Stock Prices

Are We On The Verge Of A Massive Stock Market Crash?

Is time finally running out for “the bubble to end all bubbles”?  Over the past year, we have seen stock prices rise to levels that are completely and utterly absurd, and many have pointed out that we are currently in the largest stock market bubble in the entire history of our nation.  Of course this bubble will end the way that all of our other stock market bubbles eventually ended, and recent market activity has a lot of people wondering if the time for that is drawing near.  Signs of trouble have been percolating on Wall Street for weeks, and on Monday we finally witnessed an eruption of full-blown fear.  The Dow Jones Industrial Average was down 725 points, and that represented the worst day for the index since last October.  But one really bad day is not a crisis, and even though many individual stocks have already plunged into bear market territory, we have a long, long way to go before people start using the word “crash”.  In fact, I don’t think that anyone should even think of using the word “crash” until the Dow drops below 30,000.

But without a doubt, a crash is inevitably coming.

Whether it happens this month, next month or next year, stock prices will plummet from these ridiculously inflated levels.

As for the plunge that happened on Monday, many are blaming it on fears about the “Delta variant”…

“It’s a bit of an overreaction, but when you have a market that’s at record highs, that’s had the kind of run we’ve had, with virtually no pullback, it becomes extremely vulnerable to any sort of bad news,” said Randy Frederick, vice president of trading & derivatives at Charles Schwab. “It was just a matter of what that tipping point was, and it seems we finally reached that this morning” with worries about the delta variant.

To me, there are other issues that are of much greater concern, but apparently this is what is spooking investors this week.

According to CNBC, the number of newly confirmed COVID cases per week has more than doubled over the past month…

Covid cases have rebounded in the U.S. this month, with the delta variant spreading among the unvaccinated. The U.S. is averaging nearly 26,000 new cases a day in the last seven days through Sunday, up from a seven-day average of around 11,000 cases a day a month ago, according to CDC data. Cases were already flaring up around the world because of the delta variant.

Now that the market has started to fall, some experts are warning that the drop could be quite substantial.

For example, one Morgan Stanley strategist believes that we could eventually see a “correction” of 10 to 20 percent…

“The market appears ready to take on a more defensive character as we experience a meaningful deceleration in earnings and economic growth,” Morgan Stanley chief U.S. equity strategist Mike Wilson said in a note Monday. “Market breadth has been deteriorating for months and is just another confirmation of the mid-cycle transition, in our view. It usually ends with a material (10-20%) index level correction.”

Actually, if that is the worst that happens we will be quite fortunate.

In recent days, the mood on Wall Street has shifted dramatically.  In fact, the CNN Fear & Greed Index is now sitting at 16 which is considered to be in the “extreme fear” range, and the VIX has been soaring.

As our friends at Zero Hedge have pointed out, the last time we witnessed this much fear on Wall Street the S&P 500 was absolutely plummeting…

With the S&P 500 around 3.5% off its record highs, we note that fear has exploded. The last time fear was this high, the S&P was down 40%!…

We shall watch and see what happens this time around.

Zero Hedge has also pointed out that Goldman Sachs has been aggressively selling off billions of dollars worth of stocks recently…

What is even more remarkable is just how much Goldman has harvested so far in 2021: as shown below, having started with a $20BN equity portfolio which has enjoyed a $5BN increase in market prices, Goldman dumped a whopping $5.5 billion of its equity assets so far (excluding a modest $1.5BN in purchases) or more than a quarter of its entire portfolio as of Dec 31.

This is not normal for Goldman Sachs.

In fact, you have to go all the way back to just before the financial crisis of 2008 to find another time when they did such a thing…

The last time Goldman was “aggressively” selling into a “supportive” market? Well, we have to go back all the way to 2007 and 2008 when Goldman was busy creating the very CDOs which its prop desk would then “aggressively” short.

We all remember how prophetic that particular move turned out to be…

That is “interesting” to say the least.

But as big financial institutions such as Goldman Sachs are dumping stocks, talking heads on television continue to assure all of us that a wonderful new era of great prosperity is just ahead.  Just check out what Bill Ackman told CNBC on Monday…

Billionaire investor Bill Ackman said Monday that the spread of the delta variant doesn’t pose a significant threat to the economic reopening, and he sees interest rates rising on the back of the big comeback.

“I hope what it does is that it motivates anyone who doesn’t get the vaccine to get the vaccine. I don’t think it’s going to change behavior to a great extent,” Ackman said in a interview on CNBC’s “Squawk Box.” “You are going to see a massive, my view, economic boom. … We are going to have an extremely strong economy coming in the fall.”

Wouldn’t it be nice if he was right?

I would love to see a “massive” economic boom.

Unfortunately, I don’t believe that is going to happen.  In fact, I believe that we are rapidly approaching some of the most difficult economic times that we have ever seen.

The laws of economics cannot be ignored forever.  The federal government is now 28 trillion dollars in debt, we are in the midst of the greatest corporate debt binge of all time, and U.S. consumers continue to go into debt as if tomorrow will never arrive.

But tomorrow always arrives eventually, and our “tomorrow” is going to be a day of reckoning that is going to be far more painful than most people would dare to imagine.

