Phoenix Capital Research

More bad economic data was spilled yesterday.

According to the Bureau of Labor Statistics or BLS, we had a 3.8% decline in hourly compensation in the first quarter of 2013.  This is the single largest drop going back to 1947.

What does this mean?

People are making less money for their work. And this is happening at a time when costs of living are rising.

The housing market is once again in a bubble relative to incomes. Year over year prices are up 12%. This is not a good thing as the buying that has buoyed the rebound over the last few years has largely been from financial institutions, NOT first time homebuyers.

Put simply, real people are being priced out of the market.

We also have food prices rising. Beef is up 10% year over year. This trend is expected to continue with global food prices to rise 10-40% over the next decade.

On top of this, healthcare costs are spiraling higher as are taxes courtesy of Obamacare. Healthcare costs for the average US family are up 6.5% year over year.

So we have rising costs of living and lower wages. This is a terrible combination, which put tremendous pressure on consumer spending, which accounts for 70% of US GDP.

In other words, the economy is in bad bad shape.

Against this backdrop, stocks are on the edge of a cliff:

If we take out this trendline, stocks could easily go to 1,450. And if things get really ugly we could even see a Crash (though that would likely come later in the Autumn based on historic patterns).

I’ve been warning subscribers of my Private Wealth Advisory newsletter that we were heading for a dark period in the stock market. We’ve since taken action to insure that when the market falls, we make money.

Indeed, in the last month alone we’ve seen gains of 8%, 12%, 21%, and 28%… all from basic stocks and bonds. And we’re now preparing with six carefully targeted investments that will pay out when the market falls.

To find out what they are, all you need to do is take out a trial subscription to Private Wealth Advisory. You’ll immediately be given access to the Private Wealth Advisory archives outlining our investment strategies.

You’ll also be given access to FIVE Special Reports (an $800 value) outlining the biggest risks to the financial system as well as the best means of protecting yourself and your loved ones from them.

To take out a trial subscription to Private Wealth Advisory and take action to make sure the coming months are a time of profit, not pain.

Click Here Now!

Best Regards,

Graham Summers

 

 

 

Stocks are on borrowed time.

The single item that has driven stock prices over the last four plus years (since the 2008 Crash) has been the Fed’s expansion of its balance sheet. David Rosenberg of Gluskin Sheff, depicted this fact beautifully in the chart below:

In plain terms, this chart shows us the Fed is driving stock prices. Virtually every dollar increase in the Fed’s balance sheet has resulted in stock market gains. Take away Fed stimulus and the market would be right back where it was in 2009: with the S&P 500 in the 600-700 range.

Thus, you can safely and factually say that the stock market is on life support from the Fed. Which is why any indication that the Fed will taper its QE program could result in a stock market crash.

The Fed tried hinting at tapering a month or so ago via a placed article at the Wall Street Journal. Everyone got into a panic and Bernanke and his pals quickly went into damage control mode assuring investors that QE could last forever.

Now the talk of QE tapering is spreading. Yesterday Steve Liesman on CNBC (another media personality with close ties to the Fed) stated that the Fed was having internal discussions about the effectiveness of QE.

Later that day, Goldman Sachs Chief Economist, Jan Hatzius, who has very close ties to NY Fed Present Bill Dudley, stated that the Fed may taper QE as early as September.

It is now clear that the Fed is trying to prepare the markets for a withdrawal or tapering of QE. Judging from yesterday’s sell off (yesterday was the FIRST down Tuesday this year), the market is beginning to realize that the party won’t be lasting much longer.

Given that ALL of the stock market gains since 2008 were based on Fed money printing… what do you think will happen when the Fed tries to taper QE?

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in four straight gains of 8%, 12%, 21% and 28% in the last month ALONE.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just started another four trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

 

 

As warned previously on these pages, the US is in a recession… again.

The latest ISM reading came in at 49. Any reading below 50 is considered recessionary. And an ISM of 49 is the worst in four years.

The Fed, as usual, is oblivious to this. Bernanke claims we’re going to see a 3% GDP growth in 2014. We haven’t seen annual GDP growth of 3% since Bernanke took office. And he and the Fed have been claiming that a recovery was just around the corner for five years now… that’s HALF a business cycle.

