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5.17.2015 Financial Intelligence Report Bookmark

Are You Scared?

When I talk to people that I consider to be “awake” they all tend to say the same things to me. Almost to a tee, they suggest that they feel something isn’t quite right, but they don’t know exactly what. They feel like things are out of control, but can’t say why. They feel there’s some form of impending doom, but can’t explain what it is, or why they even feel that way.  They just know things aren’t right, but for the life of them, they can’t elucidate just why they feel that way.

Are You Scared?

When I talk to people that I consider to be “awake” they all tend to say the same things to me. Almost to a tee, they suggest that they feel something isn’t quite right, but they don’t know exactly what. They feel like things are out of control, but can’t say why. They feel there’s some form of impending doom, but can’t explain what it is, or why they even feel that way.  They just know things aren’t right, but for the life of them, they can’t elucidate just why they feel that way.

I understand that feeling and it is real. You know it in your mind, you almost feel it in your gut. It’s not just the rioting, it’s not just the crazy things like Jade Helm, it’s not just the soggy economy, it’s not just the loss of morals, it’s not just the mindless souls staring like zombies at their cell phones, it’s not just the insane Political Correctness, it’s not just the laws for the privileged versus the laws for the masses,  it’s not just any one thing. It’s a combo platter of all of that and considerably more. In a word, many of you are “worried” and I think rightfully so.  You just hide it well.

The old analogy is “whistling past the graveyard”.  Popular in the 30’s, its definition is “To attempt to stay cheerful in a dire situation; to proceed with a task, ignoring an upcoming hazard, hoping for a good outcome.”  I remember quite well using an example of whistling past the graveyard when I was a youngster.  I was 12 years old and my neighbor Matt and I had walked to the movies to see a show. Slated to end at 9 pm, the theatre was just half a mile from our house and back then kids could walk home safely in the dark.

After our movie was over, the theatre announced that they were going to run a “sneak preview showing” of a brand new movie called “night of the living dead”.  It was a Saturday evening and Matt and I phoned home quickly to see if we could stay and watch the “free” movie. We got the okay.

If you’re not familiar with the film, it’s about a group of folks that find refuge in a farm house after the population had been turned into flesh eating zombies. Well, it scared the Bejesus out of the both of us. On the way home, we had to take one short path through some woods, and we did our version of whistling past the graveyard by talking really loud to each other and making fun of the ghouls because they were so fake. Truth is we were scared witless and awful glad to get home.

I see a lot of whistling past the graveyard. You ask folks “hey, how are you doing” and they respond, “oh fine, thanks” but then later you find things aren’t so fine. They’re behind on their mortgage, the kids can’t find jobs, medical is eating them alive, etc etc. Every story is different, but similar. They aren’t fine in the classic sense that we all used to be.  They’re whistling.

I wanted to write this to let you know, you’re not alone. If you have that feeling that things aren’t right, and you’re concerned about the future, you’re in fine company. You have every reason to feel that way because indeed there’s so many things going on that it becomes overwhelming.  Let’s face it folks, the three biggest selling drugs in America are anti-depressants, anti-acids, and Erectile dysfunction medicine. That alone should give you a good insight into the stress of modern day living.

I think the key to remaining sane in this modern world is picking your battles. You can’t fight everything. If you’ve got one pet peeve chewing on you, then go after it with gusto. Maybe you can join forces with other folks bothered by the same topic, and get something done about it. But don’t try and take on all the ills, it will drive you crazy, exhaust you and make you miserable.

People often ask me why I don’t talk about such things as Ferguson or Baltimore. Why I usually don’t comment on the gay movement, or the lesser number of Christians in the past ten years. Well the fact is I have very strong opinions on such things, and many more to boot. When I see a child get expelled for chewing a pop tart into a “gun shape” don’t you think my head explodes? It most certainly does. I think the loss of common sense in America is one of the things that bothers me more than anything else. Where the hell did it go???  When I see the loss of Freedom’s we’ve experienced, it saddens me to the core.

But again, you can’t fight everything. We try our best to tell you what’s happening in global finance, who the elites are, what their angling towards and how best we can profit or protect ourselves from them. That battle alone is all consuming as far as time and energy goes. Why? Because what happens at the upper end of elitist banking will trickle down and affect virtually every aspect of your life. From taxes, to interest rates, to employment opportunity, to wars, to politicians, to you name it.  I have enough battle on my hands, that’s for sure.