***It is finally here! Michael’s new book entitled “7 Year Apocalypse” is now available in paperback and for the Kindle on Amazon.***

About the Author: My name is Michael Snyder and my brand new book entitled “7 Year Apocalypse” is now available on Amazon.com.  In addition to my new book I have written five others that are available on Amazon.com including  “Lost Prophecies Of The Future Of America”, “The Beginning Of The End”, “Get Prepared Now”, and “Living A Life That Really Matters”. (#CommissionsEarned)  By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe.  I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe.  I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article.  The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions.  I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

You Might Want To Check On Your “Investments”, Because The Financial Markets Are Starting To Go Haywire

Is the party almost over?  Volatility has returned to Wall Street in a major way, and certain investors are getting absolutely crushed.  On Wednesday, a trillion dollars in paper wealth had been wiped out during the trading session at one point, but those losses were later pared back as cryptocurrencies rallied.  On social media, there has been a lot of weeping and wailing due to the huge financial losses that some people have experienced this week.  But if you think that these losses are bad, just wait until you see what is coming later.

In the old days, investors would carefully select the companies that they were going to invest in.  The key was to identify companies that had something of great value to add to society and that were being run very well.  In those days, strict adherence to the fundamentals would often bring great rewards.  Just ask Warren Buffett.

But these days our financial markets are little more than giant casinos.  Companies that lose giant mountains of money year after year are supposedly worth billions of dollars, and “assets” that have no inherent value whatsoever are endlessly gobbled up by drug-fueled “investors” that are looking for a way to get rich quick.

This speculative environment has driven the price of Bitcoin to absolutely insane heights in recent months, but now it is starting to fall.  After hitting a record high of $64,829 in the middle of April, Bitcoin fell to almost $30,000 on Wednesday before bouncing back a bit…

Bitcoin plunged 30% to near $30,000 at one point on Wednesday, continuing a major sell-off in the cryptocurrency markets that began a week ago.

But don’t feel too bad for Bitcoin investors just yet.  Bitcoin is still up more than 30 percent so far this year, and overall it is up close to 300 percent over the past 12 months.

Other cryptocurrencies that have also soared in recent months took a huge bath on Wednesday…

Other cryptocurrencies also plunged on Wednesday. Ether, the digital currency that powers the Ethereum blockchain, was down more than 22% at $2,620.97, according to Coin Metrics. Dogecoin, a cryptocurrency that started as a joke and has been talked up by Tesla CEO Elon Musk, fell 25% to less than 36 cents. Both had substantially larger losses earlier in the session.

Dogecoin is the poster child for the wild speculation that I so often deride on my websites.  It was started as a joke, it is a useless waste of digital space, and it has no inherent value whatsoever.

But at this moment the market cap for Dogecoin is still over 40 billion dollars.

I really wish that I would have started up a cryptocurrency called “Chickencoin” when this craze was first getting started.  It would probably be worth 100 billion dollars by now.

Sadly, at this point the opportunity to get rick quick has passed, because the bubble is starting to burst.  On Tuesday, China set off a wave of panic when a major announcement about the use of cryptos in the country hit the news wires…

The China Internet Finance Association said it will not allow the country’s financial institutions to partake in any business related to cryptocurrency due to the volatile nature of the digital coins, according to a Chinese media report Tuesday that was spotted earlier by Coindesk. This decision isn’t new. China took a similar stance back in 2017, which also resulted in a massive Bitcoin selloff.

The newest crypto investors are the ones that are being hit the hardest.  Many of them got in near the top of the bubble and now they are paying a great price for it…

New entrants to crypto are especially running for the exits, according to a note from Glassnode Insights. About 23% of crypto wallets are now at a loss, and 1.1 million of the addresses have spent all coins they held during this correction.

Needless to say, this is taking an enormous emotional toll on many people.  On Reddit, some users were even posting the telephone numbers for suicide hotlines…

People on Reddit trading boards described losing their shirts and some people even posted telephone numbers for a suicide help line in case the losses led to hopeless feelings.

Some investors have gotten rich by investing in cryptos, but others are literally losing everything.  On Wednesday, those that had made huge leveraged bets that cryptos would keep rising got absolutely monkey-hammered…

As of Wednesday afternoon in New York, about $9 billion of liquidations of leveraged bets had taken place in the previous 24 hours, according to data provider Bybt. The majority were of long positions in which traders bet on an increase in the price of bitcoin or another cryptocurrency. Such liquidations take place when the market moves against a trader who isn’t able to exit from the trade or post enough additional funds to meet the exchange’s margin requirements.

For the moment, the losses on the stock market seem quite tame by comparison.  The Dow has declined for six of the last eight trading sessions, and it was down another 164 points on Wednesday…

The Dow Jones Industrial Average closed down 164.62 points, or 0.5%, Wednesday, paring an earlier drop of as much as 587 points, as investors broadly retreated from riskier assets. The index has fallen in six of the past eight sessions.

But there is a whole lot more chaos going on under the surface.  As Zero Hedge has pointed out, “in the past 7 sessions, stocks have suffered 3 of the largest bouts of concentrated selling pressure in history”.

Insiders and wealthy investors have been bailing out of stocks at a staggering pace recently, and many believe that this summer will be a very troubled time for stock investors.

But whether it happens sooner or later, it is inevitable that the stock market bubble will burst as well.

The Ponzi scheme that we call “our financial system” is destined to fail, and that should be obvious to everyone at this point.

Unfortunately, many self-deluded “investors” will stay in the game until it is far too late, and they will lose everything as a result.

