“When the bubble bursts, America will experience an economic crisis much greater than the 2008 meltdown or the Great Depression”

The bigger they come, the harder they fall.  Currently, we are in the terminal phase of an “everything bubble” which has had ten years to grow.  It is the biggest financial bubble that our country has ever seen, and experts are warning that when it finally bursts we will experience an economic downturn that is even worse than the Great Depression of the 1930s.  Of course many of us in the alternative media have been warning about what is coming for quite some time, but now even many in the mainstream media have jumped on the bandwagon.  The Economist is one of the most prominent globalist mouthpieces in the entire world, and so I was stunned when I came across one of their articles earlier today that was entitled “Another economic downturn is just a matter of time”.  When the alternative media and globalist media outlets are both preaching economic doom, that is a very clear sign that big trouble is imminent.

But for the moment, global financial markets seem to have settled down a bit.  U.S. markets were down on Monday, but there wasn’t that much volatility.  Once again, it was tech stocks that got hit the hardest

Apple and Netflix pulled back more than 1.8 percent each. Netflix fell after Goldman Sachs and Raymond James slashed its price targets on the video-streaming giant. Apple dropped after Goldman Sachs said the tech giant’s earnings could fall short this year as demand in China slows. Amazon, Microsoft and Alphabet also traded lower.

This may seem odd to hear, but what happened on Monday was actually good news for Wall Street.

Whether the markets go up or down, what investors should want more than anything else right now is calm, and that is precisely what we witnessed on Monday.  Yes, tech stocks took a bit of a hit, but overall there was not much panic in the marketplace and that is a positive sign (at least in the short-term) for Wall Street.

But that doesn’t mean that some big event isn’t going to cause another wave of panic on Wall Street by the end of the week.  Nothing about the long-term outlook has changed at all.  We have entered a time when the Ponzi scheme that we call “our financial system” could literally collapse at any moment.

And when it does collapse, the U.S. economy is going to experience pain unlike anything that we have ever seen before.  In his most recent article, Ron Paul warns that when the “everything bubble” finally bursts “America will experience an economic crisis much greater than the 2008 meltdown or the Great Depression”…

The Fed will be unsuccessful in keeping the everything bubble from exploding. When the bubble bursts, America will experience an economic crisis much greater than the 2008 meltdown or the Great Depression.

This crisis is rooted in the failure to learn the lessons of 2008 and of every other recession since the Fed’s creation: A secretive central bank should not be allowed to manipulate interest rates and distort economic signals regarding market conditions. Such action leads to malinvestment and an explosion of individual, business, and government debt. This may cause a temporary boom, but the boom soon will be followed by a bust. The only way this cycle can be broken without a major crisis is for Congress both to restore people’s right to use the currency of their choice and to audit and then end the Fed.

Of course Ron Paul is far from alone.

Just the other day, Peter Schiff said essentially the exact same thing

Economic guru Peter Schiff is saying that the next market crash will be “far more painful” than that of the Great Recession in 2008. With rising interest rates and tariffs spiking the cost of living, Americans will have some difficult financial times ahead.

“I think as Americans lose their jobs, they are going to see the cost of living going up rather dramatically, and so this is going to make it particularly painful,” Schiff said. “This is a bubble not just in the stock market, but the entire economy,” he told Fox News Business. Schiff is predicting a recession, accompanied by rising consumer prices, that will be far more painful than the 2007-2009 Great Recession.

The Federal Reserve and other global central banks worked very hard to inflate this bubble for a very long time, and now the Federal Reserve is raising interest rates quite rapidly.

They seem determined to burst their own bubble, and in the process they are going to create immense economic devastation all over the planet.

When President Trump said that the Federal Reserve has “gone crazy”, he was right on the money, and hopefully the American people will finally see that it is time to shut the Fed down permanently.

And as I noted earlier, the mainstream media also seems to at least partially understand what is happening.  For example, the following comes from a Bloomberg article entitled “Get Out of Equities Before It’s Too Late, Says Fund Manager”

The tumble in equities may go deeper than the correction earlier this year and investors should get ready to sell, according to a Budapest-based fund manager.

