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DOW, S&P EDGE UP TO NEW RECORD CLOSES
The Dow Jones Industrial Average and Standard & Poor’s 500 index barely moved on Friday, but scratched out enough of a gain to notch new record closes for both.
The Dow tacked on 15.53 points to end the week at 35,515; the S&P nudged up 7.17 to 4,468, its 48th record close this year.
The NASDAQ finished at 14,822.
As the old saying goes, “You can’t make this shit up.”
This is a headline in the business section of today’ New York Times: “S&P Hits Record Amid Rising Covid Concerns.”
Despite the latest round of new COVID lockdowns, draconian restrictions and vaccination passports that will take a heavy toll on economies, the Dow and the S&P 500 hit new records yesterday.
However, it should be noted that it’s summer time, and the living is easy. Thus, trading has been light, with many traders and money managers on vacation; on 12 August, just 3.4 billion shares were traded, well off 2021’s average pace of 4.7 billion, The Wall Street Journal noted.
With 86 percent of Fortune 500 companies having booked quarterly earnings stronger than forecast, Chris Zaccarelli, the Independent Advisor Alliance’s chief investment officer told the WSJ that, “There’s been a lot of reasons for people to remain optimistic,” and that “I think the stock market moves higher from here.”
“It’s a quiet market but the underlying tone still seems fairly positive, despite background concerns,” agreed Paul O’Connor, chief of multi-asset investing at Janus Henderson Investors in comments to the WSJ.
TREND FORECAST: We disagree with the above forecasts. Again, considering the new lockdowns and draconian mandates to fight the COVID War 2.0, there will be a sharp market correction with stocks falling 20 to 30 percent lower by year’s end.
As trend lines are now forming, the deep slump may well begin between the middle of September to late October.
As we have noted before, equity markets have cast off their ties to economic fundamentals and are now cruising on a combination of the U.S. Federal Reserve’s cheap interest rates and $120-billion monthly bond-buying spree.
In addition, when the Feds change course and raise interest rates and begin curtailing bond purchases, the markets will snap into a sharp reversal, with investors rushing for the exits before prices tumble, igniting a self-driving bear market.
What a Difference a Day Makes
As if yesterday never existed—a Monday that followed weeks of denial that the COVID War 2.0 lockdowns and draconian mandates would not have a negative economic impact—today, after falling some 500 points at midday, the Dow closed down 282 points. The S&P was off 0.71 percent and the Nasdaq fell 0.93 percent.
Snapping the 5 day winning streak, was the U.S. July retail sales report that showed a 1.1 percent decline… a steeper fall than the 0.3 percent drop economists surveyed by Dow Jones expected.
Doing the 180
The background concerns that were not heard yesterday were blared out today by BMO Wealth Management’s Yung-Yu Ma. He told CNBC, “These challenges aren’t going to go away quickly.” He warned; “When we’re looking at the expectations for consumer strength going forward, some of the edge is being taken off by the rise in the delta variant.”
Yes, the rise of the “variant” shot was fired. We had warned subscribers that the launch of COVID War 2.0 would collapse equities and economies if it was fought full force by the arrogant, ignorant, narcissistic, sociopaths, psychopaths and pathological lying politicians… running a country, city, or state near you.
No clearer proof than New South Wales Premier Gladys Berejiklian who, after imposing new lockdown rules and a $5,000 fine for breaking them, declared last week, “This is literally a war—and we know it has been a war for some time but never to this extent. The Delta strain is diabolical.”
Yes, “literally a war.” As we noted when it all began, the politicians and the media said they were fighting a war to defeat the virus… and they still are.
And we had accurately forecast that, just as the masses marched off to Mussolini, saluted Stalin and Heiled Hitler, so too would they obediently march off to the COVID War.
And as Anthony Freda’s 28 April 2020 Trends Journal cover illustrates, “DUMB ENOUGH TO BELIEVE BUSHES WARS – DUMB ENOUGH TO BELIEVE THE COVID WAR.”
And it is not the “diabolical” Delta strain that is the most deadly, as Berejiklian claims. It is, as we noted with the rise in suicides, homicides, mental illness and drug overdoses… that are a result of the “diabolical” actions taken by politicians to fight the COVID War that has robbed the masses of their human spirit and will crash equity markets and the global economy if the War persists.
Total bullshit
We have greatly detailed the solid facts and scientific data in this (See “DOWN UNDER, UNDER MORE LOCKDOWNS” in this issue) and previous Trends Journals that proves the numbers of dead in Australia, that were allegedly killed over the past 17 months by the virus, add up to next to nothing… and the vast majority are the very elderly and those suffering pre-existing chronic conditions.
