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When the “officials,” “dignitaries,” “experts” and “authorities” speak… all the little boys and girls who call themselves men and women listen to, believe and do what they are told.
Facts don’t matter. And the facts have been extensively detailed in The Trends Journal for decades: The equity markets and economies are rigged. The Federal Reserve and most central banks are Bankster Bandits that do what they are told by governments-in-charge with the main objective—as proven by their deeds—to enrich the rich.
As we have long noted, both economies and equity markets have been artificially propped up with historically low interest rates, scams called “quantitative easing,” cheap money repo market injections, plunge protection teams, etc.
Then and Now
Tracking trends is an understanding of where we are, how we got here to see where we are going.
On 19 September 2018, the day before the S&P hit a record high, we had forecast an “Economic 9/11” would sink stock markets. We based our forecast on stated Federal Reserve policy to aggressively raise interest rates through 2019.
Perfectly on-trend, equity markets across the globe tanked, many sinking over 20 percent into bear territory following our forecast. In fact, the Dow had its worst December since the Great Depression.
Back then, mortgage refinance applications had hit an 18-year low in the U.S. following the Federal Reserve raised rates a mere .25 basis points in September. With rates at their highest point in eight years for mortgage refinances, volume was a whopping 40 percent down from a year earlier. Subsequently, shares of homebuilders stocks had slumped nearly 30 percent.
However, we did a 180-degree turn, reversing our “Economic 9/11” forecast to a “Trump Market Bump” following U.S. Federal Reserve chairman Jerome Powell’s rate hike U-turn on 4 January when he pledged to be “patient” in raising rates in 2019. Subsequently, by the end of April, the S&P 500 and Nasdaq rallied to record highs.
Immediately after the Fed signaled its high probability of no rate increase in 2019, central banks and governments began shooting new rounds of monetary methadone into their financial systems to help counter slowing economic growth by also lowering interest rates, implementing more quantitative easing provisions, lowering loan standards and/or spending on infrastructure projects.
More Bankster Fraud
Go back to September 2019, when the markets were in sink mode because the gamblers, (which The Street and media call “investors”) needed more cheap money to keep betting on the markets. Between September to January 2020, the Feds pumped in $7 trillion into the repo markets.
How about the long-forgotten scheme when the Panic of ’08 hit and the Feds injected $29 trillion into the Bankster Gangs to bail them out? Oh, and remember, children, they are above We the Plantation Workers of Slavelandia; they are “Too-Big-to Fail” and we are just pieces of disposable crap.
Better Late Than Never?
When the COVID War was launched by China in celebration of their Lunar New Year, the “Year of the Rat,” and the “Free World” followed the Chinese way, “You Must Obey,” by imposing draconian lockdown orders which have destroyed the lives and livelihoods of billions… the global economy and equity markets should have crashed.
Instead, they were both artificially propped up with record low interest rates and unprecedented government money pumping stimulus schemes, which, of course, is the foundation upon which sky-high inflation was built.
But again, while we had forecast that inflation would spike, the mainstream media ignored our trend forecasts and instead, as Presstitutes always do, the media whores put out for their corporate pimps and government whore masters.
Almost a year after the COVID War began, at his December 2020 press conference, Fed Head Jerome Powell pointed to “disinflationary pressures around the globe” and said “it’s not going to be easy to have inflation move up.”
A month later, with inflation on the move well above the Fed’s 2-percent target rate, Powell said it was only “temporary.”
In July, with inflation running at 5 percent, Powell told a Congressional committee that “we really do believe that these things will come down of their own accord as the economy reopens,” he noted.
Treasury secretary Janet Yellen echoed his mistaken view in a 24 October CNN interview, describing high inflation as “temporary” (“Powell, Yellen Agree: Higher Inflation Ahead,” 26 Oct 2021).
While Powell was waiting for inflation to give up and go away, we documented its relentless rise in “Inflation Tsunami Approaching” (4 May 2021), “Inflation Soon to Get Much Worse” (18 May 2021), “Fed Officials Send Mixed Signals on Policy Shift” (29 Jun 2021), “When Will Fed End Cheap Money Policy?” (27 Jul 2021) and in many of our “Market Overview” sections.