At this point we should ALREADY be in a massive economic expansion, not waiting on a recovery. And we certainly shouldn’t be seeing weak growth and higher costs, which is the worst possible combination: stagflation.

Indeed, Copper, the commodity with a PhD in economics, peaked two years ago implying that economic growth has been slowing ever since. This hardly gives any credence to Bernanke’s claims. If anything, it shows that the man is not paying any attention to obvious signs from the world that growth is slowing.

As I told Private Wealth Advisory subscribers over a month ago, if you remove the Fed’s phony inflation measure and measure GDP in nominal terms, it’s clear we’re already back in a recession:

And stocks are at all time highs? Buckle up, what’s coming is not going to be pretty.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in four straight gains of 8%, 12%, 21% and 28% in the last month ALONE.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just started another four trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

The gaming of economic data continues in the US.

On Friday it was announced that consumer confidence hit its highest level in nearly six years. Indeed, the last time we saw confidence in the economy as this reading was July 2007…

Here’s a riddle… how can consumer confidence be so high when:

1)   Household wealth remains 45% lower than it was before the Crisis?

2)   Incomes are falling?

3)   Prices are generally rising?

Technically we’re all poorer than we were before 2008 happened. Most of us are making less money. And we’re spending more just trying to get by thanks to higher food, energy, and healthcare prices. Heck, housing is now even soaring again, pricing most beginning home buyers out of the market.

And yet… supposedly we’re all feeling much better about things. Either we’re all delusional… or the data is being massaged to look better than reality.

Against this backdrop, Bernanke continues to talk about how removing stimulus could damage the “recovery.”

This is extraordinary.

We’re five years into a financial crisis. The typical business cycle is 10 years. So just based on historical cycles alone we should be witnessing a roaring recovery by now. And yet, the Fed Chairman is worried that removing stimulus (which is now north of $85 billion by the way) would damage the “recovery.”

Folks this entire mess is one big house of cards that is getting ready to collapse again. The Fed doesn’t have an exit plan. It never had a plan to begin with except to leave the paperweight on the “print” button. The fact that they’re still talking about a recovery five years and $2+ trillion after the Crisis hit makes it clear they’re losing control.

The market is beginning to sense this as Friday’s collapse indicates. As I’ve stated many times in the past weeks, stocks were ready to correct. Friday we got a hint of what’s coming:

Investors take note… now is the time to be prepping for a market correction. As Friday’s action showed, when it comes, it’s going to be fast and violent.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in four straight gains of 8%, 12%, 21% and 28% in the last month ALONE.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just started another four trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

 

 

Stocks are on the edge of a cliff.

As you can see, the S&P 500 has failed to breakout to the upside and is now sitting on support. If we take out 1650 we could easily to for 1600 in short order. And if we do indeed break down through the rising wedge pattern (indicating that the move to the record highs was a false breakout) we could see a drop down to the mid 1400s.

Other asset classes are already predicting this. Check out the divergence between high yield bonds and the S&P 500:

The same is true of emerging markets which have lead stocks in the post-2009 period.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in four straight gains of 8%, 12%, 21% and 28% in the last month ALONE.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just started another four trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

Is it time to buy Gold miners?

The precious metals mining sector was slammed with Gold’s sharp drop in prices in April. Mining companies are more “pie in the sky” than owning actual bullion, so mining shares typically move much more sharply than Gold does (see the figure below charting the price performance of Gold against the Gold mining ETF).

What’s interesting is that the Gold smackdown occurred just a few weeks before the Fed leaked that it was considering tapering its QE program. We know for a fact that the Fed has a tendency to leak critical information to its cronies and connected insiders. Looking at how Gold moved just a few weeks before the word “taper” was picked up by the media, one wonders if the Fed hinted what was coming to the connected few before the rest of us.

Regardless of Fed shenanigans, the Gold smackdown hit mining companies the hardest. As a result of this, numerous mining companies were trading at only slight premiums to their cash levels. With no debt on their books you were essentially getting their Gold reserves and infrastructure for free (provided there wasn’t too much political risk).

All you needed was for mining companies to bottom out… which looks to be happening now.

I alerted subscribers of my Private Wealth Advisory newsletter to this situation a few weeks ago, telling them about six mining companies in particular that were priced at bargain basement prices given their fundamentals.

