May 30th Show; A conversation on what a systemic “collapse” means to us

I have uploaded a new show podcast for May 30, 2018. Click here to go to the show archives page to listen or you can listen on the link below.

-My hope is to help people understand that economic and monetary system problems present opportunities.
-Recall that QE was a novel program last decade. If there is another calamity perhaps there are other programs available. Are there any programs the governments and central banks can conjure up to address monetary and economic system problems in the future?
-Will there be a collapse? Who will be blamed for it?
-What is the goal of these elites? Is it to reform or is it to string it along until a force majeure presents itself? Never underestimate their ability to hold it all together.
-Do the patriots and alt-media followers and bloggers even know what “collapse” means?
-Are there untapped pools of liquidity that the nations can tap into to stave off debt collapse?
-The disinfo in the alt-financial media comes from the top and is filtered down. It ensnares well-meaning writers who really aren’t experts.
-George Bush, Sr. called the patriots and alt-media followers of his day as “the BUDsters.”
-Beware of the hard-sellers who rely on fear to sell their garbage. They appear in places we don’t think to look.

New World Order Economics; beware of the hard-sell collapse promoters

Beware of the hard sell, it can cost more than any losses

I came across this blog post from Martin Armstrong this morning titled, [a] Global Systemic Collapse – Opportunity & Risk, and immediately I was confronted with his perfunctory self-promotion. However, what interested me was the title. So, I read the post. As usual, it was a waste of time.

Yes, when I say we can see a monetary reset as soon as 2021, this is no joke. There are critical points in a number of markets that I will reveal in Singapore. These are the lines in the sand. Once we cross them, there is no going back. This is a global systemic collapse. I cannot emphasize how serious this is going to be.

This is NOT some new age of KNOWLEDGE or Artificial Intelligence ruling the world. Those are complete nonsense. We have to crash and burn before we every (sic) reach some new age of reform.

Martin Armstrong – A Global Systemic Collapse – Opportunity & Risk (May 29th)

I have been a regular reader of Mr. Armstong’s blog for at least five years, but he hasn’t been revealing anything new lately. I was intrigued with his concept of the 2015 financial big bang, so I paid $3,500 in 2015 to attend Mr. Armstrong’s WEC conference in Princeton. I figured it was close enough to home that I could drive, so the hassle of getting there was minimal. Once at the conference he did reveal a number of predictions for 2016-2017, but the event was nothing more than a boot camp type of seminar, where if you wished to learn more he had a number of services you could subscribe to. A person could easily spend $10,000 a year and more for his stuff and I felt short-changed by his WEC conference. I used his Socrates trading platform for several months and found it unrevealing. I went back to my methods and began making money again.

I met a number of individuals at the conference. From what I could tell, I did not come across any institutional investors. I spoke with about 20-25 attendees and they were in my position. I would estimate that at least half the people were retired and just managing their own money. I have to admit, we were taken.

In other words, Mr. Armstrong is a self promoter and his predictions are average, at best, though he will tell you otherwise.

In 1999, Japanese fraud investigators accused Armstrong of collecting money from Japanese investors, improperly commingling these funds with funds from other investors, and using the fresh money to cover losses he had incurred while trading. US prosecutors called it a $3 billion Ponzi scheme. Allegedly assisting Armstrong in his scheme was the Republic New York Corporation, which produced false account statements to reassure Armstrong’s investors. In 2001, the bank agreed to pay US$606 million as restitution for its part in the scandal.

Martin Armstrong – Wikipedia

Despite what Mr. Armstrong tells you, in the 1990s, he incurred substantial trading losses. So, whatever his computers say, he is often incorrect.

His predictions at the 2015 WEC conference were off as well. But he would tell his subscribers that the changes are demonstrated in his Socrates computer model. Though he correctly predicted the rise in the stock market, he incorrectly predicted the bond markets, the real estate market, precious metals, and most of the currencies markets. Despite the recent strength in the US dollar it has been down slightly since that 2015 conference. He was estimating 120 on the USDX by 2017.

He discounted bitcoin out of hand as it was rising. He refused to analyze it until it collapsed and then told his readers that he predicted it to the day.

Have faith in your abilities; don’t rely on “superstars” and “gurus”

Now, I am not here to bash and malign a fellow trader and investor; I do not try to make myself look good by denigrating others. But, if someone is going to put himself out there as an expert and superstar, he needs to back it up with results.

This is NOT some new age of KNOWLEDGE or Artificial Intelligence ruling the world. Those are complete nonsense. We have to crash and burn before we every reach some new age of reform.