We Told You So
And just as the Presstitutes ignored our inflation trend forecasts, so too have they ignored our Dragflation forecast: Gross Domestic products dragging down into negative territory as inflation rises.
But now, they are now pumping up the “Drag” reality by spreading the “recession” word, and repeating what we have forecast.
Ray Dalio, the billionaire founder of Bridgewater Associates—who confirms our statement that The Street is a gambler’s game by saying “I Love the Investment Game, so I’ll Keep Playing It”—is now warning about recession. “The Fed and the government together gave enormous amounts of debt and credit and created a lurch forward. A giant lurch forward and created a bubble. Now they’re putting on the brakes. So now we’re going to create a giant lurch backward,” Dalio said at the Greenwich Economic Forum.
JP Morgan Chase—which has admitted to five felony counts, which includes rigging the precious metals market—heard its CEO Jamie Dimon (or is it Demon?) warn on Monday that a “very, very serious” mix of headwinds would likely push the global economy into recession by the middle of next year.
Interviewed on CNBC, Dimon called the runaway inflation (which is at 40 year highs), interest rates rising higher than The Street expected, and the Ukraine War, “serious stuff.”
TREND FORECAST: “Serious stuff”? What stuff? These are the results of deleterious actions taken by politicians and central banksters that created what we forecast will be the greatest financial crisis in modern history.
But, most importantly, remember what Gerald Celente has long noted: “When all else fails, they take you to war.”
What was a border and political dispute between Russia and Ukraine—which has been going on for centuries—has been ramped up by the United States and NATO joining the fight to beat Russia.
WW III has begun. As we detail in this and previous Trends Journals, if this war continues and a global peace movement does not solidify, it will devolve into a nuclear annihilation… in which case, having all the money you could ever wish for won’t mean a cent.
TREND FORECAST: As the saying goes, “It’s the economy, stupid!”
And with the U.S. midterm elections a month away, Washington will pressure the Feds to ease up on their interest rate hikes.
The equation is simple. The higher interest rates rise and the more cheap money evaporates the deeper economic growth and equities fall. Therefore, if there is a breath of relief on 2 November after the Fed’s meeting that they will raise interest rates just .25 basis points rather than the expected .50 basis points, that will sharply boost the stock markets and make it seem to the general public that “Happy Days are Here Again.”
Feeling the building pressure, two Fed members, Vice Chairwoman Lael Brainard and Chicago Fed president Charles Evans both suggest a need not to be too aggressive in raising interest rates.
LAST WEEK: A CHAOTIC WEEK ENDS ON AN UP NOTE
Share prices rose through Wednesday last week on news that U.S. manufacturing output had declined, as had the number of unfilled jobs.
The news buoyed investors’ hopes that the U.S. Federal Reserve might ease its aggressive march toward higher interest rates.
Stocks then sank during the week’s final two trading days, sliding on a jobs report showing 293,000 new slots added—a strong enough result to scotch those hopes of a gentler Fed hand on monetary policy when the central bank’s rate-setting committee meets again on 1 and 2 November.
On Friday, all 11 sectors of the S&P gave ground, with tech and communications companies among the biggest losers.
Still, all three major indexes salvaged gains for the week.
The Dow Jones Industrial Average was up 2 percent, the NASDAQ 0.7 percent, and the Standard & Poor’s 500 index 1.5 percent.
The yield on the benchmark 10-year treasury note moved up to 3.883 percent on Friday, from 3.823 percent Thursday. The yield has closed the week higher every week for the last 10, the longest such stretch since the 1970s, according to Dow Jones Market Data.
The bond market was closed this week for the Columbus Day holiday.
Gold’s continuous contract traded at $1,701 at 5 p.m. U.S. EDT on 7 October, up 1.7 percent for the week.
Brent crude’s price jumped 10.2 percent last week to $97.92 at 5 p.m. U.S. EDT on 7 October. Global oil prices leaped on OPEC+’s announced production cut of two million barrels a day, as we detail in “OPEC+ Cuts Daily Oil Output Limit by Two Million Barrels” in this issue. The price of West Texas Intermediate, which benchmarks U.S. oil prices, shot up 13 percent to $93.91.
