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December 14th To 18th: A Week Of Reckoning For Global Stocks If The Fed Hikes Interest Rates?

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Time Of Reckoning - Public DomainAre we about to witness widespread panic in the global financial marketplace?  This week is shaping up to be an absolutely critical week for global stocks.  Coming into December, more than half of the 93 largest stock market indexes in the world were down more than 10 percent year to date, and last week stocks really started to slide all over the world.  Here in the United States, the Dow Jones Industrial Average is down about 600 points over the past week or so, and at this point it is down more than 1000 points from the peak of the market.  That brings us to this week, during which the Federal Reserve is expected to raise interest rates for the very first time since the last financial crisis.  If that happens, that could potentially be enough to accelerate this “slide” into a full-blown crash.

And just look at what is already happening.  Trading for stocks in the Middle East has opened for the week, and we are already witnessing tremendous carnage

Following Friday’s further freefall in crude oil prices, The Middle East is opening down notably. Abu Dhabi, Saudi, and Kuwait are lower; Israel is weak and UAE and Qatar are tumbling, but Dubai is worst for now.  Dubai is down for the 6th day in a row (dropping over 3% – the most in a month) extending the opening losses to 2-year lows. The 11% drop in the last 6 days is the largest since the post-China-devaluation global stock collapse. Leading the losses are financial and property firms.

Things in Asia look very troubling as well.  As I write this, the Japanese market has just opened, and the Nikkei is already down 508 points.

In recent days I have been explaining to my readers how everything is lining up in textbook fashion for another major market crash.  In particular, the implosion of junk bonds is a major red flag.  Late last week, Third Avenue Management shocked Wall Street by freezing withdrawals from a 788 million dollar credit mutual fund.  The following comes from Bloomberg

A day after a prominent Wall Street firm shocked investors by freezing withdrawals from a credit mutual fund, things only got nastier in the junk-bond market. Prices on the high-risk securities sank to levels not seen in six years and, to add to the growing sense of alarm, billionaire investor Carl Icahn said the selloff is only starting.

The meltdown in High Yield is just beginning,” Icahn, who’s been betting against the high-yield market, wrote on his verified Twitter account Friday.

Icahn’s comments come as junk-bond investors, already stung by the worst losses since 2008, are the most nervous they’ve been in three years after Third Avenue Management took the rare step of freezing withdrawals from a $788 million credit mutual fund.

What Third Avenue Management just did was absolutely huge.  Now investors that have money in any similar funds are going to be racing to get it out.  We could be on the verge of a run on bond funds that is absolutely unprecedented.  This is so obvious that even CNBC’s Jim Cramer is sounding the alarm…

Friday was a day where Cramer’s ears were burning with concern because of the troubles discovered with a high yield bond fund run by Third Avenue Management. It decided to bar investors from getting their money out of its Focused Credit Fund, because it could not meet demands to get cash back to them in an orderly way.

This was significant because when it tries to sell the bonds needed to satisfy these orders for redemptions, it could destroy the high yield bond market because there are no buyers anywhere near the amount that they want to sell.

I cannot emphasize enough just how disconcerting this move is,” Cramer said.

I know that for the ordinary person on the street, all of this sounds very complicated.

But it basically comes down to this – anyone that has a lot of money invested in these bond funds is in danger of getting totally wiped out.

In a situation like this, it is those that are “first out the door” that come out as the winners.  I like how Wolf Richter explained what we are currently facing…

It works like this: When an “open-end” bond fund starts losing money, investors begin to sell it. Fund managers first use all available cash to pay investors. When the cash is gone, they sell the most liquid securities that haven’t lost much money yet, such as Treasuries. When they’re gone, they sell the most liquid corporate paper. As they go down the line, they sell bonds that have already lost a lot of value. By now the smart money is betting against the fund, having figured out what’s happening. They’re shorting the very bonds these folks are trying to sell.

The longer this goes on, the more money investors lose and the more spooked they get. It turns into a run. And people who still have that fund in their retirement account are getting cleaned out.

Bond funds can be treacherous – especially if they hold dubious paper, which is never dubious until it suddenly is. And when they get in trouble, you want to be among the first out the door.

I would anticipate that we will see more junk bond carnage this week – especially if the Fed raises rates.

And as I have discussed previously, a stock crash almost always follows a junk bond crash.  If the Fed does raise rates this week and stocks do start falling significantly, one key day to watch will be Friday.  JPM’s head quant Marko Kolanovic has warned that “the largest option expiry in many years” will happen on that day…

This important event falls at a peculiar time—less than 48 hours before the largest option expiry in many years. There are $1.1 trillion of S&P 500 options expiring on Friday morning. $670Bn of these are puts, of which $215Bn are struck relatively close below the market level, between 1900 and 2050. Clients are net long these puts and will likely hold onto them through the event and until expiry. At the time of the Fed announcement, these put options will essentially look like a massive stop loss order under the market.

A perfect storm for stocks is brewing, and this week could potentially be one of the most chaotic that we have seen in a very long time.

But of course the Federal Reserve could decide to surprise us all by not raising rates, and that would change things substantially.

So what do you think will happen this week?

Please feel free to share your thoughts by posting a comment below…

  • Enrique R. DéZuardí

    Dont expect anything major. Maybe next Fall 2016…

    • Creepy Pedro

      never gonna collapse until they are ready.

      • Steeve Girard

        That point is not exact, it does not matter if they are ready or not. It will collapse when what gives energy to the system falls apart. In 2030 when the conventional oil falls. The Economy will fall apart totally.
        .
        What we are experiencing is the groaning, a sign that the will be increasing problems ahead.

