Fiscal Cliffs Precede Fiscal Valleys

It is not the fall that kills us. It is the collision with the ground. It is not the ‘fiscal cliff’ that we should fear. It is the fiscal valley that lies beyond the fiscal cliff that will kill us. Can a fall from the cliff be prevented?

The answer is ‘no’. The ‘fiscal cliff’ is Fed Chairman Bernanke’s metaphor for the expiration of the Bush-era tax cuts. Congress must act to again extend the lower tax rates as they did previously or taxes rise starting in January of 2013. The fiscal cliff is therefore a tax increase on the American public. Get ready. The ground is approaching quickly. 

Allow me to shine a ray of truth into the pitch black dungeon of government mendacity so readily accepted by the cognitively impaired followers of the ‘spread the wealth around’ crowd. 

First. taxes are going to rise no matter what. If Congress does nothing, taxes rise. If Congress does anything, they will accept the regime’s proposal of higher taxes for the wealthy. Taxes go up either way. We will enter the Valley of Austerity.

Second, the Obama regime knows their constituency. These poor people actually believe the party line that 98% of us have nothing to worry about. Mr. Obama has preached that taxes should only rise for the wealthiest Americans or about 2% of the population. Send the kids out of the room for a moment while we discuss the truth. Okay, here it is. Rich people don’t pay taxes. They offset taxes by raising prices for goods sold through their companies or properties. The consumers pay the taxes through higher prices. The Valley of Austerity is cold and barren with no visible exit.

Third, we must consider the big picture. Tax revenue, wherever it comes from, must rise to pay for the increase in government spending that is currently around $3.5 trillion a year. The Treasury currently takes in about $2.5 trillion in tax revenue. Of course, Congress could reduce government spending but I think we all know that is not going to happen. Taxes must rise. Well, only for the wealthy like Warren Buffet who do not mind the increase. Yeah, right! 

Fourth, government spending cuts cannot, and will not happen. Here’s why. We have already entered ‘the valley’. We ran off the fiscal cliff years ago. Government responded by starting wars and redistributing vast wealth to elite bankers. All of this was on the back of more debt. Of course, the populace would revolt if they knew the truth of the Valley of Austerity. So to keep the populace under control, they had to be distracted by an ‘economic recovery’. That recovery was evidenced by a rising GDP (Gross Domestic Product). The problem is that allowing the government to become a bigger part of GDP through spending does nothing but push us further and further over the cliff. Eventually, gravity kicks in. Of course, there is no way that the average American can understand this so let’s look at the real numbers.  

Supposedly the US economy totals some $15 trillion in GDP. We know that the US government spent $3.7 trillion of which a trillion or so was borrowed. The US government accounts for some 25% of GDP spending. Should the government resist tax increases and cut back the trillion in spending that they currently borrow, US GDP would fall by that trillion and post a figure of $14 trillion. That would be a GDP decline of 6.7%. Of course, we know that government spends everything they take in and then some. We also know that a reduction of government spending cuts would trickle down to other parts of the economy and GDP would likely contract even further. Not that the government would admit it but this scenario would imply a deep recession is at hand. That would be downright Greekish.

Spending cuts would likely do more damage to GDP than we can currently calculate. Again, GDP equals money velocity (MV) times money supply (MS). We know that the true story of our economy is that the current MV is at an all-time low. People can’t spend money they don’t possess. Government spending cuts would eliminate some of the deficit spending and therefore it would curtail money supply as necessitated by debt. The math would indicate a pretty severe GDP contraction. This does not even consider that the US government is going to run out of money at the end of December, 2012, and the overall debt of $16 trillion plus still oppresses real growth. No, the US ran off the cliff years ago. We are just waiting on the collision with the valley floor below. 

Therefore, regardless of what we might hear from politicians, the fiscal cliff is simply a hefty tax increase. Spending will not be addressed. Taxes will rise. And here is the final point. Who benefits most with a tax increase? We would think that the largest holders of US debt paper need to see tax increases to further insure interest coupons can be paid on such debt. That large holder would be the Federal Reserve Bank. As we know, they are our masters and we only exist to serve them. The Fed will again benefit as our misery grows. Truth only hurts liars. Spread it!

Warnings From The VIX

The VIX is an index that measures market volatility. That is what most people believe, anyway. Actually, the VIX is an index that reflects the expense of put options on the S&P 500 index. And to further define, a ‘market’ of stocks no longer exists since the central bankers decided to set prices years ago by constantly manipulating the indices. Put options, of course, become more valuable when the S&P 500 index is falling. Therefore, a rising VIX generally reflects a falling S&P 500 and a falling VIX generally reflects a rising S&P 500. This would seem intuitive but the real question is does the VIX tell us anything about the future? Or, does it simply reflect a trading trend that we already observe?

The chart below is a 20-year look at the VIX in red and the S&P 500 in blue on a weekly basis. Here is what I see.

The S&P 500 and the VIX are like Shakespeare’s Romeo and Juliet. They are two lovers that cannot remain separated over time. Their respective lines on the chart must eventually meet. They must be together. We can see from the chart that they were together in 1995 and they separated. They joined again in 2002 and again separated. They came together again in 2009 and once again separated. These are seven-year cycles and they should join together again in 2016. This means the VIX should rise and the S&P 500 should fall. Don’t panic. This won’t happen until 2016. Until then, the stock bubble will continue to be inflated by central bankers who are desperate to grow their power. Their whip of obedience is the stock index.

Of course, Romeo found Juliet asleep and thought she was dead. He then committed suicide. Juliet awakened to find Romeo dead and she then committed suicide. It is a depressing story. Neither character lived to enjoy a ‘happy ending’. 

Today, the VIX is currently working its way toward 20-year lows and the S&P 500 is currently working its way toward 20-year highs. I suppose the next few years will see this pattern play out until the bubble finally bursts in 2016. The central bankers are working diligently to inflate the bubble while debt continues to grow on every balance sheet. And yes, US corporations do have an enormous amount of cash in the banks but they also have an all-time high debt load at those same banks. In three years, the US will likely have amassed close to $20 trillion in quasi-sovereign debt and the EU nations will still be in debt-induced recession. What will pop the bubble? Maybe we run out of central bank liquor. Who knows?