***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***

About the Author: My name is Michael Snyder and my brand new book entitled “Lost Prophecies Of The Future Of America” is now available on Amazon.com.  In addition to my new book, I have written four others that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned)  By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe.  I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe.  I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article.  The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions.  I encourage you to follow me on social media on Facebook, Twitter and Parler, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

U.S. Financial Markets Have Become A Giant Mirage Built On A Foundation Of Fraud

Would you pay more than 100 million dollars for a single deli in rural New Jersey that had less than $36,000 in sales during the last two years combined?  I know that sounds like a completely ridiculous question, but the stock market apparently thinks that deli is worth that much.  On Thursday, the Dow Jones Industrial Average closed above 34,000 for the first time in history, and investors all over the country cheered.  But this financial bubble is not real.  It is a giant mirage that is built on a foundation of fraud.  Investors have lost all touch with reality, and in this sort of euphoric environment a small deli in rural New Jersey can literally be valued at more than 100 million dollars…

The Paulsboro, New Jersey-based Your Hometown Deli is the sole location for Hometown International, which has an eye-popping market value despite totaling $35,748 in sales in the last two years combined, according to securities filings.

“Someone pointed us to Hometown International (HWIN), which owns a single deli in rural New Jersey … HWIN reached a market cap of $113 million on February 8. The largest shareholder is also the CEO/CFO/Treasurer and a Director, who also happens to be the wrestling coach of the high school next door to the deli. The pastrami must be amazing,” Einhorn said in a letter to clients published Thursday.

For young people getting ready to graduate from high school and go to college, don’t waste your time.

Just open up a small deli and go public.

Soon you will be a multi-millionaire.

Alternatively, you could start a fake cryptocurrency as a joke and watch it become worth billions of dollars.

To me, what is happening with “Dogecoin” is completely and utterly insane…

The digital currency Dogecoin surged by more than 85 percent so far this week in thrilling scenes for fans of the bizarre coin. Launched in 2013 and created by Jackson Palmer and Billy Markus as a joke, the cryptocurrency has never seen the highs of rival coins like bitcoin, which is currently worth $63,531.49. But a growing fanbase has helped kickstart the meme coins value, and today has seen the prices skyrocket.

Looking at it objectively, I don’t know why any rational investor would ever put one red cent into Dogecoin.

But in 2021, rational investors are being left in the dust, and those that foolishly rush in are getting filthy rich.

I know that it may be hard to believe, but at this point Dogecoin has a market cap that is greater than 22 billion dollars…

According to CoinDesk, Dogecoin has surged by 49.96 percent in 24 hours to $0.171956, as of 9.02pm on April 15.

In GBP, Dogecoin stands at £0.124731.

The market cap for Dogecoin is currently $22.19 billion in USD and £16.10 billion in GBP.

Someday Dogecoin will be worthless, but for now this “meme currency” is shocking the world.

Speaking of ridiculous valuations, Coinbase just went public, and it is currently valued at more than 85 billion dollars…

Coinbase was briefly valued at as much as $100 billion in its Nasdaq debut Wednesday, a landmark event for the cryptocurrency industry. The stock closed at $328.28 per share, valuing Coinbase at $85.8 billion on a fully diluted basis.

Don’t you wish that you would have been the one to launch Coinbase?

Of course all of these absurd valuations are just temporary.

This bubble will inevitably pop, and those that did not sell at the top of the market will be kicking themselves.

In the financial markets, enormous fortunes are being won and lost all the time, but none of this is real.

What is real are the riots that are happening in our streets on a nightly basis.  Last night, rioters “waved a pig’s head” at police officers in Minnesota…

DAUNTE Wright protesters waved a pig’s head at cops as chaos again erupted in Brooklyn Center, with hundreds storming the police station.

Demonstrators came out for the fourth night in a row since Wright, 20, was fatally shot by police officer Kim Potter during a traffic stop on Sunday.

Sadly, instead of trying to calm the violence BLM leaders are actually arguing that rioting and looting are legitimate forms of political expression…

A prominent activist who supports the Black Lives Matter movement has appeared to support violent protests, arguing that rioting and looting are ‘a legitimate, politically-informed response to state violence’.

Bree Newsome, 35, made the passionate remarks in a series of tweets this week, arguing that police are not limited to non-violence, and that a violent response to injustice can be appropriate and justified.

And do you want to know what else is real?

As I discussed a couple days ago, social decay is transforming city streets all over America into drug-infested wastelands…

Homeless men lie on the sidewalk while others wearing blankets and rags loiter on a street strewn with garbage, feces, and drug paraphernalia along the notorious Kensington Avenue drag in Philadelphia.

Video posted online on March 10 shows people living out of suitcases on the sidewalks in the area adjacent to the entrance to the Somerset train station along the Market-Frankford train line while others openly brandish needles.

Cardboard boxes with trash bags stacked on top of them lie feet away from the entrances to various pawn shops, check-cashing stores, delis, and bodegas.

The financial bubble that we are experiencing right now will go away, but the problems on our streets are not going away.

In fact, they are only going to get worse in the months and years ahead.

But if you don’t want to believe this, go ahead and pour your life savings into Hometown International or Dogecoin and see what happens.

You only make money in the markets if you get out in time, and time is quickly running out for those that have put their faith in this financial bubble.

