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If History Is Any Indication, Junk Bonds And Copper Are Telling Us Exactly Where Stocks Are Heading Next

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Stock Market - Public DomainYields on the riskiest junk bonds are absolutely soaring and the price of copper just hit a fresh six year low.  To most people, those pieces of financial news are meaningless.  But if you understand history, and you are aware of the patterns that immediately preceded previous stock market crashes, then you know how how huge both of those signs are.  During the summer of 2008, junk bond prices absolutely cratered as junk bond yields skyrocketed.  This was a very clear signal that financial markets were about to crash, and sure enough a couple of months later it happened.  Now the exact same thing is happening again.  The following comes from a Wall Street On Parade article that was posted on Tuesday entitled “Keep Your Eye on Junk Bonds: They’re Starting to Behave Like ‘08“…

According to data from Bloomberg, corporations have issued a stunning $9.3 trillion in bonds since the beginning of 2009. The major beneficiary of this debt binge has been the stock market rather than investment in modernizing the plant, equipment or new hires to make the company more competitive for the future. Bond proceeds frequently ended up buying back shares or boosting dividends, thus elevating the stock market on the back of heavier debt levels on corporate balance sheets.

Now, with commodity prices resuming their plunge and currency wars spreading, concerns of financial contagion are back in the markets and spreads on corporate bonds versus safer, more liquid instruments like U.S. Treasury notes, are widening in a fashion similar to the warning signs heading into the 2008 crash. The $2.2 trillion junk bond market (high-yield) as well as the investment grade market have seen spreads widen as outflows from Exchange Traded Funds (ETFs) and bond funds pick up steam.

And right now we are seeing the most volatility in the junkiest of the junk bonds.

The following comes from Wolf Richter, and my jaw just about dropped to the floor when I first saw this…

This chart of yields at the riskiest end of the junk bond market – bonds rated CCC and below – shows what happened. These bonds have been selling off over the past 12 months, with exception of the sucker rally earlier this year, and their yields more than doubled from less than 7.9% in June a year ago to 16.2% by Thursday evening. And Thursday was a massacre:

riskiest junk bonds

On Thursday, yields jumped 2.6 percentage points, from 13.58% to 16.18%, as these junk bonds plunged. Those kinds of single-day vertigo-inducing sell-offs are rare in normal times, and there haven’t been any since the Financial Crisis.

Amazingly, the Federal Reserve is actually thinking about raising interest rates in this environment.

If that sounds like a really bad idea to you, that is because it is a really bad idea.

Raising interest rates would just add fuel to the fire of this junk bond rout.  DoubleLine Capital’s co-founder Jeffrey Gundlach agrees with me

To raise interest rates when junk bonds are nearly at a four-year low is a bad idea,” Gundlach said in a telephone interview.

Gundlach, widely followed for his prescient investment calls, said if the Fed begins raising interest rates in September, “it opens the lid on Pandora’s Box of a tightening cycle.”

Gundlach said the selling pressure in copper and commodity prices driven by worries over China’s growth outlook “should be a huge concern. It is the second-biggest economy in the world.”

Meanwhile, as Gundlach mentioned, the price of copper continues to plunge.

On Tuesday, it set a brand new six year low.  It is now the lowest that it has been since the days of the last financial crisis.

And as you can see from this excerpt from a recent Investment Research Dynamics article, the price of copper started crashing before the stock market crash of 2008…

I wanted to keep this simple and just look at what is considered perhaps the best barometer of global economic activity:

Copper Chart - Investment Research Dynamics

You’ll note that the price of copper is headed lower and is back to the price level where it was in the middle of 2008, right before the great financial collapse.  You’ll note that $3.6 trillion in Federal Reserve money printing – on top of trillions in Bank of Japan, ECB and People’s Bank of China money printing – has not been able to keep the price of copper from crashing again.

In case you haven’t figured it out by now, the global financial system is in real trouble.

Another sign that rough waters are ahead is the fact that global shipping has fallen into a dramatic slump.  The following comes from the Telegraph

World shipping has fallen into a deep slump over the late summer, dashing hopes of a quick recovery from the global trade recession earlier this year and heightening fears that the six-year economic expansion may be on its last legs.

