Howestreet.com - the source for market opinions

ALWAYS CONSULT YOUR INVESTMENT PROFESSIONAL BEFORE MAKING ANY INVESTMENT DECISION

April 7, 2020 | Decoupled Markets Allow our Central Bank Traders to PUMP Markets (temporarily)

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: http://kingdomecon.wordpress.com.

BFM Low wages growth, energy prices and household debt sends ...
The Fed Has a Dangerous Repo Problem: Here Are the Charts
Stock Market Manipulation Can Be Achieved Through Derivatives.

It is obvious, to me, that our central bank traders are choosing to manipulate our electronic/virtual markets up via their algorithms. Since our central bank traders have ‘unlimited’ trading dollars (to play with) this type of manipulation works (temporarily). But all this manipulation is a temporary phenomena.

At some point all this manipulation will be rejected by the greater trading community. Traders will recognize that pumping up electronic markets will not produce a growing/prosperous economy. Central planning (trading to manipulate the markets) may work short-term, but all this manipulation will prove futile longer-term.

What I witness today are virtual trading markets where programmed ‘algorithms’ do most of the trading. This system allows our central planners to control sentiment temporarily. Confidence returns as these virtual markets are pumped up and up. But will pumping up work longer-term (say for months)? I don’t think so!

The real economy is in dire straights as I write. Gross Domestic Produce (GDP) for America and the world is declining as I write. You can witness the decline here: http://www.usdebtclock.org. This decline in our REAL economy will eventually prevail over all this manipulation by our central planners.

Money rules over all (temporarily), but production and jobs will rule when events get more dire. Sentiment and confidence is now declining rapidly. Witness here: 2020-03-27 02:00 PM Michigan Consumer Expectations Final Mar 79.7 92.1. The drop in consumer expectations is down to 79.7. Consumer confidence has dropped from 101.0 to a current reading of 89.1,

As I write, real estate is in trouble. Auto sales are declining. Manufacturing is declining. The Baltic Dry Index is at 604. The 52 week high in this index was 2518. All these indices point to a recession soon and then a greater economic depression. The numbers here point to declining revenue Nationally, State wide, and Local wide. Tax revenues are now declining along with our Gross Domestic Product (GDP).

Witness the numbers here:
 http://www.usdebtclock.org

Yes, our markets have decoupled from reality for the time being. All this is temporary. Within days, weeks, months all will change as people and our trading community wake-up to what is happening. The prior bubble economy will crash as traders recognize our dire situation. Watch and learn. Have a great day!

I am: https://kingdomecon.wordpress.com.

STAY INFORMED! Receive our Weekly Recap of thought provoking articles, podcasts, and radio delivered to your inbox for FREE! Sign up here for the HoweStreet.com Weekly Recap.

April 7th, 2020

Posted In: Kingdom Economics

Post a Comment:

Your email address will not be published.

All Comments are moderated before appearing on the site

*
*

This site uses Akismet to reduce spam. Learn how your comment data is processed.