Phoenix Capital Research

The Euro situation is coming to a point… literally: we’ve entered a triangle pattern. In fact, we have a second triangle forming within this larger pattern.

We’ve got just a little more room to run before we reach the apex of this pattern. However, given how things are going over there, we could see the breakout come at any minute now. These patterns can break either up or down, but given the situation over there, it’s likely going to be down and it will be taking most of the financial world with it.

Remember, the European debt drama was always about Spain and Italy: Greece, Ireland, and Portugal were the minor players (Portugal did pose something of a threat in that Spanish banks were massively exposed to its debts). However, when Spain or Italy go down, they’re taking France and Germany (the two most solvent EU members) with them.

And that’s when the Eurozone will crumble.

With that in mind, the two key items to note are Italy’s emergency austerity program (how this tactic work for Greece and Ireland?) and France’s AAA credit rating coming under review.

This latter situation has  almost come out of left field. But the fact that France is now coming under fire  tells us that the European mess has now spread to the key “prime” players or France and Germany.

If you’ll recall, a similar process happened to the US banks in 2008 when the alleged “well capitalized” banks of Merrill Lynch and Morgan Stanley started collapsing. Greece and Portugal are like Bear Stearns. Italy and Spain will be Lehman Brothers. And France and Germany are Bank of America or Citigroup: Too Big To Fail. If the financial solvency of one of these countries (France or Germany) becomes suspect, then it’s game. set. match. for the Eurozone in its current form and the ensuing Crisis will make 2008 look like a picnic.

Keep your eyes on the French market. While the S&P 500 has exceeded its May 10 high (courtesy of the PPT), France is only just coming up to test this level. A breakdown here means that the next wave of collapse has begun:

Speaking of the S&P 500, that index is forming something of a bearish rising wedge pattern. Given how weak things got towards the end of last week, we could see a breakdown as early as today). However, the pattern does allow for a final thrust to 1,200 or so.

Big picture: I warned to get defensive several weeks ago. Stay defensive now. This snapback rally is not the start of a new bull market rally. If anything, the volatility of the last week has made it evident that we’re back in a 2008 environment: you simply don’t see 3-4% price swings on a daily basis in a healthy market.

On that note, if you’re looking for actionable investment ideas and in-depth market analysis that will not only get you through this mess, but actually help you make some money, you NEED to get in on my Private Wealth Advisory newsletter.

Over the last two weeks, while 99% of investors got crushed, Private Wealth Advisory subscribers locked in seven winners including gains of 6%, 7%, and 9% in as little as one day (no we were not using options, just stocks and ETFs).

My readers made money in 2008 and the Euro Crisis of 2010. They’re making money now.

They’re also taking steps to prepare their families and loved ones for what’s coming with my Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports, which are also included with every Private Wealth Advisory subscription.

To join them…take action to get your financial house in order… and start making this Crisis grow your portfolio instead of crushing it…

Click Here Now!!!

Good Investing!

Graham Summers

For months now I’ve been warning about the stock markets facing a devastating collapse. I cited mutual fund cash levels, systemic leverage, derivatives exposure, and on and on.

And yet, despite the clear data points and research I presented, I was told I was crazy. I even had readers from bearish websites write me to tell me that my “sky is falling” warnings were “crap.”

And then this happened (I’ve added the recent drop in overnight futures).

Stocks are now back to November 2009 levels. In plain terms, the last year and a half may as well have not happened. The second half of QE 1, QE lite, and QE 2… literally everything the Fed has done since the end of 2009 has been wasted money.

Yes, we will get a sharp short-covering at some point. But the damage is done. Even QE 3 won’t bring the market back. We’re going to new lows… as in sub-600 on the S&P 500. Many folks are going to lose everything.

While most investors are getting taken to the cleaners, subscribers of my Private Wealth Advisory have already locked in SIX winners last week, including gains of 7%, 8%, and 9% in just one day.

They’ve also SAVED their portfolios from this bloodbath, courtesy of my well-timed warning (the following is an email I received from a client last week).

As of 9:45 this morning your well-timed note yesterday has saved 10% of my trading account.  Thanks!!

Roger D.

So if you’re looking for someone to help you navigate the market AND make sure that you actually MAKE money during the Crises, you NEED to check out my Private Wealth Advisory. Because if the market drop occurring as I write this is any indication, this Crash isn’t over by a long shot.

To take out a subscription to Private Wealth Advisory…

Click Here Now!!!

Best Regards

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Given their technical set-up and oversold conditions last week, stocks should have staged a bounce of some sorts. Instead, they went into full-scale Crisis mode falling over 7% as the US was downgraded and global debt collapse went into hyperdrive.

This brought the S&P 500 up against the critical support level of 1,200. However, we’ve already taken this line out in the overnight futures sessions. As I write this, the S&P 500 is around 1,172 or so.

The bulls have only one hope to cling to and that is for the Fed to mention QE 3 in its FOMC meeting tomorrow. The Fed will absolutely HAVE to actually mention QE 3 given that its previous hints of additional stimulus resulted in meager, short-lived rallies.

However, the fact remains that the market is on Red Alert mode. The financial system is more leveraged than it was during the Tech Bubble. Mutual funds are more heavily invested in stocks than at any other time in the last 50 years.

And the cause of the 2008 Crisis (derivatives) still hasn’t been reined in.

As I warned a few weeks ago, now is the time to be getting defensive and shifting to cash. We will see some sharp bear market rallies in the near future, but the End Game is now in motion. Even if the Fed does announce QE 3, the effects will be muted.

Consider that in just two weeks the market has wiped out ALL of the gains of the last 9 months and you’ll see what I mean: the Ponzi  scheme that is our current financial system requires money constantly for it not to collapse (not correct, but COLLAPSE).

The whole world now knows that QE 1 and QE 2 were failures. Which is why QE 3 won’t do much. Which means the REAL Crisis is now here.

While most investors are getting taken to the cleaners, subscribers of my Private Wealth Advisory have already locked in SIX winners last week, including gains of 7%, 8%, and 9% in just one day.

They’ve also SAVED their portfolios from this bloodbath, courtesy of my well-timed warning (the following is an email I received from a client last week).

As of 9:45 this morning your well-timed note yesterday has saved 10% of my trading account.  Thanks!!

Roger D.

So if you’re looking for someone to help you navigate the market AND make sure that you actually MAKE money during the Crises, you NEED to check out my Private Wealth Advisory. Because if the market drop occurring as I write this is any indication, this Crash isn’t over by a long shot.

To take out a subscription to Private Wealth Advisory…

Click Here Now!!!

Best Regards

Graham Summers

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stocks got crushed this week with the S&P 500 dropping 90 points between the intraday high and low. As a result of this, we’re now at major support at 1,200:

The market is oversold and traders are looking for an opportunity to ramp this thing higher. So we could see a move to 1,250. Remember, no investment goes straight up or straight down and most collapses follow a pattern of:

1)   the initial drop

2)   the bounce

3)   The REAL drop

Indeed, the only thing that could really kick off a rally for stocks would be the announcement of QE 3 (or hint of it) from the US Federal Reserve. However, even this would be short-lived. The market has finally begun to realize that the Fed can’t solve the issues that created the 2008 Crisis.  Which is why we’ve been in a free-fall for over a week now.

With that in mind, now is the time to be getting more and more defensive. This means moving to cash, Gold, and other safe havens. If you need to remain long in stocks you need to be shifting to high-quality, large-cap companies with strong balance sheets (little debt and lots of cash). They’ll fare better than small-caps or move speculative plays during a collapse.

