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Virtually Everyone Agrees That Current Stock Market Valuations Are Not Sustainable And That A Great Crash Is Coming

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Stock Market Collapse Toilet Paper - Public DomainCurrent stock market valuations are not sustainable.  If there is one thing that I want you to remember from this article, it is that cold, hard fact.  In 1929, 2000 and 2008, stock prices soared to absolutely absurd levels just before horrible stock market crashes.  What goes up must eventually come down, and the stock market bubble of today will be no exception.  In fact, virtually everyone in the financial community acknowledges that stock prices are irrationally high right now.  Some are suggesting that there is still time to jump in and make money before the crash comes, while others are recommending a much more cautious approach.  But what almost everyone agrees on is the fact that stocks cannot go up like this forever.

On Tuesday, the Dow, the S&P 500 and the Nasdaq all set brand new record highs once again.  Overall, U.S. stocks are now up more than 10 percent since the election, and this is probably the greatest post-election stock market rally in our entire history.

But stocks were already tremendously overvalued before the election, and at this point stock prices have reached a level of ridiculousness only matched a couple of times before in the past 100 years.

Only the most extreme optimists will try to tell you that stock prices can stay this disconnected from economic reality indefinitely.  We are in the midst of one of the most outrageous stock market bubbles of all time, and as MarketWatch has noted, all stock market bubbles eventually burst…

The U.S. stock market at this level reflects a combination of great demand, great complacency, and great greed. Stocks are clearly in a bubble, and like all bubbles, this one is about to burst.

If corporations were making tremendous amounts of money, rapidly rising stock prices would make logical sense.

But that is not the case at all.  Corporate earnings for the fourth quarter of 2016 were actually quite dismal, and this disconnect between Wall Street and economic reality is starting to really bug financial analysts such as Brian Sozzi

The S&P 500 has gone 89 straight sessions without a 1% decline. Considering that Corporate America didn’t exactly light up on the top and bottom lines during the fourth quarter, such a streak is rather troublesome. Granted, the stock market is a forward-looking mechanism that appears to be trading on hopes that Trump’s unannounced stimulus and tax plans will be lifting economic growth in 2018. Even so, the inability of investors to at least acknowledge persistent struggles among companies and ongoing chaos in Washington is starting to become disturbing.

It is a basic fact of economics that stock prices should accurately reflect current and future earnings.

So if corporate earnings are at the same level they were at in 2011, why has the S&P 500 risen by 87 percent since then?  The following comes from Wolf Richter

The S&P 500 stock index edged up to an all-time high of 2,351 on Friday. Total market capitalization of the companies in the index exceeds $20 trillion. That’s 106% of US GDP, for just 500 companies! At the end of 2011, the S&P 500 index was at 1,257. Over the five-plus years since then, it has ballooned by 87%!

These are superlative numbers, and you’d expect superlative earnings performance from these companies. Turns out, reality is not that cooperative. Instead, net income of the S&P 500 companies is now back where it first had been at the end of 2011.

The cyclically adjusted price-to-earnings ratio was originally created by author Robert Shiller, and it is widely regarded as one of the best measures of the true value of stocks in existence.  According to the Guardian, there have only been two times in our entire history when this ratio has been higher.  One was just before the stock market crash of 1929, and the other was just before the bursting of the dotcom bubble…

Traditionally, one of the best yardsticks for whether shares are over-valued or under-valued has been the cyclically adjusted price earnings ratio constructed by the economist Robert Shiller. This ratio is currently at about 29 and has only twice been higher: in 1929 ahead of the Wall Street Crash, and in the last frantic months of the dotcom bubble of the late 1990s.

We can definitely wish for the current euphoria on Wall Street to last for as long as possible, but let there be absolutely no doubt that it is going to end at some point.

It would take a market decline of 40 or 50 percent to get the cyclically adjusted price-to-earnings ratio back to a level that makes economic sense.  Let us hope that the market does not make such a violent move very rapidly, because that would likely be absolutely crippling for our financial system.

Markets tend to go down a lot faster than they go up, and every other major stock market bubble in U.S. history has ended very badly.

And this bubble is definitely overdue to burst.  The bull market that led up to the great crash of 1929 lasted for 2002 days, and this week the current bull market will finally exceed that record.

Trying to pick a specific date for a market crash is typically a fruitless exercise, but market watchers are becoming very concerned about some of the signs that we are now seeing.  For example, the “CCT indicator” is currently showing “the lowest bullish energy ever”

The first factor is the CCT indicator. This indicator is a proprietary internal measurement of the general volume of the New York Stock Exchange. The measurements take into account the institutional participation as a ratio of the overall volume. Also measured is the duration of heavy block buying in rallies.

The sum total of all the measurements now shows the lowest bullish energy ever — even lower than in 2008, just before the market crash.

In other words, this current bull market appears to be completely and utterly exhausted.

The laws of economics cannot be defied forever.  Traditionally, commodity prices and stock prices have tended to move in unison.  And this makes perfect sense, because commodity prices tend to rise when economic conditions are good, and in such an environment stock prices are typically going to move up.

But now we are in a time when commodity prices and stock prices have become completely disconnected.  In order to bring this ratio back into line, the S&P 500 would need to fall by about 1000 points, and such a decline would cause a level of financial chaos that would be absolutely unprecedented.

This current stock market bubble has lasted much longer than many of the experts originally anticipated, but that just means that the eventual crash will likely be that much more devastating.

In the end, you don’t need to know all of the technical details in this article.

But what you do need to know is that current stock market valuations are not sustainable and that a great crash is coming.

It may not happen next week or next month, but it is going to happen.  And when it does happen, it is likely to make what happened in 2008 look like a Sunday picnic.

  • horse777res

    GOD is in control!!!!

    • aldownunder

      Dreamer

      • horse777res

        DECEIVED!!!

    • Kissmagrits

      1 John 5:19 We know that we are children of God, and that the “WHOLE” world is under the control of the evil one. That includes the Babylonian monetary system which is designed to get everyone in debt and enslave mankind.

      • Bruce

        I’m curious. If the whole world is under control of the evil one then who is the evil one? Surely, you know that the bible says God killed every man, woman and child on the face of the planet except Noah and his family. Imagine 2 and 3 month old precious infants, without sin, drowned. That’s loving and merciful? Sorry, I have a hard time swallowing that!
        Please note that my thoughts are in NO way intended to sway your thinking or challenge your beliefs or religion rather they are to explain why I don’t believe the same as you.

        • Kissmagrits

          The evil one is satan the devil that wanders the earth in spirit form along with his demons seeking those he can lead astray from gods path of righteous living. The devil knows how wonderful and beautiful heaven is because he used to live there before he rebelled against God and was cast out by the Arch Angel Micheal. He threw away his chance forever to live in paradise and now in his rage he wants to drag as many people to hell with him and prevent them from accepting Jesus Christ as their Lord and Savior and going to eternal paradise in Heaven. When one third of the Angels were cast out of heaven to earth for rebelling with Satan against God, they saw human women were beautiful and took them for their wives. They procreated with these women and these women gave birth to (fallen Angel /human hybrids). These were the Nephilim Giants like Goliath that David killed. The fallen angels also mixed the DNA of humans and animals and created chimeras. That’s where you get Ancient Greek legends of minataurs and half human half animal creatures from. The earth was filled with these nephilim giants. The earth was also filled with these half human half animal chimeras. That’s why God sent the flood to destroy all the perversity and abominations that the fallen angels had done on the face of the earth. When you also read after the flood when God commands the isrealites to go into these villages and kill every man, Women and child, they are killing Nephilim. Deuteronomy 32:4 He is the rock, his works are perfect, and all his ways are just. A faithful God who does no wrong, upright and just he is.

        • JC Teecher

          Bruce, the liberal mind cannot comprehend/understand the Plan of God or the fact that he created each and every soul, “for His pleasure”.
          Those that are not bringing him pleasure are walking down a dark path that is layed out by that “evil one”…Satan and his spirits.

          I heard a liberal actress say the other day, that she does not care for a God that demands that everyone loves Him, or else they go into a hot suffering place called hell.
          My response to that is this: Well, guess what snowflake, God did not create you for your own pleasures in this life, so you are not forced to love Him or anyone as well…it’s called freewill.
          If that freewill causes you to slap the face of God with such comments, then you should also know this. Every negative word and thought, that comes out of the mind and mouth of one of His created, is written in your personal Book of Life record in Heaven.
          Every one of those negative and vile words that is not atoned / forgiven for, will have to be accounted for on the day of Judgment when every knee will bow and every tongue will confess.

