As we have been reporting since late March of last year, when the U.S. Federal Reserve began injecting tens of trillions into the equity markets to prop them up as most of the world’s economies locked down, it was a “right in front of your eyes” racket to keep the White Shoe Boys on their money-junkie high.
There has never been such an overt Bankster fraud like it in the History of the World.
Tens of millions of businesses locked down and out of business. Billions of people out of work and struggling to make ends meet. Restaurants, nightclubs, convention centers, theaters, cinemas, amusement parks, hotels, airplanes, resorts, cruise ships, fairs, festivals, commercial real estate, apartment rentals… the list goes on, dead and empty.
Yet, equity markets hit new highs… yes, indeed, Money Junkie highs.
What does all this mean for the workers of the world… the citizens of Slavelandia? Read Gregory Mannarino’s new article, “THE NEXT PHASE: NUCLEAR DEBT, SLAVE SOCIETY.”
Fake High
Pushing equity markets higher today is the “uplifting” news that European car sales plunged 23.7 percent in 2020, according to the European Automobile Manufacturers Association, which said the lockdowns “had an unprecedented impact on car sales across Europe.”
As for the inner city apartments, as the financial markets hit new highs, the world’s big financial centers – from New York to Toronto to London to Sydney – their rents are plunging.
An overview of the decline was detailed by RHB Rental Housing magazine, which lists the facts and data. They quoted Tim Lawless, Asia-Pacific head of research for data provider CoreLogic Inc. “Supply is high and occupancy has fallen off a cliff.”
RHB wrote that “International students who normally bolster demand are stuck at home and young renters – the most mobile group in real estate – are finding fewer reasons to pay a premium to live in what is, for now, no longer the centre of things.”
Beyond big city rents, as we noted last March, with colleges among the first to send students home and close down under the “New Abnormal” restrictions, with the ending of sporting events, etc., college towns will become ghost towns… “Rust Belts 2.0.” From hotels, restaurants, taverns, retailers, renters… businesses big and small will shrink and/or go broke.
On the broader rental market front, as reported by RHB: Manhattan rentals are down 11 percent median monthly; rent for a studio in San Francisco tumbled 31 percent; rents in Toronto plunged 14.5 percent in the third quarter compared with the same period last year; Singapore rents are 17 percent lower than their peak in 2013; vacancy rates in the central business district of Sydney Australia, are down 13 percent… and the list goes on.
Duh!
And, now, with the bubble burst in sight, CNBC’s headline story is a Deutsche Bank survey released today that found 89 percent of 627 market professionals they surveyed think some financial markets are in bubble territory.
Of those bubbles, bitcoin and U.S. tech shares are at the top of the list. Bitcoin is viewed as a more extreme case, with half of respondents giving the cryptocurrency a rating of 10 on a 1-10 bubble scale.
Deutsche Bank’s survey showed U.S. tech stocks as the second biggest bubble, with an average score of 7.9 out of 10 and 83 percent of respondents giving it a tech bubble rating of 7 or higher.
“F” The Facts
Yesterday, Asian and European stocks were higher. Today, they were mixed in Asia, with Hong Kong’s Hang Seng index climbing 2.7 percent on the news the government will extend social distancing measures… thus further crippling businesses that are suffering steep losses from prior-imposed restrictions.
Today, equities were slightly down in Europe after rising yesterday. As for the U.S., stocks edged up, bouncing back a bit from last week’s downs on hopes of more cheap stimulus money and speeding up the vaccination push.
As we thoroughly noted in last week’s Trends Journal… from heavy industry to high tech, across the business spectrum, the word from The Street is that once enough people get vaccinated, Happy Days will be here again.
Yes, we had forecast there would be a sharp bounce-back this spring and summer, but it will be temporary. What has been lost is lost. The “Greatest Depression” has begun.
GOLD/SILVER. While gold and silver prices edged up today, with markets climbing higher and expectations of an economic rebound, they have not bounced back to their start of the year highs.
Considering that governments, especially the United States, will pump in more cheap money to stimulate growth, we maintain our forecasts for gold $2,100+ per ounce and silver $50+ per ounce in 2021.
And while the U.S. dollar is near a four-week high, we forecast it will continue to weaken, which, in turn, will push inflation higher as it will cost more to buy less… thus, driving precious metal prices higher.
OIL. Oil prices climbed higher today on hopes that more money pumping by governments will juice deadening economies, thus pushing up oil demand.
As we had reported, Saudi Arabia’s plan to cut output by an extra one million barrels per day (bpd) in February and March has pushed oil prices to an 11-month high. Yet, with more lockdown orders in place and fears of a deadly new virus wave spreading that will keep people at home and afraid to go out to eat and play, we forecast oil demand will remain particularly weak this winter.
However, as proven with the JPMorgan Chase Gang caught rigging the precious metals markets and fined $900 million for doing so, so too are other commodity markets rigged… including oil. Thus, prices can move higher considering the many nations whose GDP is oil-export driven.
BITCOIN. As we go to press, bitcoin is down 1 percent, trading at $36,117. We maintain our 5 January forecast when the cryptocurrency broke above $41,000 that “we do expect a market correction”… which it did just a few days later, falling some 10 percent.
And, we maintain our 5 January forecast that, “The downward breakout point will be hit should prices fall below $25,000 per coin.”