Martin Armstrong – A Global Systemic Collapse – Opportunity & Risk (May 29th)

Mr. Armstrong has been preaching calamity for at least the five years I have been reading his posts. Notice that he always gives himself wiggle room, yet giving the collapse prognosticators enough ammunition to use his posts as proof that collapse is around the corner.

Notice the excerpt; he says we have to crash and burn before we see serious reform. He doesn’t say we will crash and burn. Ask yourself this question; what if the elites do not want serious reform? What if these elites want to string this along until war comes?

I submit to you that there will not be any serious reform until a force majeure presents itself. I say it can only be war. Mr. Armstrong, however, refuses to believe that there is any real conspiracy for global government and that this world is running in cycles. If you believe him you will be running in circles and will most likely be poorer, too.

Have faith in your ability to discern fact from fiction and to know when you are being played.

The new world order’s financial system; what’s bad for you is good for the economy

To grow the economy, the New World Order promotes predatory industries

It is obvious to those who follow the alt-financial media that our current monetary system is ostensibly flawed, since the vast majority of humanity does not benefit from its structure.  But to its developers and promoters,  it is a system used to exploit others. To these elite, it is a wonderful wealth extraction system. Only a small part of humanity does not end up on the losing end.

As society devolves and humanity degrades morally we can observe how the economy and the financial system transform along with it to reflect this harsh reality. So, we should not look at our new economy and lament of imminent collapse. Rather, we should soberly view this transformation of the economy as a logical evolution. Moral restraint precluded us from giving in to our indulgences and thus, kept many sectors of our current economic system from growing too large. This is no longer the case.

I am not here to judge whether I condone certain activities or behaviors, but a simple analysis of these matters can easily show to the objective person that what is good for you and me is bad for the economy. Conversely, what is bad for you and me is good for the economy.

Let’s take a look a some of the new and growing industry sectors in this new world economy.

Gambling and games of chance

When I was an undergraduate Economics student back in the 1980’s my professors taught that gambling and games of chance, in game theory, were examples of “minus-sum” or “negaitve-sum” propositions. Essentially, it was viewed that the negative externalities of gambling and games of chance (e.g. higher crime, gambling addiction, regressive wealth extraction, broken homes, personal bankruptcy) outweighed the positive externalities (e.g. higher tax revenue, casino shareholder profits, and casino jobs).

Indeed, society was much different back 30-40 years ago. There were tight restrictions on gambling, casino construction, and lotteries. This was done ostensibly to be less injurious to society as a whole. A large percentage of the population were concerned with the adverse consequences of gambling and it was reflected in the nation’s legislation at the time.

Americans who made bets with gaming, lotteries and offshore regulated betting firms lost approximately $107 billion in 2017, an increase of 1.5% on the previous year, and that’s expected to increase to $118.5 billion this year, according to H2 Gambling Capital, a data and market intelligence firm based in the U.K. That does not include unlicensed or “black market” activities.

Marketwatch – This is how much Americans lost on state-sanctioned gambling last year (May 15th)


“There’s an underground gigantic pool of revenue and now it moves into the sunshine,” said Ted Leonsis, owner of basketball’s Washington Wizards and hockey’s Washington Capitals. “It’ll make sports betting for the next generation of sports fans as mainstream as buying stock in Fortune 1000 companies.”

The American sports-betting market is projected to be one of the biggest in the world. Research firm Eilers & Krejcik Gaming estimates that as many as 44 million people could place $245 billion in bets each year if all 50 states were to allow widespread betting. The more likely scenario, according to Eilers, is that 32 states would allow betting by 2023, with $120 billion in total bets creating some $6 billion in annual revenue for the sports book operators.

Bloomberg – ‘Gigantic Pool’ of Cash Awaits Teams in Dawn of Legal Betting (May 15th)

It is clear that the gambling industry is going to continue to grow and there is nothing that can be done to reverse its course. The toothpaste is out of the tube and the people demand it. Moreover, the moral stigma that kept it under wraps is no longer present.

The U.S. Supreme Court recently struck down a federal ban on sports gambling. My first thought was what took so long?

Americans can legally bet on soybean futures, the rise and fall of stocks, horse races, dog races, state lotteries, real estate investments, church bingo games, the roll of dice and various card games.

But not sporting events?

Americans love sports and a significant percentage of them like to bet on sporting events. Nearly two-thirds of Americans and almost three-fourths of sports fans think sports wagering should be legal.

Troy Media Legalized U.S. sports gambling? It’s about time (May 25th)

As we can see, the rationalization is overwhelming. So, I say, let’s make it legal. Society wants it. Notice what the author opines; “Now the trick is to put the revenue to the best use: on public fitness and activity initiatives.”