“Investors have to start looking for a way out from equities now,” Attila Dzsubak, investment director at MKB-Pannonia Fund Manager, who helps oversee 670 billion forint ($2.4 billion) in assets, said in Budapest. “Past experience shows that exits can quickly become too narrow.”

In the stock market, you only make money if you buy at the right time and if you sell at the right time.

Many of those that are wealthy on paper at the moment are going to see that paper wealth disappear in stunning fashion during the coming collapse.

America’s pride is largely based on the staggering wealth that we have been able to enjoy, but what is going to happen once that wealth is gone?

For the moment the bubble still lives, but the clock is ticking…

About the author: Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.

The Last Days Warrior Summit is the premier online event of 2018 for Christians, Conservatives and Patriots.  It is a premium-members only international event that will empower and equip you with the knowledge and tools that you need as global events begin to escalate dramatically.  The speaker list includes Michael Snyder, Mike Adams, Dave Daubenmire, Ray Gano, Dr. Daniel Daves, Gary Kah, Justus Knight, Doug Krieger, Lyn Leahz, Laura Maxwell and many more. Full summit access will begin on October 25th, and if you would like to register for this unprecedented event you can do so right here.

Global Markets Continue To Fall As Bloomberg Warns “The Next Financial Crisis Is Staring Us In The Face”…

It looks like it could be another tough week for global financial markets.  As the week began, markets were down all over the world, and relations between the United States and Saudi Arabia have taken a sudden turn for the worse.  That could potentially mean much, much higher oil prices, and needless to say that would be a very bad thing for the U.S. economy.  It has really surprised many of us how dramatically events have begun to accelerate here in the month of October, and the mood on Wall Street has taken a decidedly negative turn.  Yes, U.S. stocks did bounce back a bit on Friday (as I correctly anticipated), but it was much less of a bounce than many investors were hoping for.  And this week got off to a rough start with all of the major markets in Asia down significantly

In the Greater China region, the Hang Seng index in Hong Kong fell by around 0.9 percent in early trade. The Shanghai composite also slipped by 0.33 percent while the Shenzhen composite bucked the overall trend to edge up by 0.4 percent.

In Japan, the Nikkei 225 fell by 1.48 percent in morning trade, while the Topix index slipped by 1.17 percent, with most sectors trending lower.

But what happened in Asia was nothing compared to what we witnessed in Saudi Arabia.

At one point the stock market in Saudi Arabia had plummeted 7 percent after news broke that President Trump warned that the Saudis could face “severe punishment” for the disappearance of journalist Jamal Khashoggi.

The Saudis are denying doing anything wrong, but everyone agrees that he is missing, and everyone agrees that he was last spotted entering the Saudi Consulate in Istanbul on October 2nd.

And it is being reported that U.S. intelligence had previously intercepted communications which indicated that the Saudis planned to abduct Khashoggi.

It is believed that Khashoggi was dismembered after being abducted by the Saudis, and all of the major western powers have expressed major concern about his fate.  But the Saudis insist that they didn’t have anything to do with his disappearance, and they are threatening “greater action” if any sanctions are imposed upon them.  The following comes from USA Today

Saudi Arabia denied any involvement in the disappearance of Washington Post contributing journalist Jamal Khashoggi and warned Sunday that any sanctions against the oil-rich kingdom would be met with “greater action” and possibly exploding oil prices.

“The kingdom affirms its total rejection of any threats and attempts to undermine it, whether by threatening to impose economic sanctions, using political pressures or repeating false accusations,” the government said  in a statement released to Saudi media. “The Kingdom also affirms that if it receives any action, it will respond with greater action.”

So what might that “greater action” look like?

Well, one Saudi official is warning that the price of oil could rise to “$100, or $200, or even double that figure”

In a column published just after the SPA statement, Saudi-owned Al Arabiya channel’s General Manager Turki Aldakhil warned that imposing sanctions on the world’s largest oil exporter could spark global economic disaster.