Elsewhere in the markets, the US Dollar has rallied hard as investors flee stocks and the Euro. We’re now at resistance at 75. However, we need to break above 76 with conviction if this thing is going to last. If we do that, then the falling wedge pattern I noted a few weeks ago predicts a move to as high as 84.

This would coincide with stocks absolutely cratering. It could very well happen, so you need to be preparing for this in advance.

I can show you how.

Indeed, this last week has been a great one for subscribers of my Private Wealth Advisory newsletter. We’ve already seen three winners from this drop. And we’ve just opened another four Crisis Trades that are already skyrocketing.

If you’d like to join us… and take steps to prepare your portfolio for the market blood-bath that is unfolding.

Click Here Now!!!

Best Regards

Graham Summers

We are currently witnessing a pattern in the stock markets that has occurred multiple times in the last century. And everytime we did, things got UGLY.

That pattern is:

1)   a Spring Crisis

2)   a Summer rally (on light volume)

3)   The BIG Crisis

This pattern has occurred in 1907, 1929, 1931, 1987, 2000 and 2008. In each of these years, stocks came undone via some kind of Crisis during the March –May period. There was then a brief summer “relief” rally, and then things got VERY ugly in the fall.

Here’s the pattern for 2000:

Here it is in 2008:

So far, the market has been trading sideways for most of 2011, but the pattern is emerging:

Given that the Financial System is now even more leveraged than it was during the Tech Bubble… and that we’ve added TRILLIONS in debt to the US’s balance sheet, the odds of another systemic collapse are getting higher by the day.

And when it comes to profiting from this kind of disaster, few people on the planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008 (courtesy of my proprietary Crash trigger), having been warned a full three weeks in advance of the Crash to get out the market and go short.

And when the Euro Crisis of 2010 rolled around, my Private Wealth Advisory portfolio outperformed the market by 15%.

I’ve recently alerted subscribers of Private Wealth Advisory to six trades that will all explode when the markets crumble. In fact, while the markets have been a sea of red lately these positions have EXPLODED higher.

And we’re just getting started.

So if you’ve yet to take steps to prepare your portfolio for a market collapse… and would like clear “buy” and “sell” alerts on which trades to make and when… you NEED to take out a “trial” subscription to my Private Wealth Advisory newsletter.

Once you do, you’ll immediately join my elite group of subscribers including strategists at Wells Fargo, Merrill Lynch, Royal Bank of Scotland and more.

This means you’ll receive my bi-weekly research reports detailing the most important trends in the markets as well as which investments will profit most from them.

You’ll also get my real-time trade alerts whenever it’s time to “pull the trigger” on a trade. While most newsletters stick with a fixed publishing schedule, Private Wealth Advisory issues trade alerts in real-time, letting you know the minute it’s time to buy or sell a given investment.

And finally, every Private Wealth Advisory subscription comes with full access to all of my Special Reports including the Prepare Your Family, Prepare Your Savings, and Prepare Your Portfolio reports which outline precisely how to prepare these three areas of your life for the coming Second Round of the Financial Crisis.

You get all of this for just $199 per year. But this price will only be good for the remainder of August, because we’re raising the price to $299 in September.

To take out a “trial” subscription to Private Wealth Advisory today, start receiving my hard hitting financial analysis, real time trade alerts, and ALL of my Special Reports…

Click Here Now!

Good Investing!

Graham Summers

 

 

 

 

 

The situation in the US Congress marks a new low for politics in this country. I’m not going to bother going into details related to the various plans that have been proposed because all of them fail to be relevant.

What I mean by this is that all of the various cuts ($1 trillion or so over however many years) are in fact irrelevant given the fact that the US is running deficits north of $1.5 trillion PER year already.

As for the debt ceiling, whether we raise it or not is also irrelevant in the grand scheme of things. The US is broke and has been for a long time now. There is absolutely no way we will ever pay back our debts which now stand at $44K per man woman and child in the US.

This of course fails to include social security, Medicare and other unfunded liabilities which put the US debt levels closer to $60 trillion.

What I’m trying to say with all of this is that the US welfare state, or the notion of politicians dishing out handouts in exchange for votes, is soon coming to an end. Social security, Medicare and many other government spending programs will be cut in the coming years. Regardless of your feelings regarding these programs, they are not funded and with tax receipts falling (and will fall further as the Depression deepens) the US will simply not have the money to pay for these programs.

We will also see the US defaulting on its debts with some kind of debt restructuring included. This is absolutely guaranteed to happen. And THAT is the item of most import for the US financial system.

The reason for this is that the entire financial system is based on the ratings of specific securities with US Treasuries as the highest rated AAA. So if US debt takes a downgrade this will result in systemic volatility on a mass scale.

For one thing pension funds, investment funds, and other entities that are required to only invest in AAA-rated securities will have to move out of Treasuries when this happens.

On top of this, US banks will undergo another Crisis based on the fact that Treasuries are the senior most assets on their balance sheets. What happens when the bedrock of their balance sheets drops dramatically in value forcing system wide margin calls?

KA-BOOM!

When it comes to profiting from this kind of disaster, few people on the planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008, having been warned a full three weeks in advance of the Crash to get out the market and go short.

And when the Euro Crisis of 2010 rolled around, my Private Wealth Advisory portfolio outperformed the market by 15%.

I’ve recently alerted subscribers of Private Wealth Advisory to six trades that will all explode when the markets crumble. In fact, while the markets have been a sea of red lately these positions have EXPLODED higher.

And we’re just getting started.

So if you’ve yet to take steps to prepare your portfolio for a market collapse… and would like clear “buy” and “sell” alerts on which trades to make and when… you NEED to take out a “trial” subscription to my Private Wealth Advisory newsletter.

Once you do, you’ll immediately join my elite group of subscribers including strategists at Wells Fargo, Merrill Lynch, Royal Bank of Scotland and more.

This means you’ll receive my bi-weekly research reports detailing the most important trends in the markets as well as which investments will profit most from them.

You’ll also get my real-time trade alerts whenever it’s time to “pull the trigger” on a trade. While most newsletters stick with a fixed publishing schedule, Private Wealth Advisory issues trade alerts in real-time, letting you know the minute it’s time to buy or sell a given investment.

And finally, every Private Wealth Advisory subscription comes with full access to all of my Special Reports including the Prepare Your Family, Prepare Your Savings, and Prepare Your Portfolio reports which outline precisely how to prepare these three areas of your life for the coming Second Round of the Financial Crisis.

You get all of this for just $199 per year. But this price will only be good for the remainder of August, because we’re raising the price to $299 in September.

To take out a “trial” subscription to Private Wealth Advisory today, start receiving my hard hitting financial analysis, real time trade alerts, and ALL of my Special Reports…

Click Here Now!

Good Investing!

Graham Summers

 

 

 

Let’s start with the economic situation.

The Euro Crisis is by no means over. In fact, we’ve yet to get the details of the mega-Euro bailout that is supposedly going to solve all of Europe’s problems (it won’t but that’s the market’s view for now). Meanwhile Spain and Italy are both coming unraveled in a big way. With GDPs of $1.46 trillion and $2.11 trillion respectively, there is no way the ECB can bail these two out.

On the other side of the pond, the White House supposedly reached a debt deal late Sunday night. The deal involves a debt ceiling hike (no surprise) no tax increases, and $2 trillion in spending cuts over the next ten years (though Obama stressed they would not occur so as to damage the US economy).

In other words, the US Government kicked the can down the road a little further. Judging from the worsening economic data in the US (this morning’s ISM was a disaster), the can won’t be going far this time around.

Against this ugly backdrop, stocks are coming up against support at 1,275. If we take this line out, we’ve got support at 1,250 and then we’re going to 1,225 or even 1,200 in a heart beat.