        • Creepy Pedro

          The economy will be dead way before 2030

          • Rorschach

            Agreed. Kicking a can down the road means when it catches up the impact and severity will be much worse. Instead of them tackling the problems and addressing the issues they sought to print more money and more debt was the answer to their issues and problems.

          • Lennie Pike

            A lot of that printed money was printed to fund and maintain the invasion/destruction of America.

            Paid invader, occupier, and destroyer – nice work if you can get it.

      • Lennie Pike

        Or until some other financial and or military power including that of Constitutional Freedom Loving American People makes the question irrelevant.

        I profile. I don’t see anything wrong with it. Where were you born Pedro? You didn’t come into my country illegally I hope.

        The time for Americans to stand up, get tough, and fight the enemies of the United States is way past due.

        In 1913 American was overthrown, it has been consistently invaded by “legal” and illegal aliens taking our jobs and depressing our wages since about the mid-eighties while at the same time being supported through welfare by the Americans from whom the jobs were taken.

        And now the disarmament of Americans has begun by placing us on lists. Stalin, Hitler, Mao, Pol Pot, had lists.

        The time for Constitutional Freedom Loving Americans to get tough, stand up, and fight to take our country back is way past due.

        I profile. Every day I leave people on the street with absolutely no doubt they have been profiled and that if I was correct, need to get the hell out of my country now!

        So Pedro, did you come into my country illegally? Whether you did or not, our country has already been destroyed, and massive immigration is one of the main reasons if not THE main reason it has.

        We all know what would happen if an American illegally invaded let’s say for example Mexico, and took the job of a Mexican.

        One big reason this has been allowed to happen is that Americans have the tradition and history of being an actual Christian Nation – peaceful, turning the other cheek, always trying to help others, so much so that they are way too slow to anger, and when under attack mistakenly think that turning the other cheek and loving the attacker is the correct response.

        Now that disarmament has begun, the act of physically defending oneself has arrived for Americans in Connecticut and a couple of other states.

        Looks like the paid globalist government trolls who try to sway public opinion on this site and others like it may have come up with a new tactic – same as in most t.v. commercials these days meant to condition Americans into accepting a one big global Utopian dictatorship – saturation with images of people from all over the world, with either minimal or zero representation of anyone who appears to be a White American Christian.

        Guess what Pedro, in no way, does anything I said make me a racist or bigot. If you think it does, I want to know why you think that.

        If you were born here, not an anchor baby, your family has been here for generations and from a part of the U.S. that used to be part of Mexico – those points are all beside the point of what I am talking about – the intentional destruction of Constitutional America.

        I should have also asked though whether or not you are an anchor baby. The 14th Amendment was not meant to be interpreted to mean that people can come to the U.S. for the sole purpose to gain citizenship for their children!

        Total invasion of White Christian Europe has also taken place – does anyone see a pattern here or an intentional plan?

        Yeah I know, Catholics are real Christians too.

        • Creepy Pedro

          Dont be a hater…you gringos are not reproducing. Your women are the problem.

          • Lennie Pike

            It is a well known fact that women wear the pants and make the decisions in 99.9% of Latino families, and that this is the main reason Latino males will not fight against the corrupt criminals that control your country and who have prevented it from progressing into a civilized society governed by the rule of law. Latino women would never stand for their men risking their lives, and even if they did begin to allow them to, it would take many generations for the Latino male mentality to change to be able to get the job done.

            Why did you call me a hater? These may be hard truthful facts, difficult to accept, but I have spoken nothing hateful – at least not yet. Instead, why don’t you explain to me why you called me a hater. Calling me a hater is like calling a police officer who is enforcing laws that were designed for the well being of every citizen a hater. Is that what you want? A country with no rule of law? If it is, and you are from Mexico, Guatemala, or some other 100% never developed corrupt central american country, then you should go back there now because Americans are going to take their country back and then send you back forcibly.

            Speaking of hate, “Gringo” is a bigoted and hateful slur.

            What you said was pretty creepy Peadro. You wouldn’t answer my question, so if you entered the U.S. illegally, do Americans a favor and creep back over the border please.

          • Creepy Pedro

            Latinos we are taking over…your women dont have enough babies, you gringos are too busy being dminated and your women wear the pants now. In 20 years, the country will belong to blak and brown people. You all had a great nation until you turned to meth, booze,and partying. We get along but time is not on your side gringo….Your politicans dont even care about your culture.

          • Lennie Pike

            Throwing you back in Peadro.

          • Creepy Pedro

            Wont happen gringo…..we are taking over now.

          • GSOB

            Bad theology

    • Watchman

      Depends on which previous market turmoil it will follow. It can play out similar to 1987 or it can follow the 1970’s pattern. Either one still show massive risks and crashes ahead. The only difference is that today a “recovery” from this will be practically impossible as the safety net in 2008 was used up.

  • Rand

    This week the economy won’t collapse.
    Good grief. You say the same thing over and over. I know you mean well.,,,but good grif

  • Chaos no

    Nothing significant will happen either way.

    • RTL89

      You don’t realize how perilous this rate hike decision is, do you? The world has been running on the wheels of zero percent interest for the last decade, and that is why we have maintained some sensibility of staying afloat. And now they are making the decision to raise it this week. Do you not understand the repercussions of that?

      • K2

        RTL89, if the fed hikes rates and nothing happens will you accept you were wrong?