“It would lead to Saudi Arabia’s failure to commit to producing 7.5 million barrels. If the price of oil reaching $80 angered President Trump, no one should rule out the price jumping to $100, or $200, or even double that figure,” he wrote.

If the price of oil did shoot up to $200 a barrel, that would be absolutely crippling for the U.S. economy.

You see, it wouldn’t just cost a whole lot more to fill up your gas tank.  Virtually everything that we buy has to be transported vast distances, and so the price of gasoline must be factored into all of those products.

The price of food is already ridiculously high, and so I don’t even want to imagine what a trip to the grocery store might look like if the Saudis follow through on their threats.

Meanwhile, warnings from the mainstream media of a new crisis on Wall Street continue to become even more dramatic.  For example, the following comes from a Bloomberg article entitled “The Next Financial Crisis Is Staring Us in the Face”

The financial crisis ripped through Wall Street 10 years ago, pushing the global economy to the edge of the abyss. One might think those searing experiences would have created a learning opportunity — for managing risk better, understanding structural imbalances in the financial markets, even learning a bit about how our own cognitive processes malfunction.

Instead, we have little new wisdom or self-awareness to show for that traumatic event.

And this is how that Bloomberg article ended

As memories of the crisis fade as the economy recovers, we find the seeds of the next crisis are already being planted. They are the exact same issues of debt and mismanaging risk and not understanding our own limitations. Failing to learn from our prior experiences, we seem doomed to repeat them. We only have ourselves to blame.

That sounds like it could have been ripped right out of The Economic Collapse Blog.

Of course the author of that Bloomberg article is right on the money.  We never learned the very hard lessons that we should have learned from the crisis of 2008.  Instead, we simply reinflated all of the old bubbles and made them bigger than ever before.

Now America is 68 trillion dollars in debt, and our day of reckoning is so close that even the mainstream media is sounding the alarm.

It should be another very interesting week.  Monday may set the tone for the entire week, and so hopefully U.S. markets will bounce back some more.  If they don’t, it could set off another round of panic…

About the author: Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.

The Last Days Warrior Summit is the premier online event of 2018 for Christians, Conservatives and Patriots.  It is a premium-members only international event that will empower and equip you with the knowledge and tools that you need as global events begin to escalate dramatically.  The speaker list includes Michael Snyder, Mike Adams, Dave Daubenmire, Ray Gano, Dr. Daniel Daves, Gary Kah, Justus Knight, Doug Krieger, Lyn Leahz, Laura Maxwell and many more. Full summit access will begin on October 25th, and if you would like to register for this unprecedented event you can do so right here.

October Horror On Wall Street: Investors Nervously Watch To See If The S&P 500 Will Bounce Back Above Its 200-Day Moving Average

Is this going to be another October to remember for Wall Street?  As I have explained previously, the month of October has historically been the worst month by far for the U.S. stock market, and it has also been the month when our most famous stock market crashes have taken place. The stock market crash that started the Great Depression in 1929 happened in October.  The largest single day percentage decline in stock market history happened in October 1987.  And most of us still remember what happened in October 2008.  So will we be adding October 2018 to that list?  Well, so far things are certainly moving in that direction.  Between Wednesday and Thursday, the Dow Jones Industrial Average plunged a total of 1,378 points.  And the S&P 500 has now broken below the all-important 200-day moving average.  If the S&P 500 bounces back above the 200-day moving average on Friday, that will be a sign that things have stabilized at least for the moment.  If that doesn’t happen, all hell might break loose next week.

Personally, I believe that the S&P 500 will bounce back on Friday, but that doesn’t mean that the crisis is over.  Remember, some of the best days in stock market history happened right in the middle of the financial crisis of 2008.  During market panics, we should expect to see dramatic ups and downs.  When markets are calm, that is good news for stocks, but when markets start swinging wildly that is usually a sign to start heading for the exits.

And without a doubt, we have witnessed quite a bit of volatility over the past two days…

-The Dow Jones Industrial Average is now down almost 2000 points from the all-time high that was established just last week.

-The S&P 500 has now fallen for six trading sessions in a row.  That is the longest streak since the 2016 presidential election.