But what should we do right now? Party on, of course. The liquor is still flowing and tomorrow is a holiday. We don’t need to get sober yet. I believe the central bankers will keep pushing the stock indices to new highs and the VIX will respond by falling to new lows. But here comes the warning. As the chart tells us, these two indices will eventually get back together. Probably around 2016. The scenario might be that the S&P 500 will climb to maybe the 1600 level on central banker leverage that will be supported by ebullient economic news regardless of reality. 2016 rolls in and the bubble bursts taking the VIX up and the S&P 500 down 50% below its 1600-level highs. But for now, the central bankers are operating distilleries, breweries, and stills. The VIX is just warning us that real heartache will once again befall the precious stock indices. but why worry about the future? The Fed is our friend, right?

20 years weekly - SPX in blue, VIX in red

Chart courtesy StockCharts.com

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.

Is A Stock Correction Underway?

Is a correction in stock indices really underway? Is that allowed? I don’t think so. Rulers Bernanke and Draghi have been quick to put their foot down and stomp every wave of selling. I suspect this time will not be any different.

Stocks are clearly in a bubble that in my opinion, has now exceeded every bubble ever blown in history. Stocks have been puffed up by central banker intervention, manipulation, and inflation via currency expansion. Every now and then, stock prices threaten to crumble under the weight of reality. That is, everyone realizes that trying to borrow our way out of debt is insane, ridiculous, and will end in catastrophe. An economy supported by central bank infusions is not a sustainable economy. Stock prices should reflect this realization with a plummet. We are currently in one of those periods. Will the bubble now burst?

I doubt it. The US election is just a few weeks away. The American public will go to the polls and unleash upon the world another clueless puppet of the elite banking cartel to herd the sheople. Yet, most voters likely feel very strongly that their candidate can make things better. In the meantime, the current regime will make sure that all economic news is good for the next few weeks. Of course it is.

The latest news this week is that Q3 GDP grew by 2% in the US. That number was driven by a 2% increase in consumer spending and an 8.5% gain in ‘long lasting goods’. Of course, the federal government kicked in with increased spending of 9.6%. Hasn’t the regime leader been telling the world that the US was ‘cutting’ spending? Obviously speeches are only for convenience of propaganda. Besides, the federal government spends more than a trillion than it takes in. What’s another 9.6% boost in spending? When we are already buried under tons of debt, what difference can a few more shovel-fulls on top of our heads make? Well, the regime had a 2% GDP growth number to support so they made sure the numbers were there!

However, the 8.5% gain in ‘long lasting goods’ was very curious in a mendacious way. Most companies that produce ‘long lasting goods’ have been reporting a weakening demand story. In fact, corporate spending on capital goods decreased. So, we are to believe that the very people that run businesses are reducing their spending at the corporate level while they increase their own spending when they get home? And if so, wouldn’t their spending at home, as consumers, drive up demand for goods at the very companies that are reducing their spending? This is also quite odd considering that everyone on the planet agrees that economies everywhere on the globe are slowing. Warren Buffet said so. Shippers of goods say so. Regimes except for the US regime say so. 

While the US pretends to be a free nation, something very telling happened this past week. The presidential debates featuring the so-called third party candidates took place with Larry King moderating. Didn’t see it? Didn’t hear about it? Libertarian candidate Gary Johnson was brilliant and so far superior intellectually from the main party’s offerings that he almost appeared to be a different species. That is, a species with functioning brain cells. But here is the only thing everyone in the world should know. The debate for the presidency of the United States of America for these third party candidates was held on one television network. That network was the Al-Jazeera network. God forbid the American public hearing the truth. God forbid the American public overcome their profound ignorance. 

Thus, we have a stock bubble that is, and has been, orchestrated by central bankers.  My guess is this cartel will not let the Dow slip below 13000 else the dopes that have been duped will realize that they have willingly been incarcerated by their ignorance and gluttony. And, Warden Bernanke has apparently decided to retire from the Fed in 2014. There is no way he will step down with a bear eating patrolling Wall Street. Look for stock indices to rise this week. 

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.

Oasis or Mirage?

Today is October 17, 2012. The US Commerce Department said that housing starts jumped 15% in September to the highest level in 4 years! Okay, I’ll give readers a few minutes to stop laughing. The ‘Commerce Department’ is always good for a belly laugh. Seriously, quit laughing so I can make a point. Okay, so housing starts are up the most in 4 years. That should really boost the Dow Jones Industrials. Uh-oh. As we move into the afternoon, the Dow is actually down 20 points. What? Does no one trust the US Commerce Department? The DOPE (Department of Pathological Embellishment) seems to have zero credibility. Or perhaps there is another perspective.

Even if today’s housing number had a tiny speck of truth to it, instead of a it being a complete fabrication from a regime completely incapable of telling the truth about anything, we could also say that housing starts are the worst they have been in 22 years. Take a look at the chart (below) compiled by the Fed and observe that housing starts are about what they were in 1990, or 22 years ago. We could also observe that housing starts are about half of what they were in year 2000. Maybe that’s why there is no rally in stocks today. Is housing an oasis or a mirage?

US Housing Starts through 10/17/12 

Chart courtesy St. Louis Fed

Obviously, all ‘data’ these days is suspect. Clearly the regime has a story to sell and that story is one of economic recovery. Improved housing starts would be part of that ‘recovery’. So let’s apply some logic. 

I’m not an expert but most houses, if not all, have insulation and roofing. A big producer of that insulation and roofing is Owens Corning. What do they say about their business? If housing was really in a ‘recovery’, wouldn’t a maker of insulation and roofing be doing better as well?

Uh, well actually, Owens Corning just announced on October 9, 2012 that they were lowering full-year expectations for their earnings citing weakness in roofing and composites businesses. That’s right. They ‘lowered’ earnings citing ‘weakness’ in their business. How much? They lowered full-year earnings from between $360 million - $420 million (given in August) to between $280 million - $310 million. That’s quite a decrease! The company says that business has ‘weakened over the past two quarters’. Funny, the regime wants us to believe that home building has increased. Oh well, maybe builders are now building homes without insulation or roofing. 

