Month: September 2013

Are we headed for another September Crisis?

In general the period from May until November is a time for market underperformance. The average performance for the period from May 1 through October 31 each year since 1950 is just 1.2%. The average performance for the other six months of the year (November 1 through April 30) each year since 1950 is 7.0%

Historically, September is has been the single worst month for stocks over the last 80 years. Since 1929, on average the S&P 500 has fallen 1.1% in September.

This is only one of three months to have an average negative return over this period. And it is the single worst month of the year (the other two are May with an average return of -0.1% and February with an average return of  -0.2%).

Moreover, it is the Autumn when banking and financial crises have a tendency to occur. In terms of specific months, September and October are the worst with issues that lead up crashes erupting in September with October being when the actual crashes finally hit. There were Crashes during these months in 1907, 1929, 1987, and 2008.

All told, there have been a total of 147 crises since 1970 in the world. September accounted for 27 of them, the single largest month.

For certain stocks are definitively in a bubble. Based simply on CAPE (cyclical adjusted price to earnings) the market is significantly overvalued with a reading of nearly 24 (anything over 15 is overvalued).

Indeed, we’ve only been at this level of valuation during major stock tops (1929, 1966, 2000, and 2007)

Now we have the Government potentially shutting down. The markets are open on Monday which will be the last day in September.

Are we going to get another September Crisis a day late?

If you’re looking for actionable investment strategies on playing the markets, take a look at my monthly investment newsletter, Private Wealth Advisory.

Published on the third Wednesday of every month after the market closes, Private Wealth Advisory, shows individual investors how to beat the market with well-timed unique investments.

To whit Private Wealth Advisory is the only newsletter to have shown investors 72 straight winning trades and no losers during a 12-month period.

Indeed, in the last two months alone we’ve locked in gains of 8%, 12%, 21% and even 28%... with an average holding period of 3-4 weeks.

To find out more about Private Wealth Advisory and how it can help you beat the market with your investments…

Click Here Now!

Best Regards

Graham Summers

 

 

Best Regards

Graham Summers

 

It’s often argued that they don’t a bell at the top.

I would argue that we numerous bells ringing in the financial markets today.

Carl Icahn wants Apple to leverage up to boost returns to shareholders. Apple has maintained next to no debt for the better part of ten years.

Now share price is lagging and the goal is to issue a load of debt to buy back shares. Leveraging up companies that have long had little debt is a classic market mania indicator

Hilton is trying to go public. Put another way, one of the largest commercial real estate/ hospitality chains in the world is going public after being private for over 40 years…

Why go public now? Because you can raise funds cheaply in today’s high liquidity environment and you don’t want to be holding the bag when the economy slumps again.

The large financial institutions that bought homes and real estate in the slump are looking to exit. These groups and their clients didn’t get rich by being wrong.

They’ve made their profits by buying when no one else wanted to and now they’re getting out. Hedge fund Och-Ziff, PE firm Blackstone, and others are unloading their real estate portfolios.

The smart money is getting out of the market. Fortress Investment Group, Apollo Investment Group and other large “smart money” investors are literally “selling everything” they can. They’re not doing this because they expect things to improve and the market to continue to move sharply higher.

Indeed, even investment legend Warren Buffett, who has virtually never advocated against investing in stocks (with the exception of the Tech Bubble) has stated the market is “fully valued” at today’s levels.

Buffett loves stocks. He’s made his fortune investing in them. He is a near eternal optimist. For him to state the markets are fully valued and be sitting in the single largest cash hoard of his investment life is a major indicator that stocks are topping.

If you’re looking for actionable investment strategies on playing the markets, take a look at my monthly investment newsletter, Private Wealth Advisory.

Published on the third Wednesday of every month after the market closes, Private Wealth Advisory, shows individual investors how to beat the market with well-timed unique investments.

To whit Private Wealth Advisory is the only newsletter to have shown investors 72 straight winning trades and no losers during a 12-month period.

Indeed, in the last two months alone we’ve locked in gains of 8%, 12%, 21% and even 28%… with an average holding period of 3-4 weeks.

To find out more about Private Wealth Advisory and how it can help you beat the market with your investments…

Click Here Now!

Best Regards

Graham Summers

 

Let’s put another nail in the coffin of the “recovery” talk.