-The Nasdaq is having its worst month since November 2008.

-The Russell 2000 is now down 11.2 percent from the 52-week high, which means that it is officially in correction territory.

-Netflix has fallen 11 percent in just the past week.

-Facebook has lost of whopping 30 percent of its value since July.

-Only 1.5 percent of S&P 500 tech stocks are currently above their 50 day moving averages.

-Wednesday’s decline was the third largest single day stock market point crash in all of U.S. history.

-On Thursday, gold futures shot up by the most that we have seen since Brexit.

-European stocks just hit 20-month lows.

-Italian stocks have officially entered bear market territory.

When markets begin to fall precipitously, often forced selling can accelerate that process.

The following is how Andrew Zatlin described this in his most recent article

You get a call: your $1M stock is now worth only $950K.  The lender can only allow you to have a loan of $475K, and your loan is for $500K.  Problem part 2: that $500K loan also dropped 5% and you are down to $475K.

The lender feels very sorry for you, sends you a ghost hug emoji (it’s a hug that you can’t feel but you know is there).  Unfortunately, you have 1 day to pay back the $25K.  It’s the law and if you don’t get them money by close of business, they will liquidate your stock until they get the $25K

You’ve had paper gains and paper losses, depending on the ebb and flow of the market.  But now your paper loss is going to be a real loss.

You aren’t allowed to ride out the loss: the loan is due in part TODAY.

You have what retail investors know as a margin call.

The term for this situation – extending your market position by borrowing against your existing liquid value  – is called leverage.  And the recent drop in the market means that investors are now over-leveraged.

Forced selling is the meme for the day.  Fire sales will be underway.

Right now, Wall Street is more leveraged that it has ever been before.

As long as stocks have been going up, that hasn’t been a problem and everyone has been making money.

But when stocks start to go down, suddenly that becomes a massive problem.

And it looks like we may have had some dramatic “forced selling” in the market on Wednesday.  At one point in the afternoon, the market was suddenly flooded with sell orders

Today was different, because shortly after 2:40pm when a massive selling program emerged as if out of nowhere and sent the Dow Jones plummeting by over 600 points in a manner of minutes, the selling volume was indeed one for the ages.

According to the NYSE TICK, or uptick minus downtick, index, at precisely 2:43pm, the selling order flood was so big it not only surpassed the acute liquidation that was observed around 3PM on Wednesday, but the -1,793 print was one that had not been seen for 8 years: as Bay Crest Partners technical analyst Jonathan Krinsky wrote, the sudden and violent surge in selling as measured by the TICK index, when downtick volume overpowered upticks, was the lowest reading since the May 6, 2010 “flash crash” when liquidity dried up in markets, sending the market plummeting for a few minutes, as HFT briefly went haywire (or when a spoofer outsmarted the algos, depending on what version of events one believes).

In any case, “someone” was in a massive hurry to get out of the market and was willing to hit literally any and every bid in doing so.

But now that the panic selling seems to have subsided, many “experts” are urging investors to use this as a “buying opportunity”

“We look at this as a buying opportunity,” said Dryden Pence, chief investment officer at Pence Wealth Management. “I would have my shopping cart out here.”

And even CNBC’s Jim Cramer is encouraging everyone to buy stocks on Friday

Friday is the time to start buying stocks again, Jim Cramer said during a CNBC special show on Thursday evening.

Is this really a good idea?

We shall see.

As I noted above, a lot of people are watching the S&P 500 to see if it will bounce back above the 200-day moving average.  The following comes from CNBC

Wall Street’s anxieties took a new turn Thursday after the stock market broke below a key technical level that has supported the market for the past three years.

The S&P 500 index finished the day below its 200-day moving average, one of the most popular technical indicators used by investors to help analyze price trends. Sell-offs earlier this year — occurring in February, March and April — all had bottomed at that level.

Ultimately, if there is a going to be a full-blown collapse of the stock market right now, we would need some sort of “kick off event” in order to make that happen.  It would have to be something on the scale of another 9/11, the collapse of Lehman Brothers, an unprecedented natural disaster, the start of a major war or something else along those lines.