I’d love to tell you it’s all going to get better, but alas, I cannot. Each day gets more bizarre than the next. The worst part is that from where I sit, most of it stems from the financial side of the story. The struggle going on globally to deal with a quadrillion in derivatives, and dozens of completely broke nations, tends to toss normality out the window in a big way. Governments can ram all sorts of things down your throat when you’re more worried about your paycheck than keeping an eye on their criminal activity.

Just consider the abject insanity of this…on Wednesday  we had the worst retail sales report since 2009.  On Thursday the WSJ reported that we have just come through the worst month of economic reports since the great recession. So what did the market do Thursday? It ran to a new all-time high on the S&P.  Are markets supposed to soar to new highs on economic reports this bad? No. But in 2015 they do, because the market is broken. It’s all about Central planners, central bakers, Wall Street wizards. It’s all about selling debt to buy back stock, it’s about the Swiss National bank owning billions upon billions of US stocks.

You’re right to be confused, concerned and at times mad. The world has been turned upside down. College costs more than my first house. Race relations are at an all time low. Despite the war on drugs and the war on poverty, we have more of both in huge supply. Civility is gone. Road rage is the norm. The police are being militarized, and scary joint exercises are being played out in 20 states. The price of protein is out of sight, and chicken, and burger has hit yet another all time high. Seafood has become completely out of the question for tens of millions.  I could go on for ages.

My point isn’t to be an “angry white guy” as I was called recently. Hell I keep collecting nicknames all the time. I’ve been Negative Nancy, an angry white guy, and that conspiracy nut Bob just in the past month. My point is simply to say to you all, it’s real. What you’re feeling is legit.  Something is coming and only your imagination will limit what it could be. How do I know something’s coming? Because we cannot keep spinning ever more out of control for ever. Something’s got to give.

I don’t know how we fix inner cities, I really don’t. I don’t know how we get politicians that don’t lie to us. I don’t know how to fix a justice system that has one set of laws for the Hollywood and rich, and another set for us peon’s. I don’t know how to get common sense back. I don’t know how to defeat political correctness. I simply have a feeling that it all has to play itself out, burn itself out.

And I think the spark that lights the fire is some form of economic reset. Something pretty big that shakes us to the core for a while and we collectively wake up and decide we’ve been going down the wrong path for too long and it’s time to rebuild. Empires that begin to lose control don’t tend to fix themselves and return to what made them great, they tend to be faced with something major that forces them to change. War, bankruptcy, revolt, etc.  I think we’re on that path. And yes it hurts to say that.

So no, you’re not crazy and things are indeed strange and getting stranger. Everyone’s whistling past the graveyard. Something’s coming and it’s my job to try my best to figure out what it is, and how we can get around it. So far the only thing that makes the most sense to me is a global economic reset, and the disruptions something like that will bring. Maybe I’m wrong and imagining all this…but I don’t think so.  

If you’ve been with us for any length of time, you know that the thrust of most of my articles is “what can we do about it?”  It’s one thing to rant and rave about all the lunacy we see each day, but it’s something else to try and lay out real plans to deal with it. Well I tend to think that it always starts at “home”.  All you can do is make your family the best it can be. That’s financially, educationally, defensively, etc.  You’re not going to alter the tides of societal change. All you can do is alter yourselves. Once your situation at home is as good as you can make it, can you then reach out and try and “fix” other things.

Let me leave you with this thought. The President is working on his pet trade agreement. So secretive is the content of that agreement, that word is if you’re in Congress and want to see it, you have to meet one on one in a basement office. You cannot take in a cell phone. You are given the pages one section at a time and must be returned after reading while you’re watched. You are then sworn to not discuss what you’ve seen. This is what passes today for our “Government for and by the people”. It’s nothing of the sort. This is Government for and of the elitist corporations and one world thinkers. You simply get in the way.
If your elected officials have to create pacts and agreements in total secrecy and then we have to “pass it to find out what’s in it” the idea of a free Republic is no more.

