The Fed is now cornered (to a degree).

This is not to say that the Fed cannot continue to print money, nor does it mean the Fed is “out of ammunition” as many bears like to claim.

The Fed is technically never out of ammunition as it can print money forever. Moreover, as the Fed’s policy response to the COVID-19 pandemic has shown us, the Fed is more than willing to engage in policies that are technically illegal (buy corporate bonds, buy municipal bonds, etc.) by using loopholes (print the money and give it to the Treasury to buy these assets) when it’s necessary.

However, there are some problems that Fed policy simply cannot solve. And today, the markets are facing two of them.

They are:

  1. Supply-chain issues.
  2. The global energy crisis.

Printing money, Quantitative Easing (QE), maintaining low interest rates, even buying assets and securities that are technically outside the Fed’s legal mandate…. NONE of those policies can remedy supply-chain issues, or their inflationary effects.

The Fed can’t MAKE people return to work… or force them to give up their new careers and go back to unloading cargo ships or working in manufacturing facilities.

Similarly, for the Energy Crisis, the Fed can’t print oil or coal. QE doesn’t lower energy prices. And maintaining lower interest rates doesn’t make coal miners/ oil employees go back to work and start drilling or mining.

Meanwhile, inflation expectations are erupting higher. They’ve just taken out their May 2021 highs, which marked the PEAK for the last inflationary thrust.

Graphical user interface, chart, line chart Description automatically generated

These problems (supply chain issues and an energy crisis) aren’t going away any time soon either… Copper has just hit an all-time high!

Meanwhile, Oil just broke out of a 13 year bear market!

With the right investments, we are talking about the opportunity to make literal fortunes here as inflation RIPS through the financial system igniting MASSIVE price spikes in key sectors.

I outline five investments that could explode higher as inflation rips through the financial system in a Special Investment Report titled Survive the Inflationary Storm.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/inflationstorm.html

Best Regards

Posted on October 19, 2021 by The Phoenix | Comments Off on The Fed is Now Cornered… and There’s Nothing It Can Do to Fix This!

Inflation Has Finally Arrived… and the Fed Cannot Fix It

Posted on October 18, 2021 by The Phoenix

Government bureaucrats have accomplished what Central Bankers have failed to do.

For decades, Central Banks have attempted to “create inflation.”

They’ve cut interest rates over 800 times.

They’ve printed over $20 TRILLION in new money.

They’ve even tried buying every asset you can name (corporate bonds, municipal bonds, student loans, auto loans, Treasuries, Mortgage-Backed Securities, etc.).

None of these strategies worked. Inflation never ran HOT. Heck, it never even rose above 3% for more than a few months.

However, with one simple move, government bureaucrats have accomplished what Central Bankers failed to do 

By shutting down the economy, the government has managed to create crises in both labor (people are not returning to work or have changed careers completely) AND the supply chain (items are delayed for months: sitting idly in cargo ships or simply not being produced at all).

These crises in labor and the supply chain are resulting in lower supplies of much needed resources. Factories are operating at partial capacity or in some cases, not operating at all. Grocery store shelves are running bare. Orders are taking twice if not THREE times as long to be fulfilled. 

Much lower supplies + normal demand = HOT INFLATION.

And there’s NOTHING central banks can do to fix this.

The Fed can’t print employees or oil.

QE doesn’t suddenly make factories operate normally.

Yield curve control doesn’t start unloading cargo ships that are sitting at docks.

Put simply, inflation is here, and it’s NOT the kind central banks can control.

This has presented us with the opportunity to profit from once in a lifetime event: the arrival of an inflationary crisis that cannot be slowed or stopped by the Fed.

During the last major bout of inflation in the 1970s, smart investors locked in gains in the QUADRUPLE digits (1,000% or higher). And THAT version of inflation was the kind the Fed could stop!

So you can imagine the profit potential of this crisis today. 

I outline five investments that could explode higher as inflation rips through the financial system in a Special Investment Report titled Survive the Inflationary Storm.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/inflationstorm.html

Best Regards

Posted in It's a Bull Market | Comments Off on Inflation Has Finally Arrived… and the Fed Cannot Fix It

Warning: The Bounce is About to End… Next Comes the REAL Fireworks

Posted on October 13, 2021 by The Phoenix

Stocks are bouncing this morning. But that is to be expected.

