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4.29.2015 Financial Intelligence Report Bookmark

How’s That Workin?

The all seeing, all knowing grand poobah’s which we affectionately call the Federal Reserve; have told us for years that they, and ONLY they know how to steer an economy to prosperity.  Over the years they’ve hiked interest rates, cut interest rates, printed money, bought back Treasuries, “twisted”, QE’d and God only knows what else. So, how’d they do?


How’s That Workin?

The all seeing, all knowing grand poobah’s which we affectionately call the Federal Reserve; have told us for years that they, and ONLY they know how to steer an economy to prosperity.  Over the years they’ve hiked interest rates, cut interest rates, printed money, bought back Treasuries, “twisted”, QE’d and God only knows what else. So, how’d they do?

Today we learned that the first quarter GDP came in at a whopping 0.2%. Yes folks, after all the machinations, after all the huff and bluff, after all the trillions, the economy missed being negative by two tenths of ONE point. Bravo!  What a performance!   If this band of criminals actually had to work for someone and this is the performance they achieve they’d have been fired years ago.

But for anyone that regularly reads all the blather we put out weekly, you’d know that the economy is in recession as we speak. It wasn’t the weather. It wasn’t storms, locusts or hangnails. It is the result of a combo-platter of economic abuse that’s been hefted on us for decades.  I think the much better question of the day would be this…how could our politicians and our Federal Reserve take the single best economy the earth ever saw and kill it in just a few decades?  Notice I said “abuse” and not mistakes. It is mathematically impossible to get that many mistakes in a row. Sorry. Even the most stupid of the stupid occasionally make a decent decision. Not our leadership. Not once.

So if you can’t possibly make that many mistakes which takes the best economy on earth and completely ruins it and turns it into the most indebted economy the planet ever saw…it had to be done on purpose.  Uh oh, that sounds like conspiracy talk, no? No. Just the facts.  The United States has systematically been destroyed from the inside out.  But why? Why would someone, or some group of someone’s want to economically cripple the US?  Because as ugly as this is to try and believe, we are run by bankers and globalists, NOT the people you think you’ve elected to the Senate or the Presidency.

Now we have to ask a question that is somewhat uncomfortable. While it’s true that we have readers in such far off lands as Finland, Germany, Ukraine, India, etc, the bulk of us live right here in the US of A. Well, if someone is out to systematically dethrone the US from its position of “superpower” when it comes to the economy, and you are a part of the US, doesn’t it stand to reason that you are being affected? It does and you are.

Consider the elderly. My mom helped support herself and my dad by utilizing CD’s and bank deposits for years. Now if she puts money in a CD, she loses money because the interest rate doesn’t offset the price rise of food at the grocer. Savers have been punished. Millions have been “downsized” via offshoring, layoffs, and business closures. Many are still upside down on their mortgages after the Fed induced housing bubble. On and on, over and over, we can find real examples of where the decisions by “those at the top” end up screwing with your lives.

This will NOT end folks. Like my old friend John used to say “their mistake and I have to pay”. Yup. Over and over, someone at the top does something stupid or evil and the middle and upper middle class get shafted. Again, that’s not by accident.

A lot of people don’t “get” ( understand) our letters. They sign up looking for the next hot stock or what have you and then see us start the letter by talking about such things as SDR’s, the Yuan, Gold, BRICS, etc and figure it’s all just hot air and they move on. Yet they don’t seem to understand that it is the BIG geopolitical issues that shape their own little worlds. From interest rates, to jobs, to personal freedom’s to education to privacy, to you name it, EVERYONE is at the mercy of the decisions made by people they don’t know and probably wouldn’t like.

If I’m spewing about the IMF’s SDR program, do you think I’m doing it to sound like some goofy spinner head economist?? I assure you I’m not. I try and explain all this junk to you all so that you can see where we’re likely headed next and if there’s anything you can do about it. But let me give you this little gem that you will find repugnant. There is very LITTLE you can do about things. The average man or woman today is completely tied into the system, and if the system wants to screw you, you’re screwed. Period.

Follow along here a minute. If gasoline goes to 5 bucks, what are you going to do about it? You’ll pay for what you can afford. If interest rates go negative like in Europe, what are you going to do about it? You’ll still keep money in the bank. If Obama says you MUST buy his lousy insurance, what did you do? You bought it or the IRS fined you. Shall I go on? Nah, you get it.

When it comes to personal protections, we can teach you tremendous ways to get around problems. From safe rooms, to filtering water, to heat and cooking etc, I could write a darned good book about keeping safe in a nasty time. For instance look at Baltimore and the riots going on there. If that happened in your neighborhood, could you truly protect yourself and your family for a roving band of thugs? Probably not, no matter how John Wayne you think you are because you have a gun laying in your top drawer. Well we can teach you how to fix that.

