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6.7.2015 Financial Intelligence Report Bookmark

Cash Out Auto Loans!

I really do have to thank Trader Rob, Ted, Gary, Chuck, Bryce, and a host of other “good guys” that I talk to on an almost daily basis. Because without them, I’d swear I was going crazy and making up some of the stories I relate to all you folks.  But no, apparently I’m still sane, it’s the world that’s lost it’s marbles.
Cash Out Auto Loans!

I really do have to thank Trader Rob, Ted, Gary, Chuck, Bryce, and a host of other “good guys” that I talk to on an almost daily basis. Because without them, I’d swear I was going crazy and making up some of the stories I relate to all you folks.  But no, apparently I’m still sane, it’s the world that’s lost it’s marbles.

Consider the following diatribe Rob went on when we were discussing a page I found on Well’s Fargo’s web page. I had seen an ad, suggesting I should let my car “work for me” and did a bit of investigating to see what that was about. Well, this I have to say was a new one on me, and frankly I don’t like to get blindsided by not knowing what the crooks are up to.  But what I found both at Wells Fargo and PNC bank, got me pretty dumbfounded for a bit.

Well’s will loan you up to 160% of the value of your car, if you refinance it through them. Let’s see what Trader Rob had to say, when we discussed this particular fiscal insanity….


From 2005-2007 it was the "Bank of House" by proxy of cash out refi's which went to granite counter tops, pools and extra BMW in the driveway for the trophy wife in a rugbyish scrum to keep up with the Jones's next door. That worked out well of course. (Not)  So, fast forward to 2015 and now we have the "Bank of Auto" where you can obtain cash in a refi of your car. So if you're driving a 2012 corolla, and it's worth 10K, they'll give you 16K. You get 6 k for ipads and phones.

Whether payments can be maintained by all the debt serfs, the majority of which are sub prime aficionados is irrelevant. All that matters is the paper (the loan) that can be sold by the auto cash loan originator, to an investment bank; where it enters the securitization hamburger machine packaged together with other dubious paper and resold as a high yielding ABS- Asset Backed Security to the same dupes who bought the circa 2007 mortgaged backed variety

 Of course these ABS are perfectly fungible as collateral to be pledged against the purchase of more glistening horse crap Asset backed securities,which are rephypoethcated multiple times over.  All completely unregulated and uninsured. This feeds the virulent demand for more dubious paper to be sliced and diced in a system that is solely reliant  upon producing “ever more” in an increasing expansion.

 To keep the system alive, the velocity of collateral, or speed at which collateral is turned over must continue or  “the system gets it.”  As with any ponzi scheme it must rely upon continual expansion, as every level of debt serves as a basis in price for a new level of collateral. Wash/rinse/repeat.


I agree whole heartedly with his feelings. That is why there are now “rental based securities” where literally - housing rental agreements- are collected into a tranche, and sold off as an “asset backed security”. There’s solar backed securities, Mortgaged backed, resource backed and now of course “car loan backed” securities. One would have thought that the spectacular way the mortgaged backed securities blew up via Robo signing of McDonald’s fry cooks to 700,000 dollar houses would have taught us a lesson. But no, evidently not.

So in our ever hungry world for something they can consider an asset and sell to someone looking for a return, we’ve run the gambit of things they’ll collateralize. But when one considers that a very significant portion of car loans are indeed given to folks of questionable credit, called “sub prime” one has to wonder how ugly that will get when they decide not to pay any more.

But it does bring up other questions. If your car is “worth” (according to a respected outfit such as Kelly Blue book or Edmunds) say 10K, how can they justify loaning you 16K? Because even if they had to repossess it, chances are it would get wholesaled at maybe 7K at best. How’s that work? Somehow loaning more money than the value of the underlying asset ( the car) seems pretty risky to me, as that’s nothing more than a signature loan at that point.

I think the answer is found in Rob’s tirade above. They DON’T CARE if you can pay it back. They’ve bundled that crap paper and sold it to some pension manager, possibly overseas. And so it goes. This gets spooky folks…

 Follow the plot to its conclusion… the oligarchy drives interest rates to zero or lower, which means the only way to have even a chance of generating a return is to invest in super-risky products and derivatives.  Now remember what I wrote about on Wednesday about the case of Tibble vs. Edison where the Court said that if a 401K fails to perform or incurs losses they deem unacceptable, the State has the right to seize the fund.

