All Time Highs: Party Like It’s 1929!

For mainstream financial pundits the new all time highs in US equity markets seen this week are cause for celebration. The narrative is intact! The economy is great! The risks have disappeared! Everything is awesome!

Many have taken the opportunity to scoff at those who have been calling out for systemic financial and economic collapse. As one of those folks who has repeatedly highlighted the dangers of the current setup I’ll be the first to let you know that the volatility trade is a pain trade right now. The precious metals of course more than make up for it. Minor personal portfolio dynamics aside, here is a word of caution:

Don’t fall into the trap.

If you can see what has caused these new highs then it becomes abundantly clear that we are looking at a blowoff top that is the last ditch effort to trap capital in the system and prevent it from leaving. The markets are fictional constructs anyway, so why should we be ebullient over the Dow being at 18,500 perhaps on its way to 20,000 when it can essentially be set at whatever sequence of digits is preferred in the current financial paradigm.

How is that possible?

In this case a picture is worth one quadrillion words:

Central Banks

This correlation is not random. The S&P actually tracks even closer to just the Federal Reserve, but that balance sheet has stagnated at around $4.5T – at least on the open books – for a couple years now, so it has been left to the rest of the central banks around the world to do the heavy lifting.

This is the heist in action. The banks print worthless currency out of nothing and use it to buy everything.

Don’t fall into the trap.

ZIRP, NIRP, QE, QQE, helicopter money, and the panoply of extraordinary monetary policy measures aside, here’s what you need to know:

They’re luring as many people in as possible before they sink the whole thing. Don’t be one of the suckers. Use this opportunity to take possession of real wealth, hard assets, and survival supplies. Be thankful for each day, because we can’t be sure how many this system has left.

Scoff if you want. My responsibility is to warn not to convince, and I have done my duty.

 

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