Gambling and games of chance are regressive forms of taxation, and those least able to deal with the negative externalities of gambling are usually the ones most affected by it (the working class poor). However, it is clear that the tax jurisdictions are eyeing the potential windfall from gambling. If you and I are to benefit from this tax windfall potential we need to make certain that we never gamble.

In other words, in this economic system you and I benefit when everyone else gambles and we do not.

Marijuana and alcohol consumption

It is clear that the marijuana industry in the U.S. has exploded in size over the past decade.

From fashion to fragrance, to beverages both hard and soft, celebrity sells. And with marijuana sales expected to reach $8-10 billion by the end of this year, and projected to double to $20 billion by 2022, more celebs are investing money and lending their names to get a foothold in this growing market.

Chris Walsh, founding editor of Marijuana Business Daily (yes, there is such a thing), said, “This was an industry in the shadows. It was all around on the black market for many decades. It kind of rose up very quickly. A lot of people were shocked by how fast it materialized.

CBS News – Seeing green: Celebrities selling marijuana (May 27th)

Once again, I am not here to judge whether one should smoke or consume cannabis. My opinion is irrelevant. With this said, the NWO elite want us to smoke marijuana all day. They understand its characteristics on the human mind and body. It makes many of the users less healthy, less willing, cognitively-dulled, and more docile. If marijuana empowered the population its use would be strictly banned and would never be shown in the media, especially in comedic and casual form.

So, with my understanding of the predatory economic system we are enslaved under, it is in my best selfish interest for everyone else to smoke as much marijuana and drink as much alcohol as they can. I have less competition in business and a larger potential rental pool for my properties. Moreover, the tax revenue generation is going to expand greatly as a larger part of the population embraces mind-alterer usage.

In other words, in this economic system you and I benefit when everyone else consumes marjuana and alcohol and we do not.

Predatory lending and all forms of debt

In a debt-backed currency system, all the debt outstanding by all the participants of an economy largely help to support the monetary framework. By definition, those who do not possess income generating assets and can stay ahead of this money growth end up on the losing end. It is a predatory system. The debt is essentially a guarantee on the future labor of the worker, or as in the case of the U.S. government, its ability to tax us. As the debt grows over time, so does the size of the monetary system.

In a predatory lending scenario, the borrower is usually more desperate and is often more willing to give up a lot in the process. Imagine a predatory payday loan; the borrower is essentially promising a huge chunk of her future labor potential. Who said the U.S. abolished slavery? Debt slavery is alive and well today.

Even if we borrow for a house and pay 3.5% interest, we are promising the lender a piece of our future labor potential. As we can see, a debt-backed, fractional reserve monetary system is predatory, by nature, as those with the money to lend can extract the future productivity of society.

Imagine a scenario where everyone in an economy decided to pay off all their debt; the economy would instantly collapse and asset prices across the board would plummet.

Thus, the only form of debt we should take on is under a situation where we have offsetting income (e.g. rental property, profitable business, etc.) and not to use debt to finance personal consumption. Moreover, it is in our best selfish interest to make certain that everyone else is in as much debt as possible while we are debt-free.

In other words, in this economic system you and I benefit when everyone else is in debt and we are debt-free (unless you use debt to finance a profitable investment).

Conclusion – Society gets the monetary system it deserves

We need to contemplate how society has evolved over the past 40-50 years. Why should the monetary system collapse? I submit to you that this monetary system is just a reflection of its willing participants. It is an ungodly system and it is meant to be used by amoral people. These people prefer games of chance, embrace socialism (the concept of something for nothing), partake in marijuana consumption and other mind-alterers, are in perpetual debt servitude, and are much less healthy than their ancestors. In the new world economy if everyone stopped going to the doctors and were no longer getting sick the economy would collapse.

Don’t worry, the economy is growing, thanks to an amoral social class that is being served by a bunch of growing industries. We should be thankful that these growing predatory industries will help the economy to grow. The best part is that you and I can benefit, but we can’t become its victim.

Our monetary system is supported when everyone is sick. Asset prices are supported when everyone is in debt. The national citizenry is docile when everyone is smoking. People cannot rise up and rebel when everyone is losing money from gambling. It may be a predatory system, but if all we cared for was ourselves it would be in our best interest interest to grow these predatory industries, so that the government can raise as much tax revenue as possible and we can weed out our competition.

Welcome to the new world order. Look around, we are already here.

Why we should own gold and the disingenuous gold promoting and dollar bashing

Own gold for the right reasons

If you are familiar with my blog and research then you know how I approach gold as an investment. Gold should comprise a small percentage (10-15%) of our asset portfolio and we need to appreciate why we hold it. This understanding is important, because if we own it for the wrong reasons (e.g. inflation hedge, currency converting to gold-backing, market collapse, China acquiring gold in size, etc.) we will be disappointed and become disillusioned when it doesn’t perform as we were told. Moreover, we run the risk of misallocating our personal investment capital if we devote working funds to physical gold and expect imminent capital gains.