 So when either the funds fail to perform due to a lack of yield on “safe products”, or due to losses incurred on a high-risk portfolio, the State rushes in to save the people. Basically we’re getting set up for a situation worse than in 2008, (where they rushed in to save the banks and left the middle class on their own.)  This time, the angle will be that they’re going to make it so dangerous and onerous that people will be more than glad to rush to “Uncle Sam” for protection.  Like exchanging your holdings for Government “MyRA” treasuries.  

Now let’s change gears for a minute and talk about the big picture for a minute. I think this is VERY important. Each of you has to determine for yourself what the future looks like. Depending on where you get your information from, will probably determine where you let your mind go on that topic.. For instance if you read and believe the main stream media, or Wall Street, etc, they’ll tell you life will go on just fine, “same as it ever was”.  But the net is full of alternative media outlets, where you can run the whole gambit of future outcomes. I’ve seen sites that profess to be the real truth tellers, where hidden planets return, shape shifting reptiles rule the world, and people are enslaved.

Then you have the Alex Jones types. While I’ve seen Alex break many stories that were indeed true, and frankly he’s been one of the most important people in alternative media when it comes to trying to wake people up to some of the ugly truth out there, he’s pretty much in the camp of suggesting the Elites are going to take over the world, imprison and enslave mankind, and make everyone obedient little robots. His vision tends to be that Americans are going to be ruled over by martial law, and you are only allowed to live in your little cubby hole and march to work for the elites. Sort of like a nation wide concentration camp.

I don’t want to be in that camp.  If you take it to the final conclusion, I don’t tend to see the point. But I’m certainly not in the “everything’s going to be fine and normal” camp either. See, in a very real sense we’ve already been enslaved. We talk about our “freedom” but there’s very little of that left. Your life is regulated down to the nth degree. You say your house is yours, but you need a permit from the Government to add a room. You say you own your land, but if you don’t pay taxes on it, they’ll auction it off. You say you’re free to go where you want, but only if you pass their driving tests, buy their insurance, and register your vehicle every year. Your every conversation is monitored; you’re video’d from the moment you leave your house. Freedom of speech is virtually gone now, as anything you offer up as opinion is instantly branded sexist, racist, homophobic, etc.

I could go on an on, but my point is simply this; The elites became elites because they got rich along the way. How did they get rich? They opened banks or major corporations, and made trillions of dollars. They created wars and savaged the losers. They stole from the masses. Families handed down incredible wealth through the ages. Yet their game is and always has been to “make even more”.  And that’s what they will do. Yes the game will change, and their methods will change. Economies will be destroyed, wars will be waged and “they” will be there to make even more when it’s rebuilt.
 

My “fears” if you wish to call them that, are the “transition” periods. For example, there’s very few that think things can go on the way they are with unsustainable debts, broke governments, quadrillions in unknown derivatives, etc. I agree. And debts that can’t be paid, won’t be paid. But as has happened hundreds of times through history, empires fall, while others rise, and the world goes on. We are rushing headlong into one of those transition periods. America, the shining light on the hill, is fading on the world scene as the top dog. With it will come transitional stresses, and it is those stresses that cause me concern. See, no empire likes to fade from glory. The US won’t be any different and will lash out.

Our dollars are junk. Our debts too large. The games played too big and too long. Change is going to come, and it is my opinion that we’re well on the way to that change. So I do indeed believe in some rough patches ahead. That said, I am not calling for the end of the world, or elitist enslavement in FEMA camps or any of the other “fear porn” that’s peddled as our destiny. But there’s a huge difference between a “currency reset/devaluation” and the bumps and lumps that could produce, versus shape shifting reptiles, enslaving mankind. In my estimation, the things like Jade Helm, and the strange military style escalation we see around the nation, is training for any civil unrest that could certainly take place if our currency reset doesn’t go well.  Just one week of bank “holiday” and no welfare checks or EBT cards could cause a lot of towns to burn to the ground.  

Finally, don’t get me wrong. Are there satanic evil scumbags that would like to change the population of the earth down to 500 million, Exterminating billions, worship mother earth as God, and rule the planet? You bet. And throughout history there’s been hundreds of them. Stalin, Mao, Pot Pol and a dozen other lunatics instantly come to mind. I’m also aware of the secret societies that actually run the joint. I’m very familiar with the Club of Rome, the Bilderbergers, Council of foreign relations, the illuminati, Freemason’s, and a host of others. Many of these “people” have horrible ideas for how this planet should be run.  I just don’t think they win. They’ve been trying, some for hundreds of years, and so far…no dice. Are they closer to their “one world government?” You bet, and they won’t stop trying. Again, I just don’t think they get there.