Freight rates for container shipping from Asia to Europe fell by over 20pc in the second week of August, even though trade volumes should be picking up at this time of the year. The Shanghai Containerized Freight Index (SCFI) for routes to north European ports crashed by 23pc in five trading days.

Global economic activity is clearly slowing down, and there are 23 nations around the planet that are already experiencing stock market crashes.

The financial markets of the western world have not totally crashed just yet, but they are more leveraged and more vulnerable than ever.  The following comes from Zero Hedge

  • The REAL problem for the financial system is the bond bubble. In 2008 when the crisis hit it was $80 trillion. It has since grown to over $100 trillion.
  • The derivatives market that uses this bond bubble as collateral is over $555 trillion in size.
  • Many of the large multinational corporations, sovereign governments, and even municipalities have used derivatives to fake earnings and hide debt. NO ONE knows to what degree this has been the case, but given that 20% of corporate CFOs have admitted to faking earnings in the past, it’s likely a significant amount.
  • Corporations today are more leveraged than they were in 2007. As Stanley Druckenmiller noted recently, in 2007 corporate bonds were $3.5 trillion… today they are $7 trillion: an amount equal to nearly 50% of US GDP.
  • The Central Banks are now all leveraged at levels greater than or equal to where Lehman Brothers was when it imploded. The Fed is leveraged at 78 to 1. The ECB is leveraged at over 26 to 1. Lehman Brothers was leveraged at 30 to 1.
  • The Central Banks have no idea how to exit their strategies. Fed minutes released from 2009 show Janet Yellen was worried about how to exit when the Fed’s balance sheet was $1.3 trillion (back in 2009). Today it’s over $4.5 trillion.

As I explained during a recent interview with Kate Dalley of Fox News radio, what is coming should be obvious to anyone that is willing to look at the numbers honestly.

The global financial system is going to crash.

Yes, this crisis is going to take years to fully play out, but by the time it is all said and done it is going to be much worse than what we experienced back in 2008 and 2009.

So buckle up tight and hold on for your life, because we are in for one wild ride.

  • MichaelfromTheEconomicCollapse

    We live at such a critical time, and it is absolutely imperative that those that belong to the body of Christ seek the Lord at this time.

    If you live in the Northwest, I hope that you will consider joining Benjamin Baruch and myself at the Day of Awe conference in Sandpoint, Idaho on September 18th and 19th…

    • jhowell882

      wish i could Micheal but you don’t come far enough west (Portland).. could you at at some time talk about the new road to destruction of “capital-relief trades”. this sounds like the next credit default swap fiasco. saw it in the wall street journal august 18th edition. thanks for all you are showing us.

      • MichaelfromTheEconomicCollapse

        You are quite welcome.

        If anyone has questions about the upcoming conference, please feel free to contact me.

      • Kim

        Hello fellow Portlander!

    • Kim

      I would enjoy that! But I’m afraid if I did attend, I’d be attending by myself. Is there a group that I could sit with or commune with? At least enjoy a meal with? I live in Portland so it’s quite a ways away, but still doable.

      Come speak in Portland!

  • Alwaystomorrow

    The Economic Collapse Blog Has Issued A RED ALERT For The Last Six Months Of 2015

    Published 6/25/2015

    136 days until 12/31/2015.

    Lets do a count down every day until the end of 2015 and see just what happens


    By Michael S, on July 31st, 2015

    “And I kind of appreciate the countdown. It reminds people of my warning, and perhaps it will give some readers a renewed sense of urgency.”

    • Matthew

      Actually we have 30 days for the countdown – The Shimitah 7 year cycle ends on Sept. 13th. So sometime soon after that, there will be a crash.

      • Alwaystomorrow

        For me to start another countdown would be a conflict of interest.

        You can start one.

        • Kim


          Ok PLEASE let’s despense with the predictions and the countdowns attempting to debunk the predictions (if that is what your posts are for) If the former is meaningless so is the latter!

          That said, I am preparing but not entirely prepared. I need a few more things.

  • rentslave

    After the stock market crashes,bond prices will be back in a year or two.States cannot go out of business.If you’re only looking for yield and not to cash them in,it’s irrelevant to you.However,the stock market may have fleeced its last victim.It may take a generation or two for that indice to come back.