Depending on whatever we want to believe, the economic recovery is either an oasis or mirage. Housing is either the strongest its been in 4 years or the weakest in 22 years. It’s all in perspective. Truth, however, does not entertain perspective.   

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.

Draghi Raises Bernanke

In our new world of dueling central bankers, the ECB’s Mario Draghi has just called and raised the Fed’s Ben Bernanke in the game of stock index manipulation. Oh sure, the central bankers claim to be fretting about economics but let’s be honest. They have both expended everything they had in terms of economic juice. Neither can foster employment. Interest rates are at zero and will be forever. Both the ECB and the Fed have already bought multiple trillions of dollars in sovereign debt and trillions more in bad mortgages. And still, Europe is in a recession and the US probably is as well in a realistic sense.

The trick these days is navigating through all the lies that our governments tell us. For instance, our government is maintaining a tale of an improving economy. Yet, the companies that carry the good of the economy are not echoing that tale. Fed Ex, UPS, CSX, and others have reported slowing business while offering lowered forecasts for the coming final quarter. The US regime also maintains that inflation is a no-show while corn and gasoline prices have risen better than 20% in the last couple of months. To make things worse, Friday’s employment report was again weak even by regime standards. They claimed that only 90-something thousand jobs were created while the unemployment rate fell from 8.3% to 8.1%. This is a well-practiced tactic of the regime. When the jobs number is bad, the unemployment rate drops. When the jobs number is better, they let the unemployment rate rise. Only a fool would believe anything that comes from a US regime. 

The truth is ugly. The truth is the US and Europe have both been allowed to live well beyond their means for the passed few decades enabled by debt. Now the debt is too much and it is unrepayable to the lenders. Good. They should all go broke for loaning too much money to bad credit risks. For instance, has anyone paid any attention the feckless US Congress? Why on Earth would anybody loan money to this completely incompetent body of legislatures? The only thing they are good at is abolishing liberties and imposing bans. Fiscally they are an abysmal failure. Yet, the US now has more than $16,000,000,000,000 in debt. In case readers are having trouble with all those zeroes, that’s $16 trillion. 

Europe is in even worse shape as they have decades of Obama-style ‘spread the wealth around’ under their belts. Naturally, the economies of both the US and the EU are in tatters. And naturally so, the stock indices that represent these two economies should be trying to find new lows to reflect the ultimate insolvency and dissolution of the unions. Sovereignty has already been surrendered to the central bankers. 

Ah, sweet surrender. Rather than face the truth or live in reality, the central bankers have accepted sovereign surrender in return for fantasy and lies. The bankers use the assets of the populace to fund sovereign debt purchases. That works to artificially lower interest rates so insolvent sovereigns can continue to borrow money without paying the price for their fiscal irresponsibility. For instance, a formerly sovereign nation like the US that is $16 trillion in debt and after another 4 years of an Obama regime will likely be north of $20 billion in debt should be borrowing money at something like 25% interest rather than the disingenuous 1.5% that is the current Fed manipulated rate. Ditto for the EU. Of course, interest rates this high would surely tank the stock indices and then even the dumbest of dumb would realize that the ‘economic recovery’ is completely dependent upon central banker manipulation. Even the stupidest of morons would eventually recognize this. Heck, at some point even a Pelosi would realize the scam at hand.

The result of all this is we now have dueling central bankers. The Fed’s Bernanke ‘talked’ up the indices with pledges of eternal support this passed week. But then, the EU’s Draghi called Bernanke’s ante and raised him by pledging ‘unlimited’ bond buying in the land of the EU. According to Mr. Draghi, all a sovereign nation had to do was raise the surrender flag. Uh, I mean all they had to do was ask. Clearly, to have our veins flooded with all this central banker heroin, we must be in horrible shape. Without question, we are now addicted to such heroin. It should also be clear that heroin addicts never kick their habit by using more heroin. 

Draghi’s offer made stocks go up. That’s all that really matters, right? Of course. None of us care about freedom and liberty and capitalism anymore. The greatest bubble ever blown is being blown in stocks right now and we have a party to attend. We have already tied a rope around our arm and located a vein. That vein is the Dow Jones Industrial Average. All we have to do is push a little more of that central banker heroin in and we will feel elation. 

The chart below is the Dow. Readers have one guess as to which day followed Mr. Draghi’s announcement. Now, it is Mr. Bernanke’s turn.

1 Month ending 9/7/12 - DJIA

Chart courtesy StockCharts.com

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.

Stock Truths

8/24/12

Before I get to stocks, I must admit that I am a bit angry. Since Mr. Obama told us business owners that we weren’t really responsible for building our own businesses and the government was really responsible for our existence, I have been doing some thinking. A toilet handle broke in one of my businesses and I did what any business owner totally indebted to the government for my existence would do. I looked up the White House on the Internet so I could report the breakage of my toilet handle. Surely since government is responsible for my business, it seems they would have a link on their web page so we business owners could get government personnel out to fix things like toilets. But no, there weren’t any links for toilet repair. There weren’t any links for repairs of any kind. There weren’t any marketing tools to help with advertising. There weren’t any links for help with signage. Mr. Obama, if you are going to take credit for my business existence, shouldn’t you also provide services for things like toilet repair? You did say you were responsible, right? Then where are you when I need you? I am now getting more angry that government started my business for me but now I can’t get a little help with toilet repair? This is part of running businesses Mr. O. Nevermind. I’ll stick my hand in the toilet and fix the arm myself. Just like I do, and have done, everyday since the inception of my business. I do it all myself!!!!! Well if I start my business and maintain my business all by myself, is it too much to ask of government types like Obama to say the hell out of my life and my business??? Jerks!

Now for stocks.