Consider it like this…let’s suppose the most bizarre of Elitist groups got their way, and there was One World Government, and everyone was basically “enslaved” to work for those elitists. Is that not the pinnacle of a Socialist/dictatorship? It is. And what usually happens to nations that have tried that? They fail. Miserably. Even on the grand world stage instead of just a few nations going it alone; without capitalism, no one has the money to buy the products that all these “slaves” are supposed to make. Even the most repressive Governments like China have figured out that letting people “make money” is the only way they’ve gone from a horribly poor nation, to a nation that buys up Mercedes, and Rolex’s.  So while I think the elites do want a Centralized “New World Order”, I stop short of the idea of literal enslavement as many have preached.

As the US lashes out to try and remain the top dog, there are real things that should concern all of us. War, false flag attacks, etc, are all things that could be “manufactured” to try and get us out of our economic mess and push us toward more “world Government”.   

The ills I’m mostly speaking about, center around money and debt. I see a change in the global money system. With that change, there’s going to be periods of unsettle for sure. In the past, broke nations have tried extreme taxation, devaluing the currency, door to door looting of people’s savings, and even war to solve their issues. Will this time be any different? Maybe not, and that’s my fear.  Stay tuned.

The Market…

Don’t look now, but the DOW has lost about 500 points since May 20th.  The S&P has held up better, being down about 38 points from that same date. But make no mistake, the market does NOT look healthy. Not at all.

On Friday we got the non farm payroll report. On the surface it was pretty strong, coming in with a gain of 280K jobs. However it is a bogus number, as 213K of them came from the BLS’s “Birth/Death” model. Jobs that probably don’t exist. Yet the market moves upon the stated numbers out of our Government and 280K gives them fear that the Fed’s will hike rates this year.  Well that’s a problem.

Think about it like this, because the “box” they’re in is really pretty special. On one hand the Fed’s continue to tell us that the economy is improving and jobs are more  plentiful. Yet on the other hand, everyone is scared to death of a lousy 0.25% increase in rates. Well you can’t have a strong recovery if a quarter of one percent rise in rates will blow you up. Sorry.  Everyone knows this. Everyone knows that the economy is NOT as good as the Fed’s say, yet they have to make their investments based on the garbage Uncle Sam puts out. What a mess!

Yet it isn’t JUST the mess here in the States that has investors worried. The Greek comedy that continues to play out has created another ‘push/pull” concerning whether they’ll just continue to kick the can down the road, or if Greece ends up pulling out of the Euro. If they do, will Spain, Italy, Ireland, and Portugal quickly follow?  What happens to NATO?  See, Greek Cyprus has openly stated it wants Russia to host a Naval port there. Does NATO want a Russian Naval base in what was a Euro nation? Hardly.

But Friday Greece didn’t make a 300 million dollar payment to the IMF. That is the first time the IMF has been stiffed since early 1980. The deal is supposedly that Greece will bundle it’s next 3 payments together and make all 4 on June 30th. Yeah, right. Kick that can.

So we’ve got a soggy economy, the Fed’s in a nasty box, the Euro-zone having its own issues, China rattling sabers over the South Sea, a major flare up in Ukraine shelling and a hundred other interesting situations popping up around the globe. What we don’t have is any volume to the upside for stock. For weeks on end, the big volume days were sell days, not buy days. The DOW and the S&P are under their respective 50 day moving averages. What happens now?

I almost can’t believe I’m about to say this, but it looks like we might be on our way to a decent correction. While a bounce from the recent selling is in the cards, it feels like we might be entering a period of lower highs and lower lows for a while. If that’s true, we could eventually see the S&P test its 200 day at about the 2045 level. But we won’t know that this is in place until we see the S&P put in a series of closes below its 50 day first. One, two or three closes under that level have happened several times over the last 3 months, but they’ve always snapped it back up. The first time we lose 4, I’d have to say it’s certain we’re heading considerably lower.

I see no reason to get brave in here. Upside runs only tend to last a day or two and fizzle out. Then we fade down and they try it again and again. But it is getting weaker. Not the most bullish of signs.  Let’s see what they can do, and we’ll chat Wednesday about it.

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