        • RTL89

          Nope, I can’t guarantee anything. Why? Because these loonies have so many magic tricks they could perform to give off the illusion that everything is fine and that they averted another crisis. This will give “you” the false impression that nothing happened, when in reality it should have. So, in a perfect world where conniving tricks like this weren’t used to debase our perception of things, I would be easily saying to you: “yes, I will admit if I’m wrong”.

          • K2

            Then stop saying ‘ Do you not understand the repurcussions’ when you know they can hold it up.

          • RTL89

            I say that because people like you put way too much faith into this. You seem to think that as long as they can prop it up via illegal and immoral methods, then everything is hunky-dory. It’s no different than putting a Band-Aid on a volcano. It might delay the explosion for a bit, but it will inevitably blow. They need to take steps to reverse their wrong-doing, but they never will. Until that day comes, maybe you should stop insisting that everything is fine.

          • K2

            I never said everything is hunky dory, infact i said the opposite the world economy is going into a downward spiral. All i am saying is US isnt in a crash now nor will it be this year. They can hold it up for a while

      • Evan Wise

        That’s exactly what people were saying back when the Fed ended their QE3.. “Oh no, buy gold and silver, the dollar will crash, markets will bottom out, economy will implode”

  • Guest

    It’s so hard to say what will happen this week. I’ve read so many different opinions in the last few days from very smart people. It seems to me that the most experienced and successful people out there in the financial world don’t know any more than we do. I guess we’ll just have to wait and see what happens.

    • jaxon64

      I agree–EVERYONE is speculating. My speculation? The FED raises rates to a miniscule .25%–Wall Street pitches a week or two hissy fit and then it all artificially increases again bit by bit.
      We get a bad jobs report?–the market inches up…we get the fake “good” report and the market inches up. Global trade down, commodities crashing, new home sales down 6 straight years–market goes up, up, up…
      Middle class income down, record numbers falling under the poverty line, massive debt from Federal, state, local and personal…the market inches up, up, up…
      So why should I believe that the end of ZIRP will be the straw that collapses the proverbial camel’s back?

      • Guest

        Well said.

        I do believe that this ship is going down eventually. Will the dominoes start to fall this week? Perhaps.

        • Mike Smithy

          Hike to cause the crash, unhike after, but the damage will be done. Anyone thinking they’ll ramp the S&P to ATH’s will be disappointed. This is the “FED screwed up and lost control” moment.

      • Chaos no

        You are so right. It seems it will take a meteorite smashing directly into Wall Street to even slow it down.

      • Raymond Chow

        .25% is peanuts but large companies now borrow by the billion and not counting the sovereign countries that in the brink, e.g. Brazil. A billion dollars at .25% is still 25 million dollars, that’s a big chunk.

    • gfmucci

      I think a good part of the “many different opinions” is comprised of those with a vested interest in keeping the markets propped up. Take away that phantasmic opinion – the PR hype – and all that is left is the negative reality.

    • SunnyFlaSnotress

      We’re going to get a rate hike and a market tantrum.
      That’s what will happen this week.
      It isn’t hard to say at all.

      • Malcolm Reynolds

        In other words, you have no clue what gating customers means, have no clue that 3 cos have gated their clients, the contagion is already spreading, and that the markets are tumultuous because of it.
        Golly Gee Beav (and I’m totally referring to you as loins because there sure ain’t no ‘there’ there) you sure know what you’re talking about.

        • SunnyFlaSnotress

          Gating customers isn’t the issue.
          I’m amazed half the board can find their way home with the way they get so lost in diversions.. Except for you.. because you are chair-bound and rarely leave your home.

          • Malcolm Reynolds

            Gating customers isn’t the issue.
            So that’s a no, you have no clue what gating is, what it means, and what it portends.

            I’m amazed you know so much about me since given your face is always planted in always’ crotch.

          • Malcolm Reynolds

            Gating customers isn’t the issue.

            Hmmm, looks like things are shaking out to prove you wrong.

            http://www dot zerohedge dot com/news/2015-12-17/markets-brace-more-fund-liquidations-junk-investment-grade-and-loan-fund-outflows-so

            Here, I’ll quote since I know you wont bother.

            Article partially titled “Record Outflows Slam Debt Funds”

            “a broad revulsion to all aspects of the fixed income space, from Investment Grade, to Junk to bank loans”

            That RECORD revulsion was between 3.81 and 5.1 BILLION pulled from bond markets. Yea, that’s not an issue.

            “the result is clear: investors have launched a feedback loop where lower bond prices lead to more redemptions which force more selling, leading to more redemptions and so on.”

            Oh yea, since I posted this, it cant be removed by you and I’ll be more than happy to rub it in your face every time you claim you know better than someone else.

  • MIchael in Chicago

    No matter what the Fed does most governments are in so much debt they will never be able to pay it off. Global trade will not be magically boosted should the Fed cut or hold rates (this week or ever). Global consumer spending will still be down too. I doubt most stocks would see a boost no matter what the Fed does as oil and profits should remain in the toilet for Q4.

    In short I believe that so much is wrong globally and so little has changed in American markets since the last stock market correction that a perfect storm is indeed here.

    Why are airline stocks down when oil is at $35/barrel?

    • old geezer

      Airline stocks are going down because after Obama puts all gun owners on a watch list, there will a lot less flyers.

