We are perched on the precipice of a huge collapse not seen since 1929. Margin debt is at an all time record high, investors have borrowed near interest free money and purchased huge amount of stocks much worse than 1929.
The charts are showing a weakening pattern, the last retracement could of already ended and the next decline could take out the previous low and then accelerate causing a market panic since late 1920’s. This could be the BIG ONE – the epic collapse of the bond and stock markets. Junk bonds are currently headed lower – again – and have cycled lower through the Aug 24th 2015 low:
Most of the major stock market averages, however, are still hovering above the August crash low.
Stocks are currently suspended in the heavens by zero interest rates – but junk bonds are already falling off the cliff. This happened before in 2009, the Titanic is sinking, and people are fleeing to the upper decks not knowing if they don’t get out right now they won’t be able to at all. We are going to see the markets suddenly disappear into the murky waters of deflation.
There was no where else to invest that paid any decent return so the motley fools all piled into the stock market which went up based on what everyone was doing. This is madness of the crowd in action, and now we have to face the inevitable decline.
With bonds paying low to no interest these Wall Street bank fools all played the stock market and believed in their own bullshit stories about a recovery. There was no recovery – the world is worse than 2008, none of the trillions in derivatives were ever sorted out. The chances of this becoming a rout is a 100% certainty.
The averages have been moving lower and lower, and the smaller stock indices like the Russel 2000 have already taken out the Aug 24th low. The broader market averages are now poised to plunge through also. What’s it going to be like? Do any of us remember the panics of the late 1920’s?
Panics are emotional events, and when a selling panic hits again, it’s 1929 all over again – only the billions lost is now trillions lost. How many trillions have been rubbed out so far this year?
I’ve been saying for quite some time the big one was coming, the big panic on par with 1929. Most people do not understand how money can just disappear in a stock crash. Stock market is based on trading between two or more people, the price is the number they agree upon. When a panic ensues the buyers disappear unless the price is dramatically lowered.
STOCK PANICS ARE A PHENOMENON TO BEHOLD
NORMALLY ORDERLY TRADING
BECOMES EVERY MAN FOR HIMSELF
THE FEAR OF LOOSING EVERYTHING
BECOMES THE EMOTIONAL ENERGY FOR HUGE PRICE DISCOUNTS
Well it couldn’t happen to a more deserving bunch of greedy fuckers could it?
So you might ask what happened to the money that the market represented at 18,000 but now the market is at 16,000. It just disappeared, it was only an idea in your brain no longer supported by the trades. The value of your stock portfolio is a fiction like Hillary Clinton’s personal integrity.
The crash of 2008 hasn’t resolved itself yet. The Fed inflated with QE 1-2-3-Infinity, the Fed lowered rates to zero and let Wall Street borrow money for nothing, since bond rates were lower than the Great Depression the money flowed into the stocks market. The market boomed – went higher than the last runup.
Nothing has changed since the 2008 crisis, we are still looking at an overly inflated market that can drop to much lower levels when the panic hits. In the blink of an eye trillions can disappear and will disappear into nothingness and then the emotional depression sets in when millions of investors realize they’ve lost their life savings.