There are two reasons why we should own gold:

  1. We should own gold as an asset shield against potential lawsuits and liability that arise from daily life. Imagine having to go through a contentious divorce or being exposed to a catastrophic civil suit. Imagine if your balance sheet was in the cross hairs of a prosecuting attorney? If we held gold out of the system who would know? If you keep your gold buying and holdings discreet, you will always have unencumbered net worth.
  2. Gold is an insurance policy against unstable and corrupt governments that have a proclivity to abscond with their citizens’ wealth. This is especially true if a person lives in an unstable jurisdiction with a poorly performing currency. (e.g. India, Iran, Russia, Turkey, South Africa, Venezuela, Argentina, etc.).

By the way, notice this list of nations; they have unstable currencies and their leaders always seem to run cover for their corrupt governments. They tend to bash the US dollar, as it is easy to blame others for their own problems. If gold was the world’s currency, these nations would publicly denounce gold, since their balance of payments would be in even worse shape.

Beware of the gold “experts”

This is why I continually take exception to the gold promoters, shills, and the copywriters who promote the disinformation we read daily.

Case in point; this morning, I came across this article from Jim Rickards, titled, [T]he “Axis of Gold” Will Drive Gold Higher by the End of 2018. It appeared on the copywriting website, The Daily Reckoning.

The whole premise of the article provides nothing new from the gold shill perspective. Indeed, I can spend hours refuting much of what Mr. Rickards said, as there are instances in the article in which he makes sweeping generalizations that have no basis in fact.

This gold-based payments system will dilute and ultimately eliminate the impact of U.S. dollar-based sanctions.

Jim Rickards – The “Axis of Gold” Will Drive Gold Higher by the End of 2018 (May 24)

Is this true? There is no country in existence that wants to move to a gold-backed currency. If any nation wished to transact in gold and/or wanted to back their currency with gold their economic woes would mount and their debt would quickly become untenable. Gold, by definition is deflationary and any tax jurisdiction would suffocate under a gold-backed transaction system.

Iran also has an enormous amount of gold….  Iran has also received gold imported from Europe via Turkey, but the exact amount is unknown.

We don’t have any insight into how much it has because it’s also highly nontransparent. But in the first quarter of 2018, Iranian gold bar and coin purchases more than tripled.

Turkey is also acquiring enormous amounts of gold, which should not be surprising given Turkish president Recep Erdogan’s recent comments questioning the role of the dollar in global trade.

The Turkish central bank has almost doubled its gold holdings since last May, according to the World Gold Council. And it was the second largest buyer of gold among central banks for the first quarter of 2018.

So that’s the Axis of Gold. Again, evidence for this Axis of Gold is overwhelming.

Jim Rickards – The “Axis of Gold” Will Drive Gold Higher by the End of 2018 (May 24)

So what? These nations claiming to support gold are hemorrhaging foreign currency reserves in a futile attempt to support their own corrupt currency systems. Going to gold-backing would just hasten the process. With respect to Turkey, if this nation was about to flex its muscle and begin using gold for international settlements why is the lira continuing to collapse? I thought their intention to go to gold would help the lira.

The tumble of two Middle Eastern currencies – the Turkish lira and Iranian rial – which are among the world’s worst performers this year, is predicted to continue as regulators fail to arrest their tailspin.

The lira, which has weakened by about 20 per cent this year, and lost around 70 per cent of its value over the past five years, continued its free-fall even on Thursday despite a central bank intervention by boosting interest rates.

“The reasons for lira’s woes are deep-rooted and cannot be overcome with a rate cut or other drastic measures,” a currency analyst pointed out, hinting that Turkey might be entering the grips of a full-blown currency crisis.

The plunge of the lira against the US dollar and other currencies is unstoppable given Turkey’s double-digit inflation and large external financing needs as the country grapples with widening current-account deficit, consistent rise in oil prices, and a pullout by Japanese investors, analysts said.

Khaleej Times – Woes of lira and Iran rial to persist (May 24)

Turkey and President Erdoğan can denigrate the US dollar as the reserve currency and may wish to navigate around its usage, but there is no replacement for poor economic policies, reckless social spending, and a corrupt government.

Just because a nation is building a gold stockpile does not mean it intends to go to some sort of gold backing. Moreover, the last thing Turkey and Iran wish to do is to go to a gold backing. Turkey’s huge external debt load precludes it going to any gold backing. Its debt burden would immediately become unsustainable. They would no longer be able to print lira to spend.