As I write this, ALL of them are exploding higher. We’ve already closed out one for a 7% gain. And the others are destined for double digits in the coming weeks.

To find out their symbols and receive my hard-hitting analysis of their fundamentals, all you need to do is take out a subscription to Private Wealth Advisory.

Private Wealth Advisory is bi-weekly investment newsletter focused on providing individual investors with profitable investment ideas (using stocks and ETFs) in a two to six week timeframe.

In the last month alone, we’ve locked in gains of 7%, 12%, 21% and 25%… the average holding period was 18 days.

If you’re an individual investor looking for a guide to help you grow your portfolio with minimal risk, this is it!

To learn more about Private Wealth Advisory and take out a trial subscription (we offer a 30 day money back guarantee if you’re not satisfied)…

Click Here Now!

Best Regards,

Graham Summers

A few weeks ago, we noted that stocks looked to be posting a false breakout.

A false breakout occurs when the market breaks out of a technical formation in one direction then fails to follow through on the move. Looking at the rising wedge pattern in the S&P 500 this appears to be happening now:

As you can see, stocks broke out of the rising wedge to the upside. However, this move looks to be rapidly losing steam. We’ve just seen a new lower high. And if the S&P 500 were to fall back below its upper trendline LOOK OUT: failed breakouts tend to resolve both quickly and violently.

Indeed if you look at stocks relative to Copper, there’s room for a REALLY bad correction here:

We’ve noted for some time that stocks had diverged sharply from the underlying economy. But this is a truly ugly chart. And if stocks ever begin to re-connect… it’s going to be BAD.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in four straight gains of 8%, 12%, 21% and 28% in the last month ALONE.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

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

We are now seeing clear signs that the US is moving back towards a recessionary territory.

The first quarter US GDP data showed the US economy growing at an annualized rate of just 2.5% (3.0% was expected).

The only reason growth was even this high was because the Government understated inflation, recording a GDP deflator of 1.2%. This is bizarre given that the “official” inflation data point, the Consumer Price Index or CPI, is currently pegged at 2.1%.

Had the GDP number been based on the CPI, first quarter GDP would have been just 1.63%. And had it used real inflationary data, it would have been even lower than that.

We get additional confirmation of a slowdown in the economy from corporate revenues.

Corporate profits can be manipulated in a variety of ways. This is why I tend to ignore profits when assessing the state of the economy. Revenues on the other hand cannot be fudged. Either money comes in the door or it doesn’t.

With that in mind, only 45% of companies in the S&P 500 have beaten revenue estimates for the first quarter of 2013. This is down from 66% in the fourth quarter of 2012. And it’s well below the average of 50% for the last five quarters.

We addressed the trend of missing revenue forecasts in older articles. That trend remains intact with recent revenue misses coming from:

• Proctor and Gamble
• Starbucks
• AT&T
• CB Richard Ellis
• Safeway
• American Express
• IBM

This does not bode well for the economy.

Taken as a whole, corporations in the S&P 500 are expected to see a decrease in revenues of 0.3% in 1Q13. Yet against this slowdown, analysts believe we’re going to see a 6% increase in revenues for this year! Unless the global economy absolutely erupts higher, the market is far too optimistic about the state of affairs in the world.

We get additional indications of a looming recession when we remove the “deflator” aspect of GDP entirely and simply look at nominal GDP change (not adjusted for inflation) on a year over year basis.

When you do this you get a clear picture of a looming recession. Every time the rate of change for nominal GDP breaks below 4, a recession hits. As you can see in Figure 1 below, we’ve just broken this level.

Against this economic slowdown, stocks are priced quite richly. There is a word for when markets are totally disconnected from reality: it’s a bubble.

Investors, take note… the financial system is sending us major warnings… If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in two gains of 28% and 21% in less than three weeks’ time on Tuesday.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

The Fed would do well to look at Japan.

Japan’s Nikkei, after rallying over 70% since November, just collapsed 11% in less than two days. Looking at the chart, it’s pretty clear where this thing is heading: the same as the NASDAQ in 2000.

This is the problem with economic policy that focuses on pushing stocks higher: eventually the collapsing economy comes home to roost and stocks implode. We saw this in 2000 and 2008. We’re currently seeing it in Japan. And it’s only a matter of time before it his the US.