    • Illegal

      Some states may need to declare bankruptcy. Their liabilites will be greater than their revenues. There are also many state pension funds that will need to be restructured. Also government projects is what got us into part of this mess. You remember bridges to nowhere?

  • Preacher62

    Buckle up tight and hold on to Jesus for your life (your eternal one). This one only serves the purpose of allowing us to choose our eternal destination in the next one. You may choose this world which is obviously on the way out or choose the Kingdom of Heaven where Christ lives and reigns forever. What you cannot do is choose both because the two are incompatible. “Seek first the Kingdom of God and his righteousness and whatever you need will be given to you”.

    • SunnyFlaSnotress

      Given a choice between Jesus and a big wad of money, I’d take the big wad of money.

      • LOL

        Faith and prayers will protect you from hunger, thirst, SWAT teams, John Fleece, snakes and scorpions.

        Faith in my own religion only of course, all the other ones are cleary false and heretical doctrines.

        • SunnyFlaSnotress

          John Fleece?

        • Gay Veteran

          ROFLOL, careful, the bible thumpers will be after you

      • Jerry C

        Your comment reminded me of one of my most saddest verses in the entire Bible:

        “Then Agrippa said unto Paul, Almost thou persuadest me to be a Christian.”

      • Paul Patriot

        “wide is the road to destruction, and narrow is the road to life….”

        “He that has the Son, has life, he that does not have the Son, does not have life”

        “Unless a man be born again, he cannot enter the kingdom of God”

        The hatred for Jesus never ceases to amaze me.

        • SunnyFlaSnotress

          Oh, actually, I don’t hate Jesus. I just prefer the tangible and reality-based vs the faith-based.

          • Marco

            Believe me money dont save you from death……or cancer…..fuck the money I prefer health and people who i can count like family and friendship….I see so many people destroying themselves for money……but the truth is when you die all you have stay here……you dont go to heaven or hell and say to S Pedro or lucifer if you can take also your shelby mustang 🙂

          • SunnyFlaSnotress

            Marco, marco.. language, language..
            and yes, better treatments/money may (not always, but sometimes) save you from cancer and death.. I thought we went over that previously.

          • Marco

            Sorry mate for my language:) theres nothing that can kill cancer…it can give you a few more years….but always appear….and i saw that in my father..and can tell you see a strong men turning into a vegetal i do not wish that to my worse enemy..because in the end all of this like money is irrelevant…..of course money is needded por our society but not like this…the pure greed and egoism will be our end.In life theres action and consequences….in this days is like every men for himself…..and situation is not critical like Mad Max.:)..This crisis is the result the stupidity of our society or mankind… Einstein said the stupidity of human being is infinite….Today the world have nukes to destroy the entire world…and today we are rulled by stupid people…..

          • SunnyFlaSnotress

            No,no,no.. some people DO clear their cancer. Typically it is a matter of timing and spread. The less malformed cells are, the easier they are to kill/apoptosis/natural cell death.
            In my case, hormones worked. It’s been over 12 years.. no surgery, no chemo, no radiation. I signed the waiver, was told my odds, and the family never even knew.

          • Nemnor

            Marco and SunnyFlaSnotress, on the matter concerning money, Jesus, faith-based vs reality-based, BOTH of you are “correct” (in a way) – as life in general is filled with contradictions and “grey” areas.

        • Gay Veteran

          good parrot, Polly want a cracker?

    • chilller

      Thanks Preacher. Those who are non-believers have never experienced the grace of God when all’s one has to do is ask.

      • old fart

        You will starve to death waiting for your Jesus care package, God helps those who help their selves, also god help those who get caught helping their selves.

        • Gay Veteran


      • Gay Veteran

        “…Those who are non-believers have never experienced the grace of God….”

        yeah, all those 100s of millions who lived before Jesus, those 100s so millions after Jesus who have never heard of him.

        guess they’re all going to h ell, right?

    • jox

      Religious fanaticals are boring and repetitive, no matter they are christians or muslims or whatever.

      • Preacher62

        Thank you, I really enjoy being boring and repetitive and have striven hard to achieve that goal. Thanks for noticing. Praying you have the best day ever, filled with God’s sweet grace.