Yes, conditions are definitely ripe for a “perfect storm” to develop, but it is going to take a little bit of a push to get us there.

So keep your eyes open, because our world is becoming more unstable with each passing day, and it won’t take much to push us into complete and utter economic chaos.

About the author: Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.

The Last Days Warrior Summit is the premier online event of 2018 for Christians, Conservatives and Patriots.  It is a premium-members only international event that will empower and equip you with the knowledge and tools that you need as global events begin to escalate dramatically.  The speaker list includes Michael Snyder, Mike Adams, Dave Daubenmire, Ray Gano, Dr. Daniel Daves, Gary Kah, Justus Knight, Doug Krieger, Lyn Leahz, Laura Maxwell and many more. Full summit access will begin on October 25th, and if you would like to register for this unprecedented event you can do so right here.

We Witnessed The 3rd Largest Point Crash In Stock Market History On The Same Day That The 3rd Most Powerful Hurricane To Ever Hit The U.S. Made Landfall

If you don’t believe in “coincidences”, what are we supposed to make of this?  On Wednesday, the 3rd most powerful hurricane to ever hit the United States made landfall in the Florida panhandle.  Entire communities were absolutely shredded as Hurricane Michael came ashore with sustained winds of 155 miles per hour.  You can find the entire article that I just posted about this massive storm right here.  In this article, I am going to focus on what just happened on Wall Street.  At the exact same time that Hurricane Michael was causing chaos in the Southeast, an October stock market crash was causing havoc in the Northeast.  The Dow Jones Industrial Average was down 831 points, which was the 3rd largest single day point crash in stock market history.  Of course it isn’t as if we hadn’t been repeatedly warned that this was coming, and the truth is that it looks like this is only the start of the financial shaking.

In fact, international financial markets are in a state of chaos as I write this article.  Asian markets are a sea of red, and at this moment Dow futures are way down.

So it appears likely that Wednesday’s nightmare may extend into Thursday as well.

But before we look ahead too much, let’s talk about the utter carnage that we just witnessed.

According to Bloomberg, the 500 wealthiest people in the world lost 99 billion dollars on Wednesday…

Plunging global markets lopped $99 billion from the fortunes of the world’s 500 wealthiest people on Wednesday, the year’s second-steepest one-day drop for the Bloomberg Billionaires Index.

Amazon.com Inc. founder Jeff Bezos lost $9.1 billion, the most of anyone on the index, as shares of the online retailer fell the most in more than two years. The plunge lowered Bezos’s net worth to $145.2 billion, its lowest since July.

Can you imagine losing that much money on a single day?

The Dow Jones Industrial Average has now fallen for four out of the last five trading sessions, and for the month as a whole all three of the major indexes are way down

Stocks have fallen sharply this month. For October, the S&P 500 and the Dow are down more than 4.4 percent and 3.3 percent, respectively. The Nasdaq, meanwhile, has lost more than 7.5 percent.

Tech stocks are being hit particularly hard.  In fact, tech stocks just had their worst day in more than seven years

Technology stocks got clobbered on Wednesday, suffering their worst day in more than seven years, as concerns over rising interest rates punished the overall market, particularly shares of companies that have been the best performers.

The S&P 500 Information Technology Index closed at $1,220.62, down 4.8 percent, marking the biggest decline since August 18, 2011, when the index dropped 5.3 percent. All 65 members of the index fell.

At this point, 330 out of the 505 stocks that make up the S&P 500 are already more than 10 percent below their 52-week highs.

That means that about two-thirds of all S&P 500 stocks are officially in correction territory.

And 140 of those stocks are already down more than 20 percent from their 52-week highs, and that means that they are officially in bear market territory.

So why is this happening?

Many of the “experts” are pointing to the dramatic rise in interest rates

Nervousness had been building for days on Wall Street. The catalyst was the recent spike in the yield on a closely watched government bond to a seven-year high.

