Monday’s Melting Markets – $800Bn Isn’t Enough Anymore?

$800 BILLION!

That's the amount of money China's reserve adjustment is putting into the market in 2015.  “Beijing is trying to stimulate lending and they are trying not to use strong measures,” said Dariusz Kowalczyk, an economist at Credit Agricole CIB in Hong Kong. “Policy makers across the globe are trying to boost demand by increasing bank lending, especially to businesses."  In other words MORE FREE MONEY – for the top 1%.

As you can see from the CNN chart, $800Bn is really just a drop in the bucket but it all ads up as Global Stimulus since 2009 is now approaching the $20Tn mark, or about 5% of Global GDP per year for the past 6 years.  Since Global GDP growth is still less than 5%, you can imagine what would happen to us if we DIDN'T get another $3-4Tn this year, so China is simply doing their part with a timely announcement of next year's contribution.

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Unfortunately, the situation for the bottom 90% continues to deteriorate but, fortunately, none of them can even afford to read this article because they have to get up and work more hours for declining wages so we (the top 10%) can make more money even though we're selling the same amount of stuff for the same prices.

Of course, the joke's on all of us as even our money is being paid to us in devalued currencies.  The Dollar had a good year but it still doesn't buy what it did in 2007 and the last time the markets were as high as they are now was 1999, when the Dollar index was at 120 – more than 20% higher than it is today.  

So, if you are getting $208 for a share of the SPY (S&P 500) ETF because the S&P is at 2,080, that $208 only buys you about $165 worth of stuff in 199 terms.  SPY was only $150 back in 1999 so you are a bit ahead – just not as ahead as you think you are.  

More stimulus means more money for the top 1% and we now have SO MUCH MONEY that we are trickling it down on the next 9% and they are starting to do well enough to sprinkle a bit on the next 10% but, below that – as you can see from the Real Wages Chart – things are still not good and getting worse.  

Should we care?  Not really – as long as we can get ours, this is the Corporate Klepocracy we voted for and it's our job (the top 1%) to take full advantage of the situation because, clearly from the last election results – that's what the American people want us to do!  

We'll be reviewing our Buy List for 2015 over the next two weeks and we have our Secret Sant's Inflation Hedges lined up and, as long as the Central Banksters keep pumping money into the economy, we can remain long-term bullish because that money HAS to go somewhere and US equities are still the least bad place to keep your money in 2015.  

At the moment, we're playing the end of the year "Cashy and Cautious" but we have 30% more cash in our Member Portfolios than we had at the beginning of the year and we're well-hedged for a correction into Q4 earnings but, if they turn out better than expected – then we can BUYBUYBUY in February and March – especially if the ECB finally steps up and begins pouring money into that part of the World.  

It's Europe that's dragging us down this morning as Greece fails, for the 3rd time, to elect a consensus President and that dissolves the Government in 10 days and forces snap elections which MIGHT bring in a Government that tells the EU to shove the debt up thier asses.  That possibility has sent the Greek markets down 11% this morning (so far) and has driven the 10-year bonds back towards 10%.

Ordinarily, I'd say we should be concerned but Citibank has assured us that nothing is going to stop the Global Plutonomy and so far, so right – as nothing has gotten in the way of the top 0.001%'s wealth gains as those at the top have bought themselves more Yachts and Politicians to insure that things keep going their way and the fact that even "Communist" China is handing out $800Bn of low-interest loans to the people who need it least shows you that they really have infected the entire planet at this point.  

As our Members know at Philstockworld, we may complain about the game being rigged but we're also happy to play along with the riggers and make a little money while we wait for the bottom 99% to wise up (no luck so far on that front) and put an end to this scam.  

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