Every major collapse follows a clear pattern:

1) The initial drop

2) The bounce to test former support.

3) The REAL fireworks.

Stocks are currently in phase 2… as you can see, they have been rallying to “kiss” the 50-day moving average or DMA (see the red circles in the chart below). However, they have FAILED to reclaim it.

If stocks DO NOT reclaim this line right here and now, it’s likely GAME OVER for the bull market.

The whole situation is similar to that of 2008. At that time stocks broke down, then rallied to “kiss” the 50-DMA several times. When they failed to reclaim it is when the REAL fireworks hit.

We recently published a Special Report outlining certain key developments that flash right before every major crash hits.

It’s called How to Predict a Crash and it illustrates what these triggers are currently signaling for the markets… and whether or not the odds of a crash are low, medium or high right now.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in It's a Bull Market | Comments Off on Warning: The Bounce is About to End… Next Comes the REAL Fireworks

Are We Setting Up for Another 1987-Type Crash? Part 2

Posted on October 12, 2021 by The Phoenix

Over the last few weeks, I’ve been outlining the clear evidence that stocks are in a bubble, arguably the largest stock market bubble of all time.

With that in mind, yesterday I asked a critical question…

Are We Setting Up for Another 1987-Type Crash? 

It’s often said that you cannot predict a crash.

While predicting the actual day of a crash hitting is impossible, there are certain key warnings that flash before every major crash.

Think of them as BIG warnings, or the FOUR Horsemen that precede a stock market apocalypse.

What are they?

When most heavily weighted companies began to break down badly.

Technically, the S&P 500 is made up of 500 companies. However, each of those 500 stocks don’t receive the same weight from the index. Rather, certain stocks receive a disproportionate weighting giving them a much larger impact on the market’s price action. 

Because of this, in order to get a crash, you need the heaviest weighted stocks to break down badly. Put another way, even if most of the 500 companies in the overall market are in a downtrend, if the heaviest weighted stocks DON’T break down, it’s pretty much impossible for the overall market to crash. 

So today, let’s review the 1987-Crash: arguably the worst single-day collapse in stock market history.

In 1987, the 10 largest companies by market weight were:

Of these, IBM, XOM, GE and T have charts that are easy to find. So, let’s review them.

In 1987, IBM had already taken out both its 50-DMA and its 200-DMA before the crash hit. Put another way, the largest company on the index (the equivalent of the tech sector today) had already broken down VERY badly.

Exxon had yet to look as terrible, but it was clearly struggling, having traded sideways for months before finally breaking down.

General Electric looked awful, breaking its uptrend and falling below its 50-DMA long before the Crash hit.

AT&T (T) was the only one that looked remotely good, as it was still in something of an uptrend when the crash hit.

For space reasons, we’re only looking at four of the top 10 companies today. But if you were to look at all 10 charts, you’d quickly see that the majority of them had entered downtrends, and were breaking down badly, weeks before the Crash hit.

But what about the markets today? Are they issuing similar warnings?

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in It's a Bull Market | Comments Off on Are We Setting Up for Another 1987-Type Crash? Part 2

Are We Setting Up for Another 1987-Type Crash?

Posted on October 11, 2021 by The Phoenix

Over the last few weeks, I’ve been outlining the clear evidence that stocks are in a bubble, arguably the largest stock market bubble of all time.

In truth, however, it’s not just a bubble in stocks, it’s a bubble in Treasuries, which the Fed has manipulated to absurd levels via over $2 trillion in Quantitative Easing (QE) during the last 18 months.

These bonds are the senior most asset in the current financial system. Their yields represent the “risk free” rate of return against which all risk assets (including stocks) are valued. So, when the Fed created this bubble in Treasuries, it was creating a bubble in Everything, which is why I call this the Everything Bubble.

Of course, this begs the question… when will it burst?

Put another way, when does THIS happen?

Predicting the actual week, let alone the day, of a market crash is all but impossible. However, there are certain key developments that MUST happen for the market to crash. 

Think of them as BIG warnings, or the FOUR Horsemen that precede a stock market apocalypse.

What are they?

The most heavily weighted companies began to break down badly.