Bitcoin’s price rose through the middle of the week but tumbled on Friday to 19,401 at 5 p.m. U.S. EDT, giving up 1 percent over the five-day trading span.
Abroad, Europe’s Stoxx 600 index closed the week up 1 percent. The Nikkei 225 jumped up 5 percent and the South Korean KOSPI gained 3.2 percent.
The Hong Kong Hang Seng rose 3.4 percent. On mainland China, the SSE Composite lost 1.5 percent and the CSI Composite ticked down 0.7 percent.
YESTERDAY: NASDAQ SINKS TO LOWEST LEVEL SINCE JULY 2020
The Dow Jones Industrial Average fell 93.91 points, or 0.3 percent to 29,202.88 and the benchmark S&P 500 was also down 27.27 points, or 0.7 percent, to close at 3,612.39. The Nasdaq Composite also fell 110.30 points, or 1 percent, to 10,542.10, its lowest level since July 2020.
There were several reasons why Monday had an uneasy feeling, led by renewed belief that the Federal Reserve will raise rates by another 75 basis points.
The Street believes Fed Head Jay Powell will be emboldened to continue rate increases due to a still-strong job market, with an unemployment rate of about 3.5 percent.
Yet, with the average hourly earnings up 5 percent and inflation in August at 8.3 percent, it cost the plantation workers of Slavelandia a lot more to buy a lot less.
The latest inflation numbers are due out in the U.S. this week, and economists believe the numbers will remain high. The Wall Street Journal, citing FactSet, said traders believe the benchmark rate will be 4.7 percent by the second quarter of 2023.
Elsewhere, European stocks took a hit. London’s FTSE 100 was down 31.78, or 0.45 percent, to 6,959.31 and the STOXX 600 was also down 1.55, or 0.40, to 390.12. China’s Shanghai Composite was down 50.25, or 1.66 percent, to 2,974.15 and the Shenzhen Composite Index was down 41.49 points or 2.17 percent, to close at 1,870.50. Hong Kong’s Hang Seng Index was down 523.39, or 2.95 percent, to 17,216.66. Markets in Japan and South Korea were closed for holidays.
One of the major news stories that impacted stocks around the world was the announcement that the U.S. would put new restrictions on China’s access to semiconductors, which experts say will prompt China to become more self-sufficient and invest more in its own chip capabilities.
TRENDPOST: The Trends Journal has noted that the Ukraine War has been another example of the need for countries to be self-sufficient. (See “TOP 2022 TREND: SELF-SUFFICIENT ECONOMIES: CHINA LEADS THE CHARGE,” 8 Mar 2022.) The Biden administration has proven—with its reaction to the Ukraine War—that it is more than willing to tank an economy if it believes a rival would suffer.
OIL: Brent crude was down $1.73, or 1.8 percent to $96.19 and West Texas Intermediate also down $1.51, or 1.6 percent to $91.13 per barrel. Oil has been on the way up in recent days due to news that OPEC+ will cut production and indication that the Federal Reserve is going to continue its monetary tightening.
Oil prices were also negatively impacted by the strong U.S. dollar and China’s continued “zero-COVID” policy.
GOLD: Gold traded between $1,685 and $1,672 as the U.S. dollar rose for the fourth straight trading day and was inching back up to its two-decade high of 114.78.
The Trends Journal has long noted that a strong dollar makes the precious metal lose its luster for foreign investors, since gold is dollar based, and the lower their currencies fall, the more it costs to buy bullion.
The 30-year Treasury hit its highest level since 2014 and the yield on the 10-year hit 3.98 percent, an increase of 10 basis points. Economists believe there is greater than a 70 percent probability for another 75 basis point increase by the Fed on 2 November, which could also negatively impact the precious metals market.
TRENDPOST: Gerald Celente has said gold should be trading significantly higher than its current price due to all of the world’s uncertainty. The Ukraine War is expanding and Russia, in response to Ukraine blowing up the Crimea Bridge, is now conducting missile strikes deeper into the country. We forecast that low gold prices are just temporary and it remains the world’s #1 safe haven asset.