Wednesday, US gasoline prices hit an all-time high for August 22. The reason reported was a shortage of product. In truth, the central bankers have injected inflation into the markets my serially proposing further ‘stimulus’ efforts. They have inflated stocks. They have inflated bonds. They have inflated corn prices. 40% of US corn supplies go to make ethanol for gasoline. As corn prices rise, so too do gas prices. In addition, an accepted figure is that some 75% of everything we buy in the grocery store is affected by the price of corn. Prices rise when currencies weaken and fed ‘stimulus’ weakens currencies. The idea of gas prices rising due to ‘shortages’ is just a ploy to divert attention away from the cause and effect of Fed ‘stimulus’. Readers come here for the truth so there it is.

The Dow lost ground everyday this week except Friday because central bankers downplayed the injection of more bond buying. And as we all know, when the Dow drops, Bernanke comes to the rescue. As the Dow threatened to break below 13,000 on Friday morning, news that Bernanke was considering more stimulus hit the tape. Up went the Dow. Sure the pundits all postulated all kinds of reasons for the movement in stocks. With almost all of the economic news continuing to show weakness, and almost all of the corporate news continuing to show weakness, we should all expect stock weakness. But Bernanke cannot tolerate that. Everyone is guessing right now when the next magical injection might occur. Want the truth? The next Fed announcement of action won’t occur until the Dow drops into the mid-12k range. Who cares about trivia like corporate earnings or economic data? The Dow is now the Fed’s to drive. They own it.

On Friday, economic data showed that capital goods orders fell 3.4% - the biggest drop since November. Durable goods rose 4% but that rise was due solely to transportation orders. Ex-transportation, durables fell. Seems bad, right? Well, on this same day, Bernanke released a letter to Congress saying that his stimulus gun was still loaded and he was ready to act if the economy didn’t show some more strength. Guess which story made the Dow rise? Yep, economics no longer matter and neither does a ‘market’. The Fed controls the stock indices and the indices react to every Fed flinch. 

So the question is very simple. When will the Fed announce their new stock manipulation program? Again kids, don’t try this at home. Conspiring to manipulate stock prices is a crime. But not for central bankers. It is their job!

I have enlisted the chart below for some help on the timing of the next Fed intervention. The chart is a picture of the Dow over the passed 7 years on a weekly basis. The wavy blue line is the approximate 200-day moving average. The straight blue line is my interpretation of what I call the ‘quantitative easing bull market’ support line. Of late, central bankers only bluster and threaten intervention. I suspect should the Dow be allowed to fall to the straight blue line, the Fed will spring to life and the next bull run will follow. If the Dow should fall to 12800 (the support line), buyers should step in quickly to beat the Fed to the draw. If there is any risk in stocks, it is the waning power of the bull runs. If we were to draw a line connecting the tops, our line would start to look like an arc. Each bull run seems to exert less power than the previous run. And, the volume continues to wane as well. But that stuff is only for worry-worts. We have the illustrious Mr. Bernanke to protect us from any nasty bear market tendencies that used to be a normal part of stock behavior. But no more. They are not allowed. So ideally, we would like to see the Dow pull back to 12800 at which point Mr. Bernanke would jump out to announce the next bond purchase program. Otherwise, stocks could fail and so too would the ‘recovery’. We all know Mr. Bernanke no longer has a choice. The only question is when. Maybe the chart below is telling us what we need to know.

DJIA - 7 years weekly

Chart courtesy StockCharts.com

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.

Telling Tall Tales

Stock indices are driven and controlled by central banker action. Everything else is either minor or insignificant. For instance, the current rally is all based on anticipated central banker ‘stimulus’. The ECB’s Mario Draghi talked (manipulated) world indices higher a few weeks ago as he announced his bank was ‘ready to act’. He also said that his bank could do plenty. In concert, the Fed’s Ben Bernanke announced that his bank was willing, able, and ready to do anything necessary to keep the Dow up. Uh, I mean he said his bank was willing to do anything to manipulate stock prices higher from now on. Uh, I mean he said some kind of blabber about helping the economy but we are all adults here. We know that Mr. Bernanke and Mr. Draghi care nothing about economies or citizens. They only serve to manipulate stock indices higher. Thus, they ‘jawbone’ about committing more ‘stimulus’ as long as they get away with it. Then if needed, they furtively filch some money from unsuspecting and woefully ignorant citizens. They then give the cash to their bankster partners who goose the stock and bond markets. This works to keep the ignorant public distracted as to the real con game. But the point is simple. The only thing that matters to stock index direction is central banker intervention. And, right now, we have plenty of that.

At the same time, we do have some economic data that should arouse suspicion. The ‘data’ is most likely just more of the tall tale that government likes to tell because they want to control the citizenry. Since the central bankers are manipulating stock indices higher, they of course need some corroborating economic evidence to justify the rally. Enter government ‘statisticians’. 

This week, we were told of an ‘unexpectedly strong’ rise in retail sales in the US. Really? Then the biggest retailer of all should be doing great, right? Walmart sells more than the next four or five biggest retailers put together. Yet Walmart has reported that in the second quarter, same-store sales actually fell by over 2%. 

We have been getting inundated by the ‘improving’ real estate picture news. Housing is in ‘recovery’. Yet, housing is hardly even making a blip of a bounce from its multi-year descent and mortgage delinquencies are again on the rise. This week unemployment claims rose across the country yet consumer confidence ‘unexpectedly’ rose. What? More people are getting more behind on their mortgages, more people are applying for unemployment, yet we are supposedly spending more money and our confidence is rising? Really? Maybe confidence is rising because citizens know an election is coming in which we get a chance to oust the disrespectful condescending business hater who sleeps in the White House. Anyway, none of the ‘data’ makes any sense. 

A byproduct of central banker manipulation is most stock indices are rising together. Spain may be broke, insolvent, and entering a depression but it matters not when it comes to stock indices. As I pointed out last week, the EWP rises along with the Dow. Weeeeeeee!!!!!

The tale tales the government tells are simply the narrative the central bankers need to mask their manipulative efforts. We should ignore the complete fantasy that comes from government. Not that any ‘data’ matters. It could all be bad and the indices would still march higher. Only bad data and higher indices would eventually raise the suspicion of manipulation to even the stupidest investor. It might even raise the suspicion of an amerikun. Nah, as long as the Dow moves higher, they are happier than they are dumb.

