Stock Market a Few More Things

Th20160805_hillarye future of every man woman and child in the world now depends on what happens in the stock market over the next year. Most people regardless of current economic status are going to most everything they own. It will only start in the stock market. Main street and Wall street are not coupled on the way up.  They are tragically coupled on the way down. People are not going to know what hit them.

As quantitative easing got rapidly rolling back in 2011, human nature kicked in big time. The plan was, with all of the new money being added to the economy business investment in plant and equipment would take off. Of course, there was no chance that would happen but people believed it. The reason the market was declining in 2011 was that resources needed to be allocated more efficiently. All a recession is, is out with the old in with the new. The less government intervention there is the more efficiently a recession retools the economy. No one ever knows what people will want to buy next when they quit wanting to buy what is being offered in the current moment. It takes faith in the free market to allow the process to work.

So, when quantitative easing begins, what are corporate insiders going to do? They do what any rational human does. They figure out how to get paid the most in a shortest period of time. Nature provides only one basic incentive, self interest which is what allows everyone to survive. In the minds of the public, there are other incentives in operation such as a desire to serve humanity independently of self interest. The incentive to serve others is only imaginary. Corporate insiders immediately started taking care of themselves. The best and fastest way for a corporate insider to get paid is to run up the value of the company’s stock. That’s what they did.

Earnings reports are planned way in advance. Impact of earnings and news on investors determines what earnings are. Laws have not been enforced. When securities laws are not being enforced, earnings can be about anything a company wants them to be. In many cases, earnings have been what the insiders would like earnings to be. Statistics from the government are constantly fabricated. These things are coordinated. News stories draw short positions into the market and help drive it up. The general media no longer covers news unless it will benefit them and whoever their allegiance is with.

Have I ever explained that there are no facts in the present at a crisis point. Understand incentives and it is not hard to determine what is going to happen next.  Outside of printing countless dollars and and wantonly buying stock outright, there is nothing more the Federal Reserve can do to enhance asset values for the politically connected.  The elite of the world, for whom government policy benefits only, it is panic time.

Have you ever seen a billionaire panic? Really, what does it take to get Warren Buffet sitting behind Hillary Clinton clapping and acting like a complete idiot? It means there is an absolute certainty that he will take huge financial losses if he can’t control whoever ends up in the White House. Billionaires support candidates who will do anything for a buck.  Corporate insiders have paid themselves as much as is possible.  Why is the 2016 election being rigged. There is only one reason. Trump will cut them off. Dictating government policy is the only possible way to keep the stock market moving higher. So, from now through the election expect no letup in the shenanigans. The elite are being dis-empowered. Both the profit motive and lust for power are sub-incentives of self interest. Power is never surrendered peacefully. Watch for martial law. Watch out for nuclear war. There is no limit to what they will do. Do not rule out a war between billionaires. The ones who are not connected are lining up on the short side.  Trump would benefit immensely from a stock market crash.

 

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About Fantasy Free Economics

James Quillian independent scholar,free market economist,and teacher of natural law. Who is James Quillian? Certainly I am nobody special, Just a tireless academic and deep thinker. Besides that, I have broken the code with respect to economics and political science. Credentials? Nothing you would be impressed with. I am not a household name. It is hard to become famous writing that virtually no one in the country is genuinely not in touch with reality. But, if I did not do that, there would be no point in my broking the broken the code. If you read the blog, it is easy to see that there are just a few charts, no math and no quantitative analysis. That is not by accident. Given what I know, those items are completely useless. I do turn out to be highly adept at applying natural law. Natural law has predominance over any principles the social science comes up. By virtue of understanding natural law, I can debunk, in just a few sentences , any theory that calls for intervention by a government. My taking the time to understand the ins and outs of Keynes General Theory is about like expecting a chemistry student to completely grasp all that the alchemists of the middle ages thought they understood in efforts to turn base metals into goal. Keynesian theory clearly calls for complete objectivity. Government can only make political decisions. Keynesian techniques call for economic decisions. So, why go any further with that? Fantasy Free Economics is in a sense a lot like technical analysis. Technical analysis began with the premise that it was impossible to gain enough information studying fundamentals to gain a trading advantage. Study the behavior of investors instead. Unlike technical analysis, I don't use technical charts. What I understand are the incentives of different people and entities active in the economics arena. For example, there is no such thing as an incentive to serve with life in the aggregate. In the aggregate, only self interest applies. It is routinely assumed otherwise. That is highly unappealing. But, I am sorry. That is the way it is. I can accept that because I am genuinely in touch with reality. Step one in using Fantasy Free Economics is for me to understand just how little I really know. A highly credentialed economist may know 100 times what I do based on the standard dogma. Compare the knowledge each of us has compared to all there is to know and we both look like we know nothing at all. There is always more than we don't know than what we do know. I am humble enough to present myself on that basis. Why? That is the way it is. I am not bad at math. I have taught math. What I understand is when to use it and when to rely on something else. Math is useless in natural law so I don't use it. While others look at numbers, I am busy understanding the forces in nature that makes their numbers what they are. That gives me a clear advantage.
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