          That is the facts and the Plan of God.
          It will happen, and many will gnash their teeth and wail in despair and regret, when it is happening. Why? Because they received “not” the gift of grace and love that was offered….not forced.

        • Jerry C

          I’m curious. The Nephilim, fallen angels, rebelled against God and combined their fallen genetic code with humankind, along with the beasts of the land, air & sea; making everything an abomination. The only souls untouched were Noah & his family since they followed God’s laws & did not partake of the evil. So, instead of destroying everything & starting over, God, in His great love for mankind, saved Noah & his family along with the animals on the arc and started over. That’s a loving and merciful God. Sorry, I have a hard time swallowing your contempt. Of course, I’ve actually read & studied God’s Holy Word, the Holy Bible, and understand Old Testament laws & Commandments as well as laws concerning inheritance & kinsman redeemer to understand how much God loved us to die in our place for our sins.

          Everything you refuse to know about God is all wrapped up in John 3:16. Of course, Job thought he could do a better job than God too; he failed…miserably.

          • GSOB

            ……………”The Nephilim, fallen angels, rebelled against God and combined their fallen genetic code with humankind”………

            That kind of interpretation is not correct.

          • Jerry C

            We agree to disagree agreeably. What would be your interpretation as to why God destroyed the world with the Flood except for Noah, his family & the animals on the arc?

          • GSOB

            Sin

          • GSOB

            I am persuaded that this view is the correct view,……. the men who were supposed to be godly took wives who were unbelievers and their offspring are said to have been fallen ones.

            Any other interpretation opens up all kinds of possibilities which undermine the Person and work of Jesus Christ.

            Please also see
            Genesis 4:26 &
            2 Corinthians 14-16

            Be ye not unequally yoked together with unbelievers: for what fellowship hath righteousness with unrighteousness? and what communion hath light with darkness?
            And what concord hath Christ with Belial?
            or what part hath he that believeth with an infidel?
            And what agreement hath the temple of God with idols? for ye are the temple of the living God; as God hath said, I will dwell in them, and walk in them; and I will be their God, and they shall be my people.

        • GSOB

          Bruce,……
          No one is without sin.
          All that are in Adam will die.
          Flesh and blood can not inherit the Kingdom of God.
          The longer a sinner lives in Adam, the law of sin and of death will reign in them.
          Christians want to get to the proper perspective….. Job 13:15
          Though He may slay me, I will still come to Him……
          Infants or babies, 2 or 3 months old, at any age – are sinners nonetheless, and that declaration is from the Lord himself.
          Now, who would you agree with? Him or your own understanding?

  • aldownunder

    The stock market has gone ballistic. And while a correction seems set for 2017, you shouldn’t rule out higher highs.
    Technically, the Dow Jones Industrial Average doesn’t look ready to give up its gains…yet. But when it does lookout it will be nasty

    • Jazz

      Finally someone with a brain. Never bet against the house (Wall Street), the house ALWAYS wins. Dow 25k here we come!

      • Marc

        I remember the first time I saw you write about 25k. I must admit at the time I thought that was impossible. You took a lot of flack for your statements (not from me)I thought anywhere near 20k was impossible. Looks like you were right. Congrats. I asked ou how long the crash predictions had been going on. I think you said 3 years(it’s 4 now) What I did do after the chat was I stopped letting these articles steer my decisions and bought into a fund that manages European and British stocks. I bought in March last year. That’s worked out quite well. Thanks man. I still buy physical gold and property. Things will go south eventually. But no longer living as if the end is coming next month.

        • Jazz

          Great to hear Marc! Kudos! I think we have a couple of good years left before the whole debt situation really starts unraveling. But even then the $ has to go somewhere. I expect money to flow out of bonds into stocks.

          • JC Teecher

            You are saying 2020 is the year, yet you disparage anyone saying possibly sooner.
            The market managers that are awake and have considerable experience are saying the historical trends of the markets crashing is right on line for the 2017/2018 period as well. Every 7 to 10 year period it happens.

            for the blind, not you jazz, the last was 2008, so 2018 would be the normal average time frame for another…”planned” crash, by which the elite always come out on top, with big profits, because they have forewarning by TPTB.

          • Jazz

            We are in a cyclical bull market that is richly valued but not overvalued when you factor in low interest rates. As long as rates stay below 3.5/4 on the 10 year we should be able to melt higher. I agree crashes tend to come every 7-10 years but when you have the Global Central Banks judging “success” by one’s stock market and have bent over backwards to make stocks rise they will not crash the system until all hell starts to break loose. That IMO is at least 2-3 years away. Yes we may have corrections here or there but no crash for a few years.

          • Spatial Memory

            Multiple monikers accolades. Rotflmao!!!!

  • JC Teecher

    Good facts to ponder on, Michael. You do present some good hard facts and one day all your predictions are going to come true, as there is going to be a hard correction, and many will not have the time to escape before the crash. Escape the markets, that is.

    I have family members that are riding that wave like it will not crash before they make the big lick profit they envision. Sadly most have all their paper assets in the stock market. One is so greedy, he has 90% of all his tangible assets invested in stock certificates, and he is almost 80 years old. If the market crashes, he is at the mercy of the Social Security Administration crediting his account each month. That would be scary to me.

    I guess many will ride the wave and try to predict is peak, and then cash out before the crash on the rocky shore. Good luck.

    • watchmannonthewall

      When the central banks around the world can print fiat currency with a keystroke, or electronically with the same, is it any wonder the stock markets are completely divorced from reality? It would be interesting to know just how much “they” have invested in ALL markets!

      “They” can make markets go up until the electricity goes off, or they decide to sell and then buy everything on the cheap and make us greater slaves than we are already!

      • JC Teecher

        Correct you are, watchman. I can’t speak for all central banks, but specifically the one that counts for America/USA, and that is the Federal Reserve.

        “Very Important to Know for the coming planned collapse!”

        The Federal Reserve proudly boasts of having a capital account of 56.2 billion dollars.
        What they don’t boast about is the fact that in 2013 their debt to leverage ratio was 22 to 1, and in 2015 that ratio was ballooned to 77 to 1.

        And; they don’t like reporting that their liabilities are a staggering 4.3 trillion, (yes trillion) dollars.

        • socalbeachdude

          Wrong.

      • socalbeachdude

        Central banks do not do what you assert at all.

        • watchmannonthewall

          Right! That is why both the Japanese CB and the Swiss CB, in their financial statements, announce how much in stock/bonds they have in foreign countries and the European CB buys all kinds of market assets among the nations it acts for as CB. Right!

          The USCB does not announce it but it is well documented and reported it bailed out Europe in the GFC. Did any of its printed assets get used to prop up financial instruments in Europe? I think we know the answer to that question, don’t we?

          • socalbeachdude

            The Federal Reserve does not own any stocks nor does it intervene in any way at all in the equities (stock) markets.

            The Federal Reserve did not in any way, shape, or form loan any funds to any entity outside the USA that was not a US bank operation during those days, and every single penny loaned out by the Federal Reserve to member banks was FULLY REPAID WITH INTEREST BY THOSE BANKS TO THE FEDERAL RESERVE with not a single penny of net gain to any of those borrowing banks.

          • watchmannonthewall

            OK, you can believe what you want.

    • Capitalist

      How can one only take into considering long trades on stocks, when there are short trades, futures, forwards, options? These enable one to make significant sums of money off of subpar markets. Also, gold miner stocks and physical gold are good in the case where one does not have access to such derivative instruments. Also, stocks are an intangible asset, as they represent partial ownership in a company that produces a necessary or desirable goods.

      • Jazz

        You are a wise one. Lots of fools on this site. I appreciate your efforts and love reading your comments!

      • JC Teecher

        Yes, the stocks themselves are considered intangible assets because one can’t physically touch them, however: the paper certificate can be held and therefore they do represent a tangible asset, with intrinsic and extrinsic value.

        My comment was not defining the stock as tangible but, rather the defining of the use of tangible assets (cash, property, equipment, etc.) as the investment tool for purchasing said stock certificates. As in hard cash. No need to cloud the definition of tangible nor intangible.

        There are hundreds of different investment strategies, but my comment was specifically about long stock investing, and not investing in general. Some have more risks than others, but all have risks to some degree, even in real estate investing.

      • sister soldier

        Nice summary.

  • Orac4Prez

    ….but this time its different!

