Stock Market Goes BALLISTIC as Fed Signals New Easy Money Stimulus To Prevent Crash!



the correlation between central bank assets and global stocks have continued to persist this was noted several years ago and still continues to this day right now there are global growth concerns risk of enhanced tensions potential catalysts for oil to multiply impress but none of this matters the Fed is going to reduce interest rates and keep the party going are you ready you came here for the truth so let me undo that for you today we are looking at what has happened in the stock market it is important to track and trace this information as it plays out we're going to talk about many economic indicators I'm gonna show you the data that you need to know so let's begin first we're going to start by looking at the markets you can see how aggressive the moves were today up and down positive and negative but ultimately the SMP ended in the positive about seven points higher so we don't know exactly when this bull market will end but for the foreseeable future it looks like as long as the Federal Reserve is continuing to be easy extra easy then of course we will find that the stocks will love it this week solidified the fact that the market doesn't need it doesn't want it's demanding a rate cut from Powell I do have a little bit of caution going into the earnings season because we have some forward guidance uncertainty with the trade tensions but the wind and the sales continues to be that dovish stance from Powell this is what everybody is hoping for that the Federal Reserve will keep interest rates low for the foreseeable future never to bring them up again never to normalize as they promised to do never to actually unwind their balance sheet at a normal pace no no no they need to stop that altogether and perhaps even continue to purchase more assets well we've been seeing this going on for 10 years now and it doesn't seem to be stopping anytime soon I want you to pay attention to what is going on with the Federal Reserve at all times we can see that as as Powell makes a speech the market reacts accordingly whenever they put out their official statement you see right at 2:00 p.m. the market reacts to it before you even have a chance to watch it or to read it then they come online and they start talking about the information and they basically just read a prepared statement and the market reacts again and this happens to be the case where you will see aggressive moves all based on words just words no actions if you think about it what has happened over the last several months December they increased interest rates and said that we would still be doing so a few times in 2019 not only do they not go through that path but they're actually now considering reducing interest we'll see if they will actually do this when the meeting happens the market is absolutely pricing in this at this time and this to me tells us that we are in for one hell of a ride if the market doesn't get that rate cut it is going to absolutely go crazy well I think it will get that rate cut simply because they are not prepared for any other conditions that's what we're looking at right now let me show you some more information here if you want to understand why the market is increasing or decreasing you have to understand the global money supply you need to follow what's happening with the central bank's you need to know what's happening with the expansion of money the velocity of money all of these things are so important here you can see the green line and that is the SMP 500 and then you also have the global money supply and whether you see this on a daily basis it might fluctuate but ultimately what we have is that these two go in lockstep with each other and you will find that over time what we have are central banks increasing the amount of money that they hope you can see that they are lending out more money in general to commercial banks and then you have the SMP 500 the Nasdaq the Dow Jones while they do fluctuate on a daily basis oftentimes they correspond entirely with what happens with central banks and that's why I had said a long time ago many many times repeat it over and over again you've been watching here on this channel that as long as the central banks are willing to destroy the value of the currency they will in fact print more money create positive flows into equities into housing into any other type of asset simply because that's what we are doing today we are devaluing the currencies and watching the prices of everything increase tuition is increasing they didn't necessarily intend on creating that but it hasn't happened it has been really a side effect of all of the intervention this has been going on not just over the last ten years but of course it has been accelerating throughout this period so this is really the key if you want to know what I said a long while ago and I had to make this 60-second video in particular just because I had to repeat myself over and over and over again I was getting sick of repeating it so I decided to just create a 60-second video and talk about exactly what's going on and I will link to it at the very end of this video if you want to see it for yourself u.s. core consumer inflation tops projections in broad advance okay we're gonna talk about this Bloomberg article here this is where things get a little tricky because you have the Federal Reserve they claim to be in looking at inflation of course they're always looking at the core PCE rate which is a very fake rate it has no bearing on reality but of course this is what we deal with they're looking at the unemployment rate and we see it near all-time historic lows right now and you have all of the different factors out there maybe it's the stock market may be anything else consumer confidence in everything that they have in front of them right now everything according to their stats is completely doing fine so the question I have is why are you going to reduce interest rates why would you increase interest rates why would you decrease them right now you would think to yourself this is