Now is the time to be getting defensive. This means rotating our of more speculative growth plays and shifting into non-cyclicals. For some investors it means getting out of stocks all together.

One thing that NEEDS to be mentioned is that this time around, bad economic news is resulting in sell-offs. For the last two years, whenever bad data came out, stocks actually rallied on the belief that the Fed would have to provide more stimulus. So the fact that stocks are now tanking on bad economic data should be a major red flag that things have changed.

On that note, I full believe that we could be heading into another 2008 episode. We’re DARN close to triggering my proprietary Crash trigger. And there is no shortage of major black swans lurking in the financial system.

Indeed, global manufacturing is now at its worst levels since 2009. China is clearly heading into a hard landing while the European debt contagion is spreading to Spain and Italy in a big way.

Add to this the fact that the financial system is even more leveraged than it was in 2000 and you’ve got a recipe for financial disaster. And given that this coming crisis will entail entire countries (not just private banks) collapsing, this time around is going to be even worse than 2008.

However, this doesn’t mean that you have to lose money. In fact, Crises can be one of the best times to actually produce outsized profits as the financial herds panic and head for the exits.

And when it comes to profiting from this kind of disaster, few people on the planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008, having been warned a full three weeks in advance of the Crash to get out the market and go short.

And when the Euro Crisis of 2010 rolled around, my Private Wealth Advisory portfolio outperformed the market by 15%.

I’ve recently alerted subscribers of Private Wealth Advisory to six trades that will all explode when the markets crumble. In fact, while the markets have been a sea of red lately these positions have EXPLODED higher.

And we’re just getting started.

So if you’ve yet to take steps to prepare your portfolio for a market collapse… and would like clear “buy” and “sell” alerts on which trades to make and when… you NEED to take out a “trial” subscription to my Private Wealth Advisory newsletter.

Once you do, you’ll immediately join my elite group of subscribers including strategists at Wells Fargo, Merrill Lynch, Royal Bank of Scotland and more.

This means you’ll receive my bi-weekly research reports detailing the most important trends in the markets as well as which investments will profit most from them.

You’ll also get my real-time trade alerts whenever it’s time to “pull the trigger” on a trade. While most newsletters stick with a fixed publishing schedule, Private Wealth Advisory issues trade alerts in real-time, letting you know the minute it’s time to buy or sell a given investment.

And finally, every Private Wealth Advisory subscription comes with full access to all of my Special Reports including the Prepare Your Family, Prepare Your Savings, and Prepare Your Portfolio reports which outline precisely how to prepare these three areas of your life for the coming Second Round of the Financial Crisis.

You get all of this for just $199 per year. But this price will only be good for the remainder of August, because we’re raising the price to $299 in September.

To take out a “trial” subscription to Private Wealth Advisory today, start receiving my hard hitting financial analysis, real time trade alerts, and ALL of my Special Reports…

Click Here Now!

Good Investing!

Graham Summers

 

 

Given the ridiculous number of rumors (and ridiculousness of some of the rumors) related to the US and EU debt talks that are circling the financial community, I thought it best that we confront the realities these two economies face. Today we’re focusing on Europe.

Regarding Europe, we still don’t have any details regarding the Greek bailout, nor do we have any real sense of how the mega-bailout fund will really work in terms of solving any of the EU’s problems.

However, the fact remains that everything related to EU bailouts hinges on Germany. Germany is the most solvent member of the EU. And without its backing, NO EU bailout scheme will work in any way.

With that in mind, we need to consider that the majority of Germans now want out of the Euro. As I have noted in previous articles, politics is the name of the game in the EU, so the next round of German elections in September could dampen Germany’s interest in backstopping more bailouts (current Chancellor Angela Merkel’s party took a serious beating in the March elections already).

A second element that needs to be focused on is Germany’s economy. Any threat to the German economy could quickly hinder the debt talks/ bailouts in the EU for the following reason:

1)   Germany is the largest, strongest, most solvent, member of the EU, so if it’s in trouble, the less solvent members will be in major trouble.

2)   A weak German economy will fuel the political fires for those Germans who see little benefit in remaining in the EU (subsequently the heat will turn up on those politicians pushing for continued bailouts).

In simple terms, if the German economy breaks down, then the EU and the Euro are in big trouble. With that in mind, Germany has recently seen three economic releases that show the “recovery” is slowing (the IFO Business Climate, Manufacturing and Services, and the ZEW Economic Sentiment).

If any of the negative issues mentioned above become worse, the EU experiment would fast approach its end. This would result in the Euro taking a hit, which would push the US Dollar higher.

On that note, the Euro broke out of the triangle pattern I mentioned a few weeks ago to the downside. It’s now rallying to retest the lower trendline for this pattern (fitting the classic, break-down, test, then REAL move pattern I’ve been telling readers about for years).

The ultimate downside target for the triangle patterns breakdown is 136 or so. So unless the Euro stays above 44, we’re going there relatively quickly. Given that Italy has just joined Austria in cancelling a bond auction, I’d say this downside target is on its way.

However, the bigger picture here is the 125-level which has been a line of massive importance for the Euro since its creation:

As the above monthly chart of the Euro reveals, 125 has served both as important resistance and important support over the last 20 years. The Euro just broke below this level during the 2010 Crisis. The next time it breaks below this line we’ll be in the midst of the final End Game for the Euro experiment.

On that note, if you’re looking for the means to produce quick profits based on market moves, you NEED to check out my Rapid Fire Options Alert newsletter.

Rapid Fire Options Alert uses a proprietary system of trading options that I’ve developed over my years as a financial analyst. The degree of accuracy is stunning (our success rate on trades is over 77%). And the gains are simply spectacular (we’re up over 230% for the year so far).

That’s not a typo. We’ve seen a 230% return on invested capital so far in 2011. And we’re only in July.

Most importantly, this system of trading couldn’t be simpler. We trade on Tuesday mornings. When it’s time to pull the trigger on a trade, we send out an email and text alert detailing which option contract to buy, what price to pay, and what stop loss to use.

Then when it’s time to take our profits (usually within four hours’ time), we send out a second alert telling our clients to sell and what price to sell at.

It’s that simple.  Provided you can trade regular puts and calls, ANYONE can use this system to increase their portfolio dramatically: again we’re up 230% for the year so far.

To find out more about Rapid Fire Options Alert and how it can help you start seeing outsized returns from your investments…

Click Here Now!

Best Regards,

Graham Summers

 

 

 

Editor’s Note: The following is an excerpt from my latest issue of Private Wealth Advisory. In it, I present the most comprehensive overview of the European debt crisis out there, but I also identified one Spanish Bank that is poised on the brink of collapse. To find out which bank it is, how to profit from its collapse and learn about my six other Crisis trades that will pay out double digit returns when the system breaks down again… Click Here Now

The first wave of the next crisis is going to come from Europe where it is clear that the ECB has reached the End Game of monetary intervention. To whit: Greece was bailed out only 13 months ago, it has since requested an extension on those loans and is now receiving a SECOND bailout.

Greece, as a country, really has very little to do with Europe’s economy (it’s about $330 billion out of the EU’s $16 trillion GDP). However, Greece was the first nation to be bailed out. And so it has set the trend for what’s to come in Europe. And what’s to come is the following: default, political shakedowns, and civil unrest.

Ultimately, the BIG players in the EU Crisis are Spain and Italy with GDPs of $1.46 trillion and $2.1 trillion respectively. There literally is NO WAY the ECB can bail these countries out. Which is why in Europe the End Game looms and Greece’s bailouts will ultimately be irrelevant.

What I mean by this is that the ECB has played its hand with the small players (Greece) and is now facing problems it cannot possibly solve. There is only one outcome to this scenario and it is default and restructuring which will involve European banks taking a “haircut” AKA losing billions of Euros worth of money on toxic debt.