    • RTL89

      You hit the nail right on the head!!! The bottom line is that people aren’t making enough money. They are losing jobs, being laid off, and then unable to find a new job. The everyday people are the ones who invest money back into the economy via consumer spending on goods and services. That’s the basic fundamental on how an economy works. If people aren’t doing that, then the “money-changers” need to come in and control it… via manipulated numbers, buying their own stocks, and raising the debt ceiling as they print more money into circulation. As long as this is happening, we will Never get better. Anyone who says otherwise is simply fooling themselves. There’s difference between being an optimist and being a fool.

      • Steeve Girard

        The bottom line is that we are wasting energy by lowering the usefulness of currencies. Currencies that do not do the work efficiently, are profitable to the “rich”.

    • Steeve Girard

      Because each dollar give more energy in return, and more work. Companies must move more currency when it get less work per unit. Thus increasing it’s “value”.

  • Paul D Thomas

    Oil is the wild card in all of this.

    • Creepy Pedro

      oil is being taken down to destabilize the old world order.

      • Steeve Girard

        Finally catching on + 1

        • Creepy Pedro

          hahaha that was something I said years ago would happen..

  • Creepy Pedro

    No rate hike….

    • XSANDIEGOCA

      Ditto!

  • df NJ

    google “Wendelstein 7-X” it worked!!!!

    The world’s first successful hot fusion reactor!!

  • Rufus T Firefly

    Nothing drastic is going to happen. Not that the tin foil brigade ever figures that out, they’ll come up with a new hysteria to screech about.

    ” The. Time to buy is when there is blood in the streets” Nathan Rothschild

  • Powers Beyond Imagination

    If the US Fed doesn’t raise rates this week then chances are slim they ever will. Instead the US will join other nations in a global currency devaluation war. Actually, they will be admitting the fact that the economy is not recovering but is really disintegrating..
    US debt will become more expensive to pay off – an impossible task anyway.
    If the Fed does increase rates well Michael has pointed out that scenario.
    Whichever way it goes we’re screwed.
    My question is this – what is going to replace this system (at least in the short term before WW3)?

    • Steeve Girard

      Energy is the real economy… currency is just a conduit. Financial manipulation does not change the amount of energy needed to maintain everything. When we run out of conventional oil around 2030, they will understand maybe too late how much this is true.

      • Me, I & Myself

        You are complete QOO QOO.

    • RTL89

      WW3 IS the system that’s to replace the current one. It should have already happened by now, but instead they just keep delaying it by inflating the debt bubble larger and larger, ultimately making the long-term pain down the road even worse. The U.S is poking and prodding, and doing EVERYTHING in their power to start a war, so that when the collapse DOES happen, it can be blamed on a foreign entity.. and the U.S will be regarded as “admirable” and “noble” for protecting its people. And the sheeple will lick this up like the sheeple that they are. The U.S is absolutely aching to get a conflict started.

    • GSOB

      We need to seek God’s wisdom and strength to repent, recover and rebuild.

  • Ashley

    History always finds a way to repeat itself but there are many factors this time that seem to place us in unchartered territory. Only God knows so I give up guessing!

    • disqus_mma68NTtry

      and in the kingdom of God Your Name and Mine Is Sealed with his Son Jesus Christ and that much I don’t have to guess about. He knows you and He knows me….

      • Plextt Plextt

        I hope Santa brings you a great gift this year!

        • disqus_mma68NTtry

          Thank You….like wise as well.

      • Larry

        Some thoughts on the recent Islamic murderers in San Bernardino, CA. We view those acts as pure evil, which they surely are and we now are certain those perpetrators are in hell. However, considering this from a purely religious standpoint, some interesting observations arise. Were these two intentionally violating God’s will? Were they rejecting God in favor of their own will? Were they choosing hell instead of heaven? Certainly not, quite the opposite. They were totally convinced they were not only serving God but making the ultimate sacrifice of their own lives in that service. They had simply accepted one of the beliefs of their culture with undying and unquestioning faith. We can only conclude that they were acting with great sincerity but ignorance. How then would a loving God judge such? Does God condemn ignorance when its deepest intent is only to serve Him We may say, they should have questioned their faith, but the devout, regardless their religion, believe it is an affront to God to question., as if God would prefer blind acceptance over employing the reason and logic He provided. There are endless beliefs and the adherents of each quite sure theirs is the truth. Would love leave something so crucial unclear or ambiguous?

        We may say the Bible is very clear but how many different interpretations are there, not to mention, that billions have lived and died having no idea of its message or never even heard of it. I believe it’s wake up time for Christianity.

        • disqus_mma68NTtry

          That’s a great school of thought Larry. I don’t disagree…and I’ve long been concerned about it some of the very same questions. It still blows my mind 19 hijackers thought they were receiving women in Heaven as Virgins. They honestly believed that…..which amazes me even more is Christians have sat on the sidelines and allowed the guard of being watchmen of this great country go down in peril. I am not so sure were all going to get in….and just think were all okay with God in this regard. It seems everyone want’s to go with it…..and that’s what were all doing. I’m included in that thought process as well.

          • jabcat

            a site that addresses a lot of this is tentmaker.or g

        • jabcat

          Hi. I believe they will be disciplined in the next age until they realize and bow and confess Jesus as Lord. The “church” has dismissed/missed God’s work of the ages, and limited Him to this one age. It helps explain this verse – ‘every knee will bow and every tongue confess Jesus is Lord’. a good site on this is tentmaker.or g

          • Larry

            Thanks Disqus, I was raised a fundamentalist Christian and served as a Southern Baptist Deacon for many years until it just did not make a lick of sense to me anymore. The one thing they have right is that God is love, the only problem is that they don’t really believe in a God of love. Love does not condemn. There is only love and sin is the lack of it in various stages. We are all on our way back to that realization, and everyone is at different stages but all will eventually find their way, even Isis, altho it may take many many more lifetimes for some.