Bernanke and the Fed allege that the purpose of QE is to help housing recovery. But rising home prices do not actually equate to increased “wealth” for the average American.

Homes, unlike most purchases (well at least in the past), are financed via debt. In this regard the “homeowner” doesn’t actually “own” the home; the bank does. And anyone who looks at how much money banks make from mortgage lending can easily assess who comes out on top from that deal: hint it’s not the homeowner.

Say I buy a home for $200K with a down payment of $40K. I only own $40K worth of home. And if the home rises in value to $220K, I still owe the bank $180K. Sure, you could technically argue that I’ve made $20K off my initial $40K, but that would only count if I sold the house right then and there.

If I don’t sell the house, then technically I’m not wealthier, I’m just slightly less in debt (on paper). This fact becomes abundantly clear the minute I stop paying my mortgage and the bank comes knocking.

With that in mind, we need to ask, just who is wealthier as a result of the new housing bubble the Fed has created?

It’s not most Americans. According to the US census only 29% of us own our homes outright. Rather, it’s the banks and the large institutional investors who bought up thousands of homes in cash during the “recovery.”

This is not rocket science; it’s common sense. But the Fed keeps talking about a housing “recovery” like it’s helping Main Street. It’s doing no such thing. All of the Fed’s policies have been aimed at helping the large banks. They’re the ones who own the US’s homes.

If you’re concerned about your portfolio taking a hit when the bubble bursts, I strongly urge you to consider an annual subscription to my Private Wealth Advisory newsletter.

Private Wealth Advisory specializes in helping individual investors profit from any market environment. In 2008 the Private Wealth Advisory portfolio returned 7%. In 2011 it returned 9% (the market was flat). And from July 2011-July 2012, Private Wealth Advisory set a record for the investment newsletter industry, closing out 74 straight winning investments.

During this entire 12 month period, we didn’t close a single loser.

In fact, we’re currently on another winning streak having locked in FOURTEEN winning trades in the last two months, including gains of 10%, 11%, 21% and 25%. And our portfolio is on the move with winners number 15, 16, and 17 just waiting in the wings.

To take action to prepare for what’s coming… and  start taking steps to insure that when this bubble bursts you don’t lose your shirt.

Click Here Now!

Yours in Profits,

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

 

 

Finally the mainstream media is beginning to get the problems with the Federal Reserve.

The Fed claims it can generate a “recovery.” It cannot. The Fed’s devaluation of our currency is the very reason why the economy is a disaster.

According to the NY Times the average net worth for Middle class Americans in 2010 was 6% lower adjusted for inflation than their average net worth in 1989.

As the Times notes, these folks are “more educated and worked more hours, on average, and had children at a later age” than their 1989 counterparts. But none of these compensated for the fact that costs of living have skyrocketed between then and now.

As the articles notes, housing costs 56% more than in 1989, our of pocket healthcare expenses rose 155%, college expenses are up in the double digits.

The Fed is responsible for the Dollar devaluation that caused this. The Fed is the one that eviscerated the Middle Class. Its policies have lowered the quality of life for Americans. Period. End of story.

The fact that we’re now relying on these same folks to somehow fix the problems they created by endorsing even more aggressive versions of the very policies that created these problems is a dead end.

Sure, stocks will rise, but adjusted for inflation, Gold was a better investment since we left the Gold standard in 1968. Indeed, the only time stocks outperformed Gold from 1968 onward was during the Tech Bubble.

And the Fed wants us to pile into stocks now while it’s boosting inflation?

We all know how bubbles end: BADLY.

The time to prepare for this is not once the collapse begins, but NOW, while stocks are still rallying. Stocks take their time moving up, but when they crash it happens VERY quickly.

With that in mind, I’ve already urged my Private Wealth Advisory clients to start prepping. We’ve opened six targeted trades to profit from the stock bubble bursting.

We’ve also taken care to prepare our finances and our loved ones for what’s coming, by following simple
easy to follow steps concerning our savings, portfolios, and personal security via my Protect Your Family, Protect Your Savings & Protect Your Portfolio reports.

I’ve helped thousands of investors manage their risk and profit from market collapses. During the EU
Crisis we locked in 72 straight winning trades and not one loser, including gains of 18%, 28% and more.

In fact, we’re currently on another winning streak having locked in FOURTEEN winning trades in the last two months, including gains of 10%, 11%, 21% and 25%.