Technically, the S&P 500 is made up of 500 companies. However, each of those 500 companies don’t receive the same weight from the index. Rather, certain companies receive a disproportionate weight giving them a much larger impact on the market’s price action.

Because of this, in order to get a crash, you need the heaviest weighted stocks to break down badly. Even if most of the 500 companies in the overall market are in a downtrend, if the heaviest weighted stocks DON’T break down, it’s pretty much impossible for the overall market to crash.

I’ll outline precisely how this played out before the 1987 Crash (arguably the worst single-day collapse in stock market history) in tomorrow’s article.

In the meantime, if you’re concerned about another crash hitting stocks soon, I recently detailed certain key signals that flash before every market crash in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in It's a Bull Market | Comments Off on Are We Setting Up for Another 1987-Type Crash?

When This Happens the U.S. Will Be Just Weeks Away From a Debt Crisis

Posted on October 8, 2021 by The Phoenix

By Graham Summers, MBA

The market has rallied aggressively on the belief that a Debt Ceiling deal will be made. 

Celebrating a Debt Ceiling deal is like polishing the brass on the Titanic.

The U.S. has $28.8 trillion in debt. Two years ago, it was just $22.7 trillion. 

The Trump administration, despite technically being Republican, spent like socialists, running $1 trillion deficits even when the U.S. economy was GROWING. 

That deficit then ballooned up to $3 trillion when the pandemic hit. And now, the Biden administration is now looking to outdo even President Trump’s spending spree. 

By practically all measures, the U.S. economy is in recovery as it reopens. And yet, the Biden administration is looking to run AT LEAST a $3 trillion deficit this year… an amount that could potentially rise to $5 trillion or even $6 trillion if President Biden manages to get his infrastructure deal and other stimulus programs passed.

Meanwhile, inflation has ignited. 

The “inflation is transitory” argument has been thoroughly debunked to the degree that even clueless Fed officials are admitting it. The official inflation measure (the Consumer Price Index or CPI) claims inflation is 5.3%.

However, the CPI has been tweaked aggressively to understate inflation over the last 30 years. If we were to measure CPI today the same way it was measured in 1970, REAL inflation is at 14%.

Yes, 14%.

And the bond market knows this.

Even the Fed’s $960 BILLION QE program, which is designed to SUPPRESS bond yields  is failing. Bonds know inflation is roaring which is why yields are once again rising rapidly.

When they break that downward trendline, the U.S. will be just weeks away from a crisis. 

The last time the line broke in 2018, it was because the Fed was raising rates at a pace of FOUR per year while also shrinking its balance sheet buy $500 billion.

This time around, the Fed has rates at ZERO and is running $120 billion in QE per month (a record). Even if the Fed tapers QE by $15 billion soon, it will still be running over $100 billion or $1.2+ TRILLION in QE per year.

In simple terms, this time around, when bond yields begin to break out, it will be when the Fed is already pumping its brains out. 

And that’s when the End Game begins for the U.S.’s debt situation. 

The ONLY way the U.S. can continue to service its mountain of debt is if interest rates remain low. So, if interest rates are rising when the Fed is already engaged in EMERGENCY levels of intervention, it’s GAME. SET. MATCH.

When will this happen?

Put another way, when does the next crash hit?

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Posted in It's a Bull Market | Comments Off on When This Happens the U.S. Will Be Just Weeks Away From a Debt Crisis

Pop Quiz: What is the Top Performing Sector Right Now?

Posted on October 5, 2021 by The Phoenix

Pop quiz time… what is the single best investment opportunity on the planet right now?

Bitcoin? Penny stocks? Tech?

Try Energy.

The “left for dead” sector is absolutely on fire right now.

The top performing sector in the markets is Energy. Heck, it’s not even close! Energy stocks are up some 50%. The next best sector is Financials which are at 30%

Chart, histogram Description automatically generated

If you think that’s crazy, consider that oil prices are up an incredible 60% year to date (black line in the chart below). Not only is this FOUR TIMES the performance of the stock market (red line in the chart below)… but oil is only slightly behind BITCOIN, a crypto currency renowned for its insane price moves, by about 10%!!!

Chart, histogram Description automatically generated

And best of all… this massive bull market is only just beginning. Oil has only just broken out of a 12-year downtrend.