    • Steeve Girard

      Buckle this! (The finger) This physical world is by design (thermodynamics laws), not by will (magical thinking) made to fail. To eventually fall back to a ground state. We burned through all the easy energy… we had to, one day, start to choke, because we (the consumer world) were a fire. Welcome to reality.

      • Preacher62

        Every knee will soon bow to reality. I just choose to do so now. Thanks for the finger, glad to know someone still cares enough to send their very best. Have a blessed day.

  • GetReal4U2

    time is very short…read “the most important thing” article above…the Jewish fall feasts are almost upon us…Jesus will fulfill them just as he did the Jewish spring feasts…get ready…September approaches quickly…

    • Priszilla

      It’s more likely that those who believe in a crash will sell their stocks on feast day – and cause the crash and accelerate it.

    • SunnyFlaSnotress

      who’s in your picture anyways.. looks like an actor in a movie scene but I can’t place it

      • GetReal4U2

        It’s the guy from the all-state commercials…”Mayhem”…he he

        • SunnyFlaSnotress

          ty 🙂

  • SS

    Sorry for this ignorant question…..should I be taking all of my money out of the bank?

    • JailBanksters

      ‘ell Nooo
      You should be putting every penny into the Bank.
      Jamie Dimon.

      • SS


    • Marco

      There may be a time for that in the future, I really don’t think that time is now.

    • Priszilla

      How much are you talking about? If it’s millions you better buy proper homes for all your family.
      If it’s hundreds, leave as much to pay the bills.

    • K2

      If interest rates could rise, doesnt it mean you could get more interest for that money?

    • Malcolm Reynolds

      http://www . zerohedge . com/news/2015-08-17/crisis-confiscation-where-do-i-store-my-wealth

      “Today, those who are living in a jurisdiction that may, in the near future, be looking at a national economic crisis at home, should regard any wealth in banks to be sacrificial, i.e., that it might very well be swallowed up soon.”

    • alan

      The bad choices are, bank, credit union, mattress national bank.

    • kfilly

      I would keep only the minimum amount to pay your bills in a bank. Pull the rest out. Haircuts (like in Cypress), negative interest rates (pay for the privelige to keep your money in the bank like in Europe), are coming here. Our government has changed a lot of laws to make that the case. The saying possession is 9 tenths of the law has a lot of bearing here. If you don’t physically hold it, you don’t own it.

      • Jerry C

        Just saw your comment after posting. Yep. 9/10 of the law.

    • jakartaman


    • SunnyFlaSnotress

      I’m not, though I bank through a large investment firm and eye buying a house. Still having the car worked on currently.

    • Jerry C

      Rule #1: Possession is 9/10 of the law.

  • JailBanksters

    Fiat Money is like a religion, you have to believe it has value and believe it actually exists. The system only falls apart when people start to question it’s validity.


    I agree, but NARENDRA MODI will save the global economy

  • coreyb

    Stocks won’t crash because the US government will buy and pump it up, just like they did in China. Feds around the world have already bought stocks with printed money out of thin air. It’s all rigged and the government will never let stocks drop. We haven’t had a correction in 4 years. Feds in charge

  • coreyb

    Japan is in recession, but it’s stock market is doing great. Their government is buying stocks to prevent it from going down.

    • rmc9

      I think our (USA) government is too!!

    • James

      It is mostly Japans pension fund as they realize that yields on Japanese debt are not enough to pay for a rapidly aging populace

  • Harbinger

    Michael, I usually agree with most of your talking points; however, when you said “this crisis is going to take years to fully play out,” I feel you couldn’t be more wrong. With everything coming together to create the “perfect storm” we will be lucky to make it out of this year without everything falling apart. No matter how many warnings we give, their are still individuals who continue to rely on their resources rather then the Resource. Until people alter their way of thinking their is little hope.

    • MichaelfromTheEconomicCollapse

      Everything is definitely going to feel like it is falling apart, but I want people to understand that this crisis will not be a short one that will be finished quickly. Ultimately things will keep going from bad to worse for years.

      • Harbinger

        Michael, yes things will go from bad to worse. The great thing is that God’s mercy and grace are new every day. God is not going to pull us out of the fire, rather He will walk us through the fire hand in hand as long as we keep our focus on Him.