All for the the small price of $299: the annual cost of a Private Wealth Advisory subscription.

To take action to prepare for what’s coming… and  start taking steps to insure that when this bubble bursts you don’t lose your shirt.

Click Here Now!

Yours in Profits,

Graham Summers

 

 

Market tops always involve insanity. And today we have that in abundance.

On Wednesday the Fed surprised the world by not announcing a QE taper. Stocks and all “risk” assets exploded higher. Today, a mere 48 hours later, Fed President Bullard says the Fed should taper soon. Stocks collapse.

For the markets to react so significantly to such issues is a tell-tale sign that we are near a major top. The reliance on Fed stimulus has never been greater with even a hint of Fed policy actually having more impact that the policy itself.

Rumors, whispers and threats dominate trading. This is the sign of market mania.

The most important element is that this mania has been driven by the Fed, not some new technology (the Internet in the tech bubble), new asset growth (housing), but the Central Bank.

In the past, the Fed has been the fuel for bubbles. This time around, the Fed IS the bubble itself, with its balance sheet expansion driving ALL assets higher.

So when this bubble bursts, it will be truly catastrophic because no one can bail out the Fed. Interest rates are already at Zero. QE is already running non-stop. There will literally be nothing the Fed can do.

I cannot say the top is in today, nor can I say it will be here in a week. But THE top is forming. And it will be absolutely awful when it’s done. We’ve now had three SERIAL bubbles in the markets in the last 13 years. Each bubble’s bursting has been worse than the last. The next one will be THE biggest one yet.

If you’re looking for actionable investment strategies on playing the markets, take a look at my monthly investment newsletter, Private Wealth Advisory.

Published on the third Wednesday of every month after the market closes, Private Wealth Advisory, shows individual investors how to beat the market with well-timed unique investments.

To whit Private Wealth Advisory is the only newsletter to have shown investors 72 straight winning trades and no losers during a 12-month period.

Indeed, in the last two months alone we’ve locked in gains of 8%, 12%, 21% and even 28%… with an average holding period of 3-4 weeks.

To find out more about Private Wealth Advisory and how it can help you beat the market with your investments…

Click Here Now!

Best Regards

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Fed failed to announce a Taper yesterday of any kind.

It is positively outrageous, but it does inform us of many things.

First and foremost, the Fed has made it clear that it cannot be hawkish is any way. We had just two months of hinting at tapering QE from the Fed (Bernanke was back talking up how accommodating he’d be by July).

So for all the talk of taper and shifting to a more hawkish tone, the Fed’s actions speak louder than words: the Fed is totally and completely incapable of being hawkish at this time.

Secondly, the Fed knows that the US economy is a total disaster. If tapering even $10-15 billion per month from $85 billion month QE programs would damage the economy, then we’re all up you know what creek without a paddle.

Put it this way… here we are, five years after 2008, and the Fed is stating point blank that the economy would absolutely collapse if it spent any less than $85 billion per month. This admission has proven just how long ago we crossed the Rubicon. We’re already in the End Game. Period.

Finally, the Fed has proven that it has absolutely no exit strategy. The Fed is going to print money and buy bonds until the entire financial system collapses. Any time stocks fall it will try to rescue the markets. And it is going to do this ad infinitum because it has no clue what else to do.

In plain terms, the Fed has proven beyond even a hint of a doubt that it is simply flying by the seat of its pants, with no clear game plan or eventual outcome in mind. The Fed is simply going to keep doing what it’s done for five years until something breaks.

That something will be the entire financial system. We will have a crisis that is substantially worse than 2008. It is coming. In fact it is now coming much sooner than it would have had the Fed announced a taper yesterday.

In the meantime, inflation is soaring. The Fed continues to lie about CPI and inflation but the reality is that the cost of everything is going up. I’m sure you’ve noticed prices have begun rising already. This is only going to be getting worse going forward. Which is why now is the time to be preparing ourselves and our portfolios for this. Inflation can take its time to arrive. But once it does… things move very very quickly.

If you’re concerned about inflation… and want to learn more about simple bit highly effective ways you can shield yourself from it…

Click Here Now!!!

Best Regards,

Graham Summers

 

 

 

 

 

The markets roared higher over the weekend when Larry Summers withdrew his candidacy for Fed Chairman. This makes Janet Yellen of the San Francisco Fed the current favorite for next Fed Chair.