But when it comes to MONEY, there is VERY little you can do. Let’s face it folks you have paper slips in your wallet with dead Presidents on them. If tomorrow Uncle Sam says they’re worth nothing, just what exactly would you do about it? Nothing comes to mind. Crickets.  If Uncle comes out next year and says that because of the problems we have, all 401K’s have to buy “X” amount of Treasuries. What would you do about it? If Monday night Obama came on TV and said “folks, the globe is going through a rough period and a global monetary reset is happening….” What would you do? Nothing. You’re trapped in their banking system and money system.

I don’t care how successful you are. I don’t care if you’re the owner of a successful small business, or the best teacher your school system ever had. The bottom line is that you are an economic slave to their system. As long as their system remains stable, your life remains wonderful. But changes do happen and we feel we’re on the cusp of a very important change.

Over the next couple months we have to really dissect the convergence of all the issues that come together in September and October of this year. But, and this is the important part, NOT to just discuss the Shemitah or the Chinese Yuan, or the BRICS or Gold or what have you, but to see if there are real tangible things we can do to 1) protect ourselves 2) or profit from what we think is coming.   This fall is literally shaping up to be an incredibly important time, and we’re going to dig in and see what the single best things YOU can do are. So stay tuned.

The market…

The one thing I hammered to my Insiders Club members over and over for days was this…”as we approach the all-time highs, don’t get complacent, as false breakouts are common and the March 2 high could hold as a significant top for a while”.  Well, we knew the market would keep climbing and “attempt” to break out. What we didn’t know was if it would hold or not.

On Friday the all important S&P did eek out a new all time high, but it was only by 17 cents. On Monday they came in ready to really fire up the afterburners, and in moments we were up 90 DOW points. Everyone seemed convinced we were on our way to higher and higher.  Except us . I wasn’t convinced it was going to hold as a one day break of the highs by 17 cents means nothing and without a couple good market closes over the S&P 2117 high, I wasn’t convinced.

Later in the session the bottom fell out and from being up 90 points, we rolled over hard, and ended the day deeply red. Tuesday they came rushing back in, but they couldn’t even get us back to the breakout area. Again, we needed a close over 2117, and we closed at 2114. (S&P) We aren’t interested much in “intra day” highs, the important figure is the closing price.  We closed below the high water mark.

This morning was even wilder. Today was to be Federal Reserve day where the unelected and unaccountable bankers join up and decide monetary policy for our nation. The early morning futures suggested a flattish open and we got that. But it didn’t stay flat for long as we started to see some real selling hit. By noon we were down 150 DOW points and the S&P was all the way down to 2098.  So Friday’s tiny “all time closing high” on the S&P was a failed breakout.  

In very loose terms the S&P generally posts about 10 points for every 100 points the DOW moves. This is NOT a direct correlation and in fact the DOW can be green and the S&P red on the day. But in general, if the DOW is up big, the S&P will be up “big” too. Well, when the DOW falls like a rock, it usually means the S&P is falling too.

Considering the Fed statement wouldn’t hit until 2 pm, it felt a bit odd seeing them let the market fade that far, as usually they keep us somewhat contained on the morning before the actual release. As we got closer to the Fed’s statement at 2 pm, the market had risen off it’s lows and we were down maybe 70 points when the statement hit. So, what was in the statement? Interestingly, not that much…

The first thing to notice about the Fed’s statement was that they removed all reference to calendar months from the statement. They didn’t mention June or July or September or any month. They simply commented on the state of the economy and how they’d be data dependent for the timing of moving rates. Well, the Street didn’t know what do make of that. There had been so much discussion about patience and months, that the removal of both had them all screwed up.

The first reaction was a dip of about 100 points. Then we ran back to where it looked like we’d bust into the green. At one point the S&P was down just 1.5 points. But then it faded again. Up and down we went as we came into the final hour. With just 30 minutes left in the session the DOW was down 70 and the S&P off about 7. Would they make a run for the gold and push us up into the close?  No. We closed down 75.

Okay, so here we sit. The market moves sideways. Dips get bought, rips get sold. This market is going to resolve itself at some point. A couple closes over 2117 on the S&P and they’ll try and get us higher. A couple closes under the 50 day moving average at the 2090 level and we’re heading lower.  In between those two, as we have been for a while, it’s a crap shoot.

There’s one thing that is certain folks. We got a 0.2% GDP for the first quarter. The ONLY reason it was that good was an inventory build. Without that, our GDP would have been DOWN 2.4%.  The market NEEDS more stimulus, it’s a junkie and it’s showing withdrawal symptoms.  They might somehow manage to get us to new highs, but it won’t be on the back of a growing economy. Sorry.

Be careful out there. There is an outside chance that we see this market roll over and correct, and so few people are looking for that, that it could get ugly quick. Watch the levels and don’t do much while we’re in between them.

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