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It’s High Time For Action

Get ready for disruption
Friday, October 20, 2017, 8:27 PM

Executive Summary

  • Beware the coming reduction in global central bank money printing
  • The full-blown ecological emergency
  • Uncovering the hidden downside risks to the markets
  • Steps to take now

If you have not yet read Part 1: Are You Infuriated Yet?available free to all readers, please click here to read it first.

I keep circling back to the financial markets because they are the chief signaling agent for most people. As long as the markets are doing okay, people’s attention wanders away from our predicaments and towards believing in the dominant "all is fine" narrative.

But, with the crystal-clear connection we see between asset prices and central bank money printing, prices in today's “markets” are really a creation of monetary policy. As a result, the signals the markets send us increasingly have no bearing on actual reality.

Here’s a good example: McDonalds' stock is hitting new high after new high. This is a function of both the ever-rising markets but also of the company's own internal accounting hocus-pocus.

This chart explains much:

(Source)

The red line tells us that MCD’s revenues are down a stunning 15% since 2014. The green line tells us that their stock price is UP an even more stunning 65% over the same time period.

Meanwhile total debt of MCD’s has mushroomed from $14 billion to $29 billion, while total assets have shrunk. Yet MCD's stock price has risen handsomely.

The critical insight this is telling us about today's markets is... » Read more

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Off The Cuff: Every Rat For Himself

Our leaders are plundering the system as they ruin it
Thursday, October 19, 2017, 8:04 PM

In this week's Off The Cuff podcast, Chris and Mish Shedlock discuss:

  • The Pension Crisis Starts Bubbling Over
    • Illinois is serving as a preview of what's to come
  • The Price-To-Fraud Ratio
    • Stocks are being priced on phony earnings
  • Netflix: A Case Study Of A Classic Scam
    • Losing $billions each year in cash flow, but reporting a profit
  • A Coming Price Deflation?
    • It's going to happen, Mish predicts

In a discussion sure to get your blood boiling in anger, Chris and Mish look at the actions of those in power as the repercussions of their poor decision-making begin to become apparent. Do they take ownership of the problem? Do they prioritize developing solutions? No: they duck out the back door, while voting themselves fat severance plans. 

Here's Mish's accounting of what's going on right now in his home state of Illinois...

Click to listen to a sample of this Off the Cuff Podcast or Enroll today to access the full audio and other premium content today.
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Off The Cuff: Watch The Fed Chair Transition Closely

Yellen's succession may just pop today's market bubble
Tuesday, October 17, 2017, 7:40 PM

In this week's Off The Cuff podcast, Chris and Alex Merk discuss:

  • The Cost Of Disaster
    • Natural disasters are NOT GDP "positive"
  • Watch The Fed Chair Transition
    • It could be what pops this bubble
  • Fracked Up
    • Why the shale patch will continue to disappoint
  • Parallels with the 1930s
    • Military spending is becoming a bigger driver of the economy

Axel Merk returns this week to share why he believes the upcoming Federal Reserve Chair transition just might be the pin that pops today's asset price bubble:

Click to listen to a sample of this Off the Cuff Podcast or Enroll today to access the full audio and other premium content today.
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Off The Cuff: Toxic Policies Are Killing The Economy

Ruining our tomorrow to benefit an elite few today
Wednesday, October 11, 2017, 1:56 AM

In this week's Off The Cuff podcast, Chris and Wolf Richter discuss:

  • The Pricing Of Risk Is Kaput
    • Today's assets are priced at truly insane levels
  • As A Result, Safe Yields Are Non-Existent
    • Which is killing savers
  • The Masses Are Being Betrayed
    • Sacrificed for the benefit of a rarified few
  • The Housing Bubble 2.0 Appears Set To Pop
    • More data is showing a topping out

Wolf returns this week to discuss the toxic repercussions of today's gross mis-pricing of risk. It leads to increasingly dangerous mal-investment, elevating the heights from which prices will fall during a correction. The worst part about this is that this current Mother Of All Bubbles is a deliberate act of policy by the central planners, who are sacrificing the future of the many to benefit the today of an elite few:

Click to listen to a sample of this Off the Cuff Podcast or Enroll today to access the full audio and other premium content today.
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Fighting Back: A Call To Action

Making the switch from victim to hero
Friday, October 6, 2017, 8:36 PM

Executive Summary

  • Future Betrayal
  • Call To Action: The Positive Steps For Fighting Back
  • Becoming the change agent these times need

If you have not yet read Part 1: Betrayed! available free to all readers, please click here to read it first.