Truth of the matter is that neither candidate should be considered for Fed Chairman.

Summers was one of the chief architects for the 2008 meltdown, repeatedly pushing back on anyone who wanted to regulate the derivatives markets. This in of itself should bar him from ever being considered for a position of influence in the financial markets.

Yellen on the other hand is yet another academic with no business or banking experience. She was one of the primary forces behind QE at the Fed and has repeatedly advocated for more QE despite the fact that there is no evidence it has succeeded now (nor is there any evidence that it succeeded in the past).

Thus, we literally had a choice between one candidate who helped blow up the entire financial system and another candidate who has no idea of how the economy works outside of textbooks.

Regardless, the markets perceived Summers as hawkish and so they are ripping higher today believing that the next Fed chair will continue to maintain Bernanke’s policy of leaving a paper weight on the “print” button.

The markets are going positively manic on the news.

This feels like the final push before a more serious correction. The Fed meets on Wednesday at which point it is expected we’ll see a QE taper announcement.

The fact of the matter however is that Bernanke has created a bubble that is even bigger than that of 2007.

We all know how bubbles end: BADLY.

The time to prepare for this is not once the collapse begins, but NOW, while stocks are still rallying. Stocks take their time moving up, but when they crash it happens VERY quickly.

With that in mind, I’ve already urged my Private Wealth Advisoryclients to start prepping. We’ve opened six targeted trades to profit from the stock bubble bursting.

We’ve also taken care to prepare our finances and our loved ones for what’s coming, by following simple
easy to follow steps concerning our savings, portfolios, and personal security via my Protect Your Family, Protect Your Savings & Protect Your Portfolio reports.

I’ve helped thousands of investors manage their risk and profit from market collapses. During the EU
Crisis we locked in 72 straight winning trades and not one loser, including gains of 18%, 28% and more.

In fact, we’re currently on another winning streak having locked in FOURTEEN winning trades in the last two months, including gains of 10%, 11%, 21% and 25%.

All for the the small price of $299: the annual cost of a Private Wealth Advisory subscription.

To take action to prepare for what’s coming… and  start taking steps to insure that when this bubble bursts you don’t lose your shirt.

Click Here Now!

Yours in Profits,

Graham Summers

 

 

The following is an excerpt from a recent issue of Private Wealth Advisory.

As noted yesterday, generally speaking stocks today are showing all of the hallmark signs of topping out. The market is overpriced, overbought, the smart money is selling, CEOs are bearish, market breadth is shrinking and earnings growth looks poor.

Now, I am not officially calling a top in the market today. But I do want to alert you that a top of some kind, possibly major, is forming.

In terms of predicting how far the market will fall, we first need to consider that the stock market is in a bubble. Historically, bear markets feature a drop of 32%. Bursting bubbles on the other hand, usually feature a drop of 50%. Indeed, if you look at the last two market Crashes over the last 13 year, all of them featured drops of roughly 50% or so.

Based on this measurement, this would mean the S&P 500 falling to sub-900.

Other indications of a market top forming can be drawn from historical price movements. Mark Hulbert from Marketwatch recently noted that of 35 market tops since the 1920s, the preceding bull market has seen stocks rise 21% in the previous 12 months.

The S&P 500 just hit a 23% gain in the last 12 months (see Figure 5 below). So we’re on track with a market top in terms of historic price trends.

Finally, there are major valuation concerns for the markets today. Since the S&P 500’s founding in 1926, stocks have returned an average of 11% per year.

Consider the following: had you invested $10,000 in the S&P 500 in 1926 (at that time it was the S&P 90) with dividends reinvested today it would be worth over $33 million.

Without dividends reinvested, it would be worth $1.9 million. Put another way, without dividends, which are paid out of earnings, stocks return only slightly more than Treasuries, though with considerably more risk.

Thus, the ideal time to invest in stocks is a time in which future earnings yields from stocks are expected to grow considerably. This would indicate that dividends are likely to grow, thus allowing for a considering stock market “premium” in terms of returns.

Today is not such a time. As famed value investor John Hussman notes, the 10-year Treasury bond is currently yielding 2.6%. Hussman believes stocks will average 2.8% per year going forward for the next 10 years.

Thus, there is literally no “equity risk premium” at this time. Put another way, the benefits of owning stocks based on future earnings is simply NON-existent.