  • Bruce

    No doubt the stock market is way off from where it should be. Also, no doubt it is going to have a crash to some degree. However, even if by some miracle it should sustain itself we still have financial disasters hurdling our way. Trillions upon Trillions in derivatives that will be going bust.
    The list of financial asteroids is to numerous to name therefore, let me say this. I cannot shake that Trump while campaigning said that 24 Trillion of debt is the point of no return. We are presently at 20 Trillion and amassing about a Trillion a year in more debt. Therefore, 2020 will usher in many things other than the 2020 new year celebration glasses.
    However, I don’t think 24 Trillion will represent the wall. We should start feeling significant repercussions prior to slamming into that wall. Things could very easily get so bad that we don’t even know when we’ve hit it. An analogy would be like hurdling towards the sun, you’d be dead long before you got there.

    • Spatial Memory

      Let’s hope 24T isn’t any threshold because extrapolating out ‘off balance sheet’ and ‘reinsured’ items the aggregate debits are already north of one quadrillion!!

      • socalbeachdude

        What utter nonsense!

        • Bruce

          Utter nonsense. With that statement it is a logical assumption that you think we can just borrow any amount of money that we want? No consequences no matter what huh? That my friend is utter nonsense

  • Spatial Memory

    …”In the end, you don’t need to know all of the technical details in this article” = ROTFLMAO!!! What technical details??? Another wannabe that’s does NOT comprehend that key indicies are transitioning to “float weighted” from capitalization weighted- and carry costs plus such modifications make time corrections much more practicable than price corrections?

    Too funny for words!!!

    • socalbeachdude

      You poor stupid little snowflake!

      • Kissmagrits

        What the hell is he talking about?

      • Spatial Memory

        Obviously you have no clue who I am. ROFL. I must reply to you the same as I have for many years. You have zero education nor experience in economics, banking and finance and certainly not capital markets machinations. Your repertoire hasn’t advanced much and it’s surprising that this blog site hasn’t banned you already- as so many others have. Your comments and guesswork surely has decimated any investors or traders portfolios foolish enough to not know better. Sorry for your losses.

        • Jazz

          Do you know who he is? He is an amazing gay man who created some of the best financial models in the world. Governments try to get his models. He had movies made about him and he is world famous on blogs like zero hedge. hoo ra!

        • socalbeachdude

          The Most “Horrifying” Chart in the World

          Larry Fink is terrified.

          Fink runs BlackRock, the world’s largest asset manager. The company manages a whopping $5.1 trillion. That’s more than Goldman Sachs, Bank of America, or Wells Fargo. It’s more than the annual economic output of Japan, the world’s third-largest economy.

          This makes Fink one of the most powerful people on the planet.

          Obviously, you don’t climb to the top in Wall Street by being easily rattled. But right now, Fink’s nervous.

          He’s worried about “a lot of dark shadows that could impact the direction of the marketplace.”

          Today, consumer confidence is even higher than it was in 2007. And we all know how that ended.

          The S&P 500 plunged 57% over the next two years. The Russell 2000, which tracks 2,000 small U.S. stocks, dropped 60%.

          Sir John Templeton, one of the greatest stock pickers ever, famously said:

          Bull markets are born on pessimism, grown on skepticism, mature on optimism, and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.

          http://www.caseyresearch.com/articles/the-most-horrifying-chart-in-the-world

    • Kissmagrits

      I have no clue what you just said so you must be right and I’ll agree with you 100%. LOL.

      • Spatial Memory

        Of course I am correct. Those advanced candlestick technical analysis methodologies have been time tested since the 11th century- and still hold today despite avant garde financial engineering.

        Meanwhile the author denies reality based on ludicrous beliefs in supernatural forces and powers.

        Price action NEVER lies!!!

        • Jazz

          Too bad you’re a loser and lose all your money in the markets. Your boyfriend must love it when you come home after another losing day. Does he kiss you still?You are one foolish man!

        • socalbeachdude

          Markets have always been CYCLICAL and rise to absurd preposterous unsupportable highs and then CRASH.

    • Jazz

      Dow 25 and 30k here we come! No crash until at least 2020. Maybe a correction here or there but up up and away like a rocket. Nows the time for major inflation of stocks and real estate. These fools really think a crash is coming. Lol. Maybe they should stay in their bunkers while we show em how to make bank!

    • Jazz

      You hide behind your technical details while losing all your money in the stock market. That’s the true lol!!!

  • Horiboyable .

    What you need to remember is that people are not investing at the moment. They are parking money in the stock market. Investors are fleeing the Euro and the bond market and that money has got to be parked somewhere. It is causing distortion round the globe, it could be property prices in Canada or Norway or prices in stocks.
    The smart money know if they get caught holding sovereign bonds they will get zero because the state will never take action against its self. Wait until the penny drops about the Euro, the exits will not be big enough. Folks are not investing but positioning themselves to limit their loses with the coming melt down.

    • socalbeachdude

      What utter nonsense. There is NO MONEY AT ALL IN THE STOCK MARKETS. All that is there in the stock markets are STOCK CERTIFICATES which must be sold to another greater fool in order to get any money back. Moreover, each and every prospectus clearly tells prospective purchases of stocks that there is a RISK OF 100% LOSS on the purchases of any equities.

      • Horiboyable .

        Yea sure, ok there is no money in the stock market……. Contact Buffett because he recently spent billions on Apple Shares
        Time for your medicine.

        • socalbeachdude

          All one does when one buys shares of stocks is to PAY FUNDS TO THE PRIOR OWNER OF THOSE SHARES and there is no money whatsoever that remains in the market at all which is just a clearing house for those purchase transactions.

          That is very unlike a bank account where a deposit has a right of withdrawal of the funds that one deposits. The redemption value of shares relies entirely upon what another buyer is willing to pay and can drop to 100% below what the last person who purchased those shares paid.

          • Horiboyable .

            Thanks for the lesson pal but I am on another page.

  • chris

    It would be really interesting to find out who exactly has been lending money to governments at negative interest rates. The only people i can think of who would be that stupid are the same people who can easily create it by printing it up or by creating it digitally. In addition it would be interesting to see how many shares the central banks have been buying, either directly or indirectly, in order to manipulate/prop up the market. Certainly ultra low interest rates and the belief that the central banks will always step in to support the markets have been the foundation of this ludicrous bull run since 2009, but should it crash badly rates can’t be lowered so what would be left other than massive QE?
    If it is all on a knife edge at the moment all it would take would be a very small rise in interest rates to bring it down so Yellen bears a very big responsibility at the moment.

    • socalbeachdude

      The Federal Reserve totally ended its 3 versions of QE on October 31, 2014 and all of those funds were used to buy EXISTING SECURITIES from member banks with the proceeds being put into the reserves accounts of those banks inside the Federal Reserve which is precisely where those funds are sitting parked now and have always been sitting.

  • jj

    This is typical of people who don’t understand what causes price movement in markets. The S&P P/E ratio peaked in the 87 crash at 50/1, dot com bust 46/1 and the 2008/9 crisis at 122/1. Today we are at about 24. With the ratio at this level for the S&P the Dow simply cannot crash. At worst a normal correction before moving higher.
    What causes all collapses is the retail investor. They get spooked and sell forcing price down to a point where the HFT algos trigger sell orders and off we go. There is not that high concentration of retail traders in the markets today.
    What has been causing dollar strength and the rise in the Dow for over a year is international capital flows especially from Europe as the euro and the EU collapses. The ECB has destroyed the banking system and the member countries economies and as capital is being pulled from banks it has caused liquidity problems for them. If you control large amounts of capital, are you going to park it in a collapsing currency, banks with liquidity problems, economies destroyed and a trade union collapsing?
    As the sovereign debt crisis has stated again there with yields spiking capital will rotate out of these and flow into both the dollar and the Dow. This capital needs markets with huge pools of liquidity and that is these two asset classes.
    People have been forecasting a dollar and Dow collapse for over three years and they have been all wrong because they simply do not understand that these international capital flows moving into markets is what really has caused the upward movement and this will continue with the Dow heading for 23,000.
    Remember professional traders do not want others to know their positions because they do not want to be a target. If they state something in public you can bet they are doing the opposite. They use the media to move sentiment and markets. To state something in public that is true is like opening your order book up for all to see. It simply doesn’t happen. Take Soros before the Brexit vote as he was claiming he was shorting the pound and buying gold. He was doing the opposite as Bloomberg reported he lost $1.5 billion on the pound trade alone.