***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***

About the Author: My name is Michael Snyder and my brand new book entitled “Lost Prophecies Of The Future Of America” is now available on Amazon.com.  In addition to my new book, I have written four others that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned)  By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe.  I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe.  I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article.  The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions.  I encourage you to follow me on social media on Facebook, Twitter and Parler, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

The Number Of Billionaires In America Has Absolutely Exploded During The Pandemic

For the wealthy and the ultra-wealthy, happy days are here again.  Even though we have just been through one of the most difficult 12 months in our history, the number of billionaires has increased dramatically during this pandemic.  That seems rather odd, but there is no denying that the rich have gotten even richer during this crisis.  In fact, Forbes revealed this week that the number of billionaires has risen by about 30 percent over the past year…

The number of newly minted and reissued billionaires soared last year, Forbes reported Tuesday in its annual ranking, a staggering accumulation of personal wealth that stands in sharp contrast with the widespread economic struggles unleashed by the coronavirus pandemic.

The number of billionaires on Forbes’ 35th annual ranking swelled by 660 to 2,755 — a roughly 30 percent jump from a year ago — and 493 of them are first-timers. Seven of eight are richer than they were before the pandemic. Forbes calculates net worth by using stock prices and exchange rates from March 5.

Of course thanks to the reckless policies of our leaders, a billion dollars does not go nearly as far as it once did.

But still, a billion dollars is a whole lot of money.

Needless to say, the biggest reason why the number of billionaires has exploded is because we have been witnessing one of the greatest stock market rallies in history.

A year ago, the Dow Jones Industrial Average was sitting at about 23,000.

Today, it is above 33,000, and some analysts expect it to shoot quite a bit higher throughout the rest of 2021.

Stock prices have never been more detached from economic reality as they have been over the past 12 months, and they have only risen so high because of unprecedented intervention by the Federal Reserve and because of extremely wild spending by the federal government.

Many have warned that the party will inevitably come to a crashing end at some point, but it hasn’t happened yet.

So for now, the market optimists look like champions.

And now that Joe Biden is in the White House, the corporate media is telling us that we are on the verge of a grand new era of American prosperity.  The corporate media insists that the pandemic will soon be behind us thanks to the vaccines, and the talking heads on television envision a return to the good old days very quickly.

In fact, Barron’s is already declaring that the “U.S. economy might be stronger than it’s ever been”.

And CNN is trying to convince us that “America’s economy could be heading for a golden era of growth”.

Really?

If the U.S. economy is actually improving, then why are new claims for unemployment benefits going up?…

The number of Americans filing first-time unemployment benefits unexpectedly rose last week, according to the Labor Department.

Data released Thursday showed 744,000 Americans filed first-time jobless claims in the week ended April 3. Analysts surveyed by Refinitiv were expecting 680,000 filings. The previous week’s total was revised higher by 9,000 to 728,000.

If economic conditions were getting better, that number should be going the other way.

Even I didn’t expect a number this bad.

Prior to 2020, the all-time record high for new unemployment claims in a single week was 695,000.  That record was established in October 1982, and it stood all the way until the COVID pandemic hit the U.S. early last year.

Sadly, we have been above 695,000 almost every single week since then.

The numbers compiled by the states tell us that nearly three-quarters of a million Americans filed new claims for unemployment benefits last week.  That is an absolutely catastrophic number.  Nobody should be talking about a “golden era of growth” or claiming that the “economy might be stronger than it’s ever been” until we get that number back down to pre-pandemic levels.

And right now, we are at a level that is about three times as high as pre-pandemic levels.

Look, the truth is that anyone that tells you that unemployment is low in the United States is lying to you.

According to John Williams of shadowstats.com, if honest numbers were being used the unemployment rate in the United States would be 25.7 percent right now.

That is the sort of number that we would expect to see during an economic depression, and the truth is that we are in an economic depression.

Over the past year, more than 70 million new claims for unemployment benefits have been filed, and approximately 4 million U.S. businesses have gone out of existence permanently.

But don’t worry, the stock market is hovering near all-time record highs and the corporate media is telling you that everything is going to be wonderful now that Joe Biden is in control.

Come on man!

You can’t really believe that stuff that they are shoveling.

With each passing day, more Americans are losing their jobs, more Americans are falling out of the middle class, and the cost of living just keeps going up even higher.

In fact, we just learned that global food prices have now gone up for 10 months in a row…

The global food-price rally that’s stoking inflation worries and hitting consumers around the world shows little sign of slowing.

Even with grain prices taking a breather on good crop prospects, a United Nations gauge of global food costs rose for a 10th month in March to the highest since 2014. Last month’s advance was driven by a surge in vegetable oils amid stronger demand and tight inventories, according to Abdolreza Abbassian, a senior economist at the UN’s Food and Agriculture Organization.

I am going to continue to watch global food prices very carefully, because I believe that it will be a very important trend in the months and years ahead.

But for now, the good news is that at least economic conditions are relatively stable.

Yes, things are not nearly as good as they were before the pandemic, but at least they are not getting a whole lot worse.

So even though things are not great, we should enjoy this period of relative stability while we still can, because it definitely will not last.