Finally, the government claims that inflation is tame. Really? Gee, just in the month of July, corn prices rose 22%. I have read that 70% of what we buy in the grocery store is corn related. In addition, 40% of US corn production goes into ethanol that in turn goes into gasoline production. So, the price of corn went up 22% in a month and inflation is still tame? Yes, gasoline prices also moved up about 5% for the month of July as well. None of us should ever pay any attention to the government’s CPI numbers ever again. They are a bogus lie. 

Seeing is believing. Below is a chart of the price of corn. Nothing else needs to be said. The US government is simply a liar. This chart shows first how preposterous the US regime is for trying to sell the ‘no inflation’ tall tale. The corn chart shows the effects of central banker manipulation. Their money creation machine, while it enriches their bankster friends, creates inflation. Corn prices have risen four-fold since 2006 and look poised to make new highs very soon. Thank you Mr. Bernanke! Can I have another?

Oh yeah, the indices are rallying on the prospects of more Fed manipulation. I just hope none of my readers like to eat corn! The chart does not lie.

Corn - last 10 years ending 8/17/12

Chart courtesy StockCharts.com

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.

Investment Bubbles

8/11/12

The current economic picture is rather gloomy. Europe is a mess. They are drowning in debt. Central banker Draghi is offering a lifeline that is inflated with more debt. Somehow believers want to believe more debt is the answer. China is slowing and almost no one believes Chinese data. Most pundits believe China is slowing precipitously. Their government is offering more debt a stimulus. Most believers want to believe more debt will perk up the economy. Of course, China exports heavily to the US and while the US regime claims all is well and recovery is taking hold, only worshippers of the regime share this belief. Just this passed week, we learned that mortgage delinquencies were rising again. It does not seem plausible that the Chinese economy could slow while the US economy strengthens. We should take note that only the current regime claims that things are getting better. Economic growth data from previous quarters is getting revised lower and expectations are getting reduced. Stocks?

Well, stocks are riding the bubble of central banker inflation. Every time indices threaten to weaken, a central banker somewhere pops out to offer ‘stimulus’. What they mean of course is more debt. These central bankers are trying to prop up equity markets by manipulating interest rates to zero. Sure, they can get rates to zero. All they have to do is buy up all the sovereign debt in the world. Then who owns these supposedly sovereign nations? Right - the central banks. That is the goal. But the populous has no understanding of pure evil or economics or almost anything that doesn’t involve some ridiculous reality TV character. And, as long as the stock indices continue to churn higher, no one will complain of lost liberties or lost capitalism. 

But given the overall economic weakness of world economies, and given the enormous debt loads of governments and individuals alike, and given the risk of imminent financial collapse at the twinkling of a derivative deal gone bad, the case of the rising stock indices would surely indicate that we are in bubble land. I believe we have entered into the greatest bubble ever blown and when this one pops, everyone is going to lose everything. In a sense, investors have already lost everything. They have surrendered capitalism. They have surrendered the ability to control currency valuation. They have accepted debt that can never be repaid. They have surrendered intellect. And, they have surrendered their future. Central bankers have all that stuff and they alone control the currency. When they say the currency is no longer valid, it will all be gone regardless of what investors see on their monthly statements. That day is coming soon.

The chart below is a look at this passed week. The Dow is in candlestick and we can clearly see that every time the Dow threatened to roll over, central banker manipulation propped it back up. I don’t know that there is any significance to the 13,000 level on the Dow, but the central bankers sure look head strong to defend it. Even Friday was a curious day. China announced very poor export numbers. That would seem to indicate that they were not exporting much to the US. Global economic expectations were again ratcheted down. Yet, it didn’t seem to matter. The Dow stumbled around until the last hour of the day when it lurched higher by over 40 points. A quarter of the days volume came in during the final thirty minutes of trading. To this, I say, ‘Good job Mr. Bernanke’. Of course, this little rally was instigated on this day by a Fed member saying more stimulus was needed. The bubble kept expanding. 

Oh, just one more thing. That red line is the EWP - the Spanish ETF. Readers may want to brush up on Spain but they are most likely entering into their own Greek-style debt depression. Didn’t matter. As we see from the red line in the chart, the EWP pretty much tracks the Dow. How’s that? Yep, regardless of solvency, almost all indices move together these days. Bubbles tend to play out like this. And of course, there is a lot of money to be made in bubbles. We just don’t want to be there when they pop. Bubbles Bernanke will surely declare ‘bank holidays’ when this happens to give his fellow robbers time to pilfer whatever is left of American savings. So, please don’t confuse whatever it is we are doing these days with investing. We are just riding the bubble while the central bankers inflate everything together.

5 days 8/6/12 - 8/10/12, 30-min bars: DJIA in candlestick, EWP in red

Chart courtesy StockCharts.com

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.

Bernanke Blows Big Bubbles

7/27/12

Let’s see. We are at the end of July, 2012 and what do we know?

The US economy slowed to a 1.5% growth rate in Q2.

Previous years’ GDP growth was ‘revised’ down.

Microsoft, Apple, Intel, and Texas Instruments all had disappointing news on their respective businesses.

US consumer confidence is the lowest in a year.

Consumer spending is slowing.

Europe is in a recession that is worsening such that the ECB chief is making statements about doing everything necessary to preserve the EU. Remember kids, if you or me were to manipulate the indices like this we would be put in jail. The banksters have different laws than the rest of us. Just ask Martha Stewart. In addition, the crippled economies of Spain and Italy have banned short selling of the bank stocks.

Spanish unemployment just hit an all-time high.

China’s economy is slowing.

Company-wise, Starbucks is closing stores due to poor sales. Facebook is falling on its face. Amazon.com just reported that net income dropped 96% from a year ago. 

And yet, the Dow has risen nearly 10% from its June 1st low! It is up 1.4% as I write this piece (7/27/12). Why?