However, there is a MUCH bigger problem here and that problem is the same one that created the 2008 disaster: DERIVATIVES.

US commercial banks have over $200 trillion in derivatives outstanding on their balance sheets. However, worldwide, the derivatives market is over $600 TRILLION in size. And the financial system in Europe is as saturated, if not MORE saturated with toxic debt than the US financial system.

According to the Bureau of International Settlements, the total exposure worldwide to PIGS (Portugal, Ireland, Greece, and Spain) debt is over $2.5 TRILLION. Most of this is in the form of derivatives. And 70% of it is from foreign entities (banks and firms located outside of the country).

Let’s take Greece for instance. Courtesy of derivatives, France has $92 billion in exposure to Greece debt. Germany is on the hook for $69 billion. Great Britain has $20 billion. And the US has $43 billion.

These levels, while dangerous, are not catastrophic. As I’ve stated before, Greece is NOT the big problem for the EU. However, worldwide exposure to Greek debt is in the ballpark of $277 billion. So a default there would result in significant market dislocations.

Now consider the exposure to a BIG Problem such as Spanish debt. In this situation, Great Britain is on the hook for $51 billion. The US is on the hook for $187 billion. France is on the hook for $224 billion. And Germany is on the hook for a whopping $244 billion.

As I said before, Greece is ultimately a small player in this mess. Worldwide exposure to Greek debt is $277 billion. Worldwide exposure to Spain, on the other hand, is north of $1 TRILLION.

Now this is where things get REALLY tricky. Because of the intertwined nature of the derivatives market, a Greek default could result in systemic risk for the simple fact that if one of the banks that goes down with Greece has extensive exposure to Spain as well, then things could get ugly very, VERY fast.

Indeed, given that the European banking system is just as, if not MORE saturated than the US’s when it comes to toxic debt, even a small player like Greece could end up triggering another round of systemic risk.

This all ties in with what I’ve been saying for months now… that 2008 was in fact the warm up and that the REAL Crisis is fast approaching. And when it hits, the Fed will be POWERLESS to stop it. Because this time it will be entire countries, NOT just Wall Street banks that collapse. So what’s coming will be the equivalent of 2008 all over again, along with food shortages, civil unrest, outbreaks in crime, bank holidays, and the like. It will, in short, be like what’s going on in the Middle East today (though NATO won’t be bombing us).

Which is why if you haven’t already taken steps to prepare yourself and your portfolio for the coming disaster, you need to do so NOW.

I can show you how…

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

When it comes to profiting from this kind of disaster, few people on the  planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008, having been warned a full three weeks in advance of the Crash to get out the market and go short.

I believe we could see another 2008  situation unfold in the near future, which is why I just unveiled six specific trades  to subscribers… all of which will pay off  HUGE returns as the current stock market collapse accelerates.

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers
Editor In Chief
Gains Pains & Capital

 

 

 

The 2008 Crisis occurred when private US banks became so distrustful of one another’s balance sheet risk that interbank liquidity dried up triggering a systemic implosion in the unregulated derivatives market, particularly in Credit Default Swaps (which was a $50-60 trillion market at the time).

The Federal Reserve dealt with this situation by suspending accounting policies (permitting banks to lie about their true balance sheet risk), offering to backstop those banks with the greatest derivative exposure (JP Morgan, Bank of America, Goldman Sachs, and Citigroup), shifting trillions of dollars’ worth of toxic debt to the US balance sheet and then funneling trillions of new dollars into the banks most at risk of a derivative collapse (the banks I listed before).

From a philosophical perspective, the Fed removed the notion of “risk of failure” from Wall Street’s collective mind. As anyone who’s studied human behavior can tell you, without consequence for one’s actions most people will take their bad behaviors to the limit.

As a result of this, Wall Street went back to doing what caused the Financial Crisis in the first place: increasing leverage, fleecing clients, and paying its employees’ excessive salaries. Today the financial system is once again overleveraged. In fact, leverage levels today exceed those that occurred during the 2008 Tech Bubble, the large banks continue to be insolvent due to their gargantuan derivative exposure.

Put another way, the financial system is primed for another 2008 episode. The very same issues that caused 2008 remain in place. Leverage is far too high. And the unregulated derivatives market remains a multi-hundred trillion dollar problem.

However, the next Crisis will not simply be another 2008. The reason for this is that by transferring trillions in toxic debt to the public balance sheet, the Federal Reserve has put the US’s credit rating and debt situation in jeopardy.

To be clear, the US was already bankrupt due to unfunded liabilities (including Social Security and Medicare, the US has over $50 trillion in debt). But the Fed’s actions truly brought things to a tipping point.

Consider that before the Financial Crisis the Fed’s balance sheet consisted of $800 billion worth of Treasuries. Today, thanks to QE 1, QE lite, and QE 2, it’s $2.8 trillion. To put that number into perspective, it’s larger than the economies of France, the UK, and Brazil.

Remember, most if not ALL of this increase was the result of the Fed taking on DEBT (and toxic debt at that). With only $51 billion in capital, the Fed now has a leverage ratio of 54 to 1. To put this into perspective, Lehman Brothers was only leveraged at 30 to 1 when it went bust.

To say that the US Federal Reserve is now insolvent would be a gross understatement. The only reason anyone trusts the Fed today is:

1)   Tradition (it’s backstopped the system since 1913)

2)   The Fed has a printing press which means it can create money out of thin air

3)   Lack of alternatives (what other entity in the US has a printing press?)

And the only reason the US financial system and currency haven’t already collapsed is because other countries are in even worse shape and on the verge of collapse themselves (see Europe, China and Japan… China is rapidly heading towards a subprime crisis of its own).

However, this relative appeal (the US, while bankrupt, is in better shape than other countries) does not mean the US will avoid taking its medicine. That medicine will consist of some kind of debt default/ restructuring and a collapse in the Federal Reserve banking system. Put another way, it will mean an end to our current monetary system.

This process will involve bank holidays, severe market dislocations and crashes, temporary food shortages and consequent civil unrest.

I can show you how…

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

When it comes to profiting from this kind of disaster, few people on the  planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008, having been warned a full three weeks in advance of the Crash to get out the market and go short.

I believe we could see another 2008  situation unfold in the near future, which is why I just unveiled six specific trades  to subscribers… all of which will pay off  HUGE returns as the current stock market collapse accelerates (one is already up 8%).

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers
Editor In Chief
Gains Pains & Capital

 

 

 

Stocks have started to break down in a big way again. It looks as though we’ve entered a wide trading range on the S&P 500:

If we don’t bounce hard at 1,300, we’re going to 1,250 in short order. The $1 million question on everyone’s mind is whether this is just a correction or the start of another Crisis.

The US Dollar is indicating it could very well be the latter:

As you can see, the US Dollar looks to have just broken out of a falling wedge pattern. The ultimate target for this breakout, if confirmed, is over 84. The only thing that could instigate that kind of move would be a full-scale Crisis (the last two significant US Dollar rallies were due to the 2008 Crash and 2010 Euro Crisis, respectively).

If this happens it will be the Eurozone that starts it. The debt problems over there have no spread to Italy, a country far too large for the EBC to bail out. And with the European banking system being just as, if not even more saturated with toxic debt as the US’s, we could see a systemic collapse over there from just about anywhere: Portugal could take down Spain which could in turn take down Germany, etc.

Indeed, the Euro is hanging on for dear life at 140. A break below this level would indicate we are at the beginning of a serious breakdown in the Eurozone. That would be the trigger to watch for the beginning of REAL trouble.