Chart, diagram Description automatically generated

With the right investments, we are talking about the opportunity to make literal fortunes from this massive secular shift.

We’ll be covering this incredible opportunity in the coming days and weeks… how best to profit from it, what are the unique plays that Wall Street has yet to find… and more.

You won’t want to miss this!

To make sure you don’t, sign up for our FREE Daily Market Commentary GAINS PAINS & Capital using the below link:

https://gainspainscapital.com/

Posted in Trading Opportunity | Comments Off on Pop Quiz: What is the Top Performing Sector Right Now?

Not One Sector Is in an Uptrend… Is A Crash About to Hit?

Posted on October 4, 2021 by The Phoenix

Stocks are now on the edge of a cliff.

The S&P 500 broke below its 50-DMA two weeks ago. It has since failed to reclaim this line. That is the first time this has happened this year.

The good news is that 4,300 (purple line in the chart below) served as support last week for the market. But if the bulls cannot rally here and now, we’ll likely see a drop to the 200-DMA (currently at 4,161).

Chart, histogram Description automatically generated

To make matters worse, the weekly MACD is on a “sell signal” (red circle in the chart below). You’ll note that this sell signal is quite different from previous signals in its depth and violence.

Chart, histogram Description automatically generated

And finally, as of Friday, we had a new slew of weekly candles. Not one sector of the S&P 500 is in an uptrend. At best we have one that might be in an uptrend. The other 10 sectors are all in confirmed downtrends, meaning over 87% of the market’s weighting is in downtrends.

A picture containing text, receipt Description automatically generated

This is all REALLY bad news. With this much of the market’s weight in downtrends, the door is open to some REAL fireworks!

This has many investors asking…

IS A CRASH ABOUT TO HIT!?!?

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in stock collapse? | Comments Off on Not One Sector Is in an Uptrend… Is A Crash About to Hit?

Stocks Are Sitting on the Ledge of a Cliff

Posted on October 4, 2021 by The Phoenix

Stocks are now on the edge of a cliff.

The S&P 500 broke below its 50-DMA two weeks ago. It has since failed to reclaim this line. That is the first time this has happened this year.

The good news is that 4,300 (purple line in the chart below) served as support last week for the market. But if the bulls cannot rally here and now, we’ll likely see a drop to the 200-DMA (currently at 4,161).

Chart, histogram Description automatically generated

To make matters worse, the weekly MACD is on a “sell signal” (red circle in the chart below). You’ll note that this sell signal is quite different from previous signals in its depth and violence.

Chart, histogram Description automatically generated

And finally, as of Friday, we had a new slew of weekly candles. Not one sector of the S&P 500 is in an uptrend. At best we have one that might be in an uptrend. The other 10 sectors are all in confirmed downtrends, meaning over 87% of the market’s weighting is in downtrends.

A picture containing text, receipt Description automatically generated

This is all REALLY bad news. With this much of the market’s weight in downtrends, the door is open to some REAL fireworks!

This has many investors asking…

IS A CRASH ABOUT TO HIT!?!?

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in stock collapse? | Comments Off on Stocks Are Sitting on the Ledge of a Cliff

September Ends BADLY… is a Crash About to Hit?

Posted on October 1, 2021 by The Phoenix

Stocks ended the month with an extremely ugly candle.

As the below chart shows, September ended outside the range of August (purple circle in the chart below). Historically, these developments usually resolve with the stock market testing its 10-month moving average (MMA).

As I write this Friday that line is at 4,116, however, we can expect it to rise to 4,1150 or so in the coming weeks. So, we’re talking about stocks dropping another 5% from here, which would bring the total correction to 10% or so.

Chart, waterfall chart Description automatically generated

The bigger question is if stocks will stop there.

Despite the recent drop, stocks are still extremely stretched above their 20-MMA (some 13% to be precise). Historically any time the market has been this stretched, we’ve seen a drop to the blue line.

Chart Description automatically generated

This has many investors wondering if a crash is about to hit.

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in stock collapse? | Comments Off on September Ends BADLY… is a Crash About to Hit?

Stocks Need to Rally Hard Now or We Have a Top in Place

Posted on September 30, 2021 by The Phoenix

Today is also the second to last day of the week, which means we are about to see a new weekly candle on the charts.