Indeed, Bernanke’s whole life work has been based on the belief that the Fed didn’t do enough during the Great Depression. So he’s opted to expand the Fed’s balance sheet to over $3 trillion and to monetize most of the US’s debt issuance via QE to battle the Financial Crisis.

Altogether, the Fed has monetized QE equal to 15% or so of the US’s GDP. Doing this has already put stocks back in a bubble and damaged the economy to no end. Marginal debt is back at record highs, housing has not bottomed, and Bernanke is still talking about a “recovery” FIVE years after the Crash. At this point based on the business cycle alone we should be in a roaring growth spurt.

QE doesn’t work. It never has. Look at Japan.

Japan has monetized an amount equal to well over 25% of its GDP via QE. And at that point its bond market began to crash. It’s not coincidence that the Fed is beginning to talk about tapering QE now that this is happening. Even a career academic can look at what’s going on in Japan and know that more QE won’t help the US.

So the Fed is essentially handcuffed at this point. Increasing QE in any way risks a Japan-bond market style rout.

Can you imagine what would happen if the financial system faces another Crisis? The Fed has already thrown everything including the kitchen sink at the system. If the system collapses now the Fed will be powerless to stop it.

Investors, take note… the financial system is sending us major warnings… If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in two gains of 28% and 21% in less than three weeks’ time on Tuesday.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

Japan’s bond market is officially losing control.

We have definitely taken out the multi-year trendline here, making a new high higher after a higher low. This is BAD news as it indicates that Japan’s bond market could be entering a cyclical downturn.

If this happens then the great global bond market rig of the last five years is coming to an end. Most analysts have been ignoring bonds because stocks are at record highs.

BIG MISTAKE.

As Japan has indicated, when bonds start to plunge, it’s not good for stocks. Today the Japanese Bond market fell and the Nikkei plunged 7%. The entire market down 7%… despite the Bank of Japan funneling $19 billion into it to hold things together.

This is what it looks like when a Central Bank begins to lose control. And what’s happening in Japan today will be coming to the US in the not so distant future.

If you think the Fed is not terrified of this, think again. The Fed has pumped over $1 trillion into foreign banks, hoping to stop the mess from getting to the US. As Japan is showing us, the Fed will fail.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in two gains of 28% and 21% in less than three weeks’ time on Tuesday.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

Just what is the Fed so scared of?

Today, the Fed’s favorite reporter, Jon Hilsenrath at the Wall Street Journal published an article completely refuting his own work from just two weeks ago.

If you’ll recall, two weeks ago, Hilsenrath wrote that the Fed was planning to taper its QE purchases before the end of the year.

Today, Hilsenrath wrote that when the Fed does taper its buying  it won’t be “predictable.” So which one is it? And more importantly, with stocks hitting a new high almost every day, why is the Fed so alarmed about signaling an end to its massive monetary stimulus efforts?

After all, the first Hilsenrath article didn’t even put a dent in stocks. They’ve gone almost straight up since he wrote it on May 13.

Could it be that the Fed is terrified that it’s created another bubble… a situation where stocks become completely disconnected from the economy?

After all, the S&P 500 is now diverging massively from Copper and Lumber, two very economically sensitive commodities.

Ditto for the S&P 500 and Emerging Markets which have lead US stocks since the 2009 bottom.

This is what the Fed is so afraid of… stocks are in a bubble and the underlying economy is terrible. We all know how these situations resolve: BADLY.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in two gains of 28% and 21% in less than three weeks’ time yesterday.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

 

 

Two big events have occurred/ are occurring.

1)   Chicago Fed President, Charles Evans who is one of the biggest pushers for QE, stated that the Fed has “the appropriate monetary policy in place” and that the economy is “improving quite a lot.”

2)    The Bank of Japan is beginning a two-day policy meeting today.

Regarding #1, Evans has been one of the biggest pushers for more QE. Throughout 2011 and 2012, every time he appeared on TV he stated that the Fed should do more.

So for Evans to suddenly change his tune and state that the Fed’s current policy is “appropriate,” indicates a significant shift in tone. This goes along with the Fed’s recent hint at tapering QE, which we’ve noted before on these pages. It’s now becoming more and more clear that the Fed is planning on tapering QE in the coming months and is trying to manage down investor expectations.