However, one thing is clear: we are fast approaching the REAL Crisis.  And there’s no shortage of Black Swans to hit either. The Euro problem isn’t going away. In fact, it’s now spread from Greece to Italy and Portugal… the latter county now being officially rated as “junk.”

Meanwhile, China is experiencing a liquidity Crisis on par with the Lehman-collapse. In fact, a recent bond auction there failed to sell EVEN HALF of the bonds offered (there’s not enough capital available).

And then of course there’s the US where we have only two weeks to deal with the debt ceiling before we begin a default.

The next Crisis is literally at our doorstep. And it’s going to kick off another 2008 episode as all the over-leveraged players (read: EVERYONE) will have to sell positions to meet margin/ redemption calls. However, this time around we’ll also see civil unrest as people lose their social safety nets (unemployment, social security, etc).

What will follow will be the equivalent of 2008 all over again, along with food shortages, civil unrest, outbreaks in crime, bank holidays, and the like. It will, in short, be like what’s going on in the Middle East today (though NATO won’t be bombing us).

Which is why if you haven’t already taken steps to prepare yourself and your portfolio for the coming disaster, you need to do so NOW.

I can show you how…

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

When it comes to profiting from this kind of disaster, few people on the  planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008, having been warned a full three weeks in advance of the Crash to get out the market and go short.

I believe we could see another 2008  situation unfold in the near future, which is why I just unveiled six specific trades  to subscribers… all of which will pay off  HUGE returns as the current stock market collapse accelerates (one is already up 8%).

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers
Editor In Chief
Gains Pains & Capital

 

 

Indeed, it just posted the single biggest money pump since Lehman Brothers…  on the week of June 27 2011. If you’re looking for a reason that stocks have been ramped so much higher in the last two weeks. This is it.

Indeed, for the week ended June 27, the Fed flooded the financial system with $76 BILLION in liquidity. Bill King of the King Report puts that number into perspective noting that it’s BIGGEST increase since September 22, 2008 right after Lehman Brothers collapsed.

That’s right, the Fed just juiced the system as much as it did when Lehman Brothers went under. While a shockingly large single money pump, the Fed’s generally been flooding the system with liquidity at a pace equal to that of 2008 since the beginning of the year.

In 2008, the Fed put roughly $1 trillion in liquidity into the system to try and hold things up. So far in 2011, it’s put in nearly $700 billion. You think that the recession ended and systemic risk has gone away? Explain this one.

In simple terms, it’s clear that beneath his attempted calm, Ben Bernanke is in fact scared stiff. Why else would he be printing money night and day? If the financial system was indeed stable and secure, why is he pumping money at the same pace as 2008?

This all ties in with what I’ve been saying for months now… that 2008 was in fact the warm up and that the REAL Crisis is fast approaching. And when it hits, the Fed will be POWERLESS to stop it. Because this time it will be entire countries, NOT just Wall Street banks that collapse. So what’s coming will be the equivalent of 2008 all over again, along with food shortages, civil unrest, outbreaks in crime, bank holidays, and the like. It will, in short, be like what’s going on in the Middle East today (though NATO won’t be bombing us).

Which is why if you haven’t already taken steps to prepare yourself and your portfolio for the coming disaster, you need to do so NOW.

I can show you how…

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

When it comes to profiting from this kind of disaster, few people on the  planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008, having been warned a full three weeks in advance of the Crash to get out the market and go short.

I believe we could see another 2008  situation unfold in the near future, which is why I just unveiled six specific trades  to subscribers… all of which will pay off  HUGE returns as the current stock market collapse accelerates.

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers
Editor In Chief
Gains Pains & Capital

 

 

 

 

 

 

 

 

 

 

 

The Fed must literally be about to pee itself.

The $600 billion in QE 2 bought at best roughly three months’ worth of improved economic data. Granted, it was heavily massaged economic data (US economic data is now largely a work of fiction), but for simplicity’s sake, we’ll say that the Fed got roughly one month’s worth of improved economic data for every $200 billion it spent.

However, QE 2 ALSO blew up food and energy prices up: between 2010 and 2011 gas rose 33% while ground beef, cheese, and vegetables were all up in the double digits as well.

So the Fed needed things to cool down a bit. So they allowed QE 2 to end. Of course, Bernanke juiced the market one final time to the tune of $76 billion, probably hoping that the market would buy his bluff and believe that things might hold up without Fed juice.

But the market didn’t. Instead, the markets have begun to implode proving beyond any doubt that the Fed was the primary support behind the stock market rally.

So here we are today. The US economy has very clearly fallen off a cliff. The Fed already has a $2.8 trillion balance sheet (larger than the GDP of France, the UK or Brazil). Announcing QE 3 would mean creating an inflationary disaster. And NOT announcing QE 3 means a market collapse and very likely another 2008 scenario.

So it’s literally “pick your monetary poison.”

However, in the end, regardless of how we get there, QE 3 will come. The reason for this is that EVERY Fed move since the Financial Crisis began has been aimed at propping up the large Wall Street banks who continue to remain insolvent due to their TRILLIONS in derivative exposure.

When it comes between screwing the taxpayer vs. triggering a systemic implosion that will destroy the banking oligarchs, the Fed has taken option #1 EVERY TIME. They’ve already done it to the tune of $4 trillion (at the bare minimum). They’ll do it again.

Why?

Because letting the banks collapse means hitting “reset” on the entire financial system (at least temporarily). Wall Street as at minimum over $200 TRILLION in derivatives sitting on its balance sheets. And the Fed will do anything it can to try and contain this disaster. That includes kicking the US Dollar off a cliff and screwing US consumers.

Ultimately, all of these efforts will fail (see the Euro situation today). But this will only happen after the Fed has done any and every action it can to prop things up. This will include QE 3 and as many QE’s as the US Dollar will allow.

So, QE 3 is coming. We might even see QE 4 before the system collapses. But the system WILL collapse. And when it does, it will be a 2008 type Crisis on steroids.

The reason for this is that the Financial System is now even more leveraged than it was during the Tech Bubble. When the Crisis hits all the over-leveraged players (read: EVERYONE) will have to sell positions to meet margin/ redemption calls.

This will kick off a death spiral in the markets as every drop results in more and more selling from financial institutions. Add to this the collapse of the Euro, a China hard landing, and US debt default and you’ve got the makings of a global catastrophe: think what’s happening in Greece with now on top of a stock and bond market crash.

What will follow will be the equivalent of 2008 all over again, along with food shortages, civil unrest, outbreaks in crime, bank holidays, and the like. It will, in short, be like what’s going on in the Middle East today (though NATO won’t be bombing us).

Which is why if you haven’t already taken steps to prepare yourself and your portfolio for the coming disaster, you need to do so NOW.

I can show you how…

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

When it comes to profiting from this kind of disaster, few people on the  planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008, having been warned a full three weeks in advance of the Crash to get out the market and go short.

I believe we could see another 2008  situation unfold in the near future, which is why I just unveiled six specific trades  to subscribers… all of which will pay off  HUGE returns as the current stock market collapse accelerates.

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers
Editor In Chief
Gains Pains & Capital

 

Forget the details and the specifics… here’s the latest news you need to know about.

Europe is bankrupt and the EU will not exist in its current form within 12 months. The ECB tried to “bailout our way to success” strategy on some of the more minor players (Greece), but is now finding that there isn’t actually enough money to bail out the larger players (Spain and Italy).

So, barring a leveraged buyout of Italy by Germany and China, the EU will be breaking up and the Euro collapsing within the next 12 months. How this will happen remains to be seen (the EU splits into two sections? Is done away with altogether? Etc). But the facts remain that the EU has reached the end game for bailouts (you cannot bail out entire countries).