If the markets do not rally hard into the end of the week, we will end this week without a single sector is in a definitive uptrend. We have two potential uptrends (Consumer Discretionary and Financials), but everything else would be in a confirmed DOWN-trend.

This means NONE of the market would be in a confirmed uptrend and a full 76% of the market would in a DOWN-trend.

Sector Symbol Uptrend? Weighting
Technology XLK No 27.60%
Health Care XLV No 13.50%
Consumer Discretionary XLY Maybe 12.70%
Communication Services XLC No 10.80%
Financials XLF Maybe 10.40%
Industrials XLI No 8.40%
Consumer Staples XLP No 6.50%
Utilities XLU No 2.80%
Materials XLB No 2.60%
Real Estate XLRE No 2.40%
Energy XLE No 2.30%
In Uptrend 0.00%
Counting Maybes 23.10%

This is the kind of environment in which real FIREWORKS can hit. Indeed, the below chart needs no explanation.

This has many investors asking themselves, “ is a crash about to hit?”

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in It's a Bull Market | Comments Off on Stocks Need to Rally Hard Now or We Have a Top in Place

The Market is in Serious Trouble

Posted on September 29, 2021 by The Phoenix

The markets are bouncing today, but nothing has been resolved.

The technical damage from the last few weeks has been horrific. The two most heavily weighted sectors in the S&P 500 (Tech and Healthcare) are in confirmed downtrends.

Tech (XLK) has broken below its 50-DMA. It also as a sell on its weekly MACD.

Diagram Description automatically generated with low confidence

It’s the same story for Healthcare (XLV).

Chart, histogram Description automatically generated

These two sectors alone count for 40% of the S&P 500’s weighting. With both breaking down like this, the market is under significant duress. Throw in the fact that all but three sectors are in a similar situation, and we have some 85% of the market’s weighting in DOWNTRENDS.

This is the kind of environment in which fireworks can hit.

But is a crash about to hit?

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in stock collapse? | Comments Off on The Market is in Serious Trouble

If You Think Inflation is GOOD For Stocks… Take a Look at This

Posted on September 28, 2021 by The Phoenix

The Fed continues to push the narrative that inflation is transitory.

On one level, Fed officials are correct. Everything is transitory. But the Fed isn’t being philosophical here…it’s attempting to argue that they don’t need to do anything, and the current wave of inflation will naturally dissipate.

I know, this is ridiculous. But the Fed is so desperate to maintain its $120 billion per month money printing scheme, that it must come up with ridiculous excuses.

First it tried Climate Change, but since it’s not clear how printing money fixes the weather, they’ve shifted gears to claiming inflation isn’t an issue and will go away on its own.

Why do this?

Well, it’s difficult to claim that printing $1.4 TRILLION per year is a benign enterprise when the cost of living is rising by double digits. And so we end up with ridiculous situations in which Fed officials are forced to make foolish claims such as their biggest concern is that we won’t have enough inflation.

I’m not kidding.

Yesterday, Chicago Fed President Charles Evans stated the following whopper: “I am more uneasy about us not generating enough inflation in 2023 and 2024 than the possibility that we will be living with too much.”

It’d be hilarious if it wasn’t causing so much suffering for everyday Americans. Anyone who’s been to the grocery store or filled up their cars at the gas station knows this is bunk.

The same goes for anyone who is paying attention to what the markets are actually saying. If you turn off the news and simply focus on the charts, it’s clear the market is SCREAMING “inflation!”

The top performing asset classes this year are Energy (XLE), Financials (XLF) and Real Estate (XLRE). They are up 43%, 33% and 26%, respectively.

Chart, line chart Description automatically generated

These are all inflation plays.

Energy and real estate are obvious. And Financials rally when yields rise (and yields are rising due to inflation). Heck, even Goldman Sachs has figured this out and is warning its private clients about a commodities super-cycle courtesy of an inflationary storm.

If you think this will be great news for the stock market, think again. During the last major bout of inflation in the 1970s, stocks collapsed some 50%. Even worse, they finished the decade DOWN.

Put another way, a crash is coming. The big question is, “WHEN?”

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in Inflation | Comments Off on If You Think Inflation is GOOD For Stocks… Take a Look at This

Bonds Just Called the Fed’s Bluff… Stocks Are on Borrowed Time

Posted on September 27, 2021 by The Phoenix

The biggest development last week was the breakout in the 10-year U.S. Treasury.

