Long-term predictive accuracy; The key to successful investing

Understanding the conspiracy for global government can be profitable

-As longer-dated interest rates fall, small changes to bond yields results in magnified asset price changes

It all comes down to how bond yields change over time. With each tick lower, asset prices respond ever more strongly.

We need to keep in mind that the exceptional growth in domestic stock prices is only a direct result of the changes to interest rates along an ever lower yield curve. As interest rates move lower and lower over time, every drop in yields corresponds to greater and greater asset price increases.

Indeed, the plunge protection team may act from time to time to support asset prices, but the ever shrinking bond yield curve does most of the heavy lifting for TPTB.

-As long as the existing monetary system remains intact, and as debt levels rise, the U.S. dollar will be well bid

The dollar may be toast and the patriot radio blasts it. But most international loans are denominated in it, and as the global economy continues to weaken, demand for the USD should increase, especially as other economies underperform, and their interest rate differentials vs. the US widen. It is the global currency.

In order for commodity inflation to take place, money must reach the end user. This is just not happening. The overcapacity in the commodity sector is just too overwhelming. The large commodity producers bought into that idea of ever-growing BRIC nations. That was a costly mistake, and the alternative media bought into that as well.

Brazil’s debt is collapsing; Russia is doing worse than their official numbers say. Who even knows what is going on with China? The yuan will never be a reserve currency, because their govt numbers have less credibility and their debt market is too opaque. They are building up for the future war.

Chris Pirnak (pseudonym, Thom Beecham) henrymakow.com, September 21, 2015

What seems obvious now was not so to the alt-financial media in 2013 when I was predicting that that the dollar would keep rising
My prediction of Dow 20,000 when it was at 16,500 turned out to be profitable to those who listened. My thesis on henrymakow.com in 2015 is still valid today.

As this global agenda for falling sovereign bond yields continues to kick into high gear, I write this post as a reminder that we need to keep perspective on the large secular economic and financial trends.

Why stop at zero? I agree with Alan Greenspan; zero is just an arbitrary number to the new world order.

My experiences writing on Henry Makow’s website frustrated me, because the vast majority of his subscribers disagreed with my theories. Moreover, my articles were heavily edited for content, because the readers often found my unique conclusions unacceptable. These readers maintained that the system was crashing down and that a new dawn was soon to come.

Most alt-financial followers are too contaminated to make accurate predictions. Despite criticizing their unwashed brethren of possessing an inability to see the truth, these alt-media followers suffer from the same hardwired biases as well. In essence, these novice analysts either have a predetermined outcome in mind or another agenda, and disregard any evidence to the contrary.  This type of cognitive bias is a systematic error of inductive reasoning, which perpetuates poverty when it comes to investing.

To counter the erroneous advice and predictions of the alt-financial media, I started my blog in early 2016 to warn others

Early in the decade, I concluded that price growth and bond yields would continue falling despite rising debt levels. By function, QE is deflationary and lends itself to a self-perpetuating cycle of fading economic growth and consumer prices. The irony is that this all supports higher asset values.

Despite calls to the contrary, long-term rental real estate investing continues to be very profitable. I always recommend direct ownership over passive REITs.

Conclusion

Despite the Cassandra calls in the alt-financial media to the contrary, I see an orderly and well-maintained global central bank monetary policy programme in place to keep the governments in business. The illusion of confusion is intentional, and all other things being equal, QE will work to support asset values to the chagrin of its critics. Since the manufactured crisis of last decade, this is how the elites have decided to act. If they stop now, they will get the blame.

I know this may seem counter-intuitive, but I warn all those who will listen to stay out of all debt that does not generate offsetting income. This includes personal loans, owner-occupied mortgages, student loans, etc.

If you or your child has to go to college, then commute to an in-state school and forget about all the other reasons to spend a lot of money for the college experience. That is hype perpetuated by the media and movies. If I were a high school student in Northern Virginia and contemplated going to college, I would commute to George Mason and get a cheap and decent four year degree. Perhaps I would get my associates degree first at NOVA for pennies and then transfer. I could skate by with less than 20k in total student loan debt.

Just because interest rates are going lower does not mean that debt is preferable to spending cash. To make matters worse, most alt-media followers have been left out of the asset price bonanza and have even less room to make any more financial mistakes.