          • GSOB

            Wrong again….

          • Larry

            Jesus did not die for the sins of mankind. Jesus was trying to teach us that we are all one, and only that realization will allow us to love others as ourselves and not judge. The statement that got Jesus killed was, “the father and I are one” and he was trying to teach us that we are the same. But he was interpreted by Jews ingrained in OT teachings of a judging, angry, jealous God and they could not hear truth just as the religious are today. The only difference in You and Jesus is that he realized who and what he really was. God is all and all is God, there is no separation. There is only love and until we come to that realization we will keep calling forth more lives.

          • GSOB

            Wrong, on so many points…..
            Deceptive, attractive…..
            but wrong.

    • SunnyFlaSnotress

      That was wonderfully religious and vague in a nonfactual and uninformative sort of way! /s

      • Airedale

        That was unfunny in a snotty and unimaginative sort of way.

        • SunnyFlaSnotress

          lol

    • John Byde

      Ashley, I think the territory is only unchartered for those who haven’t read the relevant bible verses. Blessings to you and yours.

  • Powers Beyond Imagination

    There is an answer to every question (even if it’s the wrong one – at least we try). There is a solution to every problem. That being the case it is obvious the ones in power (anywhere) are not the right people for their positions.
    Michael needs to run for President!
    The other candidates on offer just need to run – preferably far away.

  • Joe Woolf

    I think we can safely say that the market is doomed….. it’s really all about timing after that.

    I don’t have any money in the market now…. I parked my 401k… I have money in my safe and more silver than I weigh in there with it.

    I hope nothing bad happens but, I refuse to not see reality.

    • Ms

      I just started collecting silver. It’s a good feeling.

  • David Hilty

    No rate hike this week. No rate hike ever. They’ve painted themselves into a corner. Too much debt to raise rates.

    • Joe Woolf

      love the avatar, David!!!

    • Steeve Girard

      It is not in the interest of the FED to raise rates, they would choose negative rates over hiking them, thus charging money to have it being kept in banks.
      .
      Nope, the economy is in a standard power resource scarcity deflation curve. They do not understand that any action they take will cause more resistance to build up, and waste more resources. The moment that everything will break down, will be decided when the energy required to maintain, will become too insufficient. Currency is just a conduit of energy. Financial manipulation will not prevent the inevitable, only a new source of cheap energy, can repair everything.

      • Robert Collins

        great post, absolutely spot on when you describe currency as a conduit of energy. In fact the way I look a it is that money is energy, non-fiat currencies are based on something that uses energy in its production, gold, cowrie shells etc.Fiat currencies do not. Printing money is a hopeless a task as trying to print energy just blowing up a pricked balloon. The new source of real energy is however proving elusive.

    • Mike Smithy

      True, the FED has painted themselves into a corner. Liftoff for the real economy is impossible without a complete reset.

      • Watchman

        Well either the Fed does a small-rate hike somewhere around .25bps or investors completely lose confidence. I don’t see it ending positively either way.

        • Ken

          I agree. A rate hike will boost the dollar, and all the countries with weak currencies will begin to default on their dollar denominated debt as they can’t get much for their oil or mining plays. A pass on raising interest will cause a loss of confidence in the so called recovery. I think the result will be more sellers than buyers either way. Then the printing presses will be cranked up to paper over the debt saturation problem increasing it to new levels, perhaps with a helicopter drop of dollars to stimulate the economy. It won’t work, at least not for long.

          • Chaos no

            Dow is soaring after the rate hike.

          • Lennie Pike

            Which is a first. It coincides with the “price” of silver tanking while at the same time being in huge demand and with waiting periods for delivery of the physical metal (not a first).

            The question should be asked: who is fraudulently in control of the numbers, the information, and the World’s monetary system?

            They won’t be able to keep this fraud going much longer and have the new system already waiting in the wings. They will hold on to financial power with military power – coming soon to a town near you – already arrived at places far away.

            When they do arrive, you will know whether or not they are your enemy or mean you harm by one and only one method: whether or not they attempt to confiscate your firearms.

            Lately there has been just a little bit of evidence that it is very important to them to confiscate your firearms – especially of the military type. Geez, I wonder why that is? They have been very busy creating FEAR!!!! FEAR!!! FEAR!!!, with their propaganda machine. Geez, wonder why that is?

            You ARE out in an isolated area by now aren’t you? ARE YOU OUT IN THE COUNTRYSIDE?!!!!!!!!!!!!!!!!!!!!! With your Countrymen?

    • SunnyFlaSnotress

      You may tale a popular stand now, but “they” will still be at you…and really… who are you kidding?

    • Chaos no

      No rate hike? Wow look at the dow soar after we just got rate hikes.

  • Joe Woolf

    economists…. it’s a funny thing….. they can be like politicians…. .it’s amazing what they can’t understand when their job depends on them not understanding it.

  • Jazz

    Fed hikes rates as the economy is sound enough to withstand the hike. It will be a one hike then wait and see approach. Markets rally hard next week. S&P will be back above 2100 and Dow will get back near 18k. Oil will rebound and we will all say what a week! For those in the markets we will have a big cheer. Hip hip horay for another week in the bull market!