***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***

About the Author: My name is Michael Snyder and my brand new book entitled “Lost Prophecies Of The Future Of America” is now available on Amazon.com.  In addition to my new book, I have written four others that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned)  By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe.  I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe.  I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article.  The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions.  I encourage you to follow me on social media on Facebook, Twitter and Parler, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

Experts Are Warning That A U.S. Stock Market Crash Is Very Likely In The Months Ahead

Stock prices are not going to stay this high.  Everyone can see that we are in a stock market bubble that does not have any parallel in all of U.S. history, and everyone can see that the end of that bubble is approaching.  The only debate is about how fast and how far the eventual fall will be.  For the first time ever, the ratio of U.S. stock prices to U.S. GDP has reached 200 percent.  In other words, the total value of U.S. stocks is now twice as high as the value of all U.S. economic output for an entire year.  To get an idea of how crazy this is, just check out this chart.  Historically, the ratio of U.S. stock prices to U.S. GDP is normally under 100 percent, and so if all stock prices were cut in half U.S. stocks would still be overvalued.  That is how extreme this bubble has become.

Other key valuation measures also indicate that stock prices have gotten wildly out of balance.  The following example comes from a Motley Fool article entitled “Here’s Why You Should Expect a 20% Stock Market Crash in 2021”…

Looking back 150 years, the S&P 500 has averaged a Shiller P/E of 16.78. Admittedly, the Shiller P/E ratio has been a lot higher over the past 25 years. The advent of the internet has broken down information barriers for retail investors, and historically low lending rates for more than a decade have fueled borrowing and lit a fire under growth stocks.

But as of Feb. 3, the Shiller P/E for the S&P 500 was knocking on the door of 35 — more than double the long-term average. To put this figure into some context, there have only been five periods in history where the Shiller P/E ratio topped 30 and stayed there during a bull market run. Two of these events — the Great Depression and dot-com bubble — led to some of the biggest pullbacks ever witnessed in equities. Two other events (not counting the current move) occurred within the past three years, delivering declines of 20% and 34%, respectively, in the S&P 500.

Basically what this is saying is that if stock prices fell by half, the Shiller P/E for the S&P 500 would still be above the long-term average.

So if the market only falls by 20 percent this year as that Motley Fool article is suggesting, we should consider ourselves to be extremely fortunate.

We have never seen anything like this before.  The bubble that we are in now absolutely dwarfs the epic stock market bubbles of 1929 and 2000.  Stock market mania has gripped the entire nation, and all sorts of people have been getting rich, at least on paper.

But many Wall Street veterans that have been watching all of this transpire have become extremely concerned.  The following comes from a Forbes article entitled “Is The Stock Market About To Crash?”…

‘Very, very concerning’ echoes of the 90s dot-com bubble are being heard loud and clear by nervous market experts. A 12-year-old bull market; SPAC mania; IPOs that more than double on the first trading day; an army of amateur traders and GameStop mania. It certainly feels like irrational exuberance–and it triggers alarms for those who remember the dot-com bubble of the late 1990s. “The parallels we have today are historically very, very concerning,” notes Jim Stack, president of Whitefish, Montana’s InvesTech Research and Stack Financial Management. “The current froth is the icing on the cake, and when you look through it, you see a lot of other underlying issues.”

In this sort of environment, videos by kids on YouTube showing people how to make a million dollars by day trading stocks get hundreds of thousands of views.

If you have been able to make a lot of money by playing the stock market, good for you.

Just make sure that you get out in time.

Every other stock market bubble in U.S. history has ended badly, and as John Hussman recently noted, this is our generation’s moment of peak financial insanity…

Nothing so animates a speculative herd as a parabolic price advance in an asset detached from any standard of value. I am convinced that future generations will use the present moment to define the concept of a reckless speculative extreme, in the same way our generation uses “1929” and “2000.”

So just how far does Hussman think the market could ultimately fall?

Well, he believes that stock prices would have to drop 65 to 70 percent just to get back to historical norms…

Understand how extreme current valuations have become. In order to simply touch run-of-the-mill historical valuation norms, the S&P 500 would have to lose somewhere in the range of 65-70% over the completion of this cycle.

Stock prices always, always, always get back to their historical averages eventually.

It is just a matter of time.

However, we should hope that a stock market crash can be put off for as long as possible, because a truly catastrophic stock market crash would cause far more economic pain than we have experienced so far.

Our system simply would not be able to handle a decline of 50 percent or more in stock prices.  It would essentially mean the end of our financial system as we know it today, and that is something that nobody should want.

The good news is that I do not expect a stock market crash within the next 30 days unless some sort of major “trigger event” comes along.

Stocks may go down, but for the moment I expect at least a short-term period of relative stability.

But that short-term period of relative stability will not last very long at all, and I fully expect 2021 as a whole to be a very, very painful year.

***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***

About the Author: My name is Michael Snyder and my brand new book entitled “Lost Prophecies Of The Future Of America” is now available on Amazon.com.  In addition to my new book, I have written four others that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned)  By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe.  I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe.  I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article.  The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions.  I encourage you to follow me on social media on Facebook, Twitter and Parler, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

The Exact Same Thing That Is Happening To GameStop Is Eventually Going To Happen To The Stock Market As A Whole

A stock is only worth what someone is willing to pay for it at a particular moment in time.  Sadly, this is a lesson that many GameStop traders are learning right now.  Just a few days ago, GameStop had surged above $300 a share and a lot of investors that had gotten caught up in the frenzy thought that they were suddenly rich.  But you only make money in the stock market when you get out.  Those that sold at the peak of the bubble were extremely fortunate, but most GameStop investors are determined to hold on to the bitter end, and the end will definitely be quite bitter indeed.