China does not wish to go to any form of gold backing. The Chicom government has built its economic powerhouse entirely on a fiat-based, centrally-managed, fractional reserve monetary system. The usage of fiat money was the centerpiece of this economic miracle and the People’s Bank of China is a privately-run central bank. China would only lose with gold-backing. It wants nothing to do with having the yuan as a primary reserve currency as there are too many requirements that would run counter to its internal growth agenda into making China a formidable military opponent to the U.S.

Where there’s smoke….

I find it peculiar that the anti-dollar, gold-promoting rhetoric of the alt-financial media dovetails perfectly with the propaganda emanating out of the media outlets in the Russian-Sino sphere of influence. This one aspect alone should force us to take pause as Russia and China are not our friends. We should not fall victim to the fallacy of opposition; the enemy of our enemy is not our friend.

Obviously, I cannot conclude definitively that there is a relationship with some of the alt-financial media and foreign propaganda outfits like RT, Sputnik News, and PressTV. But, if the popular personalities in the alt-financial media are gaining exposure on these propaganda channels that’s a clue that we should stay away from much of what they have to say.  Where there’s smoke, there’s usually fire. These outlets are preying on our predisposition to embrace the anti-US Fed confirmation bias. But remember, China and Russia’s central banks are privately-run as well. This conspiracy is much larger than most are saying.

Own gold for the right reasons….

May 23rd Show – Is there an “Area 51” of economic and monetary policy research?

I have uploaded a new show podcast for May 23, 2018. Click here to go to the show archives page to listen or you can listen on the link below.

-There are currently no viable solutions to the monetary system problems being discussed. I find it curious that there is a lock-down with respect to any practical and public discussion
-Cryptos and blockchain still need at least 10-15 years of technological advancement to make them viable
-The euro, yuan, and yen offer no alternative to the dollar
-The SDR is almost 50 years old and provides no practical solution
-Gold backing to currencies would collapse the fiat system overnight as monetary growth would grind to a halt. Not one nation wants to see gold backing
-The collective oligarchy must be developing a new system behind closed doors. They are long-term planners and it is impossible that they are not developing one right now. They must have built an “Area 51” of economic research to develop new monetary system theories and technologies that can be employed on a mass, global scale.
-Never underestimate the elites’ ability to keep their system going for longer than we have patience for. The patriots were crying collapse 25 years ago. William Cooper was warning his listeners in the early ’90s of impending calamity.
-The boom/bust cycles provided by the current monetary system will continue to provide the wealth extraction necessary for the elites to consolidate the world’s wealth.
-All this collapse talk creates the learned helplessness that makes the transition easier when the time comes. We need to be patient and learn to work with this broken system for now.

Private equity residential landlords drive up prices; How we can compete and succeed

My concern is that the single-family home will always be more expensive
The typical home that would interest private equity investment

I came across a Bloomberg article titled,  [T]he $1,300 U.S. Rental Home Is So Hot the Canadians Are Bidding for It. In the article it discusses how Tricon Capital Group Inc., a Canadian firm, has quickly become the third-largest publicly listed landlord of U.S. single-family rentals by snapping up homes from Arizona to Florida. It now ranks behind Invitation Homes Inc., backed by Blackstone Group LP, and American Homes 4 Rent in a market it says is valued at about $3 trillion and is still largely owned by individual investors.

The demand “feels like it’s insatiable,” Tricon Chief Executive Officer Gary Berman said in an interview in Bloomberg’s Toronto office. “Sixteen million American households rent single-family homes. So put that into perspective. That’s bigger than the entire Canadian housing market.”

Tricon is aiming to double its assets under management to $10 billion by 2023, attracting capital from institutional investors and bringing corporate efficiency to the market. The Toronto-based company owns 15,500 rental homes in the U.S., with a value of about $2.9 billion. That compares with more than 80,000 for Invitation Homes and about 52,000 for American Homes 4 Rent.

Bloomberg – The $1,300 U.S. Rental Home Is So Hot the Canadians Are Bidding for It. (May 16th)

A permanent force in real estate
Home prices continue to rise and  coincides with the entrance of private equity in 2012

My concern with regards to private equity firms and single family homes is that the operation of a large portfolio of single family properties can become very expensive.  However, the article mentions how these firms have streamlined their processes to save a lot of money in unnecessary operating cost. Tricon is also building out its maintenance capabilities, with a fleet of trucks Berman calls a “Home Depot store on wheels.” That helped the company push repair and maintenance costs down to 9.7 percent of revenues in the first quarter from 11 percent a year earlier.