    • MaxRockatansky33

      Another load of nonsense. Bulls are going to Spain. No rally and oil will fall even more, even you mentioned this that oil will continue to fall. So you just deny yourself. Put away those hype happy merry capitalist rant and look at the reality.

      • Jazz

        I said oil would go lower when it was in the low to mid $40s. It is now too low and due for a rebound. It is oversold right now. I closed out my oil short positions and puts on some of the emerging market countries – Brazil, China, Russia, etc.

        • Rorschach

          Yet nobody cares what you have to say Jazz.

        • MaxRockatansky33

          Chinese economy is weakening. Russia suffers from economic sanctions (cheap oil is not helping) and Brazil? That’s not an economic power.

    • fwalker2016

      Your guesswork is getting more ludicrous with each foolish forecast. Obviously you’ve abandoned your sp500 to 2300 and AAPL to $240 forecasts. Roflmao

      • Green tip

        What do you see coming if the Fed does indeed raise rates?

    • Watchman

      Zazz you forgot to take your meds again. You don’t want to be put into solitary confinement again in the mental hospital where are you do you?

  • disqus_mma68NTtry

    The Force Awakens…..

  • Steeve Girard

    Ok, what are the risks? We believed in nuclear power, but it had big woes. I doubt this one will not have big woes.

  • Jason C

    QE Infinity …. Just Saying

  • Nicholas Fowler

    It sounds like a case of heads I lose, tails I lose… at some point the whole shebang has to come crashing down the longer it is left, and I talk in terms of weeks, the worse it will get. I notice how the cabal are busy tooling up for war, on several fronts, a grand distraction, for the real destruction of the present world economy. They are like a pack of rabid wolves chasing through a cul de sac and suddenly the brick wall is looming right ahead of them and they have no way of turning back…

  • Powers Beyond Imagination

    Throughout history it is recorded that when interest rates are increased over time a crash soon follows.
    This time the system is crashing before a rate hike – read Steeve Girard from a couple of hours ago. The financial crash of 2008 is still crashing today. The economy today has not recovered so the Fed raising rates seems illogical. However, debt is soaring and reaching a point where a crisis of confidence will undermine the $US. Therefore, raising rates maintains the dollar.
    Damned if they do and damned if they don’t.
    But one reality is for certain – whatever rally in the stock markets may occur will be followed by a fall. Prep up it’s coming!

  • phdinlogic

    The stock market is rigged just like the fiat, ponzi scheme called the Fed…..What will the Jekyl Island crew think up next?

  • J B

    There’s a greater chance of an asteroid hitting Yellen’s house on Dec 18 at 10:05 AM during a Heatwave while a herd of wile Animals storm down Wall St.

  • dlewenz

    I have already made two bets to kiss a pig on main street in Bryan OH if the fed raises rates.

    • Philosopher

      Get ready to pucker up!

  • Thomas D Guastavino

    There is no justification for the fed raising rates other then then the fed is in a panic mode to create at least some breathing room to cut when the next crash occurs. I would love to be a fly on the wall at a fed meeting.
    I wonder if we can find out where the fed chairmen are putting their own money? Any way to find out?

  • Mad Monkey

    I read an article the other day that made perfect sense. It is no longer an investors market but a short term traders market. So if the traders hedge that rates go up the market will initially surge if rates are up up. Visa Versa. It will take a few days before the actual impact of the rate rise starts to take effect. Like markets dropped when the last expected rate rise did not occur. A few days later the markets started dropping again. So we see an initial surge of US stocks if rates go up take a big breath a few days later the downward carnage will start.

  • df NJ

    Oil will drop like a rock. They did it! The Germans created the first working hot fusion reactor. Essentially this is like having a mini-sun on Earth. Plasma is 1.5 million degrees controlled by a rotating magnetic field. This is like the Wright brother’s 1903 flight. I bet no one even knew what the airplane would have been like 15 years later!

    google “Wendelstein 7-X”

    The world’s first successful hot fusion reactor!!

  • alan

    I expect the magical printer will save the stock markets as it does every time. Dip, print and repeat. The stock markets don’t mean anything.
    Worry when the power is off a week, or you see cruise missiles flying over. Otherwise anything money / debt related doesn’t seem to matter.

    • Up here

      This is by far the most accurate comment yet…good job

  • Harquebus

    “All paper money eventually returns to its intrinsic value – zero.” — Voltaire.
    We have plastic currency now. Can’t burn it and can’t wipe your bum with it.
    Up, down or steady, it matters not. Zero multiplied by any rate is still zero.
    For the first time in history, all currencies are fiat.

  • rat28

    This is the best opportunity to buy

    • fwalker2016

      ROFL

    • GSOB

      You can say….
      “one of my turns”

  • XSANDIEGOCA

    Yellen could not live with herself if she raised rates. Poor dear is getting vapors as it is.

  • RedSky

    It sounds to me from what I have heard, the feds feel that the economy is strong enough for a rate hike at this time. It will not be a huge increase, probably 0.25% for now which will not be too bad given the
    rates are so low to begin with (4.20). Nonetheless, it will quell buying power in a market place that is already seeing higher prices and flat sales reports. The used car lots are already filling up with very late model used cars. The subprime car loan fiasco is starting to rear its ugly head I believe. Many municipalities are raising (or trying) to raise the minimum wage and this could adversely affect job creation as well.

    • GSOB

      Testing, testing, testing 1, 2,3….