The Positive Responses – A Call To Action

It’s time folks. This whole enchilada is about to run off the rails. You know it, I know it, and especially “they” know it. The only people who don’t know this are so distracted by life’s insignificant details, and so hopelessly incurious, that they won’t have any clue until their own lives fall apart.

These people will experience the future as if they were blindfolded participants at a free-for-all boxing match. In other words

Until and unless we admit we have a problem, there will be no hope of repair or recovery. It doesn’t matter what the problem is – alcoholism, addiction, infidelity, lying, cheating, stealing – recovery begins by admitting that a problem exists.

Which means we need to talk about betrayal and the many ways we are being betrayed, and are even betraying ourselves. It won’t be an easy conversation to hold, but it’s entirely necessary.

The alternative is the equivalent of an Alcoholic Anonymous meeting that has decided to eliminate 11 of the steps and just go with one step; “Hey, in this meeting we just pretend nothing’s wrong and we keep on drinking.” Sadly, this exact one-step program is oversubscribed in many communities.

Until and unless that happens, you, we, all of us need to be prepared for more, not less, violence. We should expect more business-as-usual decisions not fewer. We should anticipate more distressed people doing increasingly desperate things, such as checking out via drug use and other addictive behaviors.

You may have overlooked or ignored betrayals - small or large - in your personal life that will now exert themselves to the front of your mind. You may lash out at your betrayers, be they at work, These will take over and shape your destiny, so our advice is that you should get out in front of them.

You will need additional tools to clear these out, manage them, and work with whatever other emotional stressors in your life so you can continue to move forward, grow, develop and have a happy and full life.

If you are ready to learn how to improve and strengthen your emotional capital then... » Read more

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How To Defend Against An Unfair Re-Set Of The System

Hint: think like the 1%
Friday, September 29, 2017, 8:03 PM

Executive Summary

  • The source of leverage being used to manipulate us
  • The powers that be have a much weaker hand than we realize
  • The increase use of force to control the system will ultimately undermine it
  • What options are available to those who want to free themselves from this supression?

If you have not yet read Part 1: Upon The Next Crisis, The Rules Will Suddenly Change available free to all readers, please click here to read it first.

In Part 1 we surveyed the dynamics driving ever-expanding state control, the state’s priorities in crisis management (secure the state’s authority and the wealth/power of elites) and the authorities’ current preference for indirect control of the market.

Leverage and the Market as a Signifier

Markets are no longer markets—they are simulacra of markets, displaying the superficial appearance but not the dynamics and uncertainties of real markets, which have an unnerving tendency to veer away from the state-approved scripts of permanent, stable expansion.

Why have central banks and states (which includes blocs of nations such as the Eurozone with a centralized governing elite) chosen to cloak their control of markets?

The answer is has two parts:  1) central banks/states must leverage their intervention due to the monumental scale of global markets; owning assets worth hundreds of trillions of dollars is at best awkward in the current arrangement and at worst politically impossible.  

While financial leverage is a relatively straightforward tool, 2) the real leverage is exerting psychological control over the market by transforming market price action into a signifier (i.e. signaling mechanism) that persuades participants to... » Read more

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Off The Cuff: It's About To Get A Lot More Unfair

When the next big crisis hits, the rules will get changed
Thursday, September 28, 2017, 8:29 PM

In this week's Off The Cuff podcast, Chris and Charles Hugh Smith discuss:

  • Driving Blind
    • The data we are depending on is uselessly distorted..
  • Underestimated Risk
    • ...so we can't see how tenuous things are right now
  • Setting Up For A Fall
    • ...allowing valuations to get waayy ahead of fundamentals
  • A System Waiting For A Trigger
    • ...all that's needed is a reason for the system to implode on itself

This week Charles Hugh Smith returns to talk with Chris about the dangerous degree of distortion in today's world. Overvalued assets, ecological overshoot, over-leveraged economies, and increasingly antagonistic geopolitics -- these and other other imminent threats should have our leaders and our markets girding against risk. But instead, the dominant narrative being put forth is that all is great and getting better. Complacency is being sold to us -- even though, mathematically, the systems we depend on will experience tremendous shocks in the coming future.