    • Spatial Memory

      Although P/E ratios are trailing and static data, P/E/G (growth) ratio is more dynamic and forward looking, the spx was “capitalization weighted” through the 1987 and dot com era you mentioned. Today’s SPX is float weighted and has obviously caught many legacy spectators and prognosticators flat-footed. Most shocking is after nearly a decade now and literally thousands spx points higher many still DO NOT KNOW and continue to foist legacy notions and guesswork. That CAPE adjusted may make sense in a price weighted index, seems less “useful” in a capitalization weighted index but CERTAINLY is useless in a float weighted environment… with significant carry trade dynamics- as you suggested. Jmho:)

      The two advanced candlestick technical analysis methodologies (Heikin-Ashi (“one look”) or Ichimoku Kinko Hyo methodologies) clearly illustrated those changing dynamics long before many rookie blog sites. Some still DO NOT KNOW !!!

      • socalbeachdude

        Stock markets always crash from the top prices.

    • Jazz

      Finally someone who gets it! Stocks will continue to melt up to at least 25 to 30k before a crash (20% or me drop) then we recover and Dow 50k. It’s not rocket science! Buy great companies hold forever and make bank. Wash rinse & repeat. That’s how I built my empire!

      • JC Teecher

        Not much of an empire if you are trolling on a Christian prepper site. i think I could find a lot better things to do with my time and mountains of money. I think you have a little education and a little insight, and come here to propagate your ego. Self serving.

        • Jazz

          Haha thanks for the diagnosis Doc, now move along! I obviously have time & money that you desire.

          • JC Teecher

            You are wrong on many fronts, but I will only address the two that you do lie about, concerning me.

            I desire not your money nor time. I have sufficient enough of both, and am content to do my job as the Rope bearer of truth on the internet and other places.

            I covet nothing of any man as I have lived, done, and seen more than 99% of all Americans, and quite content to die the flesh death and move into the eternal spiritual realm. Today, tomorrow, or in a decade from now; as it makes no difference to me.

            Can you say the same, and discard your empire today, for the Kingdom?

            That is what i thought.

      • socalbeachdude

        No. Are you really that clueless?

    • socalbeachdude

      Nope.

  • Priszilla

    With the right promise the taxpayer will bail out anyone.

    • socalbeachdude

      The US government taxpayers is now $20 trillion in debt and that debt is increasing at more than $1 trillion a year.

  • Jazz

    Bahahaha here we go again! Ya’ll can short the market again. I’m gonna ride the bull market to Dow 25 and 30k. Jazz called S&P 2300 and I will be right again!!! No stopping this bull train. Maybe a crash in 2-3 years but not now lol. Buy buy buy!

    • Spatial Memory

      Jazz Z. did call for spx 2300. Only problem was, at the time (2015) spx was at 2130 and immediately took a nosedive to 1780. Then JazzZ vanished.

      • Jazz

        No fool! It was the opposite. I called 2300 at 1800. Go check your facts loser.

        • Spatial Memory

          Get real. Rotflmao

      • Jazz

        And your call for a crash lastbyear never manifested. You rookie!

        • Spatial Memory

          I’ve stated many times: crashes DO NOT begin from high inflection points. I had expected a 3-6% pullback then test- at this point more likely a sharp pullback -6% range- or correction. Nonetheless thanks for the laughs.

          • Jazz

            You said “we will see a crash in Q1 2016” bahahaha. Loser can’t even admit when he is wrong. Does your boyfriend call you out or let you get away with that crap at home too?

          • Spatial Memory

            Yikes!! That projection of your latent issues is beyond obvious. Get professional help.

          • Jazz

            I guess your boyfriend does let you get away with that lying mouth of yours. Does he still kissing your lying lips? You’re the fool who needs help with all of your disillusions!

          • Spatial Memory

            Looks like that bullseye analysis has left you manic and unhinged.

          • Jazz

            Haha. Well at least you can come out of the closet now that your lifestyle is acceptable. I don’t knock you for that just your lousy market forecasts is what I take aim at.

  • Spatial Memory

    Between the negative divergence in the term structure of implied volatility, uncertainty in credit markets and pending monetary policy changes and thirdly and most importantly: the return of JazzZ, I now expect a sharp pullback – possibly 6%+ or even a correction (10% decline) in key equity indicies before end of March – q1 (window dressing) and reports. Jmho 🙂

    • Jazz

      Lmao!!! Just like your call for a crash last year. Don’t quit your day job. Your calls are as accurate as the weathermen and fortune tellers. Go put it all on red or go the craps table you’ll probably do better fool. Lol. Jazz makes bank!

      • Spatial Memory

        Some literally have made bank(s)- boughtem, builtem and soldem. Others tell tales on blogs- see mirror. ROFL

        • Jazz

          Yeah okay. If you did any of that you wouldn’t be wasting time on blog sites. You ain’t nuttin but a troll lol.

          • Spatial Memory

            This blog site and your kind may appear to be a waste of time, however I find it to be some of the most hilarious capital markets related comedy available anywhere!! Thank you again for the comic relief and many great laughs!!

          • Jazz

            Name one movie they made about your life and your works? Love how you throw stuff around like you are a somebody. Nobody buys your bs here.

          • Jazz

            Oh the crickets! Ask for facts and the liberals scurry like the cockroaches they are! Spatial shouldn’t you be at a Stop Trump rally or something?

        • Jazz

          I do like your imagination. Did you also write books n Macro economic theory and keynesian economics oh and the fiat monetary system? What are you today? An academia author? world traveler? Dragon slayer? Winning trader? A fool with a keyboard? Yeah the last one!

          • Spatial Memory

            Classic reductio ad absurdum. lol

    • Jazz

      If we all do the opposite of you we’ll get rich!

      • Spatial Memory

        The poor just want to “get rich”. The “rich” just want immortality.

        • Jazz

          Well you must want to “get rich” lmao. Poor pathetic fool!

          • Spatial Memory

            Keep telling yourself that. Rotflmao

          • Jazz

            Yeah you and you band of butt monkeys lose your shirts “trading” the markets. Be a real investor like me! Buy great companies and hold em and make a fortune like me. Sorry you’re so jealous!

          • Spatial Memory

            I have stock positions that I’ve held since 1980s; doubtful you’d ever even heard of stocks or equities then. lol

          • Jazz

            Haha yeah like sears and Jc penny. I own companies like NVDA FB AMzn & VMW and ride the bull train up up and up while you pick loser after loser like the loser you are. Hahah

          • Spatial Memory

            Pikers sure have some funny notions of capital markets. BTW have you dropped AAPL from your tale? LOL

          • Jazz

            No I still own some apple shares but admit I sold some to take chips off the table. Still own NFLX FB NVDA VMW AMZN GOOG TSLA and many many well run companies. Go do your candle sticks hahaha

          • Spatial Memory

            No need to, with background in comp sci, economics and decades in the industry, I have developed a diffeomorphic overlay and proprietary eigenfunction methodologies for such simple tasks. Don’t lose your day job. Rotflmao

          • Jazz

            Haha and I built a time machine. I do love how you pretend to be a somebody when you have peanuts in your bank account and couldn’t trade your way out of a paper bag. Hahaha

          • Spatial Memory

            As I told you years ago. You can read the many books, articles, or see the movie documenting my works. Yours are evidenced on blog sites. ROFLMAO

          • Jazz

            Oh now they are making movies and writing books about your works? Hahaha. What “one flew over the cuckoo’s nest”. I need to call the asylum and let em know you are on the loose!

          • Spatial Memory

            Now? Most of those works are nearly two decades old. Save your minutes on your welfare phone. ROFL

          • Jazz

            Oh “those” works I thought they were “your” works. I see what you did there. Once you get called out you change the tune and I’m not talking about you being gay. I could care less about that, but pretending to be someone you are not is just as bad as when you were “in the closet”. Just saying!

          • Spatial Memory

            Look homeward. Serious obsessions with gender issues loud and clear is what you’re “just saying”. Just saying! lol

          • Jazz

            I have no objections about your lifestyle. Love your deflections though. Almost as comical as your transgender bathrooms at Target. You probably own that stock because of their bathroom policies lmao!!!! You provide great comedy my friend! Are they now making a “movie” about you commenting on blogs? Hahaha

          • Jazz

            Hold on. I need to go to red box and rent all the movies they made about your life and your works. Lmao!!!!!! Wait it’s empty like your brain!!!! Lolrofllmao

          • Spatial Memory

            Watching from your world is all you can do. ROFL. Empty like your net worth. ROTFLMAO

          • Jazz

            Still waiting for the names of movies they made about your life. Lmao x 100!!!!!!!