I think that it is great that a horde of retail investors want to punish the short sellers, but GameStop is definitely not a long-term investment.

In fact, the fair value for a share of GameStop stock is probably less than a dollar.

So it was quite bizarre that “the Reddit army” was able to push the price of the stock to more than $300 a share.  Ultimately, any really determined group of investors can temporarily pump up the price of any stock, but in order for it to stay elevated there must be buyers that are willing to purchase the stock at that level day after day.

Everyone knew that GameStop was going to come back down, and that has happened in dramatic fashion during the last two trading sessions…

Shares of GameStop sank further on Tuesday, with shares of the volatile retail-trader favorite sliding 60% to finish at $90 per share.

The tumble follows a more than 30% drop during the regular market session Monday after finishing at $325 per share on Friday. That brings the two-day loss to 72%.

For the sake of GameStop investors, I hope that the stock bounces back a bit on Wednesday, but it is just a matter of time before it returns to a level that is much closer to fair value.

Some investors such as Dave Portnoy got really excited about what Reddit traders were trying to do, and he got in at the very top of the bubble.  Now that several of those stocks have cratered, Portnoy has lost approximately 700,000 dollars…

After the bell, Portnoy provided an update on his AMC, NOC, and NAKD positions. He said he bought them at the “absolute high” and sold them at the “exact bottom.” In total, he said losses amounted to $700k, something we noted earlier.

That has got to hurt.

Others have also seen the value of their stock holdings drop in precipitous fashion.

For example, Keith Gill saw the value of his holdings in GameStop drop by 13 million dollars on Tuesday alone…

Keith Gill — who goes by DeepF——Value on Reddit and Roaring Kitty on YouTube — says he suffered a loss north of $13 million on Tuesday alone from his GameStop bet, but he’s still not selling.

He’s the man who helped inspire the epic short squeeze in GameStop last week that sent shockwaves through Wall Street. Through YouTube videos and Reddit posts, Gill attracted an army of day traders who cheered each other on and piled into the brick-and-mortar video game stock and call options, creating a massive short squeeze as the shares jumped 400% last week alone.

I know that he says that he is doing this to make a point, but I have a feeling that someday he is going to look back and kick himself for not selling when he had the chance.

Golden opportunities come along very rarely in life for most people, and when they do it is important to take advantage of them.

Of course one of the big reasons why GameStop crashed was because Robinhood had restricted trading in that stock, and now that the stock has crashed Robinhood is rolling back the limitations…

Robinhood on Tuesday rolled back more of its trading limitations, now allowing clients to buy up to 100 shares of GameStop.

GameStop climbed off the lows as the Robinhood changes were announced.

Speaking of Robinhood, this whole episode has exposed the fact that they were never actually “looking out for the little guy” at all.  The following comes from Senator Josh Hawley…

Enter Robinhood—as in, steal from the rich. Robinhood was the trading platform for the little guy. No fees, no hassle. It was Big Tech, once again, allegedly democratizing another sphere of American life captured by elite control. But like the tech platforms, Robinhood wasn’t really about its users. Its bread was buttered by selling the data on users’ trades to the big players—the elite guys, like Citadel—to give them inside tips on where retail investors were sending their money. And the Citadel guys, in turn, pay off their regulators—like treasury secretary Janet Yellen—in their years away from government for favors when they’re back in power.

What a crooked system we have, but our politicians will never have enough courage to actually try to change it.

And of course the so-called “guardians of democracy” in the mainstream media relentlessly defend our extremely corrupt system.

Sadly, it is just a matter of time before the entire house of cards comes crashing down for good.

The talking heads on television are preaching to us about the dangers of “the GameStop bubble”, but the truth is that our entire stock market has become one gigantic bubble.

As I keep reminding my readers, if the market were to drop by 50 percent tomorrow, it would still be way overvalued.

Price to earnings ratios always return to their historical averages eventually, and it will be no different in our case.

Of course we should hope that the eventual crash can be put off for as long as possible, because the collapse of the stock bubble will severely hurt millions of people financially.

But as sure as you are reading this, it will happen.

So I really don’t want to hear any more babbling from the sanctimonious idiots in the financial community that are trying to tell us that GameStop investors “had it coming”.

Yes, everyone could see that the GameStop saga was not going to end well, but everyone should also be able to see that things are not going to end well for the market as a whole.

If you can make some money in the short-term by playing the stock market, that is great.

But as our friends at Zero Hedge like to say, “on a long enough timeline the survival rate for everyone drops to zero”.

***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***

About the Author: My name is Michael Snyder and my brand new book entitled “Lost Prophecies Of The Future Of America” is now available on Amazon.com.  In addition to my new book, I have written four others that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned)  By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe.  I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe.  I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article.  The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions.  I encourage you to follow me on social media on Facebook, Twitter and Parler, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

Guess Which Side The Corporate Media Is Taking In The GameStop Story…

You would think that a plucky group of Internet rebels standing up to a bunch of notorious hedge funds and short sellers would be a story that even the mainstream media should be able to get right, but apparently that is not the case.  As you will see below, the corporate-controlled media is attempting to convince all of us that the hedge funds and the short sellers are actually “the good guys” and that the “Reddit army” that is taking them on is a bunch of dangerous insurrectionists that are a threat to the entire system.  Of course I suppose that it shouldn’t be a surprise that the corporate-controlled media is standing up for the establishment, because the establishment showers them with millions of advertising dollars.  But it really has been disgusting to watch them totally sell out like this.  If you listen to the mainstream media long enough, you would be tempted to believe that we now live in a “Bizarro World” in which everything that was once evil is now good and everything that was once good is now evil.