      • Nemnor

        Michael, I would put part of your (above) statement differently, like this – “Ultimately, things will keep going from bad to worse (generally speaking), and not just for years, but all up to the end-of-days – towards total collapse/chaos and/or WW-III.

        Looking back at the last 100+ years history of Capitalism, one can know that the above statement is “realistic”, once one is aware of the main underlying issue that “compeled” Germany to “trigger” WW-I and WW-II. That awareness would let one know that the decadent and decaying world-wide Capitalist system will likely bring about WW-III, as the system relentlessly heads towards total socioeconomic collapse/chaos (and (world) war is also a form of total collapse/chaos).

      • K

        I understood what you meant. And I agree. Once we hit bottom this time, we may never come all the way back. Further let me add my opinion. Some of us, even among the prepared, will not make it. I believe myself, among those who will not make it long term. I hope to just live long enough, to pass on what I know. But as with all things, that is the Lord’s call, not mine.

      • Isaac

        Yes I understand what you’re saying Michael, but one thing bothers me. Do you think it will be a s*** hits the fan event where there is no food, water, and stuff and a ‘mad max’ scenario plays out? Or something like 2008 where there is another bailout and some sort of stability remains?

        • tayronachan

          Farmers are still going to farm, and fishermen are still going to fish. imho.

  • tom

    Will a collapse help Trump or help Clinton? or help obama stay in office….

    • alan

      Declare a state of emergency and cancel elections until the crisis is over, when ever that is. Just say’n, I am not predicting it, but that’s how it would go.

      • rmc9

        …I think that’s the plan all along…orchestrated it was

    • jakartaman

      There will not be a Government that you would recognize. Possibly 5 new country’s based on regions.
      This will take effect over time.

      • SunnyFlaSnotress

        Benevolent planets will intervene. We will see their leadership superiority and have them govern these provinces.

    • SunnyFlaSnotress

      Clinton will possibly reset the currency. It’s not a help issue.. it just is what it is.

    • Jerry C

      NObama is going to the U.N. to become king of the world & implement his hope & change to the entire planet. Why would TPTB stop the elections when they control them & sheeps think their votes matter? They’ll crash it really hard after he leaves so that he can tell the world he saved us for 8 years. The world will love him & accept his Mark.

  • alan

    You know they are prepared this time and watching the market very closely. You know the fed has that printer all polished up real nice!

    My bet is.., 90% chance smooth to a little bumpy through Christmas and smooth after that. 10% chance we will be eating our kids at Christmas.

  • grumpyhillbilly

    I wonder even if we can rebuild with all the shameless deceit and sense of entitlement that is running rampant society.

  • G21

    The Bible foretells a time, just before the Great Tribulation, called “The Beginning of Sorrows”, in which –

    – Socialism rises
    – Widespread war breaks out
    – Economies collapse, leading to famine
    – Plagues and disease sweep the planet

    During The Beginning of Sorrows, 1/4 of earth’s population will die.
    You can read all about it in Revelation 6:1-8.

    Since we’re seeing these Sorrows already taking shape, why wouldn’t you secure your and your family’s spiritual well-being now, while there is still time? It’s not difficult, and you don’t even have to go to church to do it. Just pray to Him.

    • SunnyFlaSnotress

      Your icon got me thinking about hollow point bullets. I did some research and now I understand how they can be preferable. I will probably get some.

      • Alwaystomorrow

        Hornady critical defense. Expensive but good.

        • watchmanonthetower

          Accurate. Deadly. Dependable.

          All the pertinent qualities one needs in a projectile.
          And love that silver nickel casing…


          • Alwaystomorrow

            The accuracy is up to you!

          • watchmanonthetower

            True. But that is their slogan…

          • tayronachan

            Off Topic —- My Rem 700 30-06 deer rifle won’t shoot better than 4 MOA with 150gr., even with reloads. Before getting rid of it, I tried the 110gr V-Max by Hornady, and it shot 1 MOA. Go figure.

    • Nemnor

      G21, genuine “socialism” can NEVER be built in a condition of chaos, wars and economic collapse.