Central bank steroids. The US Fed and the EU ECB have both pledged to do everything possible to goose the stock indices higher. Uh, I mean they have both pledged to do everything possible to keep their big banker friends solvent. Uh, I mean they both pledged to do everything possible to carry on the ruse of economic growth. Oh yeah, there was some poppycock about helping economies and blah, blah, blah. But we all know far too well that the real goal of the central banker is to foster investment bubbles. It appears to me that we have entered into perhaps the biggest bubble ever blown! If the US economy was really in ‘recovery’, why would Mr. Bernanke continue to offer stimulus bubbles? If the EU wasn’t staring into a fiscal abyss, why else would Mr. Draghi suggest stimulus bubbles? 

The chart below illustrates the point perfectly. This is a year-to-date look a the Spanish ETF, EWP. Yes, Europe is in a recession and Spain is one of the weaker EU members at the moment. Today the Spanish government announced that the country’s unemployment is at an all-time high. The reported unemployment rate in Spain is now over 25% while the government’s bond yields have risen to over 7%. As has been reported for months, a 6% yield is supposed to be ‘unsustainable’. Does any of that matter? Not really. 

The ECB announced yesterday that they stood ready to do anything necessary to keep the scam going. Uh, I mean they would do anything to keep the EU intact. That means bailouts for the big banks or any other banks that hold derivatives related to Spanish sovereign debt. Now, take a look at the chart below and examine the last two trading days. Obviously we have entered the bubble stage of the central banker economic recovery. And, obviously there is no longer any reason to concern ourselves with news or reality. Between Mr. Bernanke and Mr. Draghi, there is going to be a bubble and that is all that needs to be said. 

Oh, while we all like to think we are still ‘investing’, the Dow was up 1.4% today on central banker comments. The Spanish EWP was up 6.3%. Still think we are ‘investing’? 

2012 year to date - EWP

Chart courtesy StockCharts.com

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.

Rebuttal To Obama’s Insults

This is a bit of a departure from my normal blog about stocks. The stock indices are all in Bernanke’s hands anyway but there is something more important that I want to discuss. Please indulge me.

“Somebody else invested in roads and bridges. If you’ve got a business, you didn’t build that. Somebody else made that happen” - Barack Obama  

There - he said it in public. I find Mr. Obama’s statement highly offensive, grotesquely insulting, pathetically moronic, and dripping with fascism. Although, I am not surprised in any way. I own not one but two businesses. I feel compelled to speak out. As our third President, Thomas Jefferson, once implored, I also feel a duty to try to change a government that no longer represents me. What follows is my rebuttal. 

I alone conceived the ideas for my businesses. I put my education to work. I relied on my intelligence to bring my businesses to life. I put my money into my businesses. I accepted all the risks. I accepted the prospects of failure. 

I get up everyday and go to work. I work hard and I put all my energy into my companies. I lie awake a night wondering if I have made the right decisions. Yes, for better or worse, I have built my businesses. And at the end of the day, somehow God gave me the courage to try.

And now, after another hard day that every business owner puts in, I have to sit back and listen to some pompous, ridiculous, bureaucratic product-of-the-system that depends on the taxation power of subservient citizens lecture me that my efforts would be fruitless without the aide of government. Really?

Actually, Mr. Obama, I believe that I have succeeded in spite of government interference. I must navigate 72,536 pages of tax regulations, 2,319 pages of financial regulation, 2,074 pages of the coming health care tax, and an endless morass of federal, state, and local regulations just to form and operate a business. But to claim I didn’t get here on my own? 

No, Mr. Obama, I didn’t. As you say, somebody built those roads and bridges to enable my businesses to thrive. And this is where the real insult lies. 

By the grace of God, I had a mother and a father who stayed together to raise me and by brother. My parents got up every day and went to work. I watched my parents go to work when they didn’t feel like it. I watched them go to work sick. I watched them go to work braving bad weather. I watched them collapse from exhaustion. I watched them pay taxes that went to pave roads and build bridges. I watched them pay taxes that paid for schools and teachers. My parents sent my brother and I to college and they paid every dime. My parents instilled in me a sense of self-reliance so that I would not drift through life in some meaningless bureaucratic job void of productivity and totally reliant on taxation of the productive for existence. 

No, I didn’t get here alone. My parents were there for me and they paid for the roads and bridges on which I now travel. They also paid for the roads and bridges on which the bureaucrats now travel on their way to their office so they can find ways to extract more money from me and my businesses through fees and taxes. To say that government is really the responsible party for the existence of my businesses is a most egregious insult to my parents. I take great offense to this profane remark!!

A friend of mine immigrated from Greece to America in the early 1970’s. He knew zero english and he had $16 dollars in his pocket. To make a long story short, he learned to speak english, he started a business, and now owns several in our area. He left his native country of Greece to get away from a government that thought it to be responsible for building everyone’s business. Was my friend right? How has Greece faired with its social welfare philosophy? Will four more years of Obama’s rule exterminate America? 

The term ‘American‘ should not really apply to someone that is a citizen of the United States. Americans want freedom and opportunity. Nothing more. To have someone from Washington, DC belittle us for entrepreneurism, disrespect us for our courage, insult us for our efforts, and completely disregard our parents‘ contributions is perhaps the lowest point in American history. Mr. Obama, you should hang your fascist head in shame. You have certainly prompted Americans that get up and go to work every day to hang their head in shame for doing so.    

Perhaps Americans should show solidarity to protest this remark of insolence. Since our government has turned its back on us, we should reciprocate. I suggest the following. The date is Friday, July 27. The time is high noon. Wherever we are, we should find the direction of Washington, DC, rise to attention, and turn our backs to the capital for three minutes in silent protest. Pass it on. That’s my plan. Hopefully I can restrain myself from the urge to drop my trousers and offer a full moon!

The Good News Is The Bad News

Greetings, investors! I have great news! The economy is headed towards a fiscal cliff and economies all over the world are struggling. Isn’t that great? Yes, of course it is. You know what that means?

Here comes the ‘stimulus man’ - here comes the ‘stimulus man’!! Yippee!! We’re saved! Let the buying begin.