Why is Berjiklian imposing these tough COVID War measures? Because she is in the ruling class of arrogant, ignorant, narcissistic, sociopaths, psychopaths and pathological lying politicians… running a country, city, or state near you. And with the COVID Vax rate at only 20 percent, she is pushing to sell the jab.
Doubling down on the destruction of the economy and human spirit and doubling up on excessive control of power… today, New Zealand Prime Minister Jacinda Arden put the country on a strict lockdown after one man tested positive for COVID-19.
That’s correct. One case—possibly a fake case since, as we have detailed in numerous Trends Journals the PCR tests are highly inaccurate. (See “PCR TESTS ACCURATE? THINK FOR YOURSELF”, 3 August 2021).
Yet, her Highness of NZ declares that starting midnight, the plantation workers of Slavelandia may only leave their dwellings to exercise, go to and from “essential” supermarket, “essential” medical care and going to the drug store to get a COVID test… and everybody must get masked up.
Thus, across the business and general population spectrum—except for the “essentials”—New Zealand and Australia will be going down economically, spiritually and socially.
And as with Australia and other nations that are being locked down and/or new restrictions have been applied when vax rates were low, with the jab rate at only 18 percent in New Zealand, the PM is also pushing to sell the jab.
TREND FORECAST: “All things are connected, like the blood which unites us all,” observed Chief Seattle. Thus, in making our economic forecasts, we note the above occurrences “down under” to illustrate the interlocking connections that will determine the socioeconomic and geopolitical future.
The free spirit of the world is being sapped out of humanity.
Should the COVID War continue, hundreds of millions—possibly billions—of lives and livelihoods will be destroyed from the businesses that permanently close, the destruction of the education system that will discourage advanced degrees… and hostile social climate that will divide nations between COVID War hawks and COVID draft dodgers.
Thus, should these conditions persist, there will be extreme equity market turmoil followed by a market crash and widespread economic despair.
TREND FORECAST: As goes the motto of the Trends Journal, while we provide the data, analyses, trends and forecasts, the bottom line is to “Think for Yourself.” Where are the markets heading? A time to buy or a time to sell? For a view from a top pro in the field, read Gregory Mannarino’s article, “Markets: An Extreme Paradox-When To Dump Stocks.”
GOLD/SILVER: While gold and silver were hit hard last week following strong job numbers and expectations of solid economic growth that will push the Fed to taper its bond buying and raise interest rates, today gold closed down some $4 an ounce, closing at $1,783 per ounce… but it’s up some $60 from last week’s low.
On the silver front, last week it was at $23.34 per ounce. While down some 18 cents today and closing at $23.61… silver is essentially stuck in the recent low range.
TREND FORECAST: Should the COVID War 2.0 continue to escalate as it currently is, we forecast a sharp decline in the retail, hospitality, restaurant, travel, convention, trade show and tourism and commercial real estate sectors. And, so too will residential real estate prices be driven down.
And unlike when the COVID War was launched in 2020 and governments and central banks pumped in trillions to artificially boost equities and economies, this time around the cheap money binge will devalue the dollar and other currencies… which in turn will drive up the prices of safe haven assets such as gold and silver.
Thus, we maintain our forecast for gold to move above $2,000 per ounce and silver to more than double in value.
OIL: Read the CNBC headline: “Oil prices weighed down by weak Asian demand.” No kidding…would have never guessed that weakening demand would drive down prices as nations lock down and impose more restrictions to fight the COVID War. Brent Crude and West Texas Intermediate registered their fourth consecutive session of declines closing at $69.39 per barrel and $66.91 per barrel respectively.
TREND FORECAST: Minus a wild card event, such as war in the Middle East, a natural disaster, etc., we maintain our forecast that the new rounds of government and business COVID restrictions that we have noted in the travel, hospitality, restaurant, events and other sectors will slow down economic growth and in turn lessen demand for oil.
BITCOIN: Bitcoin is essentially flat, still trading in the $46,000-$47,000 per coin range as it has been since last week. The coin had sunk below $30K three weeks ago.
TREND FORECAST: We maintain our forecast for Bitcoin to dive deeply if it goes below $25,500 per coin and spark sharply if it breaks above $50K per coin.
We also maintain our forecast that a major factor in forecasting the future price of bitcoin and other crypto currencies will depend on government regulations.
Thus, the more regulation, the lower the value of the coins, the less regulation, the higher the prices rise, especially as more small time traders keep jumping into the crypto market. And what is also of concern in the U.S. now, is if Washington enforces proposed cryptocurrency tax regulation.
For more on bitcoin and other cryptocurrencies, please see our “Trends in Cryptos” section.