Which means that stocks are going to be losing some (not all) of their life support.

Regarding #2, Japan is beginning a two-day monetary policy today. As noted yesterday, Japan is Ground Zero for the great QE experiment. For decades now, Bernanke and his pals have claimed that the biggest problem with the Fed’s actions during the Great Depression was that it didn’t do enough.

Japan, which has now engaged in NINE QE efforts, has finally hit the “enough” stage by announcing a record $1.2 trillion QE plan. To put this in perspective, Japan’s economy is $5.86 trillion, so this single QE effort is equal to 20% of their GDP.

If this plan fails to bring about economic growth in Japan, or worse still fails to bring about growth and unleashes inflation, then it’s GAME OVER for Central Bankers. Their one great claim “we’re not doing enough QE” will have been proven to be total bunk.

At that point there is literally nothing they can do.

We’re keeping an eye on the meeting in Japan for hints that QE isn’t working or that the Bank of Japan may attempt to taper it. If this proves to be the case, then we’re in for a truly rough time in the markets.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING. In fact we just locked in two gains of 28% and 21% in less than three weeks’ time yesterday.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

 

Japan has fueled much of this latest rally in stocks, driving the marketing first with promises of money printing by the Prime Minister in November 2012, and then a massive $1.2 trillion QE program announced by the Bank of Japan last month.

The result of this has been a collapse in the Yen and a 70%+ rally in the Nikkei in the last six months.

This has been the fundamental driver of this latest risk on rally. Remember that the US Federal Reserve has begun changing its language regarding QE and has even hinted at tapering QE before the year-end. So it’s the Bank of Japan who’s in the driver’s seat for asset prices today.

If Japan has been bad for the Yen and good for stocks… it’s been an absolute disaster for Japanese bonds. Since the Bank of Japan announced its latest QE program, Japanese Government bonds have triggered circuit breaks no less than four times due to incredible volatility.

And last week, they briefly violated their multi-year trendline.

 

Many investors are probably looking at this chart and thinking, “who cares what happens to Japanese bonds… why does a trendline violation matter here?”

First and foremost, Japan is the second largest bond market in the world. If Japan’s sovereign bonds continue to fall, pushing rates higher, then there has been a tectonic shift in the global financial system. Remember the impact that Greece had on asset prices? Greece’s bond market is less than 3% of Japan’s in size.

For multiple decades, Japanese bonds have been considered “risk free.” As a result of this, investors have been willing to lend money to Japan at extremely low rates. This has allowed Japan’s economy, the second largest in the world, to putter along marginally.

So if Japanese bonds begin to implode, this means that:

1)   The second largest bond market in the world is entering a bear market (along with commensurate liquidations and redemptions by institutional investors around the globe).

2)   The second largest economy in the world will collapse (along with the impact on global exports).

Both of these are truly epic problems for the financial system. But even worse than any of them is the following

If Japan’s bond market implodes, then global Central Bank efforts to hold the system together will have proven a failure.

Japan is truly the leader amongst global Central Banks when it comes to progressive and accommodating policy. The Bank of Japan has kept interest rates at ZERO for nearly two decades. It’s also launched NINE QE plans adding up to an amount equal to nearly 25% of Japanese GDP. So far it’s managed to do this with minimal consequences.

Central Bankers around the world have monitored these efforts and believed that they can implement similar plans. So if Japan’s bond market begins to collapse, then it’s Game. Set. Match. for Central Banker policy. And what follows will make Lehman look like a joke.

Investors, take note… the financial system is sending us major warnings…

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

If you want to get a sense of what’s happening in the world, your best bet is to ignore Government data and focus on corporate revenues.

Why revenues? Because earnings can be massaged any number of ways (depreciation methods, laying off staff to cut costs, depletion of loan loss reserves for banks, etc.). But you cannot fake actual money coming in the door.

With that in mind, I want to draw your attention to the recent drop in corporate revenues at a number of corporations including Proctor and Gamble, Starbucks, AT&T, CB Richard Ellis, Safeway, American Express, IBM.

If this doesn’t serve as evidence that real economy falling to pieces, I don’t know what does. To top it off, we can now add Wal-Mart, the single largest retailer, to the list. Wal-Mart just reported that same-store sales fell 1.4%.