Just within the past few days, the New York Times has called the “Reddit army” a “rebellion”, Investing Daily has referred to it as an “insurrection”, and NBC News has used the word “insurgency” to describe it.

But first prize actually goes to the Washington Post.  They had the gall to run a story entitled “The good guys in the GameStop story? It’s the hedge funds and short sellers”…

The Gamestop speculators are not merely in a frenzy about one stock. Their goal is to destroy the traders who link stock prices to fair value. To suggest a political analogy, they are not just blindly devoted to their candidate; they deny the legitimacy of the opposition party. They are not just acting within the system; they want to overthrow the system. It’s as though — just imagine — a rabble gripped by conspiracy theories were to attack the rules of democracy itself. The name “Gamestop” is apt.

Are you kidding me?

What is next?  Is the Post going to come out with a story about how Luke Skywalker was evil because he wanted to overthrow the established order that Darth Vader and the Emperor had instituted across the galaxy?

The official slogan of the Washington Post is “Democracy Dies In Darkness”, and that is quite ironic because they have totally gone over to the dark side.  In the same article that I just quoted above, the Post laughably asserted that “a market without short sellers” would be like “a political system without investigative journalists”…

What about short sellers? These are specialists who research stocks that might go down, sometimes because bosses are illegally covering up bad news about their companies. When short sellers identify a case of fraud or similar, they borrow and sell the stock, hoping to buy it back at a lower price later. Again, there is nothing evil about this. To the contrary, it’s a way of keeping prices honest. A market without short sellers is like a political system without investigative journalists.

Yes, let us take a moment of silence right now to acknowledge all of the wonderful contributions that short sellers have made to our society.

It really has been amazing to watch the lengths that some in the mainstream media will go to in an attempt to demonize the retail traders that have banded together to go after the short sellers.  On CNN’s website, Chris Cillizza did his best to try to turn the “woke mob” against the Reddit traders by linking them with Trump.  The following comes from his article entitled “How Trumpism explains the GameStop stock surge”…

The point is that there is no real point beyond showing up the pros — proving to them that they aren’t as smart as they think they are and that they don’t have the ability to control everything.

Which, again, has its roots in Trumpism. The entire notion of Trump’s candidacy and presidency was to stick it to the elites. And then, well, uh, there wasn’t really a plan beyond that. The screwjob was the point.

Others have gone even farther.  To me, it was extremely offensive when former SEC Commissioner Laura Unger compared the short squeeze on Wall Street to the rioting at the U.S. Capitol.

Of course whenever something happens that the establishment really doesn’t like, it is just a matter of time before they start blaming Russia.

The other night, Jimmy Kimmel suggested that “maybe even some Russian disrupters” were at least partially responsible for the chaos on Wall Street, and MarketWatch actually published an article entitled “The GameStop saga is a road map for the Kremlin and other enemies of America”.

Ever since the 2016 election, Russia has become the ultimate boogeyman.

If something major goes wrong, Russia has to be blamed for it somehow.

President Trump at least attempted to keep our relations with Russia fairly stable while he was in office, but now that he is gone I have a feeling that U.S. relations with Russia are going to completely fall apart.

But that is a topic for another article.

Getting back to the topic at hand, the short sellers only have themselves to blame for what happened.  The number of GameStop shares that had been sold short was greater than the number of GameStop shares that actually existed, and that was a golden invitation for anyone that wanted to attempt a massive short squeeze.

If it wasn’t the Reddit army, it was probably going to be someone else.

What a year this has been already.

On the first Wednesday of 2021, there was a massive riot at the U.S. Capitol.

On the second Wednesday of 2021, President Trump was impeached by the House of Representatives.

On the third Wednesday of 2021, Joe Biden was inaugurated.

On the fourth Wednesday of 2021, the GameStop short squeeze made headlines all over the globe.

So will something historic happen this Wednesday?

We shall see, but without a doubt the chaos that we have witnessed so far is just the very start of our troubles.

Everywhere you look, people are extremely angry.

And everywhere you look, our system is being greatly shaken.

Most Americans are sick and tired of the corruption and injustice that they see all around them, and they know that our “leaders” aren’t going to do anything about it.

People are increasingly taking matters into their own hands, and the Reddit army is thrilled that the hedge funds and the short sellers can finally feel their fury.

But fury is not going to fix our system.

At this point, nothing will.

***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***

About the Author: My name is Michael Snyder and my brand new book entitled “Lost Prophecies Of The Future Of America” is now available on Amazon.com.  In addition to my new book, I have written four others that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned)  By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe.  I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe.  I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article.  The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions.  I encourage you to follow me on social media on Facebook, Twitter and Parler, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

Is ‘The Reddit Army’ On The Verge Of Creating The Most Epic Silver Short Squeeze In U.S. History?