The 10-year Treasury note — whose key rate impacts the pricing on things ranging from fixed-rate mortgages to stocks to virtually every financial asset on the planet — recently climbed above 3.25 percent for the first time since May 2011. And when you add the threat of higher borrowing costs on things like houses and cars and corporate debt to the economic obstacles caused by the U.S. trade war with China, all it takes is a whiff of weakness to set a major sell-off in motion.

A week ago, I warned my readers that rapidly rising rates could spark a market sell-off, and now it is happening with a ferocity that is absolutely breathtaking.

Needless to say, President Trump was not thrilled by the market crash on Wednesday, and he is pointing the blame at the Federal Reserve

President Donald Trump slammed the Federal Reserve as “going loco” for its interest-rate increases this year in comments hours after the worst U.S. stock market sell-off since February.

Trump said in a telephone interview on Fox News late Wednesday night the market plunge wasn’t because of his trade conflict with China: “That wasn’t it. The problem I have is with the Fed,” he said. “The Fed is going wild. They’re raising interest rates and it’s ridiculous.”

“That’s not the problem,” he said of the trade standoff. “The problem in my opinion is the fed,” he added. “The fed is going loco.”

I love it.

I absolutely love it.

Could it be possible that we will soon see supporters chant “end the Fed” at Trump rallies?

No president has ever openly criticized the Federal Reserve like this, and I greatly applaud Trump for doing so.

And he is precisely correct – the Federal Reserve is the problem.

Nobody has more power over the performance of the U.S. economy than the Federal Reserve does, and the only way that our long-term economic and financial problems will ever be fixed is if the Federal Reserve is shut down.

So I hope that President Trump’s feud with the Federal Reserve gets as heated as possible.  I hope that the Federal Reserve becomes a central issue during the 2020 presidential election, and I hope that every Trump supporter in the entire country will urge Trump to make a promise to shut down the Federal Reserve.

The Federal Reserve is a deeply insidious system that has turned America into a nation of debt slaves, and it is definitely time to end that sick and twisted debt-based system and return this nation to a solid financial foundation.

About the author: Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.

The Last Days Warrior Summit is the premier online event of 2018 for Christians, Conservatives and Patriots.  It is a premium-members only international event that will empower and equip you with the knowledge and tools that you need as global events begin to escalate dramatically.  The speaker list includes Michael Snyder, Mike Adams, Dave Daubenmire, Ray Gano, Dr. Daniel Daves, Gary Kah, Justus Knight, Doug Krieger, Lyn Leahz, Laura Maxwell and many more. Full summit access will begin on October 25th, and if you would like to register for this unprecedented event you can do so right here.

Do They Know Something We Don’t? Corporate Insiders Are Selling Stocks At The Fastest Pace In 10 Years

A lot of things are starting to happen that we haven’t seen since the last recession.  A few days ago, I wrote about the fact that home sellers in the United States are cutting their prices at the fastest pace in at least eight years, and now we have learned that corporate insiders are selling stocks at the most rapid pace in ten years.  So why are they dumping their shares so quickly?  Do they know something that the rest of us do not?  Certainly nobody can blame them for taking advantage of the ridiculously high stock prices that we are seeing in the marketplace right now.  But stock prices have been very high for a while.  Why is there such a mad rush for the exits all of a sudden?  According to CNN, corporate insiders have sold 5.7 billion dollars worth of stock so far in September…

CEOs are using the market boom to quietly cash in their own chips.

Insiders at US companies have dumped $5.7 billion of stock this month, the highest in any September over the past decade, according to an analysis of regulatory filings by TrimTabs Investment Research.

It’s not a new trend. Insiders, which include corporate officers and directors, sold shares in August at the fastest pace in 10 years as well, TrimTabs said.

It would be one thing if September was an anomaly, but the fact that insider shares were being sold so rapidly in August as well indicates that this is a clear trend.

Could it be possible that these corporate insiders believe that the market is about to take a tumble?

Of course it doesn’t exactly take inside information to see the writing on the wall.  On Wednesday, the Federal Reserve raised interest rates for the third time in 2018.  Overall, this is the Fed’s eighth interest rate increase since 2015, and it looks like the Fed is anticipating three more rate hikes in 2019

Looking ahead to 2019, Fed officials expect at least three rate hikes will be necessary, and one more in 2020.