The last straw of hope that the bulls are clinging is China’s recent decision to actively buy EU member states’ sovereign debt. Those of us who recall China’s decision to buy Morgan Stanley in 2008 can’t help but wonder if the country has never heard of “due diligence” or if it simply doesn’t care about losing money.

Speaking of China, the People’s Republic is finding out that the Republic made $540 billion worth of loans to the people that:

1)   Have not been accounted for

2)   Are properly garbage and won’t be paid back

We all know how this scheme ends (see subprime collapse in US). However, given that China pretty much makes up its economic data, it’s pretty safe to assume that the bad loan situation there is even worse than Moody’s believes. So look for a “2008 type” bust in China in the coming months.

And then of course there’s the US: the current least horrendous disaster winner by default (literally in Europe’s case and metaphorically in China’s case). Congress continues to play “debt talk” phone tag with President Obama.

However, to say this is a debate ignores the fact that there isn’t actually two sides to this discussion. Both Congress and the White House are debt-crazed groups who believe throwing good money after bad = recovery. So regardless of whether the debt ceiling is raised or budget talks reach an agreement, the US is broke and will continue to be until we default and restructure our debt obligations.

In simple terms, what I’m trying to say is that we are about to witness another “2008” only on a sovereign scale. The EU will be first, but China, Japan, and even the US will be defaulting in the future. The implications these actions have for asset classes will be HUGE as all assets move relative to sovereign bonds which used to be considered the primary low risk asset class in the world.

So expect another bigger Crisis that that will be the equivalent of 2008 all over again, along with food shortages, civil unrest, outbreaks in crime, bank holidays, and the like. It will, in short, be like what’s going on in the Middle East today (though NATO won’t be bombing us).

Which is why if you haven’t already taken steps to prepare yourself and your portfolio for the coming disaster, you need to do so NOW.

I can show you how…

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

When it comes to profiting from this kind of disaster, few people on the planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008, having been warned a full three weeks in advance of the Crash to get out the market and go short.

I believe we could see another 2008  situation unfold in the near future, which is why I just unveiled six specific trades  to subscribers… all of which will pay off  HUGE returns as the current stock market collapse accelerates.

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers
Editor In Chief
Gains Pains & Capital

 

Over the weekend it was announced that the European Emergency fund may not be large enough to bailout all of the country’s who are bankrupt in Europe. This is really not a surprise.

Back in 2010 when the bailout fund was first announced I said it would prove to be another “Paulson’s bazooka” effort (in reference to Hank Paulson’s 2008 claim that a blank check to deal with Fannie/ Freddie would be the equivalent of a “bazooka” that would somehow solve those firms’ problems).

The European emergency fund is the exact same idea: that throwing around enough money can solve a debt problem. It’s the big lie: something politicians hope will come true if they say it enough times and loud enough.

However, anyone with a working brain knows there are only two (maybe three) ways to deal with debt: pay it off or default (or some combination of the two). The politicians do not want to admit this because it would mean admitting that they have no clue and that they’ve wasted TRILLIONS of Dollars worth of money.

So here we are, the first wave of the GREAT CRISIS was dealt with by transferring private sector debt onto the public’s balance sheet. Now the second round is hitting and the public sector needs to be bailed out.

So who’s going to do it?

The answer: no one.

Sovereign nations will default whether it be Greece, Italy, Spain, OR the US. There is no way we’ll be paying our debts off. The only reason we haven’t already seen defaults is because the banks won’t take a haircut on their bond holdings.

Politicians who have all been bought out by the banks have fallen for this charade so far. But it won’t last much longer. Banks may get you elected… but they can’t keep you safe from a populace that is rioting outside your door. So the banks will all be taking a BIG hit in the future.

And there’s no shortage of Black Swans to hit either. The Euro problem isn’t going away. In fact, it’s now spread from Greece to Italy and Portugal… the latter county now being officially rated as “junk.”

Meanwhile, China is experiencing a liquidity Crisis on par with the Lehman-collapse. In fact, a recent bond auction there failed to sell EVEN HALF of the bonds offered (there’s not enough capital available).

And then of course there’s the US where we have only 10 days to deal with the debt ceiling before we begin a default.

The next Crisis is literally at our doorstep. And it’s going to kick off another 2008 episode as all the over-leveraged players (read: EVERYONE) will have to sell positions to meet margin/ redemption calls. However, this time around we’ll also see civil unrest as people lose their social safety nets (unemployment, social security, etc).

What will follow will be the equivalent of 2008 all over again, along with food shortages, civil unrest, outbreaks in crime, bank holidays, and the like. It will, in short, be like what’s going on in the Middle East today (though NATO won’t be bombing us).

Which is why if you haven’t already taken steps to prepare yourself and your portfolio for the coming disaster, you need to do so NOW.

I can show you how…

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

When it comes to profiting from this kind of disaster, few people on the  planet have my ability to make Crises pay off.

To whit, my clients actually made money in 2008, having been warned a full three weeks in advance of the Crash to get out the market and go short.

I believe we could see another 2008  situation unfold in the near future, which is why I just unveiled six specific trades  to subscribers… all of which will pay off  HUGE returns as the current stock market collapse accelerates.

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers
Editor In Chief
Gains Pains & Capital

The financial world is beginning to break down in a big way today. In the currency markets, the second Greek bailout is turning out to be precisely the dud I said it would.

After all, it was only one year ago that Greece received its first bailout. Having now asked for extensions on returning those funds AND a second bailout, it’s bizarre that anyone would think giving more money to Greece would fix its problems.

Italy, Spain, and Portugal are all on equally shaky ground. The last of those three was actually just downgraded to “junk” status by Moody’s last week. So it’s not too surprising that the Euro is breaking down in a big way this morning.

We look to have broken out of the triangle pattern I talked about before. We’re now coming up against major support at 140. If we break this line it’s 136 in short order.

The drop in the Euro has coincided with an explosive jump in the US Dollar this morning, which in turn is kicking stocks and commodities (with the exception of Gold and Silver) down in a big way.

I said before that I thought the ramp job in stocks was more manipulation and performance gaming than anything else. If the S&P 500 breaks below 1325 and stays there I’ll be proven right as we’re then going to 1,300 if not 1,275 in very short order.

Meanwhile, Gold is on the verge of challenging its all-time high in US Dollars (and Euros) once again asserting that it is in fact a currency, NOT a commodity. If we break 1,550 and stay there then the next leg up in the precious metal will have begun.

In plain terms, the financial world is on RED ALERT this week as there is really little to hold the markets up anymore (QE 2 ended). Meanwhile the whole financial system is showing signs of extreme duress.

European banks (and nations!) continue to remain insolvent and we will be seeing defaults in the near future. The situation there has not ended by a long shot and I am certain the Euro will no longer exist in its current form within 12 months.

Meanwhile, China’s inflation is spinning out of control. A liquidity crisis is brewing over there that could rival the Lehman Brothers collapse, as the vast majority of local government debt in China is toxic. Indeed, China just failed to sell half of its intended local government debt in a recent bond auction.

And then of course there is the US, where we have officially breached the debt ceiling and are stealing from pension funds to meet new debt issuance. Indeed, things are now so bad with the US that Tim Geithner is potentially jumping ship.

My question is:

How bad must things be getting that Geithner, a man who has lied and swindled the American people with impunity, and has never once suffered the consequences of his actions, is voluntarily “getting out of Dodge”?

The answer: BAD.

Indeed, I think we could very easily see a repeat of the May 2010 Collapse, if not another 2008 type event in the near future. Only this time, the Crisis will be far far worse because the financial world will have realized that the central banks CANNOT solve the problems that brought about 2008.