The time to prepare for this is not once the collapse begins, but NOW, while stocks are still rallying. Stocks take their time moving up, but when they crash it happens VERY quickly.

With that in mind, I’ve already urged my Private Wealth Advisoryclients to start prepping. We’ve opened six targeted trades to profit from the stock bubble bursting.

We’ve also taken care to prepare our finances and our loved ones for what’s coming, by following simple
easy to follow steps concerning our savings, portfolios, and personal security via my Protect Your Family, Protect Your Savings & Protect Your Portfolio reports.

I’ve helped thousands of investors manage their risk and profit from market collapses. During the EU
Crisis we locked in 72 straight winning trades and not one loser, including gains of 18%, 28% and more.

In fact, we’re currently on another winning streak having locked in FOURTEEN winning trades in the last two months, including gains of 10%, 11%, 21% and 25%.

All for the the small price of $299: the annual cost of a Private Wealth Advisory subscription.

To take action to prepare for what’s coming… and  start taking steps to insure that when this bubble bursts you don’t lose your shirt.

Click Here Now!

Yours in Profits,

Graham Summers

 

 

 

The following is an excerpt from a recent issue of Private Wealth Advisory.

Tops never form cleanly.

I’ve made the mistake of attempting to call a top on the “dot” in the past. The reality is that anyone who attempts to do so is exercising their ego more than their judgment.

Market tops occur when investor psychology changes. But it’s not a clean shift. Investors, like any category of people, are comprised of numerous groups or sub-sects: some get it sooner than others.

In this sense there are certain tell tale signs that a top is forming. This doesn’t mean a top is “in” nor does it imply a specific timeline for a top to form (say a week vs. a few weeks).

However, there are clear signals that appear around tops. And I want to alert you that multiple ones are flashing right now.

First and foremost, the number of stocks that continue to break to new highs is contracting sharply.

This means that fewer and fewer stocks are breaking out to new highs while the market continues to surge higher. In other words, the market rally is being driven by fewer and fewer companies.

We get additional confirmation that the market is likely forming a top from the “smart money.”

Over the last 12 months, institutional investors have been net sellers of stocks for most of the time. This trend became much more pronounced in July with institutions selling an average of $1 billion in stocks during that .

In particular I want to note that institutional investors are dumping stocks at a pace last seen in the first half of 2008.

Among the financial institutions that are dumping stocks include Apollo Group, Blackstone Group, and Fortress Investment Group.

These groups are not only selling themselves, but have been urging their high net worth clients to sell stocks as well.

In addition to this, those at the top of the corporate food chain are uneasy with the prospects for growth. According to Markit’s semi-annual Global Business Outlook Survey of 11,000 CEOs found Chief Executives to be the most negative since the depths of the Great Recession in early 2009.

Thus, we see the “smart money” exiting the markets.  We also see fewer and fewer companies participating in the market rally. Those who run these companies are more pessimistic than at any point in the last five years dating back to the nadir of the 2009 collapse. And finally we have investors as a whole displaying the most complacency about the market in history.

On that note, Ben Bernanke has created the mother of all bubbles.

Today, the S&P 500 is sitting a full 30% above its 200-weekly moving average. We have NEVER been this overextended above this line at any point in the last 20 years.

Indeed, if you compare where the S&P 500 is relative to this line, we’re even MORE overbought that we were going into the 2007 peak at the top of the housing bubble.

We all know how bubbles end: BADLY.

This time will be no different. The last time a major bubble of these proportions burst, we fell to break through this line in a matter of weeks.

We then plunged into one of the worst market Crashes of all time.

By today’s metrics, this would mean the S&P 500 falling to 1,300 then eventually plummeting to new lows.

This is not doom and gloom. This is a fact. The Fed has created an even bigger bubble than the 2007 one.

The time to prepare for this is not once the collapse begins, but NOW, while stocks are still rallying. Stocks take their time moving up, but when they crash it happens VERY quickly.

With that in mind, I’ve already urged my Private Wealth Advisory clients to start prepping. We’ve opened six targeted trades to profit from the stock bubble bursting.

We’ve also taken care to prepare our finances and our loved ones for what’s coming, by following simple
easy to follow steps concerning our savings, portfolios, and personal security via my Protect Your Family, Protect Your Savings & Protect Your Portfolio reports.