  • mister_roboto

    Here’s what I think: Financial market carnage at some point is pretty much inevitable and baked into the cake at this point, so the Fed will raise rates when it is perceived to be most in the interests of those who are running the show to set off this carnage. It seems odd that they would do so right before the Xmas holiday. But who knows with these moral reptiles? The holiday timing could be exactly why they are doing it now if that’s what they end up doing.

  • Prut

    This is way too complicated to understand. I like crises that are started by lazy, irresponsible minorities taking out mortgages they can’t afford. Much more palatable.

  • Shawn M.

    We are witnessing the biggest consolidation move in history. The bankers are doing everything within their powers to make sure they have control, ie loans on every asset out there, worldwide. Once everyone is in place, in the system, they collapse it all and take ownership of everything. In the mean time, they are living life high on the hog, knowing, everything will collapse. They are squeezing every ounce out of the dollar, before collapsing. The collapse will happen as soon as everyone is in place.

    That giant vacuum sound will be all the assets worldwide being sucked into their control. Then, they will usher everyone into the new world system. The question is, how long will they allow everyone to suffer before they make the new system available after the old has collapsed? 1 month, 5 months?

    REMEMBER: These guys are well prepared for a collapse. They are using free money, which none of us have at our disposal, to prepare.

    • GSOB

      They are prepared to prevent a collapse by maintaining the status quo of control.

  • df NJ

    From a religious point of view, people who claim selfishness is a virtue are satanists. From atheist point of view, people who claim selfishness is a virtue are libertarians.

    Either way, in a society that values selfishness over selflessness you are not going to have any strong leftists. Wealth inequality in this country is stunning. Google and watch the video “Wealth inequality in America”. If you watch the video we are so far away from the dreaded “Socialism” curve it is laughable.

    The value of money comes from the middle class being greedy about it. I would argue based on the level of wealth inequality we have in this country we cannot go any further to the right and still have a currency having any shred of value at all!

    The problems with our country are NOT rocket science. Lobbyists force the politicians to pass legislation creating cartels and monopolies in exchange for campaign financing. It really doesn’t matter what you pay in taxes. What does matter is the purchasing power of your take home pay.

    But do not worry my comrades. Marx claimed that capitalism is always followed by communism because unfettered greed would result in the government’s currency collapse. Once the currency collapses people in the bread lines will demand MORE government not less. See you in the bread lines my comrades!

  • Rick

    So over the last few weeks, I read all the predictions of the disaster that an interest rate hike by the Fed will bring. Can someone elaborate on what kind of devistation not raising rates will bring? I’ve missed that discussion somewhere along the line, other than a mention that it will makes he Fed look bad. So what, they already look bad.

    • Watchman

      Lose of investor confidence if they don’t hike rates. Zerohedge has more details and information look there.

  • kaysel

    The writing is on the wall. This a perfect storm of economic factors coming together to create a collapse on a global scale never before seen. Declining trade, the collapse of commodity prices, decreasing wholesale and retail sales, along with overwhelming private and public debt are gong to lead to job lay offs and debt defaults on a major scale. The stock market rallies are being held up by only a few stocks, and junk bonds are tumbling, both forecasting a major market crash. How do you pay for all this debt with declining revenues? Expect any slight raising of Fed interest rates to be followed by a cut in rates–maybe into the negatives– and more QE to prop up markets for a while before everything really blows up in earnest. Get your financial house in as much order as possible in the little time left.

    • retired22

      And in this storm you aren’t even mentioning the Socio-economic & political disasters that market crashes will cause!

  • retired22

    there so much micro stuff thrown in that most people get distracted by all of the smaller issues
    The basics are this,..if the financial sector crashes now we will have a lot of pain all over ‘Main Street.If it doesn’t we will have even more pain in the near to medium future when the whole ‘real’ global economy collapses along with the financial markets.
    What it really comes down to is this,the financial hustlers,the “Vampire Squids” as Matt Taibbi calls them will keep feeding until there is nothing left to feed on.The rest of us will be eaten up alive by them.And in the end they will consume each other.Either they fail now or it will be the rest of us who get devoured later!
    The real issues were described by the great British political thinker,..Lord Acton when he said “The issue which has swept down the centuries & which will have to be fought sooner or later is the people versus the banks”

  • Rut_o

    Why would the feds raise the rates? Is there an underlying push on them?

    • GSOB

      Testing the fruit of their past labors, to see if the ominous threat of hyper inflation is now under control.

  • Creepy Pedro

    We have created the most leveraged financial system in all of history. Liquidity is drying up and the question of “if” has been replaced with “when”. The odds of markets “closing” have risen dramatically. Stress, both geopolitically and financially can no longer be hidden in plain sight. Should the Fed raise rates, I believe markets far and wide will convulse into an unscheduled “holiday”. Yet we listen to the cheers for a rate hike? Even George Orwell would be shocked!

    • Jazz

      Get off the crack pipe Pedro. I told you rehab!

      • Watchman

        Zazz you are skipping your meds again. The mental hospital is not very happy with you.

        • Jazz

          You and your alter ego Walker need to stop trolling the financial blogs because you have no clue on how finance actually works. Go read Martin Armstrong and you will get up to speed real fast!

          • Rorschach

            Jazz you have no credibility or even any intelligence to tell others what to read or what they should invest in. You are just a paid scripted troll that is probably an Obama slave.

  • Pete

    Is this another Shemitah moment?

    • Jazz

      Shemitah seems like a man made hoax

      • fwalker2016

        Your education was obviously a hoax.

        • Rorschach

          His very existence is a joke/hoax (Jazz).