The 10-year US Treasury is arguably the single most important bond in the world. The yield on this bond represents the risk-free rate of return against which all risk assets (stocks, corporate bonds, mortgages, real estate, etc.) are valued.

Now, this yield moves based on a slew of issues: economic growth, portfolio balancing, Fed monetary policy, what’s happening in international bond markets… and inflation.

I mention all of this, because the yield on the 10-year US Treasury SPIKED sharply higher last week.

Chart Description automatically generated

Let’s put this spike in a larger context.

From August of last year (2020) until March of this year (2021), the yield on the 10-Year Treasury spiked rose rapidly as inflation entered the US financial system. I’ve illustrated this spike with a green arrow in the chart below.

Chart, line chart Description automatically generated

Then, in March of 2021, the Fed began to suggest that it was planning to tighten monetary policy. This hurt inflation expectations as the financial system began to believe the Fed would act quickly enough to stop inflation before it became a real problem. As a result of this, the yield on the 10-year Treasury dropped from March of 2021 until July.

I’ve illustrated this with a purple arrow in the chart below. This was, effectively, the bond market giving the Fed the benefit of the doubt when it came to monetary policy.

Chart, line chart Description automatically generated

In this context, last week’s spike in the yield on the 10-year US Treasury represents the first time since March that the bond market began to freak out about inflation again.

This is a MASSIVE deal. It tells us that the market has called the Fed’s bluff: that the Fed won’t act to stop inflation in time and that the economy and financial system are heading towards a crisis in the near future.

If the Fed acts now, by tightening monetary policy aggressively, it will crash stocks. After all, the primary driver of this insane stock market bubble has been the Fed keeping rates at zero and pumping $120 billion per month into the financial system.

And if the Fed DOESN’T act now, inflation will rage, leading to a stag-flationary collapse in the economy… and stocks will still crash as inflation destroys profits in the corporate sector.

Just like in the mid-1970s, when stocks dropped 50% as inflation crippled the economy.

Put simply: a crisis is coming no matter what the Fed does.

The big question is “WHEN”!?!?

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in stock collapse? | Comments Off on Bonds Just Called the Fed’s Bluff… Stocks Are on Borrowed Time

Anyone Who Understands Risk Management Is Watching This Like a Hawk

Posted on September 24, 2021 by The Phoenix

By Graham Summers, MBA

Was it a dead cat bounce… or something else?

On Monday, the markets were melting down due to fears of contagion from Evergrande, China’s second largest real estate company, going bankrupt.

Since that time, the market has bounced hard… despite the fact nothing has changed about Evergrande, or its $300 billion in debt, or the contagion issues that it presents to the financial system (commodities, EU banks, Australian miners, etc.).

So, the big question for stocks is: was this a dead cat bounce or the start of a new major rally?

Let’s find out.

The S&P 500 is attempting to reclaim its 50-day moving average (DMA). As the below chart shows, this line has acted as major support throughout much of 2021. So, the fact we broke below it is significant. If the S&P 500 cannot reclaim this level and stay there… then stocks are in MAJOR trouble.

For anyone who understands risk management, the below chart has been a MAJOR concern for the last few months. On a monthly basis, the S&P 500 is EXTREMELY overstretched to the upside. At a minimum, you would expect a drop to the 12-month moving average (MMA) to occur sometime this year.

This would mean a 10% drop in stock prices. 

Note in the above chart that every drop to the 12-MMA started with a significant black candle. We’ve got one week left in September, but it looks like we could be getting our first black candle of the year.

However, given that stocks are in their largest bubble of all time by some measures… that leverage levels are obscene, and that we are seeing the kind of mania associated with major tops… smart investors are asking…

“Is a Crisis about to hit?”

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in stock collapse? | Comments Off on Anyone Who Understands Risk Management Is Watching This Like a Hawk

An Urgent Update on China’s Black Swan

Posted on September 23, 2021 by The Phoenix

By Graham Summers, MBA

The markets have rallied hard on news of a potential Evergrande debt payment.

In case you’ve missed this story, Evergrande is a massive property developer in China. The company is effectively insolvent, and with $300 billion worth of debt many analysts were predicting this would lead to China’s “Lehman moment.”

