Deflation occurs naturally when the productivity of labor increases. Inflation occurs politically. When power starts to shift in the direction of the working class, the upper class can and does create inflation politically as a means of maintaining its advantage.

“During the period between 1873 and 1879, prices dropped by nearly 3% every year, yet real national product growth was around 7% during the same time period. However, despite this economic growth and the rise of real wages, historians have called this period “The Long Depression” because of the presence of deflation.” Investopedia

Prices dropped profoundly during the 1970s during a long period of economic growth. Real wages increased significantly. At this time procedures for enhancing economic activity by way of “stimulus” had not yet evolved. A degree of economic power did shift to the working class for a while.

In our modern era, the Federal Reserve has been fighting deflation since the Reagan administration.  Increases in the productivity of labor have been monumental.  Yet, real wages have stagnated. Profit margins of corporations have increased. Prices have been very stable until recently. This is no accident. The working class has been robbed of the productivity bonus it would have received had prices been allowed to fall. This has all been accomplished politically. Now it is politically expedient to create inflation as a means of shrinking the debt size of heavy borrowers.

Deflation has been defeated for 40+ years but deflationary forces are still present and have increased.  Unlike other economies where runaway inflation has taken hold, the United States has massive production capabilities which can be used. An enormous amount of demand has been in non essential goods and services. There are also plenty of substitutes for all we buy and consume. Creating ever rising prices will be an enormous task.

One of the many negatives with respect to stimulus is that resources become more and more inefficiently allocated over time. Recessions occur because businesses are not getting the profits they expect from what they are currently producing.  Recessions disappear and business finds more productive ways to use its resources.  Inflation prevents this from happening.

In economics, if we prevent what will occur naturally, what would occur naturally occurs anyway eventually.

Notice, I am not citing numbers or pointing to lines on charts. I don’t need to. Instead, I think things through and as always am focused on what causes numbers to be what they are instead of thinking the statistics just happen to fall into place the way they do.

So, I am expecting things to reverse. Inflation will give away to deflationary forces and the overall price level will fall. Lets see what happens.

We are facing a depression, not a recession. Deflation, honestly is more likely.

 

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The Daunting Nature Of Reality

The Daunting Nature Of Reality PDF Version 

The harsh nature of the physical world is accepted without debate. We cannot go out side in the winter or summer without making adaptations.People work outside in the harshest cold weather. This cannot be done without wearing winter clothes. Even so, those outside during extreme cold weather, look forward to the warmth of a fireplace and can not wait to get there. It is cold outside but we alter our environment so that we are comfortable. Life on earth cannot survive in outer space or on any planet we know of.

Human beings also have an inner world where cold, heat and other environmental issues are not relevant. Our inner worlds are daunting also. I frequently mention that every child born immediately enters into an eternal power struggle, while not aware of this being the case. Life is regulated by harsh laws of dominance and subservience. Continue reading

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Was Adam Smith Crazy?

Was Adam Smith Crazy? PDF Version

Was Adam Smith a conspiracy theorist? It seems he was. So, I suppose that makes him crazy – right? Adam Smith is routinely deemed to be the first economist and the father of free market thought. Should we now disregard everything the man wrote or said? After all, is it not true that all allusions to conspiracy are products of the imagination and must be treated as such? Was Adam Smith just another trouble maker like all conspiracy theorists? Or, was he merely pointing out what is normal human behavior? You decide.

Continue reading

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Accepting Reality April 2022

Accepting Reality April 2022 PDF Version

The race to escape reality begins at birth. Reality is replaced with fantasy because it is too harsh to cope with. Every child is born into an eternal power structure. Our world is governed by laws of dominance and subservience. Most people live in an oasis of peace from all of the belligerence and brutality that is actually ongoing. It is easy to see the world as a peaceful place for those who have no direct involvement with it.

Most agree that power corrupts and absolute power corrupts absolutely. Today power is concentrated at the top of society more so than it ever has been in human history. So, those in charge of the world and its people are closer to having absolute power than has ever been the case before. Americans are surrendering their First Amendment rights as if those rights are not necessary and that they will be fine without them. Continue reading

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A Brand New Wonderful War

A Brand New Wonderful War PDF Version
Here are some questions I asked myself. I wonder how other Americans answer them?

I ask myself :

What do I know about the ins and outs of politics in Russia or the Ukraine?

Almost nothing, I haven’t been focused on that part of the world.

What do I know about Vladimir Putin, President of Russia? Continue reading

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What Do We The People Seek From Government?

What Do We The People Seek From Government PDF Version
It is easy to notice that, not just with government, but in all aspects of their lives, people tend to end up having what is most important to them. Sometimes they end up having just that one thing and nothing else.

If wealth is genuinely what a person wants, especially if that want is out of proportion to anything else, they are likely to have it, or at least end up with a higher than average income. There is nothing magical about becoming wealthy. It takes a lot of sacrifice. To become wealthy requires, giving up many other things in life that are meaningful to people. Be it love, free time, entertainment those things often must be left on the table. Continue reading

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Future Of The Dark Web

How are folks’ experiences on the internet going these days? How is the censorship going for you? Do you like having all your news filtered … purposefully manicured , and groomed – so that you buy into all that is intended to shape your opinions? How do you like having your First Amendment rights trashed and stepped on? Are you good with  the symbiotic relation between big tech, government and defense agencies?

Americans as a whole seem to love it that way. After all , their congressmen and president serve as their guardians…. keeping them safe. Do Americans want to have guardians or representatives? Continue reading

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Four Ways We Communicate

Four Ways We Communicate PDF Version

Sometimes the simplest explanation of something can have a profound impact. Years ago Milton Friedman came up with his four ways to spend money.

These are:

Spend your own money on yourself. This the most efficient and productive way to spending money. The buyer gets exactly what he wants. In a free market system, this approach is very common.

Spend your own money on someone else. This is a very efficient way to spend money, but less so than number 1. Continue reading

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Which Masked Man Do You Trust The Most?

Which Masked Man Do You Trust The Most? PDF Version

Back in the nineties I worked with blind people. One of them, Bob Wiley, played piano in a band  I had put together. I got to know Bob very well. He was highly educated. We talked a lot about communication between the blind,  and folk with sight.  Although Bob had been blind since birth , he had a complete understanding of what sight accomplishes.  Bob was a clinical psychologist. He understood that people communicate with body language along with speaking. Facial expressions are very telling with respect to understanding another’s intentions. Masks have been used throughout history to hide one’s face and intentions.

Of the two masked men above, which is a greater threat or any threat at all? There actually is nothing dishonest about armed robbery. Sure, it is highly immoral but the robber is completely honest about his intentions. It is your money or your life.

Continue reading

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