      The reality related to what you are trying to say might be as follows…

      – Decadent Capitalism rises
      – Widespread (or World) war breaks out
      – etc, etc….

      Just as history showed us in the past, when Capitalism brought about WW-I and WW-II. (right?)

  • Ranger_Ric

    I believe they are holding this together by the tips of their fingernas because there is still a little money left to steal.

    When it becomes obvious that Trump is going to win in a landslide, they are going to let it go.

    They are not really ready and I’m sure they were hoping for a hillary or some other bought and paid for puppet to help them along a little while longer. However, they won’t risk having Trump restore any of the damage they have done by stopping the illegal invasion and reversing the takeover of our country by the third world.

    They will allow the system to crash before he takes office, Mark my words and be ready!

    • SunnyFlaSnotress

      Trump will never win.. the minority majority and women don’t like him..White guy is no longer the majority voter.fact.

      • Paul Patriot

        Hilary will win, just my opinion, based on the liberal, progressive, sedated, sheeple who do not want liberty, but prefer oppression and government control in every aspect of their lives.

        • SunnyFlaSnotress

          Apparently we see liberty differently.

        • Gay Veteran

          yeah, and you “conservatives” loved you some Bush back in the day

      • G21

        Actually Trump polls very well with women.

        • Nemnor

          Ironically, I WISH for Trump to win (besides the fact that he is one of the few wealthy people I really do admire).

          You see, IF Trump wins, he will attempt to save or bring back (in his view) what he considers to be (true) “free market” Capitalism. Plus, all those who believe that “Capitalism is not the problem” would believe that Trump can really fix things.

          Then as sure as the Sun did rise today (19th. August 2015), I am SURE that Trump will FAIL. Not because Trump is not a capable leader, but because world-wide Capitalism is indeed decadent and can NO longer generate long-term recovery by economic means alone.

          You see, the problem facing decadent Capitalism is insoluble within Capitalism (except for a world war, which is a “reset” of an evil system, rather than a real fix for the benefit of Mankind). But, like Reagan, etc. Trump believes that all you need to do is (in his view) bring back REAL (“free market”) Capitalism and a few regulations, and all will be well again with the USA. And this is where Trump, and all who thinks that “Capitalism is not the problem” are all (dead) WRONG.

          So, a win for Trump, actually means more people will sooner come to realize that Capitalism is indeed the main root cause of the major socioeconomic issues facing the USA and the World.

          • tayronachan

            Capitalism has brought more people out of poverty than any other system. Maybe we should instead break up some monopolies? When was the last time that happened?

      • tayronachan

        Why do people like Trump? Because he is NOT a politician.

  • G21

    I just listened to an interview with Hugo Salinas-Price on USAWatchdog, and he made a good point about Donald Trump which I’d like to share.

    Mr. Salinas-Price pointed out that Mr. Trump speaks his mind in a way that angers others.
    Now, there is nothing wrong with making your opinion known, but Mr. Salinas-Price also said that Putin of Russia and Khamenei of Iran are not men who can be bulldozed by bluster and braggadocio, of which Mr. Trump is full. The point Mr. Salinas-Price made is that a wise leader needs to be “prudent”, which Mr. Trump is certainly not.

    I may be the most conservative man on earth, and I believe we desperately need good, strong, wise conservative leadership.
    I’m just not convinced Mr. Trump is it.

    • SunnyFlaSnotress

      Well, yes, Mr.Salinas is right. Trump doesn’t speak well of others and that angers those who support immigration. Trump does however appeal to the proportionally dwindling white guy though. He takes a poor stand on women’s issues. He is all pomp going nowhere.

    • jsmith

      I understand, but if not Trump then who? This country is at a pivotal time in its history, and I don’t see anyone else even coming close to a solution. Do we just open up the borders and let half of Mexico in? I mean, this is Mexico’s main export to the United States: Their poor!
      Was this what our politician’s intended to do when they passed all those immigration laws, to create a minority white United States? Is white America ready to become a minority like here in California?

      • G21

        I don’t know who. I like Cruz and Fiorina, but they’re way back in the pack.

      • tayronachan

        What ever are people going to do when there are no more white countries to immigrate to?!?!