Owner of 80,000 single family homes in desirable areas and a publicly-traded subsidiary of Blackstone

The numbers are staggering; In my July 22, 2017 article, [L]ocals Priced Out of Buying Homes (Part 2) – Wall Street Destroys Housing Again, I list the number of homes owned by these institutional landlords. The growth in the past 18 months has been nothing short of breathtaking. For instance, Invitation Homes, the publicly-traded Blackstone subsidiary, now owns 80,000 single-family homes. This is up from 50,000 at the end of 2016. In many areas of the country it is clear that these firms have been primarily responsible for the marked increase in house prices since the 2012 nadir.

As long as these firms continue to consolidate their power within the rental sector they will continue to place a floor in house prices. As their cost structures continue to fall their profit margins will increase and will thus be able to pay more for houses. My concern is that they will be able to outbid many potential homeowners.

Don’t look to the Feds for help. As I have mentioned in the past, Fannie Mae and other federal agencies have been guaranteeing these private equity loans, which allows them to borrow much more cheaply to grow their business. This provides these firms with even more ammunition to compete with homeowners.

Institutional money is our competitor; we need to change our investment mindset
Private equity offers less competition with town homes

Individual real estate investors need to accept this new reality. There are many areas of the nation that have been overwhelmed with private equity money. It is helping to permanently reprice real estate. Moreover, we cannot contemplate the gloom portrayed by the alt-financial media that warns of impending private equity ownership distortions and potential collapse. I believe this phenomenon to be a permanent structural feature in residential real estate. Welcome to the new world order.

As investors, it is becoming apparent that we cannot compete head-on with this large force. There are some areas that these private equity firms do not consider. Our goal is to raise our capitalization rates. Savvy individual owners will always have an advantage in this regard.

  • Condominiums: The condominium market is still largely untapped and will probably remain this way. If we analyze sale and price data around the country we can see that many condominiums projects have units selling for 50% below last decade’s top. I have been scooping up condominiums since 2012.
  • Town homes: Although these properties are sold-fee simple, like detached single-family homes, there are special considerations with respect to town home ownership. There is less management autonomy, and much of the institutional money has shied away from these properties.
  • Older homes: These private equity firms only purchase and manage properties no more than 10-12 years old. I have observed in many instances that the price breaks between old and new homes have widened in recent years and believe this may be due to institutional money. The older homes still offer opportunity to the small investor.

It is clear that the institutional money is here to stay as the financial rewards are too great for them to ignore. As their operating costs decline as a percent of rental revenue their existing portfolios of homes will offer more profit potential going forward. The institutional ownership of residential real estate is another reason why I think home ownership will continue to be more expensive as we go forward. Any real estate bust will be ameliorated with a sea of private equity money.

We need to adjust to a new reality

Think about it; the globalists are sponsoring these private equity firms and are using them to buy up properties the former middle class used to own. If we consider our ongoing discussions with respect to the conspiracy against humanity, institutional home ownership only makes life tougher for the average worker. I believe the whole real estate market dynamic will be forever altered and many will not be able to benefit. Let’s hope that our understanding of this can help us overcome.

May 20th Market Update; Why there is currently no alternative to the dollar; Well-defined market and economic trends are emerging and we need to plan

I have uploaded a new market update podcast for May 20, 2018. Click here to go to the show archives page to listen or you can listen on the link below.  I have included links to relevant articles and media on the Show Archives page.  The latest show is on the top of the page.

-The internet has become the great equalizer when it comes to getting the truth, but there is too much disinfo for the average person to fall victim to. Moreover, the internet gives many people in the MSM and alt-media a false sense of expertise with respect to their true knowledge. Everyone is an expert in politics, religion, and economics.
-Dunning–Kruger Fffect; a cognitive bias where people of low ability have illusory superiority and mistakenly assess their cognitive ability as greater than it is. This cognitive bias comes from the inability of low-ability people to recognize their low-ability.
-Too many people in the alt-financial media have created misleading and biased economic and monetary analysis as they have relied on the propaganda and disinfo sources like the gold and crypto shillers, Zerohedge, RT, PressTV, Infowars, Sputnik news, etc. The brainwashing is difficult to overcome.
-There are a lot of well-meaning writers in the alt-financial media who continually get it wrong.  They rely on the disinfo outfits and do not possess high level business and economic understanding. This same problem arises in the mainstream. I personally met many of the well-known faces on the MSM business shows while at Nasdaq.
-There are many reasons why the USD is the reserve currency. These are the reasons why the Chicom government does not want the yuan as a reserve currency. An analysis of why this is the case.
-The economic trends we discussed in January and early February are now fleshing out. These trends can persist for longer than most anticipate. The good news is that we have time to respond.
-Gold and silver commentary. Silver holding up better as its industrial off take helps to support silver prices.
-USDX showing renewed strength. The dollar may be a flawed currency, but it is less flawed than the yuan, yen, and euro. The emerging markets are up first for crisis.
-Watch for autocratic rule to become more common in the emerging markets as economic hardships mount in these nations.
-US stock market commentary.
-Real estate commentary. Price are rising, but when the UST hits 4% the change can come quickly; just like last decade, but probably not as pronounced. Hold onto your cash for distressed sales.