When that happens, the REAL Crisis will start along with stock crashes, currency defaults, food shortages, and the like. Which is why if you’re not taking steps to prepare for what’s coming now, you need to start moving.

I can show you how.

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

Indeed, I just unveiled six specific trades to subscribers… all of which will pay off HUGE returns as the Euro breaks down.

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers

Editor In Chief

Gains Pains & Capital

 

 

 

 

 

I’ve been warning for years that an inflationary storm was coming. I’ve recently tailored my forecast to allow for a resurgence in deflation based on QE 2 ending and the economy diving, but my long-term forecast remains the same: inflation WILL be exploding in the years to come.

Indeed, even the biggest proponents of paper money (central banks) have begun to realize that their grand experiment is coming to an end. Central banks officially became net buyers of Gold last year. And we now find that they have acquired the most Gold in over a decade.

The Financial Times reports:

Central banks have pulled 635 tonnes of gold from the Bank for International Settlements in the past year, the largest withdrawal in more than a decade.

The move, disclosed in the BIS’s annual report, marks a sharp reversal from the previous year, when central banks added to deposits of gold at the so-called “bank for central banks” rather than lending it directly to the private sector amid growing concerns over counterparty risk.

Let’s consider this. If you’re a central bank and you actually believe in the value of paper money and your ability to create wealth by printing it…why would you be loading up on Gold?

The answer is simple: you see the writing on the wall.

The central banks of the world are in a competition to devalue their respective currencies against each other. They will work together to suppress a particular currency if a carry-trade gets too out of control (see Japan earlier this year), but in general the ECB wants a cheap Euro, the Fed wants a cheap Dollar and so on and so forth.

These guys know that the financial system is broken. They’ve known it for over a decade (Greenspan even admitted that derivatives could “implode” the market in 1999). But they’re going to kick the paper money can down the road as long as they can… primarily because the entire financial system is banking on their ability to “fix” things.

The 2008 Crisis was the first taste of systemic risk. The central banks threw everything including the kitchen sink at the problem in an attempt to hold things up. And it’s worked temporarily in the sense that the financial world still believes central banks can handle the situation.

However, the fact remains that the central banks actually didn’t fix anything. After all, you can only fix a debt problem by paying the debt off or defaulting. Moving it around and issuing more debt to meet current payments does nothing.

In this sense, the world’s central banks literally “bet the farm” on themselves and the view that sovereign balance sheets can stomach this toxic waste. As we’re now discovering in Europe, the laws of the markets (oversaturation of debt, default and the like) apply to countries as well as private banks.

The central banks know this and are now acting accordingly. It is not coincidence that they became net buyers of Gold within two years of the 2008 Crisis. Nor is it coincidence that they are now loading up on Gold at the fastest pace in over a decade. They KNOW (not think) that systemic risk is still on the table in a big way and that they will be POWERLESS to address the next Crisis when it explodes.

You can already see this in their public statements. Bernanke himself even admitted the Fed has no idea why the economy isn’t recovering. If you extend the implications of this statement it becomes clear Bernanke and pals are realizing that printing money is not going to patch up the financial system… Hence the Gold purchases.

In plain terms, the REAL Crisis, the Crisis that was put off temporarily during the last two years, is coming. It will not be a Crisis of stocks or bonds. It will be a Crisis of the financial system itself. A Crisis in which entire countries default. And it will make 2008 look like a picnic.

Remember, every asset class is defined relative to sovereign bonds. So if sovereign bonds begin defaulting… KA-BOOM. Round One (2008) of the Financial Crisis wiped out over $11 trillion in household wealth. Round Two will wipe out…?

On that note, smart investors are already taking steps to prepare for what’s coming. I’m talking about bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

If you’ve yet to prepare yourself and your loved ones for these issues, I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

Regarding market profits… few analysts on the planet have my ability to turn a profit during dangerous times.

To whit, I called the 2008 Crash months ahead of time and had my subscribers 100% in cash three weeks before the October-November 2008 nightmare hit. And the Private Wealth Advisory portfolio outperformed the S&P 500 by 15% during the Euro Crisis of May-July 2010.

So if you’re looking for someone to guide you through the coming dangerous times in the markets… you can take out a subscription to Private Wealth Advisory today and immediately begin receiving my hard-hitting analysis of the markets as well as specific investments to buy and sell to insure you stay protected… and turn a profit in the months ahead.

You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers

Editor In Chief

Gains Pains & Capital

 

 

 

 

 

The financial world seems to think that because Greece accepted another bailout we’ll be off to the races in the markets.

Aside from how absolutely moronic this view is (how’d the first Greek bailout work out? And it was what 12 months ago?), we have to consider the backdrop against which this particular tragic-comedy is playing out.

The consensus view from the mainstream financial media and 99% of find managers is that liquidity and access to loose money from central banks will keep things afloat.

However, reality shows this not to be the case… at all. Consider for instance the impact of the Fed’s money pumps.

For starters, as a back of the envelope analysis, consider that in 2007 when the credit markets first jammed up, the Fed resorted to providing emergency money pumps of $30 billion or so.

By June 2008, the Fed had done this 14 times to the tune of $200+ billion. Then came the $700 billion bailout in November 2008.

So by the end of 2008, the Fed had put in nearly $1 trillion in capital to the markets. And this did absolutely nothing to avert the market collapse.

Then came QE 1, which put another $1.25 trillion into the markets. And even after QE 1 ended the Fed continued supplying the juice to the tune of $30 billion or so per month during options expiration weeks.

Then we get QE lite, which results in another $300 billion into the markets plus QE 2 which adds another $600 billion. So all in all, the Fed’s supplied a minimum of $4 TRILLION into the markets since 2008 (I’m not accounting for the trillions more in deal that have not been made public). And the S&P 500 is at roughly the same level as before the Bear Stearns collapse.

So on the surface of it, the Fed’s money spending appears to have accomplished something positive: they spent $4 trillion and the markets rallied bringing household net worth up 17% from its low in 2009.

However, when you dig deeper into the specific results of the Fed’s actions it becomes clear that not only is the Fed creating a giant Ponzi scheme in the financial markets, but that we’re getting close to a breaking point.

Consider that QE 1 provided $1.25 trillion in liquidity to the markets. From the date of its inception until its end, the S&P 500 roughly 540 points. Put another way, each $10 billion was worth 4.3 points on the S&P 500.

In comparison, QE lite and QE 2 put roughly $900 billion into the market (roughly 75% of QE 1) creating a 251-point rally in the S&P 500. In this case, every $10 billion in additional capital was worth 2.7 points on the S&P 500.

So $10 billion of Fed money today is worth just over half (62%) the market gains of $10 billion in Fed money back in 2009. Put another way, every new injection of $10 billion from the Fed is producing less and less results.

If we step back and look at this plainly, we will see that reality does not in any way match the view that the Fed’s liquidity will solve the financial world’s problems. In fact, we see that each Fed move is having a smaller and smaller impact on the financial markets. Extend this idea out a bit further and you find that we will reach a point at which the Fed will no longer have any control over the financial markets.

I believe that we are rapidly approaching that point. Indeed, the Fed has already hit a wall in the sense that the negative impact of its policies (inflation/ prices soaring) far outweigh any positive impact (stocks rallying).

At some point, and I cannot say when, the market will begin to realize that the Fed cannot backstop the entire financial system. When this happens, THEN the REAL Crisis will hit and it will make 2008 look like a picnic. The reason is quite simple: the next Crisis will be a Crisis of Faith pertaining to the US Federal Reserve.

For 80+ years, the US financial system has operated under the belief that the Federal Reserve could handle any problem. This belief was put to the ultimate test in 2008 when the Fed faced off against the biggest Financial Crisis of the last 80 years. And the ONLY thing that kept us from the brink was the belief the Fed could fix things.

