As I sit here I’m in absolute awe as to just what is construed as “informative analysis” in regards to not just the “markets,” but business and more.
Since putting the MYTR Broadcast™ on hiatus I have personally wrestled with the question as to whether it was the correct decision or not more times than I ever thought. The reason is, just like you, this “lock down” hysteria that has been forced upon us allows more opportunities for contemplation. To say that it was a difficult decision at the time would be an understatement. Yet, when it comes to business, you have to take what you deem as the best course for action at that time, whether you like it or not.
However, now that I’ve had this time for both reflection and analysis – I couldn’t be more resolute in my original decision. i.e., I would do the exact same thing again regardless of what I now know. That’s the best you can do. You can’t change the past.
Circumstances for/of the time demand decisive action. It’s one of those aspects of being either a business, or a person following one of my mindset principles from The Business of I™. i.e., You’re in charge, you’re responsible: evaluate, decide, follow through, adjust if necessary. Rinse, repeat.
Now with the above for some context, let me add another element to the above. The prior assumes that you will either A: Reap and keep the rewards of your prudent actions. Or B: will suffer the consequences.
Pretty simple, along with probably the only assumption ever worth assuming (we all remember about assuming, right?) i.e., you’ll reap or suffer.
It’s pretty universal – until you move it into the world of politicians and/or appointed positions. Here is where any assumption to “the real world” should be jettisoned both in their dealings with it, as well as their ideas of it. Because what you or I may do in relationship to it is more often than not diametrically the opposite to how they will and do.
As many of you know I’ve been highlighting my observations on said “markets” over the course of these many weeks as to try and articulate what I’ve been noticing in relationship to other activities, because the potential for a sudden falling off a cliff moment still remains more than present. Remember: this is all my conjecture, no one knows. Repeat, no one.
The reasoning is, based on my observations via different methods of analysis, that all the warning signs are in place. Much like I warned (once again) coming out of 2019 and into February of this year.
There is probably no other field for analysis the equates to the capital markets, although quantum dynamic programming are now a factor within it, but I digress. This is where any and all assumptions are taken out back and … (need I say it?) None more so than, “It’ll never happen!” Let’s just say for the sake of arguments: It just did. Here’s why…
Imagine for a moment that you and I were having a business meeting in one of the very fine restaurants located anywhere within the U.S. back in June of 2000. Then, during this meeting, I revealed to you that I wasn’t who you thought I was, but rather, I was a messenger from the future sent here to warn you about both what was coming at any moment, and what will transpire over the subsequent 20 years. Here’ what that would sound like…
Over the course of this year (2000) all assumptions that the Nasdaq™ and other markets would fall apart causing such massive losses that there would need to be a complete bailout causing the Federal Reserve to embark upon such dire economic policies that it would effect the way money, business and governments would interact with stocks.
I would go on to say …
Some governments would embark on purchasing their own debt therefore monetizing it. Japan would be the leader and many will follow. Then, over the course of 10 years time the Federal Reserve will levy and many times further enhance these disastrous policies creating another stock market bubble that will cause the ruination of home prices with catastrophic consequences where 50% losses in home values would be the average, Some will lose more.
All the while remembering at this time home prices going down was a “not possible” frame of mind.
As you shook your head in disbelief I continued by saying:
But that’s not the half of it, literally…
Over the next 10 years I’ll describe how the Federal Reserve will embark on a road known as “QE” (quantitative easing) that will allow for these funds to be fungible for people and organizations that will be moniker’d as “Friends of the Fed” through different accounting tricks, channels and more to lever up and make all past bubbles minuscule in nature. Using the same market (e.g., Nasdaq) I’ll outline how not only will it about double from where it is current;y (i.e., June of 2000) but it will subsequently crash by over 20% and within weeks will regain all that was lost. This will take place behind a backdrop that 36 million Americans will be reported having filed for unemployment during those same weeks . But wait…there’s more!
The entire global economy has been shut down. Whole nations, including the U.S. are under a quarantine lock down brought on via the scare of a global pandemic. Businesses are mandated to close, people are mandated to stay home, airlines can’t operate, automotive factories are shutdown. You name it – it’s not open.
Small business owners are being put in jail for daring to open their businesses. People are calling the authorities if children are seen playing together and on, and on.
At some point you’d be thinking, “This guy’s nuts!!” correct? It would be a fair assumption. The problem is all the “nutty talk” is now reality. And it gets crazier with every waking moment.
As I am typing this the “markets” are once again skyrocketing. Most of the U.S. majors have gaped up nearly 3%. Why? One simple answer and it’s been the same one in all of the above examples: The Federal Reserve.
On Sunday night, just as the U.S. futures markets opened (pretty convenient, yes?) “60 Minutes” reran an interview that Mr. Powell, Chair of the Federal Reserve did with CBS™ “Face The Nation” earlier.
I’m just going to highlight two sentences, but in reality, they’re all one needs to know. And going back to that hypothetical conversation I used above. If I followed it up with:
And they will not only just print excess money – but they will print it by the $Trillions during any given month.
You would have probably concluded, “Yeah, I don’t think any more – this guy is absolutely certifiable!!”
But here are those two quotes from Mr. Powell, ready?
First, on negative rates, he said…
“I continue to think, and my colleagues on the Federal Open Market Committee continue to think, that negative interest rates is probably not an appropriate or useful policy for us here in the United States.”
The issue with the above are these two words: think, probably. This is called hedging in the world of politics. i.e., I thought that way then, but I think this way now. And: probably doesn’t mean – never. I never said: never.
See what I mean?
Next, on how they make money possible…
“We print [money] digitally… we have the ability to create money digitally and we do that by buying Treasury Bills or bonds or other government guaranteed securities.”
For those wondering why the latter may be a bigger issue than the first, although both are just as damaging in reality, the latter if you were to do it would be called “counterfeiting.” And you would be thrown in jail.
When Mr. Powell instructs it to be done it’s now called “prudent monetary policy.”
And you thought I would be the crazy one, hmmm?
© 2020 Mark St.Cyr