    • tayronachan

      I think Trump would rather do business with Russia and Iran, than go to war with them. At least he sounded that way on Russia. I agree with that.

  • HeyAHuman

    So, asteroid on September 24… true or false?

    • DW

      I’ll let you know on the 25th. 🙂

  • One wild ride – you mean: HELL ON EARTH
    is Coming With A Vengeance.

  • Mondobeyondo

    The powder keg is ready… and the fuse is about to be lit.

    • Kim

      The fuse has already been lit.

      • tayronachan

        Yup, the fuse was probably lit with the “solutions” the FED put forth during the 2008 crash.

  • CharlesH

    Unless there is some type of ‘re-set’, I don’t how this can go on much longer but I’m no financial or economic guru – just using my common sense (which today is very uncommon). Now – on the other hand – numbers are infinite – so with the right nip and tuck here and there (manipulation) I suppose it could go on forEVER. Interesting.

  • john waylon

    The good news is there is proposed legislation in DC to confiscate the wealth of senior citizens and place them in internment camps for free (slave) labor in toy factories. Relieve some of the pressure and stress on the buffets and sewer systems in US.

    • G21

      What’s the number of that bill? Is it in the Senate or the House?

      • Maddog

        They don’t bother with those archaic groups, Ocommie simply decrees what he wants and presto, we get reamed. Good thing the price of oil collapsed greatly reducing the cost of Vaseline. Better order a drum or two.

  • john waylon

    Has anyone noticed the spike in heroin overdoses in the US. Is it a coincidence that Afghanistan now produces majority of opium. Reminds me of the surge in crack cocaine in LA in the early eighties. CIA has switched substances and locales and is now pumping heroin into US. Absolutely wonderful.

  • john waylon

    CIA is trafficking heroin in US.

  • Bolivar Madera

    What should I do as an average American to see myself safely survive this collapse? Is there a book I should read?

    • tayronachan

      I’m sure everyone will be affected to some extent, no one will be immune. On the flip side, the farmer will farm, and the fisherman will continue to fish.
      I’ve been following Martin Armstrong. He has a blog, it’s very good reading. Good luck.

  • Michael Lever

    This doom and gloom stuff is all very silly. It is essential that the markets crash from time to time, because crashes are necessary to remind people of the need to think and live in balance and harmony.

    The cause of crashes stems from overdoing thinking mind over matter, so much so that we become set in our ways. We are designed to manage and ride the cycle of ups-and-downs without coming unstuck in times of change. So anyone that does come unstuck is being reminded of the consequences of inflexibility in attitude.

    I appreciate a modern economy is complex but that is no excuse for thinking problems are normal and can be brushed under the metaphorical carpet. The 2008 crash was a wake-up call for action.

    A problem is symptomatic of a fault in direction.

    We cannot possibly be responsible for others until we learn how to be responsible for ourselves.

    • tayronachan

      There is a 7 to 8.6 year business cycle, and there are cycles within much bigger cycles.

    • Raymond Chuang

      Maybe this is time the USA finally looks at a MASSIVE overhaul of both business regulations and tax laws to finally make running a business viable again.
      Currently, according the Tax Foundation, the Federal income tax code is a US$1 TRILLION per year drag on the US economy in terms of compliance and economic opportunity costs. This is why going to no-loophole lower rate flat tax (or eventually to alternatives to the income tax) is a must, freeing up hundreds of billions of dollars per year for real economic activity, not to mention encouraging savings and capital formation staying in the USA, very necessary for real economic growth.
      Secondly, we need to look at business regulations in general, find every unneeded and/or obsolete regulation, and phase them out. These regulations are making it increasingly difficult to start, let alone run a business, and is a major contributing factor in driving businesses out of the USA.
      Hopefully, the USA will finally take these steps in time to save the economy as a whole.

  • Greggy Chua

    Bond mutual funds are not good to be in? What if they are not USD denominated?

  • Cashabis

    The S&P and the Wilshire5000 are both close to making a death cross.The DJIA made one Aug 11th and has dropped 1240 points since.
    If the Wil$hire5000 drops like that Trillions of dollars will be lost on top of the already $1.77 T since June 22nd.Makes for an interesting Sept/Oct. Batten down the hatches!

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