I’ve helped thousands of investors manage their risk and profit from market collapses. During the EU
Crisis we locked in 72 straight winning trades and not one loser, including gains of 18%, 28% and more.

In fact, we’re currently on another winning streak having locked in FOURTEEN winning trades in the last two months, including gains of 10%, 11%, 21% and 25%.

All for the the small price of $299: the annual cost of a Private Wealth Advisory subscription.

To take action to prepare for what’s coming… and  start taking steps to insure that when this bubble bursts you don’t lose your shirt.

Click Here Now!

Yours in Profits,

Graham Summers

 

The market is being ramped higher by traders who believe:

1)   The US’s delay in entering Syria is bullish

2)   That the PMI data out of Europe indicates all is well over there.

The primary concern with these beliefs is that they overlook at tremendous amount of problems brewing in the financial system.

1)   The 10-year bond is yielding 3%. Contrary to what a Central Banker will tell you, higher interest rates are not good for stocks, particularly in an over-leveraged financial system.

2)   The European Crisis is not over in any way. Things were swept under the rug for Merkel’s re-election, but Portugal, Greece, Ireland and even France are on the verge of economic implosion. And as Cyprus’s “bail-in” and Poland’s recent nationalization of pension funds indicate, the next time stuff hits the fan, citizens will be literally picking up the tab with their savings.

3)   The world continues to believe China has “rebalanced its economy” when in fact China is simply pumping massive liquidity into its shadow banking system. What could go wrong with this? After all, China put an amount of liquidity equal to over 20% of its economy into the shadow banking system from 4Q12-1Q13 and GDP slowed.

The markets seem to sense that all of this. In the US we’re putting in what looks like a lower high. The market appears to be forming a Head and Shoulders pattern.

If you’re looking for actionable investment strategies on playing the markets, take a look at my bi-weekly investment newsletter, Private Wealth Advisory.

Published every other Wednesday after the market closes, Private Wealth Advisory, shows individual investors how to beat the market with well-timed unique investments.

To whit Private Wealth Advisory is the only newsletter to have shown investors 72 straight winning trades and no losers during a 12-month period.

Indeed, in the last month alone we’ve locked in gains of 8%, 12%, 21% and even 28%… with an average holding period of 3-4 weeks.

To find out more about Private Wealth Advisory and how it can help you beat the market with your investments…

Click Here Now!

Best Regards

Graham Summers

 

 

 

 

 

 

The US economy continues to be a disaster.

Last week’s jobs report was just plain awful. The media is trumpeting the fact that the unemployment percentage fell, but they forgot to mention that this is because over 500,000 people left the labor force.

Indeed, the actual number of folks who left the labor force (516,000) was a RECORD. And the number of people not in the labor force is another record at 90.47 million.

This is not because these people found jobs, nor is it because the economy is improving. It’s because the Feds don’t count you as “unemployed” if you stop looking for work.

On top of this, the labor participation rate (total number of those employed divided by those of working age) fell to 63.2%. This is the lowest level since the late ‘70s. As a segment, men have an employment ratio of 69.5%. This is the single lowest reading in the history of this metric (going back to 1948).

So that’s three economic records. None of them good.

Add to this the new record of people on food stamps and you have an economic disaster.

This is an economic disaster. It shows us point blank that the economy has not recovered and that all talk of recovery is based on either phony data or outright fraud.

The fact of the matter is that we are on the cusp of a market correction if not something more.

On that note, I’ve already prepared readers of my Private Wealth Advisory newsletter with a number of targeted investment strategies designed to help them not only manage risk, but produce outsized profits during the economic slowdown.

Already we’ve locked in 14 straight winners over the last two months including gains of 11%, 14% and 25%. More are coming.

Indeed, during the first round of the Euro Crisis we locked in 73 straight winning trades and not one single closed loser. That was during a time when the market went nowhere.

So we’re getting ready for another similar winning streak during this next round of economic contraction. You can make money during times of slow growth, but you need the right investment strategies.

If these sound like the kind of investment strategies you could use for your portfolio, I suggest taking out a trial subscription to Private Wealth Advisory. You’ll immediately begin receiving my bi-weekly investment reports outlining the most important developments in the market.

You’ll also receive my real-time trade alerts, telling you the minute it’s time to open or sell a trade.

