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December 28, 2017 | 2017 – the Year of Bubbles and Cryptos!

Donald B. Swenson: Born January 24, 1943, Roseau, Minnesota. Graduated H.S. 1961, Moorhead High, Minnesota. Graduated College 1968, Moorhead State University, Minnesota. Designated member of Appraisal Institute (MAI), 1974. Employed with Western Life Insurance Company, 1968 – 71; Iowa Securities Company, 1971 – 73; American Appraisal Company, 1974 – 81. Part-time teacher/valuation consultant/bartender, 1979 – 2008 (taught workshops at Waukesha County Technical Institute, Wi. and Madison Area Technical College, Wi.). Retired 2008 (part time teacher/blogger), AZ. Self educated economist/philosopher/theologian:


We are soon at the end of another year. Our planet has made another revolution around our Sun. I am supposedly one year older as a result of this ‘motion’. A year occurs as our planet ‘moves’ in space and makes its journey around this object called our Sun. Time is viewed as a ‘result’ of motion in space. We all seem to think anew as a new year of motion arrives. What will 2018 bring to our planet and to our global economy? Can anyone divine any significant trends or changes?


My sense is that new change will arrive early in 2018 as the groundwork has been laid for this change. The recent GOP tax bill will go into effect on January 1. The continuing changes within our Central Bank institutions will be huge in 2018 IMO. I expect Mr. Trump to nominate some four new faces to the Federal Reserve Board in 2018. This will create huge change as events play out over time. The Yellen policies will be history after her departure in February, 2018. She has already set in motion a change which appears significant, however!


Central Banks rule over all our global markets today. We live with instant change as Central Bank polices can be implemented with the stroke of a computer key. Interest rates are now gradually increasing. This is huge for 2018 IMO. Our global markets are fine tuned and operate mostly on changes of Central Bank policies. A minor change in math can affect the entire financial structure. Interest rates are a huge item when it comes to our Central Bank policy tools.


My sense is that a ‘tighting’ of Central Bank interest rate policies will continue for most of 2018. Based upon prior history this WILL cause significant change in our bubble markets over time. Borrowing is likely to be less prevalent and ‘values’ of many assets will be affected (especially within the real estate sector). All this change is gradual and persistent and mostly not noticed until it becomes significant. When a bubble market crashes, then everyone becomes AWARE of the change…and desires new change!


We are now in serious BUBBLE markets within our stock, bond, real estate, and derivative markets. All these markets are much beyond what history suggests as ‘normal’. Yes, these bubble markets could continue for many months into 2018 as events play out. I recognize that I have been mostly wrong on the timing of financial events so far. I would have expected our markets to ‘correct’ prior to now. But this has not happened. The bubbles continue and they seem to adjust so that more bubbles can emerge.


The current ‘confidence’ factor is high going into 2018. Confidence is crucial to change and growth. Will the GOP tax bill cause positive changes so that ‘confidence’ can grow in 2018? This is possible but unlikely. The rich get richer but this does not mean that the economy grows and prospers for the many. Only some 50% of Americans invest in our stock markets. The other 50% are relegated to surviving on income which is limited and often declining.


Yes, the rich are likely to get even more rich in 2018 given the nature of Central Bank and governmental policies. This could trickle down to me and you. But, overall, I sense that 2018 will be a year when many bubble markets will be pricked. The crypto currencies could be seriously ‘pricked’ in 2018 and this may lead to more confusion and a downward trend in investor ‘confidence’ overall. Real estate is also likely to be ‘pricked’ in 2018. And our bubble stock/bond markets may eventually be ‘pricked’ also.


What goes UP will eventually come DOWN. This seems to be history. Cycles happen and corrections happen to all markets. No one can time a major change in our markets precisely. I have been wrong before. Most pundits have been seriously wrong these past couple of years. But we now know that Central Banks govern over our global markets. These institutions and their network of policies will determine what happens going forward. Watch these elites as they set future policy. Expect change! That is my perception! I am:

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December 28th, 2017

Posted In: Kingdom Economics

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