We had some fireworks on Monday, but the markets have since rallied hard on news that Evergrande would make a payment on one of its Yuan-denominated bonds. 

That payment is expected to be made today.

Regardless of what happens with this specific payment, the fact remains that Evergrande is effectively insolvent. The chart says it all.

Moreover, this company is not an isolated situation. China’s government has made it clear it wants the real estate sector to deleverage, which means many of the over-indebted property developers are at risk of similar issues. Real estate and construction account for 16% of China’s ~$15 trillion economy… so this is not a small problem.

Keep an eye on BHP Group limited (BHP). As one of the largest Australian mining companies responsible for supplying China’s construction/real estate sectors, it’s a decent litmus test for whether or not this issue is really resolved or not.

As I write this, BHP is staging a VERY small bounce. The chart is profoundly ugly.

At the end of the day, whether Evergrande pays its bond or not today is just one paragraph in the book of bad debts that are floating around the financial system. The fact the Fed has spent over $4 trillion propping things up since 2020 doesn’t mean this whole mess won’t come crashing down.

In chart terms, it’s only a matter of time before this happens.

The multi-trillion dollar question is…

WHEN?!?!

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards,

Posted in stock collapse? | Comments Off on An Urgent Update on China’s Black Swan

At Some Point, We Are Revisiting That Blue Line

Posted on September 22, 2021 by The Phoenix

All eyes are on the Fed today.

The Fed is expected to announce its tapering schedule for its current $120 billion per month Quantitative Easing (QE) program. The Fed has been hinting at its plan for months, via both Fed officials and media proxies.

The current proposal appears to be a $10-$15 billion per month tapering program, starting in November 2021. This is a very rapid scheme that would bring its QE program to a complete end by mid-2022.

By way of comparison, during the Fed’s last QE taper (that pertaining to QE 3 in 2017), the Fed reduced the pace of its then-QE program by $10 billion every THREE months, with the pace stopping at $30 billion per month.

Again, the current proposed tightening is much faster and aggressive than the last.

The big question is how the markets digest this. The last time the Fed attempted to taper a major QE program, it ultimately blew up the corporate debt markets resulting in stocks collapsing 20% in a matter of weeks.

Chart Description automatically generated

Will the Fed blow things up again?

It’s quite possible, particularly when you consider that stocks are currently in their largest bubble in history by some measures… financial leverage is extraordinarily high… and we are seeing the types of mania associated with major market tops.

At the end of the day, the stock market is EXTREMELY overstretched above its 50 -month moving average. The only time it’s been more stretched was before the 1987 Crash and during the Tech Bubble.

Chart Description automatically generated

At some point we are revisiting that blue line. The market always does.

By the way, the 50-MMA is currently at 3,141 while the S&P 500 is at 4354.

The big question is WHEN will this happen?

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in stock collapse? | Comments Off on At Some Point, We Are Revisiting That Blue Line

This is the Kind of Environment In Which Crashes Can Happen

Posted on September 21, 2021 by The Phoenix

Stocks got creamed yesterday, but thanks to late day manipulation, they ended up well off the bottom.

From a purely technical perspective, the S&P 500 has broken below its 50-day moving average (DMA) for the first time since March 2021. Stocks then bounced hard off the 126-DMA (six month moving average).

Chart, line chart, histogram Description automatically generated

It will be crucial to see how the markets act the next few days. We’ve had three significant breaks below the 50-DMA since the March 2020 bottom: one in September ’20, October ’20 and March ’21 (purple circles in the chart below). All of those were resolved in a little over a week.

Chart Description automatically generated

On the surface things don’t look that bad. But “underneath the hood” things are terrible. None of the S&P 500’s sectors are in uptrends.

Table Description automatically generated

Moreover, four out of the five most heavily weighted stocks (AAPL, FB, AMZN, and GOOGL) have lost their 50-DMAs and are losing their uptrends.

This is the kind of environment in which actual crashes can happen. 

To figure this out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in stock collapse? | Comments Off on This is the Kind of Environment In Which Crashes Can Happen

China’s Black Swan Has Arrived… Are You Ready?

Posted on September 20, 2021 by The Phoenix

The market is a sea of red this morning.

