Negative Interest Rates = Tax Of Savings

The trend in Europe toward negative interest rates amounts to now taxing whatever cash you have left after paying your 50% in taxes. The bond auctions are starting to show signs that people will wake up and saw what is going on. The incredible fact is that now about 30% of all government debt in Europe is trading at negative rates – that is about €2 trillion of securities in total.

 

The most important discovery I made was bumping into the 8.6 year frequency. The second, was observing that each cycle wave was focused into a different sector both domestically or internationally. Capital has moved wildly over time but we tend to learn from the last mistake and try something different expecting to find that perfect investment that never crashes. That Utopian idea does not exist for how markets function is driven by human emotion.

 

We have the last three major business cycle wave to confront within this major generational wave. Hopefully, you can see that these wave peak and once you understand how things function, you are able to see the wave coming. This wave that peaks on October 1st should not produce an instant event that we see as wh have in the past with producing a major high or low in various private sector markets. This is the PEAK IN GOVERNMENT. Polls already show that 75% of Americans do not trust politicians. The same is true everywhere.

 

Our model on the Euro has been interesting. It began a new wave 2008.83. The economic failure of constructing the Euro began to burst through the cracks.

 

The major high for the Euro came right on target with the model in 2008. We have the Greek crisis began in 2010 to the day on Pi from the high in 2007 on the Economic Confidence Model. Whenever something lines up with the international ECM to the day, such timing CONFIRM that will be the intense focus.

 

The alignment of the Greece Debt Crisis to the day on the Pi cycle has been the warning that this cycle is all about government and the Sovereign Debt Crisis. This turning point 2015.75 should begin the more obvious debt crisis that is brewing so the general public will become aware.

We have the insane policy of the European Central Bank quantitative easing taking the interest rates negative rather than doing what even Keynes suggested – lower taxes to stimulate. The unemployment among the youth is over 60% in parts of Europe and in America students are oppressed with loans they cannot escape yet 65% cannot find employment in what they paid all this money for. They cannot escape the debt, thanks to bankers paying bribes to politicians, so in American we too have a lost generation that live in their parent’s basement and cannot start a life or family no less buy a home prevented by student loans.

The negative interest rates are oppressing the elderly and has robbed them of their dreams. They were told to save for retirement and now they face negative interest rates after paying a lifetime of taxes. Four months ago when 10-year Swiss yields turned negative for the first time, demonstrates that capital was scared of the Euro and was just looking to park somewhere. That event was herald by Larry Summers and it has snowballed into a veritable avalanche of negative rates across European government bond markets faster than in real life from the top of the Matterhorn.

There is so much cash around and nothing to invest in that we see companies buying back their own stock. This will set the stage for a potential Phase Transition and a bubble top in stocks in the USA, which could be a doubling in the Dow. This is the same problem during the 1920s where companies were also buying back stock and even during the crash. Companies buying back their own shares reduces the supply and set the stage for a shortage.

This is clearly the PEAK in GOVERNMENT. We are facing a collapse in confidence of government on an unprecedented scale. Politicians are predominantly lawyers with ZERO practical experience in running a business or understand currency flows. All they know how to do is write laws. We need people from all walks of life in government – not more lawyers. You would not go to a taxi driver for brain surgery. So why call a lawyer to manage an economy? This demonstrates that education is worthless for all the money spent on degrees mean nothing if a lawyer can do any field without such degrees.

2015.75 = the PEAK in GOVERNMENT

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Negative Interest Rates are a Tax on Money Itself