All just for $299 a year.

You get:

• 26 bi-weekly investment reports (ranging from 15-30 pages in length)
• Six Special Reports outlining unique opportunities and risks in the markets that 99% of investors don’t know about.
• 30-50 trades per year provided to you in real time
• The sense of calm in knowing that you’ve got your financial house in order.

To sign up for Private Wealth Advisory…

Click Here Now!!!

Yours in Profits,

Graham Summers

Chief Market Strategist

Phoenix Capital Research

 

 

 

 

 

The facts are now becoming abundantly clear, that the forecast we’ve maintained for well over two years has been validated: the US is in a DE-pression and both Washington and the Federal Reserve have wasted trillions of Dollars.

The reality is that what’s happening in the US today is not a cyclical recession, but a one in 100 year, secular economic shift.

See for yourself. Here’s duration of unemployment. Official recessions are marked with gray columns. Bear in mind that the Feds measure unemployment based on people looking for work, so if you stop looking, you no longer count as unemployed and this number will fall.

Even with this accounting gimmick, the average duration is still at 35 weeks.

Here’s the labor participation rate with recessions again market by gray columns:

Another way to look at this chart is to say that since the Tech Crash, a smaller and smaller percentage of the US population has been working. Today, the same percentage of the US population are working as in 1978.

Here’s industrial production. I want to point out that during EVERY recovery since 1919 industrial production has quickly topped its former peak. Not this time. We’ve spent literally trillions of US Dollars on Stimulus and bailouts and production is well below the pre-Crisis highs.

Here’s a close up of the last 10 years.

Again, what’s happening in the US is NOT a garden-variety cyclical recession. It is a STRUCTURAL SECULAR DEPRESSION.

And those who claim we’ve turned a corner are going by “adjusted” AKA “massaged” data. The actual data (which is provided by the Federal Reserve and Federal Government by the way) does not support these claims at all. In fact, if anything they prove we’ve wasted money by not permitted the proper debt restructuring/ cleaning of house needed in the financial system.

Which is why smart investors are already preparing for a market meltdown.

On that note, I’ve already prepared readers of my Private Wealth Advisory newsletter with a number of targeted investment strategies designed to help them not only manage risk, but produce outsized profits during the coming economic slowdown.

Already we’ve locked in 14 straight winners over the last two months. More are coming.

Indeed, during the first round of the Euro Crisis we locked in 73 straight winning trades and not one single closed loser. That was during a time when the market went nowhere.

So we’re getting ready for another similar winning streak during this next round of economic contraction. You can make money during times of slow growth, but you need the right investment strategies.

If these sound like the kind of investment strategies you could use for your portfolio, I suggest taking out a trial subscription to Private Wealth Advisory. You’ll immediately begin receiving my bi-weekly investment reports outlining the most important developments in the market.

You’ll also receive my real-time trade alerts, telling you the minute it’s time to open or sell a trade.

All just for $299 a year.

You get:

• 26 bi-weekly investment reports (ranging from 15-30 pages in length)
• Six Special Reports outlining unique opportunities and risks in the markets that 99% of investors don’t know about.
• 30-50 trades per year provided to you in real time
• The sense of calm in knowing that you’ve got your financial house in order.

To sign up for Private Wealth Advisory…

Click Here Now!!!

Yours in Profits,

Graham Summers

Chief Market Strategist

Phoenix Capital Research

 

 

 

 

 

 

 

 

Value investing is often too narrow-minded.

What I mean by this is that value investors will often focus on a company’s “value” using a number of metrics and ignore all other aspects of its business.

For example, let’s say you find a company trading at 50% of its value. This in of itself would qualify this company as a “deep value” investment.

However, the question has to be asked, “why is this company trading at a 50% discount to its ‘value’?”

Put another way, what do you see in this company that the market does not?

The market misprices investments about as often as it accurately prices investments. It’s up to the value investor to determine when a company’s true “value” is and how it compares to the value at which the market is currently prices it.

My point with this is that companies’ stock prices do not trade in a vacuum. Earnings come from the economy (whether it be the public or private sector). In this aspect consumer trends, incomes, supply shocks and other external forces meet a company’s internal strengths (competitive advantages, competent management and the like).

I raise this issue because I regularly hear the media talking about how stocks are “cheap” and that it’s time to buy. But if the economy is contracting sharply (which it currently is) then even “undervalued” stocks will be affected.