So you’re right to whistle past the grave yard. You’re right to have that ugly feeling in your gut. You’re right to think that as much as you hope for the best you fear for the worst lately. In all the years I’ve been writing this, which actually started in 1994, some 21 years ago, I’ve never been as “worried” about our future as I am today. That says a lot because I’ve come through some big things in my life, from Vietnam to 9/11 to the 2008 crash.  

95% of all my articles are designed to enlighten you to what we really see going on, and provide some path to profit from it, or protect yourself from it. It’s all I know how to do. Stay tuned.

The Market…

Trumpets, Kazoo’s and waving flags, we had it all Thursday and Friday. Why? Because the S&P set another new all-time high. It didn’t matter that first quarter GDP was negative. It didn’t matter that the official retail sales report was the worst since 2009. It didn’t matter that the WSJ said we’ve “just come through the worst set of economic reports since the great recession”. Nope, none of it mattered. All that mattered was that the central planners created a debt based system footed by ever rising asset prices. So they had to make them rise some more, even in the face of horrific reports.

Yet we do have to question the authenticity of the break out. For two months they’ve been working on trying to goose the S&P up and over 2117 which was the March 2 all time high. They did it Thursday and added another point Friday. Yet the internals of the market didn’t go wild. For instance on Friday the XLF which is the ETF for the financials, was actually negative on the day.  The IWM or “small caps” couldn’t break over their 50 day moving average. For such an important overall level, the broad market just didn’t participate.

So is this breakout to new highs on the S&P real, or is it going to fail? Let’s consider.  For the past two months, my stance was that we would indeed challenge that March 2 high. Despite trying over and over, yet failing and falling each time,  I didn’t waver in my belief that they’d keep trying. Well they did that. Then a few weeks ago I changed my thinking to one in which not only would we attack the old highs again, we’d probably get “up and over” them. Well we just did that. So now we have to wonder if it will all hold up and the market pushes for a new leg up, or if it fails to hold this level.

So far they’ve held it, but it hasn’t been easy. ON a break out you want increased volume and we didn’t get it. You want broad market participation, and we haven’t gotten it.  The DOW transports are well below their 50 day moving average and 600 points below their highs.  The semi’s ( semiconductors) haven’t even reached their April highs, let alone the March 2 high. So all in all, the “indicators” of market participation are pretty weak.

However other market indicators such as advance/decline readings, RSI’s, stochastics, etc, point a stronger picture. The take away is that the breakout has held for now, but if the participation doesn’t broaden out, it won’t hold for more than a few days. If however they get some more volume and more stocks join the party, we could indeed see the last hurrah push forming.

I tend to think that they’ll throw the kitchen sink at holding us up. That would tend to get some selling in bonds, as they try and cash out of “safety” and rush into more stocks. We could see a quick rush higher in equities, but a rush that burns out quickly and we roll over into a long correction.

But I think the big picture point here is this…if this breakout holds and we do see the market run higher, I don’t think it has long legs. In other words, what’s the upside potential? Frankly I don’t see too much.  I’d be surprised to see us gain more than say another 300 on the DOW and maybe 30 – 60 on the S&P before we exhaust ourselves and see a pretty hefty pull back.

Why do I say that? Because the market is evil at times. Think about it like this. For years now this market has pushed higher in the face of every ill you could conceive. An almost hot war in Ukraine, Isis running amok, horrid economic reports, lousy employment participation numbers, you name it. But then after March 2, it struggled mightily to hold the gains. Money started leaving equities in droves, with reports showing more than 70 billion dollars being pulled out of stock funds.

If the market starts to advance again, a lot of that money will flow right back in. Would it not be just like Mr. Market to suck everyone in, give them the illusion that this market is destined for much higher, and then behind the scenes go short and yank the rug on everyone? It certainly would. And that’s what I think they’re going to do.

So while it’s not written in stone, and yes this breakout could fail here if there’s not some more participation…if they pull it off, I think it’s the beginning of the end.  As long as they keep the S&P over 2117, we should see them pull the financials/small caps/Semi’s with them and give us one more shot higher. If however 2117 fails for more than a single close or two at the most…they very well might not be able to get it back together and I think we’ll correct rapidly.

Good luck out there folks and we’ll chat again on Wednesday night.

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