“The Fed shows no signs of taking (a) breath in rate hikes,” Robert Frick, corporate economist with Navy Federal Credit Union, wrote in a research note.

This is terrible news for stock market investors, because every rate hiking program in the history of the Federal Reserve has ended in a stock market crash and/or a recession.

In fact, since 1957 there have been 18 rate hiking cycles, and every single one of them has ended in disaster.

So do you think that we are going to beat the odds this time?

After raising rates again, the Fed released a statement in which it said that it expects the U.S. economy to grow “for at least three more years”

The Fed sees the economy growing at a faster-than-expected 3.1 percent this year and continuing to expand moderately for at least three more years, amid sustained low unemployment and stable inflation near its 2 percent target.

“The labor market has continued to strengthen … economic activity has been rising at a strong rate,” it said in its statement.

You can believe that if you want, but it is also important to remember that Federal Reserve Chairman Ben Bernanke assured all of us that a recession was not coming in 2008.

And later we learned that the moment when he made that statement a recession had actually already begun.

Needless to say, investors were not thrilled by Wednesday’s rate hike, and the Dow Jones Industrial Average dropped another 100 points.  Stocks have really struggled this week, and we continue to get more disappointing news from the real economy.  On the heels of a “disappointing” existing home sales report, we just received news that new home sales missed expectations

Following existing home sales disappointment, hope was once again high for a bounce in new home sales in August but once again disappointed with a 629k print (up from a revised 608k), but missed expectations of 630k.

While the sales gain was the first in three months, the downward revisions to prior figures indicate that the market in recent months was slower than previously reported, adding to broader indications of cooler demand in residential real estate.

And the trade war continues to take a toll as well.  According to Ford’s chief executive, the metals tariffs are going to result in a billion dollars in lost profits for his company…

Ford CEO Jim Hackett told Bloomberg Television on Wednesday that his company faces $1 billion in lost profits from President Donald Trump’s tariffs.

“The metals tariffs took about $1 billion in profit from us – and the irony is we source most of that in the U.S. today anyways,” Hackett said. “If it goes on longer, there will be more damage.”

Perhaps this is one of the main reasons why it looks like Ford could soon be laying off thousands of workers.

The “smart money” is always one step ahead of the “dumb money”, and corporate insiders have a much better view of what is really going on inside their companies than any of the rest of us do.

So if they are collectively convinced that now is a perfect time to sell, that is a major red flag.

On Wall Street, actions speak much louder than words, and corporate insiders are sending a very loud message by selling so many of their own shares.

About the author: Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.

Why Are So Many People Talking About The Potential For A Stock Market Crash In October?

It is that time of the year again.  Every year, people start talking about a possible stock market crash in October, because everyone remembers the historic crashes that took place in October 1987 and October 2008.  Could we witness a similar stock market crash in October 2018?  Without a doubt, the market is primed for another crash.  Stock valuations have been in crazytown territory for a very long time, and financial chaos has already begun to erupt in emerging markets all over the globe.  When the stock market does collapse, it won’t exactly be a surprise.  And a lot of people out there are pointing to October for historical reasons.  I did not know this, but it turns out that the month with the most market volatility since the Dow was first established has been the month of October

The difference is quite significant, as judged by a measure of volatility known as the standard deviation: For all Octobers since 1896, when the Dow Jones Industrial Average was created, the standard deviation of the Dow’s daily changes has been 1.44%. That compares to 1.05% for all months other than October.

Like me, you are probably tempted to think that the reason why October’s number is so high is because of what happened in 1987 and 2008.

But even if you pull out those two months, October is still the most volatile

You might think that this difference is caused by a few outliers, such as the 1987 crash (which, of course, occurred in October) or 2008 (the Dow suffered several thousand-point plunges that month as it reacted to the snowballing financial crisis). But you would be wrong: The standard deviation of daily Dow changes is much higher in October than other months even if we eliminate 1987 and 2008 from the sample.