          • Spatial Memory

            Stop begging. ROFL

          • Jazz

            No need to beg for something that doesn’t exist. Is the government still trying to steal your economic models?

          • Jazz

            Did you tweak your code on your economic models at all when you were in jail?

          • Jazz

            I don’t care that you are gay. Why is that “my issue”?

          • Spatial Memory

            As if you don’t already realize. ROFL

          • Jazz

            Your works are acid trips. They fried your brain!

          • Spatial Memory

            More projection – very telling. lol

          • Jazz

            Love your projections. What should we load up on? Gold oil? Us stocks? What are your models telling us? Is the government still trying to get your code? Hahaha

          • Jazz

            Your YouTube videos with 2 views are not considered “movies” about your works.

          • socalbeachdude

            Really? You have a total of 234 comments on Disqus – all recent – and only a total of 39 upvotes on those comments!!!

          • Jazz

            Did you keep holding those stocks when you were in jail?

    • socalbeachdude

      What utterly clueless nonsense!

  • Thiagarajan TVS

    Dear Michael,

    Our central focus should be on climate change. that is going to
    cripple almost all economies. In three counroes, Australia, UK and USA hospitals are being closed, shortage of doctors and nurses is looming,
    patients are made to wait for hours. UK Government is facint
    funds crunch.

    The statistics of deaths in USA tell a different story.
    According to the CDC, these are the top causes of death for 2015,
    the latest year for which data is available, as well as the number
    of Americans who died from those diseases:

    Heart disease: 614,348
    Cancer: 591,699
    Chronic lower respiratory diseases: 147,101
    Accidents (unintentional injuries): 136,053
    Stroke (cerebrovascular diseases): 133,103
    Alzheimer’s disease: 93,541
    Diabetes: 76,488
    Influenza and pneumonia: 55,227
    Nephritis, nephrotic syndrome, and nephrosis: 48,146
    Intentional self-harm (suicide): 42,773
    *********************
    What is incomprehensible is the reality, the truth that we cannot gulp. We stubbornly refuse to understand the role of God in all situations
    that we witness around the world. God is changing the world through employment of myriad tools. One among is to influence our conscious mind to writhe in mental depression. Meditation is the only survival tool..
    The truth is that if we meditate we survive; if we dont, we die.
    Choice is ours and every choice we make has outcomes.

    Look at what is happening in California,now, in Australia and in UK.
    Famine will loom large and people will die of starvation. Systematically all crops are being destroyed. Let us not continue to live in
    illusions.

    Each individual is the composite of body mind and soul. While the body is visible, mind and soul are not. It is the soul, God in us, is playing
    a pivotal role in our living. Did not Jeus Christ say: Kingdom of God
    is within you!

    Billions of men and women are ignorant of this truth. Ignorance is not a bliss now. It is going to be a death knell now!.

    God is bringing down His heaven on earth,, and this might coincide with
    exit of Pluto from Capricorn in 2023. Pluto caused unearthing of all financial scandals world over.

    God can influence anyone`s mind to be in distraught conditioin today
    if spiritual path is not embraced.

    Thiagarajan TVS

    Thiagarajan TVS

    • Jazz

      Lol. Climate change is a hoax!!! Climates go through cycles like everything else. Get a brain and come back!

      • Spatial Memory

        Obviously you do not know the difference between climate change and global warming. Good to see your ignorance is not limited to capital markets. ROFL

        • Jazz

          Climates change not because of anything man does! They go through cycles loser!

          • Spatial Memory

            You may want to learn the definition of Climate. lol

          • Jazz

            You may want to learn the definition of “carry trade” lol. My friends and I still laugh at your carry trade commentary.

          • Spatial Memory

            Rotflmao

          • Jazz

            You are a mindless wonder. Don’t ever change. We get kicks out of your rants and tomfoolery!

          • socalbeachdude

            Its stupidity is just beyond mind boggling!

        • socalbeachdude

          There is neither “climate change” nor is there any “global warming”. Your ENDLESS STUPIDITY just never ceases to amuse and amaze!

    • horn blower

      The Lord knows the days of upright men, and their inheritance shall be perpetual. They shall not be confounded in the perilous time, and in the days of famine they shall have enough. But the wicked shall perish, and the enemies of the Lord shall be consumed as the fat of lambs: even with the smoke shall they consume away. Psalm 37

    • socalbeachdude

      There is NO CLIMATE CHANGE AT ALL and the average global temperature today is within ONE HALF OF ONE DEGREE of what it was 100 years ago.

      • K2

        Average air/land temperature or sea temperature?

        • socalbeachdude

          Average means a global average of all recorded temperatures.

    • GSOB

      The human spirit mingled with the Spirit of Christ, forever, is the Christ in you, the hope of glory.

      God’s new covenant. The old has passed away.

      I saw the holy city, the new Jerusalem, coming down out of heaven from God, prepared as a bride adorned for her husband

      The Spirit and the bride say,

      “Come!”

      Let the one who hears say,

      “Come!”

      And let the one who is thirsty come and the one who desires the water of life drink freely.

      As God’s partners, we beg you not to toss aside this marvelous message of God’s great kindness.

      For God says,
      “Your cry came to me at a favorable time,
      when the doors of welcome were wide open.
      I helped you on a day when salvation was being offered.”

      Right now God is ready to welcome you.
      Today he is ready to save you.

  • Rick

    Do you ever turn on the TV in anticipation of your favorite show for the week, settle in with a snack and beverage, flick on the tube, only to find out the show you thought would be a new episode is only a repeat? Wow, what a deflator. Some how I get the feeling I’ve read this whole story somewhere, maybe even here. Michael, it would be better to print nothing, rather than rehash. It’s probably difficult keeping up a major blog, but please…. There must be a hundred other more novel things you can dig up rather than this old news. What about Fukashima, (and I know you’ve covered it also), but from anew angle. How are the Japanese coping? Have their mortality rates increased? Morbidity rates? How about the elites that are buying land in the Southern Hemisphere to escape the onslaught of radiation that will eventually ruin the northern hemisphere? Should we all be looking at an escape plan? Is there a credible escape plan? Or maybe a better solution? What tech companies are working toward a solution? The list goes on and on. Let’s get creative, let’s get original again!

    • Jazz

      Hahaha great points. With no fear mongering there’s no books and videos or prep gear to peddle. Even the snake oil salesmen have to rehash old lines that worked. Hook line and sinker. Wait the economic collapse got “delayed again”. Sorry to ruin the plot but it’s just recycle recycle recycle. Any way you slice no economic collapse is coming anytime soon to the greatest Nation on earth.

      • Spatial Memory

        Rotflmao

    • Sam

      That get out of the Northern Hemisphere is a real good
      idea.

      • socalbeachdude

        Not.

    • sister soldier

      Amen Rick and amen again. There is plenty of “under and unreported” news to cover and yes they do tie back to the economy in one way or another that will adversely or proactively affect any and all fiscal outcomes.

    • JC Teecher

      Sorry Rick, and I do respect your noble way of thinking, but; in reality, the World, not just America, is past the point of no return.

      What we have is a short window of opportunity to learn and accept the inevitable, and make necessary adjustments to handle the world wide economic/financial collapse that is coming for 100% sure.

      There will be no cleansing of the environment until the Creator does it once and for all. there will be no change in the hearts and minds of liberals and deceived religious fanatics…which includes the pretrib/prosperity Christian churches.

      Time is running out, and we are in a short window of opportunity for those with eyes to see, to get their stuff together, and prepare for the coming Kingdom.
      Tribulation of at least seven years is coming and there will be no escapism..for anyone, except those whose number comes up.

      No point in reporting about things that no one can do anything about, such as Fukushima. Why should we care why or how those that are planning on baling out of America? Would it make a difference in your plans?

      If reporting on those things makes any difference, or would possibly do so, then I could see your point.

      You and your big supporter (below) does not want to hear about the coming collapse, because you are playing ostrich with the importance of preparing against it. or you are unable to do so.