This is the first time this has happened in six quarters.

So much for the “recovery” theory. If you look at the real economy, things are getting worse and worse. When even Wal-Mart reports that people are spending less (remember that corporate email that February sales were a “disaster”?) you KNOW things are bad.

Folks, something awful is brewing in the economy. And yet, against this backdrop, stocks continue to rally hard. This bubble is worse than anything I’ve seen in my career, including the 2007 top.

Investors, take note… stocks are always the last to “get it.” This bubble will end as all bubbles do: in disaster.

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

Bill Gross, who manages the world’s largest bond fund, has indicated that the 30+ year old super cycle bull market in bonds has ended. This is very bad news for the markets.

First and foremost, if bonds fall, rates will increase. With higher rates, it will be harder to meet debt obligations. This will be the case for corporations as well as sovereign nations.

For the former, this means that more money going towards paying off debt and less going to shareholders. For the latter, sovereigns, this means default. Most sovereign nations in the developed world are sporting Debt to GDP ratios above 100%. These levels are just manageable with interest rates at record lows. When interest rates rise, default becomes a very real possibility.

In the case of the US, a 1% rise in interest rates means more than $100 billion more in interest payments. That money has to come from somewhere… which means either taxes going up, or the Government spending less on various programs.

For Europe, a 1% rise in rates can be almost deadly. Italy and Spain were both thought to be rock solid members of the EU. Once their ten year rates rose to 7%, they were suddenly on the verge of default.

And for Japan, if rates rise just a few percentage points, the entire system collapses.

For investors trying to navigate this market, it’s critical to note that the last bear market in bonds ended over 31 years ago.

This means that there is an entire generation of investment professionals and money managers who have never invested during a bear market in bonds. So many of these folks will be in a totally new environment.

Investors, take note… stocks are always the last to “get it.” This bubble will end as all bubbles do: in disaster.

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

The stock market is completely and totally out of control.

Eight of the last ten closes have been new record highs. It’s now been six months since we had a 5% correction. Traders got us to 1,650 on the S&P 500.

At this point, no long term investor in their right mind should be buying. This is especially true given that the S&P 500 is now not only totally disconnected from economic reality, but is disconnected from every other asset class.

Check out the divergence between stocks, Gold, Copper, and Oil. Do you think the latter three are more or less sensitive to the Fed slowing QE?

Better yet, take a look at the divergence between bonds and stocks. Ever since early May, stocks have gone straight up while bonds, a “smarter” asset class that is more sensitive to the threat of QE tapering, have fallen.

And again, the US Dollar is rallying (another indication QE is likely to taper). The currency markets are even larger and more sophisticated than bonds…

Investors, take note… stocks are always the last to “get it.” This bubble will end as all bubbles do: in disaster.

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

The markets are rallying because today is Tuesday. Stocks have rallied every Tuesday for the last 17 weeks and traders are now conditioned to play for this move. It’s also a POMO day (meaning the Fed is pumping the markets), which adds fuel to the fire for a stock rally.

The market is beyond overstretched. We have not had a 5% correction in six months. Stocks have gone almost straight up for 89 days (we haven’t had a 3+day correction in that long).  This is an all time record. The last time stocks rallied without a 3+ day correction was in the buildup to the Crash of 1987.

Check out the chart of Stocks vs. Copper.

Copper is great at predicting economic growth. Stocks are not. And the major divergences between the two tend to be resolved sharply (notice the sharp correction in Copper in late 2011).

With that in mind, either Copper needs to ERUPT higher as the world economy comes roaring back… or stocks need to drop BIG TIME.

Guess which one it will be? Do you think this might have something to do with why Bernanke is worried about potential for “sharp moves” in the markets?

Between this, rampant insider selling (makes you wonder if the people running the companies know something about the economy the Fed is ignoring), the downturn in economic data in the US, and the ongoing disaster that is the US jobs market, the market is priced for a total collapse.

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

 

After the market’s close on Friday, Jon Hilsenrath at the Wall Street Journal released an article implying that the Fed might remove or reduce its QE programs before the year end.