When that happens, Charles predicts the current set of rules we live by will quickly be changed by the central state "for the public good". These changes, however, will protect those at the top -- the ones whose profligacy has run things of the rails -- while stripmining the wealth of the 99%.

Click to listen to a sample of this Off the Cuff Podcast or Enroll today to access the full audio and other premium content today.
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Crisis Preparation: What To Do

The key steps to take NOW, before the next crisis hits
Friday, September 22, 2017, 9:34 PM

Executive Summary

  • Why doing nothing is no longer an option
  • Our recommended steps to take for
    • Finances
    • Home
    • Personal Safety
    • Health
  • Plus: lots of links to related resources

If you have not yet read Part 1: When a Storm Approaches available free to all readers, please click here to read it first.

What To Do

Broken models and bad ideas eventually catch up with you. That day is coming. As to when, I clearly don’t know.

If there’s an outbreak of war with North Korea than that could easily precipitate the breakdown, especially if the conflict spreads across superpowers. That could happen at any time, so the lessons from the hurricanes is this; get ready now.

Barring some sort of kinetic follies, the farthest I can see things carrying on as they have is until 2019 or 2020 when the profound lack of investment in oil will show up as an oil supply shortfall that will result in much higher oil prices. Those higher prices will run smack into ~$250 trillion of global debt and ~4x that amount of un(der)funded liabilities. I covered that thesis in this report, which is worth a re-read (or a first read in case you haven’t already).

The global equity markets are floating along on a sea of liquidity which has allowed them to seriously depart from the underlying fundamentals and from any sense of risk. When neither fundamentals nor risk apply, you have a bubble on your hands.

Bubbles are always in search of a pin. None of us can predict what that pin might be, but it’s out there.

When the next downturn finally comes, it will be with the force of a hundred corrections denied. We’ll be falling from a much higher level of insanity and self-delusion. Once again we’ll discover that prosperity cannot be printed out of thin air. History doesn’t repeat, they say, but when it comes to bubbles it certainly does. They are always the same; they arise from too-easy credit.

Here’s what I think everybody should do, regardless of circumstances... » Read more

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Off The Cuff: The Economy Is A Junkie

Dependent on hits of ever more debt -- until it dies
Thursday, September 21, 2017, 7:14 PM

In this week's Off The Cuff podcast, Chris and John Rubino discuss:

  • Hey, Did We Just Declare War On North Korea?
    • Trump's UN speech stuns the world
  • Unpacking The Latest Fedspeak
    • Much more talk than action
  • The Junkie Economy
    • Dependent on hits of ever more debt until it dies
  • The High Cost Of Lacking Resilience
    • Harvy, Irma & Maria are teaching us a lesson in real-time

This week Chris and John tackle the latest Fed announcement. Yellen's talk of tightening/normalizing -- to borrow from common parlance -- is really a "nothingburger" until the world's other major central banks curtail their stimulus efforts.

The world economy is still receiving $125 billion in liquidity injections every month. This, of course, has destroyed the integrity of the markets and turned all investors into speculators -- as whatever the central banks decide to do next is the only thing that will matter to prices.

As we have been warning for years, this will all end badly once the central banks have either destroyed their respective zombie economies or their fiat currencies (if not both). 

Click to listen to a sample of this Off the Cuff Podcast or Enroll today to access the full audio and other premium content today.
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Off The Cuff: It's A Mad, Mad, Neo-Con World

Current policy is making the US more isolated
Monday, September 18, 2017, 6:36 PM

In this week's Off The Cuff podcast, Chris discusses:

  • It's A Mad, Mad, Neo-Con World
    • US foreign policy is becoming increasingly reckless
  • The Beginning Of The End For The Petrodollar?
    • China is challenging the dominance of the dollar
  • Gold: The Oppressed
    • Perhaps the most suppressed asset in modern history?
  • Upcoming PP events
    • Come join us in New Orleans and/or Munich

Chris flies solo again this week to make sense of the many geo-political risks popping up as the long-time axis of global stability becomes more and more wobbily and destabilized. There is much in US policy that appears increasingly reckless, pitting America increasingly against the world's other major powers.

Click to listen to a sample of this Off the Cuff Podcast or Enroll today to access the full audio and other premium content today.