Staying focused on how the next crisis unfolds; What I am doing right now

US Fed policy is causing the next crisis; We need to time this correctly to stay solvent

While the US Fed continues to battle its own self-imposed war on inflation here in the US, the real rot is taking place outside its borders.  The emerging markets, which rely on external financing for its budget needs are the first in the cross-hairs.

We have discussed in the past that the causes of the upcoming manufactured financial crisis will be from misguided and myopic US Fed monetary policy. Ironically, those in the US will be the last to see the full impact of higher interest rates. Recall the Triffin dilemma and the adverse effects that conflicting monetary objectives bring to the table.

Outstanding debt securities from developing nations have ballooned to $19 trillion from $5 trillion a decade earlier, the credit-rating company said in a report. Despite the development of local-currency bond markets, borrowers will be hobbled by higher external borrowing costs, a stronger dollar and slowdown of capital inflows, it said.

Fitch estimates the Federal Reserve will raise rates at least six times by the end of next year.

Apart from the most vulnerable large emerging markets, namely Ukraine, Turkey and Argentina, Fitch sees risks in higher-rated United Arab Emirates, Qatar, Peru and Kazakhstan due to their reliance on external (dollar-based) debt. China is assessed as medium-risk country and the main challenges are high debt across the broader economy and the liquidity profiles of mid-tier banks.

Local-currency bonds of emerging markets are primarily bought by domestic investors such as pension funds, insurance companies and banks, providing a relatively stable funding source. Andrade Gutierrez SA, one of Brazil’s biggest construction companies, is the only emerging-market debt default Fitch has recorded so far this year, following five defaults in 2017.

-Bloomberg; Fitch Says EM Is Vulnerable as Debt Balloons to $19 Trillion (May 17th)

In this phase of the unfolding crisis in which domestic monetary policy objectives will eventually get the blame, we need to comprehend that the emerging markets will get slammed first. However, as credit dries up, the developed markets will feel the hurricane force winds as well. Imagine 30-year mortgage rates at 6%. If the US Fed raises six more times we could have a real estate market that resembles last decade’s. Supply can appear out of nowhere, especially if investors need to liquidate.

Plan accordingly….

Domestic economic data and inflation numbers provide the catalyst for higher rates

The economic data in the US are not as bad as what those in the alt-financial media are proclaiming. Sure, the income disparity has widened and has left about 40% of the population in the dust, but in aggregate, the numbers are currently OK.  The US Fed kept rates too low for too long, and now are playing a “reactive” role as prices mount. This will provide the groundwork for the next bust, but we need to be patient and must plan in advance for the unfolding manufactured crisis.

As long as the 10-year US treasury stays below 4%, the US real estate market should weather the storm, but it is difficult to contemplate its trajectory from not overshooting that level, given the US Fed may raise six more times. Indeed, we may see yield inversion, but if prices continue to rise, we could see the 10-year overshoot by a wide margin.

Investors who have long used the VIX volatility index for signs of a market downturn can now add the dollar to their list of fear indicators. This is especially apparent in the case of emerging-market stocks, which have seen a rally reversed in recent weeks as the dollar’s surge makes the riskier assets less attractive. “Forget the VIX,” the greenback’s spot gauge “is the new fear index if we consider the number of market cracks the dollar has exposed,” Stephen Innes, head of trading for Asia-Pacific with Oanda Corp., said in a note to clients.

-Bloomberg; Dollar Index Replaces VIX as New Market Gauge of Fear (May 17th)

Since the US dollar is the reserve currency, its value in the international markets can never be underestimated. As panic in the emerging markets spreads, the dollar will continue to rise. These emerging markets are scrambling for whatever dollars they can find before these borrowers default. Throw in a restrictive US Fed monetary policy and we have a recipe for disaster.

The euro is not capable of pulling any monetary market slack. The fundamental problem with the euro is that monetary policy is determined at the European Central Bank, but fiscal policy is determined at the individual national level. In order for the euro to succeed long-term, each nation needs to cede its fiscal sovereignty over to the European Union. This is something the European Union member nations are not yet ready to do. This is what makes the US dollar a more stable unit; fiscal and monetary policies are established in tandem, and the US dollar is still the reserve currency. About 63% of the world’s currency reserves are in US dollars.