  • Raymond Chow

    I hope Fed will raise rates this week if not just to show they meant what they say. They’ve been promising to raise rate countless of time now and still haven’t done it. If stock falls and the country is back in recession or even depression, why prolong the inevitable?

  • Philosopher

    I have always heard that bonds were safer than stocks. I am thinking the people that invested in bonds and the pensions that invested in bonds are going to be very surprised when those funds go down in flames.

  • cal

    Have a come to Jesus moment. Call on the name of the Lord and you shall be saved. Then pray the Rapture is soon, very soon. You don’t want to be on earth when Bill, Hillary and Monica return to the WH.

    • df NJ

      I think our omnipotent all-power all-loving God lets everyone through the gates of heaven to experience eternal heavenly bliss regardless of our earthly sins or how we practiced our religion. Jesus proclaimed this along with the Earth is God’s church and you do not have to buy your salvation from the church. Without sin the church has nothing to sell. So the church leaders at the time crucified Jesus so they could keep making money off of our sins.

      • GSOB

        Really bad theology.

    • The rapture is a lie. You dispensationalists are all alike. Jesus Christ confirmed the covenant -not- the Antichrist. There is no gap between the 69th & 70th week. You have given away the birthright you should have had to a still anti-Christ nation. You have committed the sin of Esau. May you repent & may God have mercy on your soul (as he did mine since I used to be like you). You have all been fooled by your paid-hireling-pulpit-preachers. I pray you leave the rapture cult along with your belief that the people of the 6 pointed star are the chosen people (with 6 triangles & 6 equilateral sides) (the image of the beast/count the number/the number of a man “Israel”). Count it all gain and don’t look back when you leave the rapture cult. Leave your feelings behind and follow the Truth. Please. GlobalAnswers .com.

    • The rapture is a lie. You dispensationalists are all alike. Jesus Christ confirmed the covenant -not- the Antichrist. There is no gap between the 69th & 70th week. You have given away the birthright you should have had to a still anti-Christ nation. You have committed the sin of Esau. May you repent & may God have mercy on your soul (as he did mine since I used to be like you). You have all been fooled by your paid-hireling-pulpit-preachers. I pray you leave the rapture cult along with your belief that the people of the 6 pointed star are the chosen people (with 6 triangles & 6 equilateral sides) (the image of the beast/count the number/the number of a man “Israel”). Count it all gain and don’t look back when you leave the rapture cult. Leave your feelings behind and follow the Truth. Please.

  • DB200

    “But it basically comes down to this – anyone that has a lot of money invested in these bond funds is in danger of getting totally wiped out.”

    When the investors used margin debt to invest, it even becomes more spectacular as also the lenders loose their shirts.

  • Jazz

    Stock market up, oil up. Guess who called it? You guessed it! :). More up days to come folks. Step right up!

    • Watchman

      Nice try Zazz. You really are either stupid or an intentional troll. Now do everyone a favor and go troll somewhere else perhaps the CNN website.

      • Jazz

        Says the king of the trolls. Lmao. Guess you can’t handle the truth!

    • fwalker2016

      Meanwhile the sp500 is still down 100+ since your ridiculous cries began, the djia is down nearly 1000 points and your darling AAPL is down even more significantly on a percentage basis. Keep congratulating yourself roflmao

      • Jazz

        Don’t see the S&P at 1400 like you said Walker. Move along

        • fwalker2016

          Never said sp500 to 1400 by December. Meanwhile thanks again for the laughs at your ridiculous market notions

          • Jazz

            Lmao “the S&P will hit 1400 by Dec” – fwalker2016/

          • Rorschach

            Says the “new highs” Jazz troll.

    • MaxRockatansky33

      Look! A new prophet!

  • chilller

    We’re at the part of the roller coaster ride where you are just cresting the top…but can see down the steep drop everyone on board is about to experience….there goes my stomach!

    • Jazz

      Lol. We are still riding up to the top partner. We have much much higher to go before a drop! Markets will be at new highs soon!

      • Rorschach

        Enjoy your highs because there is a huge drop to the bottom once you top.

  • Chaos no

    Dow futures are soaring this morning in anticipation for tomorrows rate ime. Even German and Great Britain are soaring once again in anticipation. It doesn’t look like there will be any carnage what so ever. Once again the doomsdayers are off to a bad start.

  • Chaos no

    Dow futures are soaring this morning in anticipation of tomorrows rate hike. Even Germany and Great Britain have markets that are soaring. It looks like there wont be any carnage from this small increase. Once again the doomsdayers are off to a bad start.

    • Watchman

      Is this your second handle “recovery”? If so you need to find a real job and one that you don’t suck at.

  • Chaos no

    Oh Lord yes its all gonna crash. Oh what are we gonna do? Oh God help us! The end is near!!! Get ready!!! The same doomsdayers that are telling us that our money is not going to be of any value are the people that want you to spend that same money on their doomsday and survival material. It all makes perfect sense.

    • GSOB

      You just provided a micro example of the macro situation.

  • Scoopie

    Well, they were hiked .25, and the stock market didn’t seem too perplexed by it. Let’s see what happens re. fiat currency.

  • Cyber Revengeance

    FED has hiked the rate. now what

    • GSOB

      Breath

  • Chaos no

    The half of those 93 stock markets arent going to be down now. Everything is beginning to lift off.

  • Hector

    Well, as expected, nothing happened after the FED raised the rates today. The stock markets surged… So much for the fear mongering on sites like these…

  • Jojo

    Still GOD is in control where just strain one b one something like blessing or curse who follow and not

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