BITCOIN: The price of world’s most popular crypto was little changed on Monday and hovered around the $19,063 per coin range, down slightly from the weekend, but remaining relatively steady.
Another element of the crypto is that it continues to mirror equities. Investors were already thinking about Thursday’s CPI data from the Bureau of Labor Statistics to get a sense of future Fed monetary tightening. The higher interest rates go, Treasury yields often rise and become more appealing investments than non-interest-bearing cryptos.
The Trends Journal has noted that crypto investors have been on a rollercoaster ride for a while now, but CNBC, citing Kaiko, noted that bitcoin ended within the $19,000 level for the fourth Sunday in a row, which could be seen as a sign of market stability.
TREND FORECAST: Word on The Street is that this week’s CPI numbers will show a 0.3 percent monthly increase and an 8.1 percent year over year gain, which means the Federal Reserve will likely act more hawkish in its approach to taming inflation. That means crypto traders will not likely get the breakout that they are hoping for.
Paul Tudor Jones, the billionaire investor who once seemed bullish on cryptos in 2020, seems to have adjusted his expectations.
“I’ve still got a very minor allocation, I’ve always had a small allocation to [Bitcoin],” Jones said, according to CoinTelegraph. “In a time when there’s too much money—which is why we have inflation and too much fiscal spending—something like crypto, specifically Bitcoin and Ethereum, where there’s a finite amount of that, that will have value at some point.”
But again, as we note above, with the midterm elections just a month away, the Fed may well do Washington’s bidding by raising interest rates just .25 basis points following their 2 November meeting.
This will sharply boost the equity markets and Main Street will see this as a signal that inflation will ease, wages will rise, and economic growth will be strong… thus they will vote for the political gang in power.
TODAY: DIZZYING DAY ON THE STREET
The Dow Jones Industrial Average was up 36.31 points today, or 0.12 percent, to 29,239.19. The S&P 500 was down 23.55, or 0.65 percent, to 3,588.84, and the tech-heavy Nasdaq Composite also shed another 115.91 points, or 1.10 percent, to 10,426.19.
It was another rocky day in the market as traders are facing uncertainty over the CPI numbers that are due out on Thursday, future Fed moves, and a weakening global economy. Economists believe that the Federal Reserve will raise rates to 4 percent and then get a sense of how the market reacts. But as we note, with the midterm elections coming, they may well raise rates just .25 basis points on 2 November to boost the stock markets before people go to the polls on 8 November.
Jamie Dimon, the JPMorgan boss, warned that the S&P 500 could fall another 20 percent.
And as we note in this Trends Journal, The International Monetary Fund released a new report today that showed global growth is forecast to slow next year more than previously expected, and that policy makers “face an unusually challenging financial stability environment.”
Elsewhere, in Europe, the FTSE 100 was down 74.08 points, or 1.06 percent, to 6,885.23, and the STOXX 600 was also down 2.17, or 0.56 percent, to 387.95. In Asia, Japan’s Nikkei fell 714.86 points, or 2.64 percent, to 26,401.25 and Hong Kong’s Hang Seng was down 384.30 points, or 2.23 percent, to 16,832.36. South Korea’s Kospi was down 40.77 points, or 1.83 percent, to 2,192.07. In China, the Shanghai Composite was up 5.65 points, or 0.19, to 2,979.79 and the Shenzhen Component Index was up 55.70, or 0.53 percent, to 10,577.81.
The Nikkei was hurt badly after a three-day weekend by declines in the tech sector a day after the Biden administration announced new semiconductor controls to help spur growth in the U.S. chip-making market and to limit China’s access to U.S. technology.
Hong Kong’s Hang Seng fell below 17,000 points for the first time in 11 years as mainland China imposed new COVID lockdowns as infections broke out in major cities after a recent holiday. The country is preparing for a major Communist Party meeting in Beijing that begins Sunday that will finalize the country’s plans for top leadership in the country for the next five years, Kyodo News reported.
TRENDPOST: It’s nice to see top economists catching up to what we have been warning about for over a year: the Fed’s decision to downplay inflation as “transitory” for months only led to the contagion spreading and becoming dangerous to the global economy as a whole.