What I am doing to stay solvent

I unloaded a couple properties I didn’t care for and had a difficult time maintaining. They were farther away and I had a more troublesome time getting them rented. I also declined a commercial line of credit earlier this year. Furthermore, the profits I made from my crypto trading remain in my bank accounts as I did not carry out a planned property purchase. I paid down an existing 30-year mortgage taken in 2016. It is estimated that I will pay it off by 2024.

I remain in cash and out of stocks. I trade equities and cryptos, but do not invest in them as of now. I will keep my rental portfolio as is; my LTV is less than 20%. I estimate that the next bust will be much worse than most anticipate, but life will go on. It doesn’t necessarily mean we will get a new monetary system, it just means that the collective oligarchy (George Orwell’s phrase) will get more powerful from the wealth and power consolidation.

I have not been concentrating on precious metals, because if we see the USDX rise to 100 and higher, gold and precious metals could get hit hard. Any scramble into the dollar will hit the price of gold. We are already seeing this. As this process unfolds we could see gold rise as uncertainty begins to manifest further. But, recall my previous analysis of the gold markets; I stated that the globalists allowed gold to rise from 250 to 1,900 in quick fashion, so they could manage it from a higher price. We could see further price management in gold and silver. This is why I prefer cash in the form of the US dollar. However, I recommend investors sticking to the local currency they transact in, if it is a stable one.


It is difficult to contemplate any imminent large scale equity unwind here in the US as the small cap indexes continue to climb to all-time highs, but if we see credit market distortions on the scale of last decade everything is off the table. Small caps are rising as their future prospects are more focused on the domestic economy and less on the emerging markets

With this said, this manufactured crisis (proclaimed by the monetary mouthpieces in late January-early February) could linger for years and lead to war. All wars start from economic decay.

May 16th Show – The alt-financial media; deception comes in many forms and it’s done by design

I have uploaded a new show podcast for May 16, 2018. Click here to go to the show archives page to listen or you can listen on the link below.  I have included links to relevant articles and media on the Show Archives page.  The latest show is on the top of the page.

-The controlled alt-financial personalities are legion and are there to impoverish the potential resistance
-The list of the people in the alt-financial media who are controlled will shock you. It is a sobering assessment of my long-term observations (15 years) with my economics and financial background.
-If you seek the advice of these charlatans you will continue to lose.
-Many of these personalities have been involved in fraud and deception. ALL of them have terrible track records.
-They appear on RT, Sputnik news, Newsmax, Agora Financial, Daily Reckoning, KWN, PressTV, and Inforwars. They are also regular contributors on ZeroHedge.
-The writers on most of these sites are paid copywriters posing as objective news and research outfits.
-Porter Stansberry was convicted by the SEC of securities fraud on 2007 and ordered to pay $1.5 million in fines.
-The monetary system is controlled by a collective oligarchy and is satanic by design. It is natural for us to reach out to those who appear as its enemy so, it is in the best interest of this oligarchy to control their opposition.
-Russia, China, and Iran are all controlled by this oligarchy as Russia and China are both controlled by the same private banking crime syndicate. This crisis between the nation blocs is all manufactured, but the results are very real.
-The track records of these charlatans have been so poor that they have turned to crypto shilling to extend their control over the masses.
-The use of fear in the alt- and patriot-media has destroyed the movement permanently.
-Crypto shilling is so easy to do that even reputable real estate news sources are being fooled by it.
-40% of American households are functionally lower class in that they cannot even afford the most basic of middle class necessities.

May 15th Market Update – Gold and US Treasuries take out important levels; What’s next?

I have uploaded a new market update podcast for May 15, 2018. Click here to go to the show archives page to listen or you can listen on the link below.  I have included links to relevant articles and media on the Show Archives page.  The latest show is on the top of the page.

-This morning’s strong data are repricing certain markets.
-US 10-year treasury takes out 3%, the highest levels since 2011. That is new yield support as treasury prices tumble. Gold falls below 1,300 on very strong dollar rally.
-Any future crisis will result from USD strength, not weakness.
-Gold is not yet ready for prime time as the consensus of the market participants is that things are OK. Gold holds up better during conditions of great uncertainty, and we are not yet there.
-the 1,300 level for gold may sound important, but other levels are more important than the psychological 1,300 price.
-My guess is that the future global economic crisis will come from the emerging markets
-With The Russell 2000 and S&P Smallcap 600 so close to their all-time highs, it’s difficult to imagine seeing any meaningful stock correction.
-Real estate should hold up fine until the 10-year hits 4%. That will put fixed-rate mortgages close to their historic 20 year norms. Get rid of underperforming real estate.
-Canadian sales and prices are slipping. The cost of building a home in Canada is growing; similar to here in the US. In overheated areas the building costs have risen tremendously. Thank you government and the people’s wishes.