The reason this matters is because Hilsenrath is thought to be an unofficial mouthpiece for the Fed. Time and again he’s released articles hinting at the Fed’s future policies in advance. And many believe senior Fed officials such as Bernanke will personally leak ideas to him to test the public’s response to said ideas in advance.

So many believe that Hilsenrath’s Friday article was indeed the Fed preparing the markets for a tapering or removal of QE before the year end. Given that the entire US market is moving lockstep with Fed activity (the Fed’s balance sheet has literally reflated the NYSE tick for tick post 2009) this is a huge deal.

This supports our view that the Fed is aware stocks are in a bubble and is attempting to prep the market in advance for less liquidity.

Since QE 2, the negative effects of QE (higher costs of living) have outweighed the positive effects (higher stock prices) by a wide margin. Only 52% of US households own stocks… but everyone is paying for higher food and higher energy prices.

On a deeper level, QE is a drug for the market. There is no evidence in history that QE creates jobs or growth Both Japan and the UK have launched QE equal to over 20% of their GDP, neither have experienced a significant pickup in jobs or GDP growth as a result.

So QE was always about one thing only: pushing the market higher. But now the market is completely detached from economic realities. There is a word for this… it’s “bubble.”

The Fed knows this and is now trying to prepare the market for withdrawal. But the market is on total life support from the Fed. Take away the Fed punchbowl and the party stops.

Between this, rampant insider selling (makes you wonder if the people running the companies know something about the economy the Fed is ignoring), the downturn in economic data in the US, and the ongoing disaster that is the US jobs market, the market is priced for a total collapse.

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

Japan should serve as a lesson to central planners around the world.

Japan’s stock market/ real estate bubble burst in the early ‘90s. Since that time Japan has launched NINE QE efforts equal to roughly 25% of its GDP. And GDP growth has worsened despite these efforts from 2% to 1%. Ditto for employment.

Japan elected a new Prime Minister Shinzo Abe in September 2012. Since that time, his primary belief has been that Japan hasn’t engaged in enough stimulus. He threatened the Bank of Japan to get working… and it did, announcing a $1.4 trillion stimulus last month.

Since that time, the Yen has positively imploded. It broke below 100 yesterday for the first time in years. It’s now fast approaching the long-term trend line. When we take this out, it’s GAME OVER for the great monetary experiment of Japan.

Japan has a Debt to GDP of over 200%. Japan’s demographics are terrible (the country sells more adult diapers than child diapers). Its economy has been imploding for 20 years, and now its truly epic bond bubble is on the verge of collapse as well.

If you thought Greece was bad for the financial system, wait until you see what Japan will do to it.

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers

 

 

Stocks are officially in a blow-off top.

This is the culmination of Bernanke’s life’s work. In his mind he has succeeded in saving capitalism by spending trillions of Dollars pushing stocks higher.

It doesn’t matter that the US hasn’t experienced 3% GDP growth a SINGLE year since he took the Fed. It doesn’t matter that the employment ratio is at levels last seen back in the early ‘80s. It doesn’t matter that there are now a record number of Americans on food stamps.

All that matters is that stocks are up. That equals a recovery for the Fed.

This whole mess is sad really. Having seen two bubbles burst in the last 13 years, we all know how this ends: in disaster. And each time the disaster has been bigger. Indeed, the 2008 collapse was a far worse thing than the Tech Crash.

And what’s coming will be even worse than 2008. This time around, entire countries will go bust, not just banks.

On top of this, when this bubble bursts, interest rates will already be at zero and the Fed’s balance sheet swollen with garbage debts. The Fed and other Central Banks WON’T have the usual tools available to save the day.

If you are not already preparing for a potential market collapse, now is the time to be doing so.

I’ve been warning subscribers of my Private Wealth Advisory that we were heading for a dark period in the markets. I’ve outlined precisely how this will play out as well as which investments will profit from another bout of Deflation.

As I write this, all of them are SOARING.

Are you ready for another Collapse in the markets? Could your portfolio stomach another Crash? If not, take out a trial subscription to Private Wealth Advisory and start protecting your hard earned wealth today!

We produced 72 straight winning trades (and not a SINGLE LOSER) during the first round of the EU Crisis. We’re now preparing for more carnage in the markets… having just seen another SIX trade winning streak…

To join us…

Click Here Now!

Best Regards,

Graham Summers