      • Rick

        JC, you may be reading more into my little satire piece than I intended. I never said I believe an economic collapse isn’t imminent. I truly believe there will be one, and it will cost a lot of people their life savings, and in some cases their lives. Not good. What I am saying is that nobody, including Michael can predict when it will occur. He, and many others have tried before and have failed. I guess we’d all look like prophets if every other day or week we predicted a market crash, and low and behold one day there was… We’d then be able to claim we called it right, and you should bow down and follow my way…No, God has a plan for it, and I’ll leave it there.
        I’m just saying there are more immediately relavent stories and topics to cover right now.
        As for planning, I’ve been planning for quite some time, many years in fact, and yes I’ve even had a move to South America on the table at times. Why not consider all options. With Trump winning last year I’ve had the good fortune of re-evaluating that piece of it. Best of luck to you in your planning efforts also.

        • JC Teecher

          Yea, I understand Rick, and also agree that we are not able to have the crystal ball like some have, on the coming collapse.

          However; as I am just about all prepped up as i can be, and realistically have no more planning to do, i have compassion for those that have not planned and prepped, and some of those are just now logging on to sites like this, and need the nudging along that Michael S. provides with his articles.

          We sometimes have to think about the newbies that are coming on board, be they Christians or just new to prepping in general.

          Michael does a good job of giving us articles of importance, and some to just help fill the boredom of everyday living.

      • socalbeachdude

        Nope.

    • Richard O. Mann

      I read a report on Fukashima a while back by one of the experts in the nuclear field. The thinking by them is that is there is another event at Fuka, and the water which they are using to keep the nuclear fuel cooled gets shut off, the resulting explosion will not only cover Japan with deadly radiation, but will all so cover most of the Northern Hemisphere. That alone will be more than enough to take folks minds off the economic problems. There are more really nasty things going on in this world right now which could be written about. I think Michael may cover more of those on his other blog. Death and chaos are coming.

      • Rick

        You sound well informed, and I bet you are right about that.

      • socalbeachdude

        Not from Daiichi-Fukushima.

  • Zlatko Milanovic

    I don’t know. It does seem like we’re in a bubble. The debt is enormous and scary. At some point, we won’t be able to pay even the interest, and that might cause a currency collapse. It seems wise to keep 5-10% of your portfolio, or whatever you can, in physical gold and silver. Not everyone will agree, and that’s fine, but some precious metal, a few months of stored food, weapons and ammunition is wise under any circumstances. Be prepared, that’s the Boy Scout motto. Otherwise, I hope the market continues to rise, to the benefit of everyone who has a 401k, investments or a pension.

  • rentslave

    States will not default on their bonds.Were they to even hint at that,they would be out of business because no one would ever again lend them a farthing.They will squeeze the taxpayers-and even the illegals-harder than did Nicky to Tony Dogs in Casino.

    • Spatial Memory

      A simple understanding of Exters Pyramid and it’s applications in ‘central banking’ may alleviate that notion. Debits are monetized, balance sheets expanded and such defaults are engulfed. Assets= Liabilities + Equity.

      • rentslave

        I’ll have to examine that.

      • Jerry C

        Good God man, you’re cold-hearted. While your lambasting Assets=Liabilities + Equity, real good people are losing their jobs, homes & lives! I bet you love the motto, “Buy while there’s blood flowing on the streets!”.

        In the end, all the money in the world won’t pay for your own soul.

        • Spatial Memory

          Double entry accounting and fractional reserve banking may be cold-hearted in an anthropomorphic universe.

          • socalbeachdude

            Full General Ledger accounting with double entry an integral part is apparently something you do not even comprehend!

      • socalbeachdude

        What utterly clueless nonsense! Equity / capital is the difference between Assets and Liabilities and can be either positive or negative. Don’t you even comprehend basic General Ledger Accounting? Really? Seriously?

        • Spatial Memory

          To any with formal educations and/or experience you have now proven, your lack or any beyond any doubt whatsoever. Rotflmao

          • socalbeachdude

            No wonder you are so hopelessly lost in the fog of finances.

            There are only 5 classes of accounts in General Ledger Accounting and those are:

            1) Assets
            2) Liabilities
            3) Capital / Equity
            4) Income
            5) Expenses

            All accounting matters of any sort fully fit within those categories. Assets are the WEALTH an entity or person possesses. Net worth is Assets minus Liabilities which determines Capital / Equity.

            I would suggest you refrain from making yourself appear even more stupid than you already have and take some basic classes in accounting.

          • Spatial Memory

            Obviously you’re confused regarding double entry accounting and the function of a General Ledger Account. Although fasb site is clear on their cut and paste reproduction policy – so I’d suggest you peruse the facts rather than continue to prove your lack of education and weak attempts at constructive deception. 🙂

          • socalbeachdude

            Laughably false. I am not the least bit “confused” at all as to full General Ledger Accounting which involves doubly entry using credits and debits for every transaction entry to the 5 master classes of accounts used in GL accounting.

            The very purpose of all accounting General Ledgers is to account for monetary transactions and monetary values of 1) assets, 2) liability, 3) income, 4) expenses, and 5) capital / equity in any company and every GL uses double entry accounting to properly debit and credit 2 accounts within the 5 categories of the GL to account for every transaction on its books.

            A General Ledger produces a TRUE FINANCIAL PICTURE of any entity’s accounts without which it is impossible to get a true financial picture (such as the US government which does not follow GAAP rules or use GL accounting).

            An entity’s NET WORTH is what is in the CAPITAL/EQUITY account which is determined by deducting liabilities from assets of any entity.

            I would suggest you learn about GL Accounting as your knowledge of it appears to be near zero.

          • Spatial Memory

            Continue with your constructive deception (and upvote yourself- ROTFLMAO) any with real world education and/or experience are ROFL at your charade failing and markets confirm your foolishness beyond belief. Priceless CAPITAL markets comedy !!!!

          • socalbeachdude

            Your utter ignorance is mind boggling.

          • Spatial Memory

            Mind boggling is your foolish repertoire failure when confronted by facts. ROFL

          • socalbeachdude

            You are so DEAD WRONG on accounting, that you really expose yourself as a total fool when it comes to GL accounting. Sad.

          • Spatial Memory

            Meanwhile you fail to post a single link to support your fabrications because none exist yet you still pretend thinking nobody recognizes. Roflmao

          • socalbeachdude

            What utter nonsense.

  • Spatial Memory

    Prefacing with “honestly” speaks volumes. Men’s Rea. 🙂

  • Here is a sign for folks and what we all might view happening here soon enough.

    February 21, 2017 Europe Says It Wants to Confiscate Money, Precious Metals, Crypto Currency and Prepaid Cards to Fight Terrorism

    The proposal wants to monitor and tighten the control over electronic crypto and electronic currencies such as Bitcoin, Litecoin, Dogecoin, along with debit and credit cards in the EU, and is applicable to all those who travel.

    http://anonhq.com/europe-says-wants-confiscate-money-precious-metals-crypto-currency-prepaid-cards-fight-terrorism/

  • Spatial Memory

    Here’s one for the bears:

    … Geophysicists at the university of Leeds in the United Kingdom have warned that the stability of the magnetic poles of the Earth could be interfered with soon, leading to an instability that could spell doom for life on Earth. The researchers did not give a specific timeline for the impending disaster, but said it could happen soon….

    • Jerry C

      ROFLMAO! Should’a, could’a, would’a. Oh, the horror!!

    • Leif Erickson

      It’ll probably happen during the weekend.Or my vacation.

      • Spatial Memory

        CBOE Volatility Index – VIX … and NASDAQ appear to indicate likely won’t happen today.

        • socalbeachdude

          Markets crash when the VIX reaches its lowest levels and that is the BIGGEST WARNING SIGN OF AN IMPENDING MARKET CRASH. Helllooooo?

          • Spatial Memory

            Although the VIX, which quantifies the term structure of the implied volatility skew of the 30 days options on the sp500 may generate significant changes in synthetic positions / synthetic put and related arbitrage opportunities extrapolation as BIGGEST WARNING OF AN IMPENDING MARKET CRASH is LUDICROUSLY FUNNY!

          • socalbeachdude

            The VIX is an INVERSE INDICATOR and when it reaches its lowest range of levels is when the STOCK MARKETS CRASH and then it rises up towards as high as 80 when the stock markets reach bottoms and it is reasonable safe to buy.

          • Spatial Memory

            Your homespun notions and guesswork are hilariously funny- if not for the fact that despite markets clearly rejecting such foolishness and proving beyond any doubt whatsoever how horrendously flawed you continue to insist otherwise and that the markets and price action must be incorrect. Thank you again for the many laughs. 🙂

          • socalbeachdude

            Your utter ignorance of market cycles and the facts I have clearly stated are the only thing here that is “hilarious!”

