Category Archives: Policy Error

President Trump is worsening the trade war between China and the US in order to force the Federal Reserve to ease monetary policy. Before proceeding, I want to stress that none of the following is meant to be political analysis. … Continue reading

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The Final Blow Off Top Just Hit… Next Week Comes the FIREWORKS

Well, that’s that. The markets surged on the Fed announcement of NO rate cuts because the market now believes the Fed is GUARANTEED to make a MASSIVE cut in July. The S&P 500 (blue line in the chart below) hit … Continue reading

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What Are the Odds that Bonds, Copper, and Fed Ex Are Wrong About the Economy?

Stocks have now cleared the all-important level of 2,900 on the S&P 500. The index just peeked above critical resistance (top red line in the chart below). Overbought and overextended, stocks are now due for a correction/ consolidation. It would … Continue reading

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The Fed Needs a Reason to Cut Rates… and Stocks Will Deliver it Shortly

Yesterday’s Fed meeting had one clear message: The Fed needs a reason to cut rates. The Fed has obviously laid the ground work for a rate cut by hinting at easing… but with the “official” GDP numbers at 3.2% and … Continue reading

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Sign of a Top: Mom and Pop Investors Finally Piled Back Into Stocks… All Based on BS

So it was all BS. For months now, the Trump administration, through both tweets from the President and countless articles published in the financial media, has proclaimed that a trade deal between the US and China was “just around the … Continue reading

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Bull Trap Warning: There Has Been No Real Progress on China-US Trade

So it was all BS. For months now, the Trump administration, through both tweets from the President and countless articles published in the financial media, has proclaimed that a trade deal between the US and China was “just around the … Continue reading

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Anyone Who Still Thinks The Fed Has a Clue About Forecasting Needs to See This Chart

Whatever little credibility the Powell Fed still had has been permanently shredded. Throughout the last 15 months, the Powell Fed has maintained that it would be able to normalize Fed policy. This meant interest rates at historic norms (above 3%) … Continue reading

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Warning: The Fed Has No Idea What It’s Doing

The Fed is officially trapped. For years, I’ve stated that the Fed would never be able to normalize policy. Why? As Japan has shown us, once a Central Bank embarks on the path of extreme monetary policy like ZIRP and … Continue reading

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Warning: The Fed Will Be Using YOUR Money to Prop Up the Bubble Soon

The Fed is officially trapped. For years, I’ve stated that the Fed would never be able to normalize policy. Why? As Japan has shown us, once a Central Bank embarks on the path of extreme monetary policy like ZIRP and … Continue reading

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The Political Class Needs Capital to Plug the Everything Bubble: Prepare to Be Taxed!

Yesterday’s article caused quite a stir. I wish that represented the worst of what’s to come, but it doesn’t. Prepare to be taxed. The growing mantra from the political class is that “the wealthy aren’t paying their fair share.” While … Continue reading

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The Everything Bubble Has Burst, Now Come the Wealth Grabs, Pt 2

They’re coming for your money. The Everything Bubble has burst and the debt markets are in distress. We’ve already seen yields rise above their long-term downtrend, suggesting that higher debt costs are now a reality. Because any real structural solution … Continue reading

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By the Time the Fed Hits Its Goals, the Markets Will Be Crashing

The Powell Fed has set one goal and one goal only for its policy… Hitting the “neutral rate of interest.” The neutral rate of interest is when the Fed has rates equal to the pace of inflation. While this is technically … Continue reading

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The Trade War Is a Done Deal… the US Dollar is Toast

Perhaps the single most dangerous move an asset class can make is a “false breakout.” A false breakout occurs when an asset breaks out of a consolidation pattern, only to reverse. The reason why this development is so dangerous is … Continue reading

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Don’t Be Fooled By the US Dollar False Breakout

Perhaps the single most dangerous move an asset class can make is a “false breakout.” A false breakout occurs when an asset breaks out of a consolidation pattern, only to reverse. The reason why this development is so dangerous is … Continue reading

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What Happens When a Central Bank Loses Control?

Is the Bank of Japan Finally Losing Control? While we like to focus on the US Federal Reserve (the Fed) because it controls the global reserve currency (the US dollar) and therefore is the most important Central Bank in the … Continue reading

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Is the Bank of Japan Finally Losing Control of Its Bond Market?

Is the Bank of Japan Finally Losing Control? While we like to focus on the US Federal Reserve (the Fed) because it controls the global reserve currency (the US dollar) and therefore is the most important Central Bank in the … Continue reading

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Did Japan Just Signal the Start of the Next Crisis?

Is the Bank of Japan Finally Losing Control?                     While we like to focus on the US Federal Reserve (the Fed) because it controls the global reserve currency (the US dollar) and therefore is the most important Central Bank in … Continue reading

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The Stock:Bond Ratio Says “Risk Off” Is here

The stock market is in serious trouble. Yes, I know that FANG stocks are going to infinity and nothing can bring this market down. But the reality is that “beneath the surface” there are plenty of signs of a significant … Continue reading

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President Trump Just Tweeted the Biggest Investment Tip in Decades

Trump just gave Jerome Powell is marching orders. As we’ve noted over the previous weeks, the Powell Fed screwed up royally in June when it forecast five additional rate hikes over the next 12 months along with an accelerated pace … Continue reading

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The Fed is Going to Crash Stocks to Save Bonds

The single most important bond in the world is the 10-Year US Treasury bond. This bond represents the “risk free” rate of return for a total economic cycle (roughly 10 years) denominated in the global reserve currency (the $USD). Put … Continue reading

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