the time we'll just leave things the way they are there's no concern with inflation there is no problem with the stock market employments at a record-low why in the world wouldn't we just leave things let it as it ride and let it just happen but of course that's not what we're doing here we are actually trying to tinker with this system and they do so at their own peril the feds anticipated rate cut is unusual in that it comes at a time of very low unemployment and an economy that is growing at a trend of about two percent the economy added a surprisingly strong two hundred twenty four thousand jobs in June and there was an unexpected pickup in consumer inflation the core PCI is a 2.1 percent year-over-year one of the highest readings during the recovery so this is right now as you can see that inflation was really muted we're concerned is too low well in this case it depends how you measure inflation but with the core CPI it's at two point one percent and that's what they want to see in that case there there are other measures and this just shows you that if you're looking at other data you may come up with different results that's obvious as always like that but here is just one more example where the Federal Reserve really has no excuse to cut rates at this time will they do it you tell me hit me up in the comments section down below let me know what you think and then at the bottom here they have some really good information I want to show you I've now come to the conclusion the Federal Reserve is going to cut rates not because of the weakness in the US economy but because they want to make the coordinated effort to forestall a global recession my question is with all of this information that you have here why are you going to cut rates it doesn't make sense what exactly are you gonna do by cutting rates by a quarter point are you really going to forestall a global recession how is that gonna affect you when everything that you've been seeing so far has been positive well something's not adding up that's really what it comes down to Fed chairman warns of unthinkable harm my goodness if the debt ceiling isn't raised can you believe it a debt ceiling problem we have this fiasco that occurs every single several months they come out with the same thing oh my goodness we're at the end we can't make a decision oh no what are we gonna do and then they do they always increase the debt ceiling even though Obama had said we don't have to worry because increasing the debt ceiling does not increase the debt you know that quote now essentially what we have here is the same problem over and over and over again where more debt is added the deficits continue to get worse and the central banks around the world continue to print more money this cannot absolutely cannot end well for the average person this always always ends terribly and you can see that this is the most excessive thing I've ever gone we can look at the previous cycles and see that okay when there's smaller problems then the real crisis that is created or smaller in respect to the information that we're getting at today I mean when you see the excesses that they've gone into it is mind-boggling my goodness I just want to show you really quickly index charted a long and bumpy road across its latest 1,000 point milestone I just want to show you the previous times that it was encountering this area here between 26 and 27 I thought it was interesting to see how hard it was to actually cross this I mean a year and a half basically trading within this range meanwhile people were saying buy the dip buy the dip but it took a year and a half just to be able to cross that point and it will potentially go higher if the Federal Reserve cuts if you see the trade deal signed on a paper not just in some tweet or something this right here just gives you an idea of how long it could take to break through certain barriers but I wanted to leave you with this information out of Hussman funds he said this we learned the hard way in the recent cycle that we can't just assume that there is any limit to speculation all we can do is to measure those speculative tendencies through market internals and respond accordingly on the other hand when divergence and internal deterioration suggests that investors are inclined toward risk aversion it's dangerous to blindly assume that monetary easing has some magical power to support the market remember what happened in 2007 we saw these same behaviors people were talking as if nothing bad could ever happen don't worry Federal Reserve has got it the government is going to print money they're gonna fix it up they're gonna make sure it's all good but then we still had 2008 we still had the housing crisis we still had mass job layoffs we still had a stock market that came down tremendously all of this was at the time that the Federal Reserve was dropping interest rates and this happened to be a problem for a lot of people not in the financial industry but going all around the world in fact that were feeling the effects of this that they did not act appropriately to interest rates in the first place then they had to try to save face although there's no problem right now don't don't worry about it no problem and then they always react too late and they're doing it too slowly and then you have the problems that we have today the same situation essentially I'm gonna end the video there if you found that informative please hit that thumbs up button when you give me a like you are supporting me and this channel I do appreciate that very much if you want the financial education you were not taught in school these two books have everything you need all the details from A to Z the foundation history the asset class definitely check them out at the link in the description if you want the audio book that's available at the money GPS com if you want to see that 60-second video where I talk about what will happen in the stock market up or down you gotta watch it 60 seconds click on it and I will see you there

Leave a Comment

Your email address will not be published. Required fields are marked *