          • Spatial Memory

            As markets continue to reject your ludicrous guesswork daily. Roflmao

          • socalbeachdude

            I’d suggest you look at the charts showing a 50 year nearly exact correlation between market crashes and low VIX numbers.

          • Spatial Memory

            I’d suggest you look at the historic charts on credit markets, prevailing rates and correlations between the term structure of the yield curve, carry costs and realized volatility and the term structure implied volatility and the slope of the skew. Your myopic notions sure are great for laughs but horrendously expensive if applied real world. ROFL

          • socalbeachdude

            What on earth does any of that have to do with the valuations of stocks? As to the credit / debt markets they are enormously extended and the RATES OF DEFAULT are soaring across all classes, particularly in consumer credit (debt) as well as junk corporate debt and municipal debt all of which are at record levels and absolutely unsustainable.

  • Feb 22, 2017 Lowe’s lays off hundreds as corporate office gets cleaned out

    Home improvement retailer Lowe’s has laid off more than 500 full-time corporate employees company-wide in its latest effort to streamline the company and boost profitability.

    http://www.thomasdishaw.com/economy/lowes-lays-off-hundreds-corporate-office-gets-cleaned/

    • JC Teecher

      My niece and sister in-law work for the Lowe’s Companies customer support staff and see the changes daily. Lowe’s has a history of firing higher paid employees, in order to increase profits and stock prices.

      This move now is based on those same factors as well, but the bigger picture is that they have been struggling, for years to compete with Home Depot, Walmart, and, Amazon’s, internet business.
      There hard nosed approach at organization for this type business has now come full circle, and the realities finally sank in for hard headed, big feeling, college educated, idiots, that call themselves “Top management”.

      That reality is that no company this large can compete on a top level performance basis without one thing in place, that they have previously denied they need, and that is the personnel infrastructure to handle the volume of orders that puts them in the same categories as the likes of Walmart and Amazon.

      Hence, they get rid of higher paying jobs to compensate for hiring of 600 new mediocre paying (average $10.00 hourly) jobs in the customer support categories, and voila’, the infrastructure to handle the volume is in place.

      Personally, I don’t see Lowe’s Companies ever having the well greased internet business, like Amazon, of which requires a lesser number of support personnel, because much of their business is seasonal.

      • socalbeachdude

        Retail is in a huge world of hurt these days.

        • Spatial Memory

          Retail is a zero sum game. Your predictions and guesses are in a huge world of hurt. lol

          • socalbeachdude

            How is retail in any way a “zero sum game?” Obviously, you don’t even know what a ZERO SUM GAME even means.

          • Spatial Memory

            ze·ro-sum
            ˈˌzirō ˈsəm,ˈˌzērō ˈsəm/
            adjective
            (of a game or situation) in which whatever is gained by one side is lost by the other
            …………….

            Too simple to prove your nonsensical comments clueless beyond belief.

          • socalbeachdude

            And obviously neither that term nor your definition have any applicability to the retail business whatsoever.

  • Richard O. Mann

    It’s like a jet powered air craft going straight up. It’s a great ride until it hits the upper levels of the atmosphere where there is not enough air to keep it ignited. At that point, the engine flames out, the air craft stalls, and then starts an uncontrolled fall back towards the earth. Yes, there have been many posts on the danger which is the crazy growth of the stock market. Yes, there have been many warnings that it is going to crash. And, much like the message that Jesus is coming back to this earth some day soon, many have gotten tired of hearing it. But, that does not change the fact that both are going to happen. It may not be today, or tomorrow, but that does not mean it is not going to happen.

    • SnodtBlossom

      Talk about recycled toilet paper.. This is the 3rd time the author used that image with the same story line.

      • Rebel

        And..?

        • none

          The third time is a charm.
          1929. 1o89. 2017?

  • socalbeachdude

    2008-2009 did nothing of the sort whatsoever. As to 2008-2009, that little and very rapidly corrected downward blip was all due to an accounting rule known FASB (Financial Accounting Standards Board) Rule 157 (“mark to market”) which was essentially rescinded in March 2009 at which point the markets returned to huge increases.

    • chris

      What you seem to be saying is that allowing companies to make ludicrous valuations on their assets rather than accurate valuation (meaning some of them were essentially junk) saved the stock market. What we are talking there is essentially the sub-prime mortgage crisis where rubbish was AAA rated. Other people say that the only reason the markets bottomed out in March 2009 was because that was when the QE programs kicked in.
      As for 2008/9 not being the near end of the global financial system even the British Prime minister at the time, Gordon Brown, boasted in the UK parliament that the actions that he and his government had taken had ‘saved the world’.

      • socalbeachdude

        Nope. None of the BOOK VALUATIONS were in any way slightly out of line with fair valuation, let alone in any way “ludicrous” at all.

        MARKETS ARE OFTEN DEAD WRONG and when markets panicked in 2008-2009 and values plunged in the markets that was certainly not any valid reason to revalue the assets on the books of financial concerns to those preposterously panicked market prices – which, by the way VERY QUICKLY AND TOTALLY RECOVERED IN MARCH 2009 when the “mark to market” FASB Accounting Rule 157 was rescinded.

        The temporary bailouts by the government and Federal Reserve were not only totally unnecessary but totally meaningless and useless.

        The Federal Reserve QE programs had nothing to do with that and those funds were used to buy EXISTING SECURITIES from member banks of the Federal Reserve with the proceeds all deposited in the reserves accounts of those banks INSIDE THE FEDERAL RESERVE which is where those proceeds have always remained.

  • socalbeachdude

    From a risk-of-bankruptcy standpoint, the retail business is the new oil and gas

    Move over, oil and gas.

    Retail is set to replace the troubled energy sector as the most distressed sector this year, according to ratings agencies, lawyers and analysts, beaten down by the strain of competition from juggernaut Amazon.com Inc. AMZN, +0.75% and a range of other issues.

    The sector’s future is looking increasingly gloomy, with the cost of digital investments, trimming excessive store locations and lagging revenue amid declining traffic setting the stage for a spate of bankruptcies and restructurings in 2017 and 2018, experts say. The sector is grappling with changing consumer behavior and shrinking discretionary spending as consumers are faced with higher prices for everything from rent to prescriptions to gasoline.

    Fitch Ratings’ “Bonds of Concern” list is filled with retailers, and the agency is expecting the default rate for the sector to jump to 9% in 2017 from 1% over the last 12 months. The retail sector had $38.9 billion in outstanding debt as of December. Research firm CreditSights has an underperform rating on the sector’s bonds.

    http://www.marketwatch.com/story/retail-industry-is-expected-to-replace-oil-and-gas-as-2017s-distressed-sector-2017-02-15?siteid=YAHOOB

  • LIZ THE SHIZ

    ZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZZ, wake me up when it happens , bubble bubble we are all in trouble , meanwhile enjoy living in the MATRIX

    • socalbeachdude

      What “matrix?”

      • Spatial Memory

        Fermi’s paradox – zoo hypothesis.

        • socalbeachdude

          More utter nonsense from you, I see!

          • Spatial Memory

            You see market and economic crashes daily as well… while others see incredible advances to record highs and incredible gains for participants. Sorry for your luck.

          • socalbeachdude

            What I see are laughably and utterly preposterously overvalued stocks headed for their biggest crashes in history dead ahead.

      • LIZ THE SHIZ

        take the red and the blue pill, maybe it will clarify things for you

        • socalbeachdude

          I don’t do drugs. Apparently you do. I’d suggest you refrain from such.

  • socalbeachdude

    Hedge Funds Continue to Chase the Herd With Record Momentum Bets

    Hedge funds can’t get enough of momentum — even if it means embracing an investing strategy they hate.

    Loosely defined as betting on shares that went up the fastest over the preceding nine-to-12 months, hedge funds are the most reliant on momentum strategies since at least 2010, according to an Evercore ISI analysis of 13F filings with the Securities and Exchange Commission. Meanwhile, they’ve reduced their bearish bet on value stocks, which are priced at deep discounts to earnings and assets, for the first time in nine quarters, the study shows.

    Investors rarely take on momentum and value positions at the same time, which is what’s happening now.

    https://www.bloomberg.com/news/articles/2017-02-21/hedge-funds-continue-to-chase-the-herd-in-record-momentum-wager

    • Spatial Memory

      Momentum is defined and quantified using the percentage closing prices on a weekly basis

      … Loosely defined on a trailing nine to 12 months …. (With intermediate term defined as six to 18 months) ROTFLMAO

      Too funny

      • socalbeachdude

        So now you’re trying to argue with the Bloomberg article? Really? Seriously?