With that in mind I want to draw you to the acceleration of economic deterioration in the US.

Those of you who regularly read us know that we prefer to use nominal GDP as a measurement of GDP growth in the US.

The reason for this is that all “adjusted” GDP data involves a “deflator” metric that is meant to adjust for inflation. The Feds often use an inflation adjustment that is even lower than their official Consumer Price Index metric (which is already massaged to downplay inflation) in order to make GDP growth look greater.

Consider this simple example. Let’s say that the US GDP grew by 10% last year. Now let’s say that inflation also grew by 10%. In this scenario, real inflation adjusted GDP growth was ZERO.

However, announcing ZERO GDP growth is a major problem politically. So what do the Feds do? They claim that inflation was just 8%, and BOOM you’ve got 2% GDP growth announced for a year in which real GDP growth was actually zero.

Using nominal GDP, it’s clear the US is back in recession as the year over year change has brought us to a reading of sub-4. Every time this has happened in the last thirty years the US economy has been in recession.

Investing in this environment requires careful stock selection, which is why we’ve created our new long-term value investing newsletter Cigar Butts and Moats which utilizes precisely the same techniques that Benjamin Graham and Warren Buffett used to amass their fortunes.

Already one of our picks is up 7% in just a month. And our others are on the verge of breakouts as well.

To sign up for Cigar Butts and Moats at a special entry level offer of $79.99.

Click Here Now!

Graham Summers

 

The market is erupting higher on the usual start of the month buying and some gimmicked economic data out of Europe.

In this case, the specific data point in question is Europe’s Performance of Manufacturing Index or PMI, which rose to a 26 month high. This, combined with claims that Europe’s recession is “over” has convinced traders that the European crisis has officially been put to rest.

I’ve written at length about how politics drives everything in Europe (particularly the media). German Chancellor Angela Merkel, the woman with her finger on the “bailout” button for Europe, is up for re-election at the end of September. It is not coincidence that we’ve seen a sudden improvement in Europe’s economic data in the last two months going into this event.

After all, the alternative to Merkel’s re-election is politically unsavory for Europe: Merkel’s primary opposition wants an end to the bailouts and Germany out of the Euro.

If you were a totally bankrupt European Government relying on the promise of additional funds from Germany to stay in power and your options were A) start cranking out better data now with the promise of future bailouts from Germany or B) having to deal with a German Chancellor who wants out of the Euro… which would you choose?

Indeed, if the European Crisis is over, why did Germany’s Finance Minister just admit that Greece needs another bailout? It’s been nearly four years since Greece’s debt woes first surfaced officially. Four years and three bailouts later and Greece is still not fixed… but the European recession is over as is the European debt Crisis?

Right.

This move today feels like a dead cat bounce. Spain’s stock market, the Ibex, which remains the canary in the coalmine for Europe, is rallying to retest former support:

If we cannot break back above this line and stay there, then the market has called BS on the media’s campaign to convince the world that Europe is fine.

On that note, I’ve already prepared readers of my Private Wealth Advisory newsletter with a number of targeted investment strategies designed to help them not only manage risk, but produce outsized profits during the coming economic slowdown.

Already we’ve locked in 14 straight winners over the last two months. More are coming.

Indeed, during the first round of the Euro Crisis we locked in 73 straight winning trades and not one single closed loser. That was during a time when the market went nowhere.

So we’re getting ready for another similar winning streak during this next round of economic contraction. You can make money during times of slow growth, but you need the right investment strategies.

If these sound like the kind of investment strategies you could use for your portfolio, I suggest taking out a trial subscription to Private Wealth Advisory. You’ll immediately begin receiving my bi-weekly investment reports outlining the most important developments in the market.

You’ll also receive my real-time trade alerts, telling you the minute it’s time to open or sell a trade.

All just for $299 a year.

You get:

• 26 bi-weekly investment reports (ranging from 15-30 pages in length)
• Six Special Reports outlining unique opportunities and risks in the markets that 99% of investors don’t know about.
• 30-50 trades per year provided to you in real time
• The sense of calm in knowing that you’ve got your financial house in order.

To sign up for Private Wealth Advisory…

Click Here Now!!!

Yours in Profits,

Graham Summers

Chief Market Strategist

Phoenix Capital Research