Once we get to Thanksgiving, the market tends to get sleepy, and it usually doesn’t wake up again until the new year begins.

So if something big is going to happen in the market in 2018, it is probably going to happen in the coming weeks.

And it is inevitable that something big will happen at some point.  As Jesse Colombo has pointed out, stocks are more overvalued right now than they were just before the great stock market crash of 1929…

In a bubble, the stock market becomes overpriced relative to its underlying fundamentals such as earnings, revenues, assets, book value, etc. The current bubble cycle is no different: the U.S. stock market is as overvalued as it was at major generational peaks. According to the cyclically-adjusted price-to-earnings ratio (a smoothed price-to-earnings ratio), the U.S. stock market is more overvalued than it was in 1929, right before the stock market crash and Great Depression

It is becoming increasingly obvious what we are heading for, and a growing chorus of market experts are issuing ominous declarations about this market.

For example, David Tice is warning that “we’re getting closer to a meltdown scenario”

According to investor David Tice, who made a name for himself in running the Prudent Bear Fund before selling it to Federated Investors in 2008, the current market is dangerous. Tice was quoted as saying he’s “nervous” because “we’re getting closer to a meltdown scenario.”

And John Hussman ultimately expects “two-thirds of market capitalization” to vanish…

I am aware of no plausible conditions under which current extremes are likely to work out well for investors. There are a few possibilities that could involve a smaller loss than the two-thirds of market capitalization that I expect to vanish, as the run-of-the-mill, baseline expectation for the S&P 500 over the completion of this cycle. Yet it’s worth recognizing that the completion of every market cycle in history has taken the most reliable valuation measures we identify (those best correlated with actual subsequent S&P 500 market returns) to less than half of current levels.

Could you imagine the chaos that would be unleashed if the stock market went down by two-thirds?

That would make what happened in 2008 look like a Sunday picnic.

And there are a lot of parallels between what happened in 2008 and what is happening today.  For example, the housing market is slowing down dramatically just like it did a decade ago.  The following comes from a Bloomberg article that I came across earlier today entitled “Builders Slump as U.S. Housing Market Shifts to the Slow Lane”

The housing market is stalling, and homebuilder stocks are feeling the pain.

The S&P Supercomposite Homebuilding Index is down 21 percent year-to-date, on track for the biggest annual drop since 2008, when it fell 32 percent. That’s even with tax cuts, unemployment near the lowest since 1969 and a real-estate developer in the White House. What gives?

Just a few days ago, I wrote an entire article about the fact that home sellers are cutting prices at the fastest rate that we have seen in eight years.  The housing market is clearly telling us that a big time economic slowdown is coming, but most people are not listening.

Switching gears, we have also recently learned that it looks like Ford Motor Company will soon be laying off lots of workers

Ford Motor employees are warily awaiting details of CEO Jim Hackett’s promised “fitness” plan and the serious possibility of significant job losses as the company faces pressure to improve its operations.

The company has warned of $11 billion in restructuring costs over three to five years, which could mean thousands of worker buyouts, according to analysts.

Why would they be doing that if the economy really was in “good shape”?

And let us not forget about the ongoing woes of the retail industry.  Recently, I was astounded to learn that a whopping 20 percent of all retail space in Manhattan is currently vacant

“When you walk the streets, you see vacancies on every block in all five boroughs, rich or poor areas — even on Madison Avenue, where you used to have to fight to get space,” said Faith Hope Consolo, head of retail leasing for Douglas Elliman Real Estate, who said the increase in storefront vacancies in New York City had created “the most challenging retail landscape in my 25 years in real estate.”

A survey conducted by Douglas Elliman found that about 20 percent of all retail space in Manhattan is currently vacant, she said, compared with roughly 7 percent in 2016.

New York City is one of the few areas around the country that has actually been prospering.

If things are that bad there already, what does that say about the outlook for the rest of the nation?

The truth is that the economy is not nearly as good as you are being told, and things could literally start breaking loose at any moment.

Unfortunately, as a society we have not learned very much from history, and most Americans seem to think that this bubble of artificial prosperity is going to last indefinitely.

About the author: Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.