The issue at hand is China’s massive Evergrande property developer. The company is effectively insolvent, with over $300 billion in bad loans. Many are calling this “China’s Lehman Moment.”

The company’s stock is down 80% Year to Date.

Chart Description automatically generated

How serious is this?

Serious.

Real estate comprises nearly 8% of China’s economy. Construction is another ~8%. So, all in all, you’re looking at 16% of the second largest economy in the world experiencing the bankruptcy of one of its largest players. This has significant implications for everything from commodities (use in construction) to finance (the loans used to build the buildings and finance the mortgages for consumers).

And in these types of situations, there is never just one player at risk.

Contagion has already begun. Hong Kong property developers and Chinese industrial producers are getting hit. And if you think this will be confined to China you are mistaken.

Australia supplies much of the commodities China uses for its construction. It is not coincidence that BHP Group (BHP) and other major Australian miners are nosediving, crashing 26% in the last few weeks.

A picture containing chart Description automatically generated

And then there’s European banks, which have massive exposure to China. By the look of the bloodbath this morning, things are spreading to there as well.

Table Description automatically generated

This is the problem with an Everything Bubble: you never know where the black swan is going to come from.

With the financial system in the single largest bubble of all time, and leveraged to the hilt by easy debt courtesy of Central Bank policies, even a single spark can set the whole thing to blow.

As I warned a few weeks ago, this whole mess will come crashing down one day. In market terms, this is going to happen, it’s just a matter of time.

The question of course is “when”?

To figure that out, I rely on certain key signals that flash before every market crash.

I detail them, along with what they’re currently saying about the market today in a Special Investment Report How to Predict a Crash.

To pick up a free copy, swing by

https://phoenixcapitalmarketing.com/predictcrash.html

Best Regards

Posted in Debt Bomb | Comments Off on China’s Black Swan Has Arrived… Are You Ready?

Ok, This is TRULY Horrifying!

Posted on September 17, 2021 by The Phoenix

 Yesterday, I outlined a terrible secret.

That secret?

That the Fed knows the official inflation measure, the Consumer Price Index (CPI) is practically useless for forecasting future inflation.

In a little-known paper published in 2001, the Fed found that food inflation, NOT CPI or PCE, is the best predictor of future inflation. Fed researchers wrote the following:

We see that past inflation in food prices has been a better forecaster of future inflation than has the popular core measure [CPI and PCE]…Comparing the past year’s inflation in food prices to the prices of other components that comprise the PCEPI (as in Table 1), we find that the food component still ranks the best among them all…

Source: St Louis Fed (emphasis added).

I want you to focus on these two admissions:

  1. The Fed has admitted that its official inflation measures do not accurately predict future inflation.
  • The Fed admitted that FOOD prices are a much better predictor of future inflation. In fact, food prices were a better predictor of inflation than the Fed’s PCE, non-durables goods, transportation services, housing, clothing, energy and more.

I mention all of this because today food inflation is erupting higher.

We already noted that agricultural commodities are ripping higher.

​

But the situation is even worse than I imagined. The below quote is truly horrifying…

Adjusted for inflation and annualized, [food] costs are already higher now than for almost anytime in the past six decades, according FAO data. Indeed, it’s now harder to afford food than it was during the 2011 protests in the Middle East that led to the overthrow of leaders in Tunisia, Libya and Egypt, said Alastair Smith, senior teaching fellow in global sustainable development at Warwick University in the U.K.

Source: Yahoo! Finance

Put simply, food inflation today than at almost any time in the last 60 years. That would include the 1970s, when inflation went into the double digits and the stock market crashed over 50% in a matter of months.

If you think we’re immune to something like this now, take a look at the below chart. This is a massive bubble, looking for a pin. And by the look of things, inflation is it!

On that note, we published a Special Investment Report concerning FIVE secret investments you can use to make inflation pay you as it rips through the financial system in the months ahead.

The report is titled Survive the Inflationary Storm. And it explains in very simply terms how to make inflation PAY YOU.

We made 100 copies available to the public.

Today is the last day this report is available to the general public.

To pick up yours, swing by:

https://phoenixcapitalmarketing.com/inflationstorm.html

Best Regards

​

​

Posted in Inflation | Comments Off on Ok, This is TRULY Horrifying!