by Graham Summers of Gains, Pains, & Capital
Stocks are roaring higher today because China posted better than expected manufacturing data. The investment herd is interpreting this as meaning that the global slowdown that everyone was terrified about three weeks ago is already over.
This interpretation overlooks:
1) China’s economic data is pure fiction as admitted by Chinese officials in private (see Li Keqiang’s comment to the US ambassador to China in 2007).
2) The clear evidence that the global ecomomy is in a massive slowdown as illustrated by the terrible export numbers coming out of South Korea (-8%), German manufacturing data hitting a seven year low, and sentiment at Japan’s large manufacturers hitting a six year low.
3) Global trade has posted its sequential decline since May 2009 (at the absolute worst of the Great Financial Crisis).
4) All 11 sectors of the S&P 500 have experienced NEGATIVE revisions for EPS since the start of the year.
Maybe China has found some incredible way to see an economic rebound when the entire planet can’t, or maybe China is just posting its usual economic fiction in an attempt to juice its stock market higher and put off the inevitable civil unrest a little longer.
Indeed, if everything is going so well… one has to wonder…
Why is the White House’s economic advisor asking for an EMERGENCY .50 rate cut from the Fed?
Why have global Central Banks put $1 TRILLION in liquidity into the financial system in the last three months?
Why is the IMF and other policy experts pushing for a 10% WEALTH TAX on net wealth to shore up sovereign finances?
Why the Fed’s #2 has already stated the Fed will be forced to cut rates to NEGATIVE during the next downturn. And the ECB is showing us that when this happens rates will stay there for years… possibly forever.
This is just one part of the Great Global Wealth Grab that will soon be hitting the US shores. The fact is that there is simply too much debt in the financial system. So the political elite are looking for means of grabbing capital to prop up insolvent institutions/ governments.
That capital will come from wealth grabs and taxes.
Consider the following:
The IMF has already called for a wealth tax of 10% on NET WEALTH.
More than one Presidential candidate for the 2020 US Presidential Race has already openly called for a wealth tax in the US.
Polls suggest that the majority of Americans support a wealth tax.
And if you think this will stop with the super wealthy, you’re mistaken. You could tax 100% of the wealth of the top 1% and it would finance the US deficit for less than six months.
Which means…
Cash grabs, wealth taxes, and more will soon be coming to Main Street America.
Indeed, we’ve uncovered a secret document outlining how the Fed plans to both seize and STEAL savings during the next crisis/ recession.
http://www.investmentwatchblog.com/forget-the-stock-marketa-cash-grab-is-coming/
Realist - Everybody in America is soft, and hates conflict. The cure for this, both in politics and social life, is the same -- hardihood. Give them raw truth.
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