As Obama ends the war in Afghanistan, another war is seen on the horizon, a currency war. A fight to prevent a global depression, economic crisis, and financial collapse. Could it be just a coincidence that major market crashes intermixed with war, recessions and depressions come every 7 years. After WW1 the United States globally dominated finance. The roaring twenties brought on unexpected growth economically and industrially. Customer demand, new technology, and media created a completely new culture and lifestyle, women be coming accepted in the job market creating more income for their families. Women in many countries for the first time could vote. We saw the influence of music and art, a fist motion picture change the post-medieval European tradition, an existential experience. The change was massive, fueled by a supply side economic policy. The money spent brought back by soldiers acculturated into consumerism. The 1920s was a historical processes and cultural phenomenon a huge change from the post-industrial life they thought that Radio, automobiles, film, sports and electrification enabled for Americans to spend spurring a demand for consumer goods. . As Americans over spent the term "buying on margin" entered our vocabulary and in 1929 stock prices on Wall Street collapsed, putting millions out of work worldwide, The Great Depression or called Black Tuesday. 1932 The great depression at depth, 1939 beginning if WW2, 1946 recession and the end of WW2, 1953 Recession and the end of Korean war, 1960 Recession, 1967 Israeli -Arab war, stocks decline, 1973-1974 Arab oil stock causes a deep recession, 1980-1987 inflation and interest rates create a massive rescission 1994 stock market crash, 2001 bond crash and Mexican peso crash, 2008 do I even need to elaborate? Banks can’t cover the quantity of loans owed in bank credit in fact it is estimated that owed in more than ten times what is actually in bank reserves.
2008 was just a rehearsal for what is to come. A global depression has began, the decline in oil at such a fast rate, steel and cement following the decline with lack of demand and over abundance of supply. Many people are terrified about the market collapse, what they do not realize, the crash has already started. We have already seen this with many different currencies crashing, a result of low demand and fear. Many individuals and companies that are leveraged are bailing on their high yields. One would assume that this is some grand swindle by bankers or the FED perhaps the government it could be a JP Morgan next great idea. If or when this major crash takes place that we would think the powers that be would not let anything come between them and their large piles of fiat, they must have a master plan. This will be the time for the FED to come to the rescue and presume a hero like status forcing our only choice to induce QE4 and bank bail-ins. The reality of raising interest rates would be suicidal for the FED. Look at what the market did in December with just a threat of them raising rates. Fundamentally, the market is prime and ready for a crash. There is not an economic fundamentals to support the strong USD or stock prices, we have used cheap borrowed dollars and they will state, that this will be our recovery. Now that the USD is strong, we will see more and mutable risk assets stretching over nine trillion dollars ready to explode in our face. The energy issue is just the beginning. 1929, 2000 and 2007 were the only other times the S&P 500 higher than its historic average since 1882. Could this manipulation to lower oil, the market and raise the USD to generate a compound interest trap, sending the Eurozone into deflation.