Have I lost my mind? Hardly. The ‘market’ is dead and buried. Capitalism has been exterminated. Central bankers now set prices for everything. And, as we now learn from the LIBOR sham, the banksters make all their money on insider trading. Don’t try this at home, kids. They put Martha Stewart in jail for that. But banksters have different rules to follow than the rest of us. Well, actually, they don’t really have any rules other than to cheat the system any way they can and if they get caught, they just request a bailout. 

So here is the deal. The indices are now in the hands of the banksters. Societies, citizens, and formerly sovereign nations have surrendered to this new system else the banksters threaten to drive all indices lower. No stimulus means no rally and most certainly a depression. We wouldn’t want that, would we? No, of course not. So remain prostrate and keep the white flag flying. In the meantime, enjoy the rules of the new indices. The good news is there is a lot of bad news. That means central banker stimulus.

The US economy is sputtering at best. Consumer confidence is waning. Unemployment is still very high. And the Supreme Court just affirmed that the ruling regime has the right to tax its subjects out the wazoo and they can call it ‘health care reform’ or anything else that stupid people are willing to believe. That means there is another round of stimulus around the corner!

The Chinese economy is slowing quickly to something like a 7% growth rate. There is a property meltdown underway. Premier Wen announced that there was no sign of ‘recovery’. That means there is another round of stimulus around the corner!

The situation in Europe is terrible and it will only get worse. Most likely, the EU is in a recession now. Of course, like the US, they will continue to lie about it in hopes that if they tell a big enough lie long enough people will begin to believe it. The fact is, EU nations are broke, insolvent, and totally dependent on perpetually expanding debt. That means there is another round of stimulus around the corner!

The US retirement PONZI scheme known as ‘social security‘ is getting drained like a swamp over an oil field that a poor farmer owns. By law, funds in the system must be invested in US Treasury notes. Those notes currently yield less than 1.5%. As the months and years pass, that yield will move ever more toward zero. So, we are asking citizens to for over money for decades of their work careers to put into an investment that earns nothing at the hands of a central bank who works to devalue currency every day so that the bankster cartel can continue to borrow at zero to no doubt participate in insider trading with their derivatives linked to LIBOR. Even the idiots in Congress will one day realize the nature of the PONZI scheme and they will no doubt do what members of Congress do - they will raise our taxes to pay for the mess! That means there is another round of stimulus around the corner!

Retail sales just contracted for the second month in a row in the US. That means there is another round of stimulus around the corner!

The IMF just cut the emerging market global growth forecast. That means there is another round of stimulus around the corner!

I could go on but you get the picture. Bad news is good news because it raises the probability of more central banker injections. The stock indices are now totally dependent on this action for stock rallies. 

The chart below is a 3-year look at the Dow. We can clearly see the effects of Manipulation Ben as each stimulus/ bailout is announced. In mid-July, 2012, investors are waiting for the next Fed announcement of when the next operation will begin. This is a given. We all know beyond a shadow of a doubt that there will be another manipulative operation. It’s just a matter of when. Interestingly, the chart below is a monthly look at the Dow over these three years. During this span, there have been only 12 negative months. Given where the world is in terms of economic failure, it is both extraordinary and nauseous at the same time.

This tendency to rally on Fed action is extraordinary that assets are purchased on the acceptance that economic conditions that support those assets are disintegrating. Thus, in the new era we get Fed stimulus. The Fed actions trump reality. For those of us who love freedom and capitalism, this is nauseating because we are no longer free to set asset prices ourselves. Nor are we free to exercise investment skills to navigate through difficult economic times.

Nevertheless, we should now be cheering for more bad economic news. Ben will keep blowing the bubble bigger and bigger and bigger. As the chart shows, Ben prefers to blow the bubble in late summer or early fall. Get ready to buy with abandon. Ben will soon be blowing the wind to our backs. Bad news is great. Terrible news is even better! One could only dream of how high the Fed would push the Dow should a full-scale world-wide depression put every worker on the planet out of work and in poverty. Would that be great! Rally ho!!!

3 years - DJIA monthly

Chart courtesy StockCharts.com

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.

From Dictionary.com, the word ‘no’ means ‘a negative used to express dissent, denial, or refusal, as in response to a question’. It seems to be such a simple word. But, the power of ‘no’ is lost on modern society. The ability to exercise the word ‘no’ is a profound exercise of freedom. If we can’t say ‘no’, then we have no freedom. Slaves cannot exercise the word ‘no’.

The month of June has ended and with it, a little more freedom has been conceded. We should all be ashamed because future generations will look back at ours as one of cowardice. We surrendered when we should have stood strong. We buckled when we should have bucked. We conceded when we should have been courageous. Let history record the truth.

The freedom to say ‘no’ is what gives balance to economies and free people alike. It is fairness and truth. When prices for a good or service rise to a point where that good or service is no longer affordable, consumers say ‘no’ to the higher prices by closing their wallets. They stop buying that product. The makers of the product then have to find a way to lower the price or go out of business. They must become more efficient. If they lower the prices and demand is still solid, eventually the lower prices make the product once again affordable. This is the way a free market works. This is capitalism. The scales of freedom are calibrated to the effective degree of expression of the word ‘no’.

In June, 2012, the US Supreme Court validated the supposed constitutionality of a government regime’s ability to require its subjects to buy health care insurance coverage. ‘No’ is no longer an acceptable response. In reality, the US will now institute a nationalized health care system that will be funded with a new tax that working subjects will pay. They cannot say ‘no’ regardless of price. Proponents of the idea insist that somehow someway this new health tax will lower costs of medical care and premiums for everyone will decline. I don’t know what these people are smoking but I would like to get some of it, you know, on a prescription basis, and let the rest of you pay for it. As many people back in the ’70’s used to say, ‘That must be some good s#%&’!

Beyond the argument over medical care, we should all be concerned with freedom. As I wrote when the so-called ‘Obama-care’ universal health care legislation was proposed, let’s be honest and call this a ‘tax’. A service will be provided, it will be administered by the government, and it will be regulated by the IRS. This is a tax. Period. And yes, the Supreme Court ruled it to be a tax as well. One would have to be a stupid cousin of Pelosi to even confuse this issue with real health care. T-A-X. It is a TAX!! And, we all know that when the government institutes a new tax, that tax rate only goes up. It never goes down. 