        • Spatial Memory

          About as factual as the thousands of links and articles predicting imminent collapse through the last 10,000+ djia advance. Seriously!

          • socalbeachdude

            The Bloomberg article referenced above is TOTALLY FACTUAL and 100% correct.

          • Spatial Memory

            If the article were “TOTALLY FACTUAL and 100% correct” then: “Loosely defined as…” qualifier would obviously not be necessary nor included.

            As usual you have no clue what you’re typing.

          • socalbeachdude

            You apparently have a very hard – if not impossible – time comprehending words.

  • socalbeachdude
  • socalbeachdude

    The Federal Reserve FOMC isn’t sure whether Trump will be good or bad for the economy — but it thinks investors are ignoring the risks

    The Federal Reserve still hasn’t made its mind up about President Donald Trump’s policies.

    Based on the central bank’s most recent communication — the Fed minutes for the January/February meeting released on Wednesday — the members of the FOMC are still undecided about the ultimate effect of Trump’s economic agenda, particularly fiscal stimulus, or if it will even happen at all.

    “Participants again emphasized their considerable uncertainty about the prospects for changes in fiscal and other government policies as well as about the timing and magnitude of the net effects of such changes on economic activity,” said the minutes.

    http://www.businessinsider.com/federal-reserve-minutes-on-trump-market-risk-2017-2

  • socalbeachdude

    TESLA POSTS HUGE LOSS…SHARES SOAR UPWARDS!

    Tesla posts wider-than-expected loss of 69 cents a share

    Tesla shares rose more than 2 percent in after hours trading after the company posted a wider-than-expected loss, and despite sales being better than expected.

    http://www.cnbc.com/2017/02/22/tesla-earnings-q4-2016.html

  • Leif Erickson

    I missed another bubble. I was stuck in a Money Market Fund. Sighhhhh… Will I ever learn?

  • socalbeachdude

    Current stock prices are ABSURDLY PREPOSTEROUS and headed for their biggest crashes in the entire history of the stock markets in the US and globally.

    • Spatial Memory

      Your current stock market guesses are ABSURDLY PREPOSTEROUS and your forecasts are the MOST FOOLISH in the history of the stock markets

      • socalbeachdude

        I see you’re still lost in your delusions, dude!

  • socalbeachdude

    3 Reasons Why the New Dow Record Is No Reason to Celebrate

    Record highs are giving Wall Street an excuse to pop open the champagne, but economists say we should curb our enthusiasm.

    On January 25, the Dow Jones Industrial Average broke 20,000 points for the first time in history. Traders are celebrating and financial media is buzzing with speculation that 25,000 could be just around the corner. But history and fundamental research say otherwise.

    Here’s why…

    1. Stocks are painfully overvalued

    2. Previous Dow milestones preceded major drops

    3. This rally has been fueled by emotion instead of reason

    http://www.birchgold.com/news/3-reasons-to-not-celebrate-dow-record

    • Mark

      I actually agree with you on this issue and on most other economic information except on the Fed, which we usually disagreed in the past. I also agree on the retail data that you presented.

      • socalbeachdude

        Thank you, Mark!

        • Mark

          Your welcome…I was reading you comments on general ledger accounting and your argument with Spatial Memory. Very interesting conversation. I had accounting courses in undergrad and MBA school and forgot most of it. Now, I am no expert but you are correct on equity/capital being positive or negative. Kudos.

          Peace

  • tacoma

    Stock markets crash many times. Mostly ‘adjustment’ or ‘correction’. A few big ones have occurred but the damages are predictable, confined. Stock market crash is part of the capitalist system.

    But there is another crash coming that’s different. It is the crash of both U.S. federal government budget and the national debt. Both cannot be fixed. Both are not healthy functioning of any economic system.

    A famous VP once said “Debt and deficits don’t matter”. He is right to a degree. They don’t matter to a huge economic powerhouse like the U.S. Issuer of world dominant reserve currency. They don’t matter when the U.S. is conducting vast amount of trade. They don’t matter when the country is producing trillions dollar worth of the finest and most desired goods and services. Let me ask a simple question: what major things the U.S. make today that are not or cannot be made by other countries?

    They don’t matter until they do. That’s when even the mightiest economics crash against the laws of physics. This is not speculation or scare mongering. This is Newtonian science governing how things run, and how things crash. This is the same laws that say there is no such thing as a perpetual motion machine. Which describe the U.S. of today splendidly.

  • JC Teecher

    As I have said all I care to say about the topic at hand, I am gonna shift gears a tad, and speak out about something that has been revealed to me lately. It is about, what I have dubbed, “the cursed coast”, meaning the west coast of America. More specifically California, but eventually will have implications for Oregon and Washington state.

    Time after time and month after month, California and the west coast is under some sort of supernatural chaos and life threatening crisis.
    Fukushima is still spewing out waves of radiation that affect the Pacific, and eventually all the west coast of America. Now floods and disease is spreading all over. Just last year the drought and wild fires took a huge toll on the citizens…as well as millions of illegal Hispanics. The toll of the illegals and drugs is well over tens of billions of dollars each and every month.
    The demonic forces over San Francisco and that region causes souls to perish every day because of the sin of Sodomy and constant drug abuse.
    Silicon valley has rampant plagues of both.

    The floods, in my opinion and from what I have been shown, is a near final warning for the true Christian peoples of that region. God always give His warnings before he sends his judgments. In other words, He gives people an out. This period of flood, is another warning that there may be even more water coming. Salt water that never recedes??? I would not be surprised if the next warnings will be more intense, in order for the wise to wake up and…”come out of her my people, so that ye be not partakers of her plagues”.

    • socalbeachdude

      California is as wonderful and beautiful as ever and is the absolute PARADISE of the United States. We have ALWAYS had long dry spells and long deluging wet spells as California’s basically a desert that sits on the edge of the Pacific Ocean. 10% of the entire population of the United States lives here in California and California’s economy is the largest in the US – by far – and is a $2.5 trillion economy in the overall $18 trillion US economy with the closest state being Texas with a $1.5 trillion economy.

      We have by far the best housing in the US and the world and a shining new example for sale in Beverly Hills list by Paris Hilton’s daddy’s RE firm is:

      LOVELY NEW GOLD HOME FOR SALE IN BEVERLY HILLS, CA…

      The Midas Mansion: Luxurious Beverly Hills mansion hits the market for a whopping $100 MILLION complete with gold Lamborghini, gold Bentley and a room stocked with 170 bottles of Cristal

      Built by developer Nile Niami and architect Paul McClean, the 20,500-square-foot Opus spec house is perched above Los Angeles.

      Located on the highly sought-after Hillcrest Road, the spectacular mansion, which is being called Opus, comes with a gold Lamborghini Aventador roadster and a gold Rolls-Royce Dawn inside the car museum that has room for a total of 10 vehicles to be displayed.

      The Opus, which is listed by Hilton & Hyland with listing agent Drew Fenton, comes complete with seven bedrooms, 11 bathrooms, as the property sits on one acre of land that offers jetliner views of Los Angeles from Downtown all the way to the Pacific Ocean.

      http://www.dailymail.co.uk/news/article-4246838/Beverly-Hills-mansion-hits-market-100MILLION.html#ixzz4ZMv6ZLkY

  • Screaming Orange

    During the debates, I was impressed that Trump described the stock market as “a big, fat, ugly bubble.” Now he’s taking credit for the stock market’s new highs.

    Sigh… time to invest more money in guns, canned food and meth futures.

    • socalbeachdude

      Pretty ironic, isnt it?

    • The unfortunate reality is that people pursuing political office say what their focus groups/advisors/etc. tell them gains traction with the particular communities of voters but they rarely, if ever, follow through on their ‘promises’ or maintain any integrity with what they’ve said. Campaigns are little more than marketing exercises to showcase ‘democracy’ and give people the illusion that they have choice or say in how their nation/state/municipality is run. As Mark Twain lamented “If voting made any difference, they wouldn’t let us do it.”

  • Ken

    The sad thing is that a lot of this was caused from the last 8 years of unregulated spending ; yet you know who will get the blame.

  • Bruce

    If Trump cuts corporate taxes 20% what does that mean for Stock Valuations ?

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