It couldn’t. And we’re all beginning to see that now.

So when the next Crisis hits it will become clear the Fed CANNOT fix these issues (it never could but most people hoped regardless). And that’s when the real collapse will begin.

It’s coming. The fact Bernanke has admitted publicly that he’s clueless what’s going on is a MAJOR step towards the world realizing that he’s lost control. Which is why if you’re not taking steps to prepare for what’s coming now, you need to start moving.

I can show you how.

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

Indeed, I just unveiled six specific trades to subscribers… all of which will pay off HUGE returns as the Euro breaks down.

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers

Editor In Chief

Gains Pains & Capital

 

 

 

 

The trouble with financial forecasting for Europe is that the biggest decisions are always made in the political arena, NOT economically. Case in point, Greece, which is obviously bankrupt, voted for another round of bailouts despite the fact the first round was a disaster (won’t be paid back)  and the Greece economy is in ruins.

From a purely economic standpoint, it’d made a heck of a lot more sense to kick Greece out of the Eurozone (why should Germans be shouldered with Greek liabilities?). No businessman with a clue would want to support another Greek bailout. However, politics, not business rules in Europe politicians are both clueless and insanely corrupt.

This is why the Euro has held up and even rallied despite the fact the Eurozone is beyond doomed. Does anyone really believe the Euro is going to even exist in its current form a year from now? We’ve had two Greek bailouts and now Portugal is lining up for a bailout too. And what’s going to stop Spain and Italy from doing the same?

Finally… how on earth is a strong Euro good for the European economy? Why defend it? Why not let it collapse to benefit European exports? Again, politics.

This is why I’m ultrabearish on the Euro and the Eurozone. Sure, the US has horrible deficits, debt loads, and politicians. But the idiocy that occurs on this side of the pond is NOTHING compared to what happens in Europe. In the US, people at least want to be a part of the US (you don’t see New Yorkers wanting out of the union because California is bankrupt).

Europe on the other hand is a bunch of countries, who don’t even speak the same languages, have a long history of wars amongst each other, and who really don’t even like each other, joined together under a single union which most European voters now don’t even want to be a part of.

After all, Greece was bailed out in May of last year. It’s since requested an extension on paying back its bailout funds… AND asked for a second bailout… in 12 months. Spain also just tried to raise 3 billion in Euros to restructure its banks and only managed to raise a little over half of this… at spreads 10 TIMES when investors demanded the last time. Italian banks have fallen 27% so far this year on debt problems… and on and on.

Indeed, the Euro is setting up for a BIG move in the near future. The currency has formed a triangle pattern. These patterns can break out either to way, but given the problems Europe faces today, it will likely be downward. And the target for this pattern is 134-136 or so.

However, that move, will merely be the first of several large drops as the Euro is ultimately not going to exist in its current form within the next two years. BIG MONEY will be made by the smart investors who prepared for this in advance.

Why?

Because when the Euro collapses, it will have a MASSIVE systemic impact. The volatility will be very VERY intense. And various asset classes will implode. Indeed, we will very likely see another Crisis that makes 2008 look like a picnic. Which is why if you’re not taking steps to prepare for what’s coming now, you need to start moving.

I can show you how.

I’ve recently published three key reports titled Protect Your Family, Protect Your Savings, and Protect Your Portfolio all in all 40+ pages of material devoted to showing individual investors how to prepare these areas of their lives in great detail.

I’m talking about how to prepare for bank holidays, food shortages, stock Crashes, debt defaults, civil unrest and more.

Indeed, I just unveiled six specific trades to subscribers… all of which will pay off HUGE returns as the Euro breaks down.

So we’re ready for whatever may come. And the worse things get… the more profitable our strategy will be.

If you’ve yet to take these steps yourself, it’s not too late… in fact, you’ve still got time to get your financial “house” in order to not only survive what’s coming… but potentially even make serious money from it.

All you need to do is take out a “trial” subscription to my Private Wealth Advisory newsletter. You’ll immediately be given access to all of the reports I detail above… and you’ll also be on my private client list to receive my bi-weekly investment reports as well as real-time trade updates on when to buy and sell various investments.

And if you should decide that Private Wealth Advisory is not for you, you can ask for a full refund during the first 30 days and I’ll return every cent of your subscription cost.

The reports you’ve downloaded during your “trial” period are yours to keep, even if you choose to cancel.

To get started with you Private Wealth Advisory subscription today, download the Protect Your Family, Protect Your Savings, and Protect Your Portfolio reports and start taking action to prepare for what’s coming…

Click Here Now!

Good Investing!

Graham Summers

Editor In Chief

Gains Pains & Capital

 

With most of Wall Street absent in advance of the long weekend, those few traders on the street took advantage of the low volume to gun the market higher last week. This, combined with end of the Quarter performance gaming resulted in the market going positively vertical.

From a purely technical standpoint the S&P 500 has bounced hard off of it 200-DMA. We’ve now broken above the 50-DMA and are closing in on major resistance at 1,350:

As I’ve stated numerous times before, stocks are always the last asset class to “get it.” So with that in mind, we need to consider what other asset classes are doing in order to determine if last week’s rally was based on anything real or simply Wall Street shenanigans.

First let’s have a look at agricultural commodities. They lead stocks and other asset classes during the QE lite/ QE 2 rally by several months. They also peaked first in February 2011, well before stocks and other asset classes took a dive. So they’ve worked extremely well as leading market indicators in the last year.

This has to be one of the ugliest charts out there. Having fallen below their 50-DMA, agricultural commodities have since been rejected by that line multiple times. And we are now on the verge of posting a death cross: when the 50-DMA breaks below the 200-DMA.

The picture is equally ugly for Oil and Silver: the other two big market leaders during the last year. Indeed, Gold is the standalone market leader that continues to hold up relatively well, primarily because it’s now the “go to” asset to protect against sovereign default risk:

In light of this, it’s difficult to believe the stock market rally from last week as totally legitimate and not by end of the quarter performance gaming by hedge funds taking advantage of the light volume. This week’s action will go a long ways to explaining what’s to come in the weeks ahead.

In a market like this, the key is to stay nimble and find quick means of profiting from the volatility. Over the last year I’ve developed a system of trading that I believe to be the best such trading system IN THE WORLD.

It’s called Rapid Fire Options Alert and it’s already up 280% this year.

That’s not a typo. Nor am I resorting to some marketing gimmick such as ignoring the losers. Rapid Fire Options Alert has closed 26 trade so far this year. Of these, 21 have been winners. And with an average gain of 20%… well, those gains can add up pretty quickly.

The above chart shows the return Rapid Fire Options Alert ’s trades would have on $10K so far in 2011. What you’re looking at is over $25,000 in profits… using just $10K to trade.

Best of all, this system is unbelievably easy to follow. We typically only trade once a week on Tuesday morning.

When it’s time to make a trade we send out a trade alert via both email and text, explaining exactly what option contract to buy and the price at which to buy it.

Then, when it’s time to sell (usually just 2-3 hours later) we send out another alert via text and email.

That’s it… And we’re up over 280% so far this year.

If this sounds like the kind of profit-producing trading system your portfolio could use, you can sign up for Rapid Fire Options Alert now and have your account in place in time for our next trade due out this week.

To do so… and start seeing some MAJOR returns from your trading as earl as this week…

Click Here Now!!!

Best Regards,

Graham Summers

PS. A final note… we DO offer a 30-day trial refund period. So if you find that

Rapid Fire Options Alert isn’t for you, just drop us a line during the first 30-days and we’ll issue a full refund.

To get started with your Rapid Fire Options Alert subscription…

Click Here Now!!!