In all of the years that I have written about precious metals, I have never seen anything like this.  The corporate media is breathlessly reporting that “the Reddit Army” plans to do to silver what it did to GameStop, and this has caused a frenzy of buying and a severe shortage of physical silver at dealers all across the United States.  If things are this crazy already, what is going to happen when the short squeeze actually begins?  For now, “the Reddit Army” is still primarily focused on GameStop and other stocks that major hedge funds have been relentlessly short selling, and in recent days members of that army have actually been purchasing billboard ads to celebrate their success…

The billboards show a unified support for the investors who have driven up the price of GameStop – which was at $2.57 at its lowest point last year – to over $483 a share.

“$GME GO BRRR” read a digital billboard in New York City, with brrr referring to the sound a money-printing machine makes.

The West Coast similarly joined in, with an airplane flying over Santa Monica reading “WE ARE ALL GAMESTOP WALLSTREETBETS.”

I expect that GameStop and other stocks that have been specifically targeted will continue to be the primary focus for “the Reddit Army” during this upcoming week.

But there continues to be quite a bit of discussion on r/WallStreetBets about the potential for a silver short squeeze.  The following is one example…

Silver Bullion Market is one of the most manipulated on earth. Any short squeeze in silver paper shorts would be EPIC. We know billion banks are manipulating gold and silver to cover real inflation.

Both the industrial case and monetary case, debt printing has never been more favorable for the No. 1 inflation hedge Silver.

Inflation adjusted Silver should be at 1000$ instead of 25$. Link to post removed by mods.

Why not squeeze $SLV to real physical price.

Think about the Gainz. If you don’t care about the gains, think about the banks like JP MORGAN you’d be destroying along the way.

And even though there hasn’t been much action yet, anticipation about what could be coming has pushed the price of silver up quite a bit since Thursday…

Silver has risen nearly 15% since Thursday, when posts began circulating on Reddit urging retail investors to buy silver mining stocks and iShares Silver Trust, an exchange traded fund (ETF) backed by physical silver bars, in a GameStop-style squeeze.

Demand has been even more intense for physical bars and coins.

On Sunday, several major silver dealer websites warned of delays in processing orders…

Retail sites were overwhelmed with demand for silver bars and coins on Sunday, suggesting the Reddit-inspired frenzy that roiled commodities markets last week is spilling over into physical assets.

Sites from Money Metals and SD Bullion to JM Bullion and Apmex, the Walmart of precious metals products in North America, said they were unable to process orders until Asian markets open because of unprecedented demand for silver.

There have been runs on physical silver before, but I don’t remember ever seeing anything of this nature.

Just check out what the CEO of SD Bullion just wrote…

In the 24 hours proceeding Friday market close, SD Bullion sold nearly 10x the number of silver ounces that we normally would sell in an entire weekend leading to Sunday market open.

In a normal market, we normally can find at least one supplier/source willing to sell some ounces over the weekend if we exceed our long position (the number of ounces we predict we will sell over the weekend).

However, everyone we talk to is afraid of a gap up at Sunday night market open.

This is about ready to get really interesting as there was very little inventory left from suppliers/mints going into Friday close.

Our direct AP supplier informed us after close on Friday that the “US Mint will be on allocation for the remainder of Type 1” (Current Silver Eagle Design).

Our sales for the month of January exceeded any one month last year during the heart of the pandemic. It was an all-time record month in our company history. 

The higher the price of silver shoots up, the more severe the supply crunch is likely to become.

Of course the truth is that manipulation by the big banks has kept the price of silver much lower than it should have been for many years.

If the ratio of the price of silver to the price of gold were to simply return to historical norms, the price of silver would be well over 100 dollars an ounce.

And unlike gold, silver is a very important commercial commodity that is used in a whole host of high tech products.  This is something that James Rickards pointed out in one of his recent articles…

Silver is a commodity used in many industrial processes, including water purification, tableware, solar panels, electrical contacts, X-Ray film, mirrors and medical instruments. It’s the best electrical conductor of any metal. It is also used in automobile emission control equipment. All of these industrial and scientific applications qualify silver as a commodity input.

It is fun to invest in stocks like GameStop, but the fundamentals for such companies are not good at all.

On the other hand, the long-term fundamentals for silver are exceedingly good.  Whether the price of silver surges in the short-term or not, in the long-term it must go much higher.

Large financial institutions have been working very hard to keep the price of silver depressed, but as Egon von Greyerz has pointed out, in the end they will inevitably lose this battle…

The silver market is one of the most toxic of all. Heavily manipulated and with bullion banks now being 100 million oz of silver short on Comex and with no liquidity in London, as Alasdair Macleod has pointed out.

Still, even if not in the next week or two, silver will win this game in the medium- and long-term as the dosage of paper silver shorts is much too big to survive a short squeeze.

I really do hope that the Reddit Army commits to a silver short squeeze.

But whether it really happens or not, the price of silver will keep going up.

Many investors don’t realize that silver actually outperformed the stock market in 2020.  It was up more than 47 percent for the year, and the hyperinflationary policies of our leaders will make 2021 another good year.

Throughout human history, precious metals have been a hedge against inflation, and today is no different.

Hopefully the Reddit Army will decide to get on the bandwagon, because what they have accomplished so far is absolutely breathtaking.

***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***

About the Author: My name is Michael Snyder and my brand new book entitled “Lost Prophecies Of The Future Of America” is now available on Amazon.com.  In addition to my new book, I have written four others that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned)  By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe.  I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe.  I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article.  The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions.  I encourage you to follow me on social media on Facebook, Twitter and Parler, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

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