The corporate media does not listen to any voices except for those “approved” for commentary, so our readers will continue to get trend forecasts months before famous economists catch on.
OIL: Oil prices were down today with Brent crude shedding $2.64 per barrel, or 2.74 percent, to $93.55 and West Texas Intermediate also falling $2.67, or 2.93 percent, to $88.45 per barrel.
Gerald Celente has said there are wildcards at play in the oil market so where these prices are headed seem to be anyone’s guess.
Here’s what we know: Oil prices continued to be pulled down by recessionary fears due to another round of interest rate hikes by the Federal Reserve and the strength of the U.S. dollar.
The oil market is at a volatile point. There are factors that could lead to a jump in oil prices, including OPEC+’s recent announcement that it will cut back on its oil production, and the push by the U.S. Treasury for the G7 to finalize a price cap on Russian oil to damage Moscow’s economy.
Gal Luft, the co-director for the Institute for the Analysis of Global Security, a think tank in Washington, noted on Twitter that a price cap would likely mean that Russia would sell oil to its friends at a discount and will withhold oil from the EU market.
“The loss of 4mbp will send oil to $200,” he posted. “Sure, Russia will lose revenues but the West will lose its economy.”
TRENDPOST: It is worth noting that Jamie Dimon, the CEO of JPMorgan Chase, said in an interview with CNBC Monday that the U.S. should pump more of its own oil and gas. He compared the situation to a security risk of war-level proportions.
He said the U.S. should have been pumping more oil and gas and the effort should have been supported.
“America is the swing producer, not Saudi Arabia,” he said. “We should have gotten that right starting in March [when the Russian invasion was in its infancy].”
He said it was encouraging that gas storage supplies in Europe are nearly full before the cold months, but these leaders need to look to the future energy risk. It is important to note that Russia has been sending gas into Europe for months before dwindling supplies.
“I would put it in the critical category. This should be treated almost as a matter of war at this point, nothing short of that,” he said.
GOLD: The precious metal was down $1.90 per ounce, or 0.11, to $1,673. Silver was also trading down about 2.37 percent to $19.14 per ounce as of 3:56 p.m.
TREND FORECAST: We have long noted that gold prices have been depressed due to a strong dollar and monetary tightening by the Federal Reserve, which makes the precious metal less attractive for foreign investors. Therefore, for the short term, the higher interest rates rise, the deeper gold will fall.
However, we forecast gold is near its bottom level. Furthermore, should the Fed be aggressive in raising interest rates it will crash the U.S. and much of the global economy, making gold the primary safe-haven asset in times of economic turmoil.
Also on the upside, small interest rate hikes in the near future will be bullish for gold. As we have forecast in this Trends Journal, the Fed may only raise interest rates .25 basis points on 2 November so as to juice up the equity markets before the 8 November midterm elections. Indeed, the higher equity prices rise and the stronger the stock market appears, the general public will see this as a sign of economic strength and vote for the party in power.
Remember, “It’s the economy, stupid,” and the masses are stupid enough to believe what their “leaders” and the mass media tell them.
BITCOIN: The crypto stayed consistent today and was trading in the low $19,100 range, or up slightly by $20 per coin. The Trends Journal has long noted that bitcoin is down significantly from its November high of about $67,000.
Crypto traders seem ready to hold on to their coins until there is a break that reduces risk in the equities market. These crypto traders seem to be comfortable to consider their next moves in the $19,000 price range. There are other factors at play including how much the Federal Reserve is going to increase interest rates, which would be a drag on cryptos.
CNBC noted that despite headwinds, Google is considering using Coinbase for cryptocurrency payments for its cloud services, and BNY Mellon will add cryptos to its asset pool and will serve as a custody manager.
TREND FORECAST: Barring any major, unexpected jump in CPI numbers later this week that would send the entire equities market into a tizzy, we see bitcoin continuing in the $18,500- $21,000 range.
Stack Hodler, a popular crypto Twitter account, noted today that bitcoin is up 16 percent in the past six months against long term treasuries.
“Did BTC just get the crash over early and now it’s waiting for everyone else to catch up?” the account asked.
It is worth noting, however, that even with the big news that Google will likely begin accepting bitcoin for payment, the price remained the same.