It seems to me that as we move into the month of July, we should reflect upon Independence Day very solemnly. Our founding fathers gave birth to our country in large part because they wanted to exercise the freedom to say ‘no’ to taxes extracted by the British government from the new colonies. It didn’t seem fair to our forefathers that the sweat and toll of those who produced something in this new part of the world should be forced to give up part of their earnings to a government that no longer offered any representation. And now we turn our backs on our forefathers as we roll back the hands of time. We are surrendering freedom to a government that grows more powerful and more intrusive by the day. This Independence Day should be a day of shame as we again, refuse to exercise the freedom of the word ‘no’.

When we lose the power of the word ‘no’, we lose the ability to control prices. Health care costs have been rising at a rate much higher than the gooberment’s concocted inflation numbers and will likely continue their rise. Why? Because the root of inflation is the same root that poisons freedom. The central bank has always been a destructive force on the value of a nation’s currency. The central bank gains power by taking ours. The central bank gains assets by taking ours. Andrew Jackson knew this and he told us so. He protected his, and future generations, in one of the greatest acts of patriotism ever witnessed by annulling the central bank’s charter in 1832. But we are weak and growing stupider by the generation.

As the central bankers have pilfered the treasures of a nation, they have learned a few tricks over the years. In present day, as long as the Dow Jones Industrial Average rises, the subjects of the regime will not protest a bridle in their mouth nor a yoke around their neck nor a whip across their back. The Federal Reserve’s PPT virtually insures that any slip in the Dow will be met with a furious rally. And so it was on Thursday, June 28, 2012. Europe was desperately trying to avoid the inevitable bankruptcy of her sovereigns, JP Morgan admitted that the $2 billion in losses announced last month were really more like $9 billion and counting, Barclay’s was just fined $454 billion for LIBOR rigging, Q1 economic growth was not a strong as originally lied about, consumer spending was slowing, the Supreme Court had just given the US regime the okay to implement a massive new health care tax, and understandably, the Dow was down 170 points by 2:30 PM. No matter. A rally burst forth in the final 90-minutes of the day to leave the Dow down only 30 points. 

If we really want to live freely, we should be allowed to set prices for everything including stocks. When we all felt prices were too high, we should be able to exercise the power of ‘no’ by selling stocks. But we aren’t allowed to do that and prices are never allowed to be fairly adjusted. The central bank always stands ready to launch a rally. After all, they don’t have to use their own money. Certainly part of this rally was based on the news out of Europe that the European Union had solved all of their member debt problems with the waving of the central bank magic wand. They announced that all the banks that lost all of their money trading derivatives would now be recapitalized. The EU announced an ESF or an ESN or CON or a RUSE or an ESPN or something with an ‘E’ in it to produce trillions of euros for cash starved banks. Did it bother anyone that Europe has been grappling with debt problems for several years and has yet to do anything meaningfully helpful? Yet now, coincidentally as second quarter was ending and the Dow was fading, they put forth a magic solution of sorts. Just in time to save the euro, the EU, and the Dow! Well, in truth they only acted to save the big banks in Europe and also to spur on a rally in stocks. 

The month of June was positive for the Dow basically thanks to two trading days. The third day of the month gave the Dow a 2% gain due to rumors about Fed stimulus. As the Dow turned weak in the second half of the month, the PPT instigated a 150-point rise in the last 90 minutes of the next to last day of trading. Then the wondrous announcement from the EU supplied the Dow with a 270 point, 2.2% rise in the final trading day of the month/ quarter. This action was almost enough to erase all of the losses for the quarter. All stock gains are now tied to rumors of, or actual announcements of, central banker stimulus. Hurray for freedom to set prices ourselves!!

So I ask again. Why aren’t investors allowed to set prices for stocks? Why do central banks intervene so often? Are we so devoted to the Dow that we are willing to surrender all freedom so the central bankers can rig the indices higher only to make our new-fitted bridles and yokes more comfortable? Will it be worth it if we surrender all our freedoms in exchange for a new high on the Dow? Are we willing to put the word ‘no’ on the profane list? 

Yes. Uh, I mean, ‘yes master’. Of course, we are willing slaves. Just as long as the Dow goes higher we will accept anything from the regime. We won’t argue with higher prices for anything. For example, on the last day of June 2012, the euro-banks got their bailout promise, stocks enjoyed a serious rally, and consumers were rewarded with a 7.9% increase in the price of West Texas Crude. Hip-hip-hur..., what? 

For all the people as dumb as a Pelosi, here is the way it works. Elite banksters, suddenly insolvent from speculative derivative trading, get rewarded with bailout money siphoned from the treasures of taxpayers by central bankers which in turn inflates prices for stocks and everything else including oil so that the woefully ignorant subjects of the land lose the power of ‘no’ in setting prices and wind up paying 10% more for oil. Don’t cry - the Dow Jones Industrials went up too! 

What are we going to do about it anyway? We don’t control prices anymore since we relinquished control of the word ‘no’. Besides, the current regime has promised that health care costs will fall anyway. What are we worried about?

My friends, we have taken the first few steps down the slippery slope of Mount Enslavement.

So let’s fire up the barbecue, wave our flags, and celebrate Independence Day. The Federal Reserve and the European Central Bank have the Dow moving higher now. They certainly set the prices for bonds. Now they set the prices for stocks. Investors and citizens have surrendered the power of ‘no’. That little word is the ultimate expression of freedom. What are citizens in the US supposed to celebrate again on July 4? Independence? Independence from what?

Disclaimer: The views discussed in this article are solely the opinion of the writer and have been presented for educational purposes. They are not meant to serve as individual investment advice and should not be taken as such. This is not a solicitation to buy or sell anything. Readers should consult their registered financial representative to determine the suitability of any investment strategies undertaken or implemented. BMF Investments, Inc. assumes no liability nor credit for any actions taken based on this article. Advisory services offered through BMF Investments, Inc.