Wednesday, April 16, 2014

How The Fed Conducts War

Aah! There they are. I was worried that the Plunge Protection Team (PPT, or, if one prefers, The Presidents Working Group on Financial Markets) had forgotten their job. The PPT exists so the Fed can drive stock prices to the moon. Generally, the PPT comes into the fray in the final hour of trading on the NYSE to buy stocks up in an attempt to arrest a stock sell off. I prefer to define a PPT attack as the Dow rallying more than 100 points per hour. To be sure, the Fed has done a wonderful job of pushing stock prices higher on a nearly everyday intervention basis. For sure, nearly every week and surely every month of the last year or so has seen a constant 45-degree ascent. The PPT has not been a necessary part of the overall manipulation. 

But then, the month of March ended with losses showing up for the Dow for Q1 of 2014. Yes, the Fed was there at the open of every trading day since mid-March with a fistful of money to buy stocks higher. They managed to get the Dow almost back to even for the year. With Q1 client portfolio statements safely in the mail, the Fed, as they always do at the beginning of a quarter, took a break. Not surprisingly, as the month of April unfolded, the Dow began a nasty descent. Apparently falling to just above 16,000 was the line in the sand. As trading opened on Monday, April 14, 2014, the Dow sprung from its selloff of the previous Friday and leapt higher in the first hour of trading. Hello, Fed! Then, and since most investors are beginning to realize that stock prices are in a bubble, the Dow began to again roll over. Lower and lower it went toward 16,000. From 3:00pm to 3:15pm, the selling increased.

At precisely 3:15pm, the buying started. The next 45 minutes were all about buying all by the Fed. The Dow rose more than my prescribed 100 points during those minutes to qualify as a PPT intervention. Good for them. Below is a 2-day chart of the Dow with 15-minute bars so we can memorialize yet another instance of Fed manipulation in the final hour of trading. Notice the abrupt rise in price with the increasing volume in the final 45 minutes.

4/11/14 & 4/14/14 - EWP (15-minute bars)
Chart courtesy

Oops! Actually that chart above is a chart of the Spanish ETF, EWP, over the same time horizon. What I am thinking? Spain has an unemployment rate of nearly 30%, daily demonstrations and riots across the country, massive debt, massive housing problems, and no hope of ever returning to real economic growth. Parts of the country are flirting with secession. What could a chart of Spain’s ETF have in common with the Dow? Let’s see the Dow below.

4/11/14 & 4/14/14 - DJIA (15-minute bars)
Chart courtesy

Wow! The EWP and the Dow are nearly the same exact chart! Both experienced a nice rally in the final 45 minutes of trading. But that’s the PPT. They buy everything. I’ll bet the Antarctic Index was straight up at 3:15pm as well. The point is this. Does it really matter? Stocks, all stocks, are going to perform as the Fed dictates. Maybe the new rally has therefore started? Who knows? We should ask Ms. Yellen.

So, does garbage like Spanish indices rise along with the Dow or is the Dow and the US economy garbage like Spain? In bubbles, garbage rises like everything else. 

The initial rally came after the regime announced that March retail sales has leapt the most in several years. Of course they did. Someone should tell the idiots at Cold Water Creek. They just announced bankruptcy. Someone should tell the idiots at Radio Shack. They are closing over a thousand stores. Ditto for Family Dollar. Amazingly, retail sales are up without any retailers enjoying any of those sales. Clearly the regime simply writes ‘news’ that supports higher stock prices.

Well, good for them. The regime writes what they want us to believe. They claim inflation is non-existent. Yet, gasoline, natural gas, insurance, and taxes are all up. Beef prices are the highest they have been in 30 years. I could go on but this contention is ludicrous. We all know inflation is way up. Even the idiots on the financial networks are talking about the disconnect. But lies make stock prices rise.

Let me amplify that point with another regime contention. They claim that women have recovered all job losses since 2008. On the same day, another research group said that the percentage of stay at home moms has increased significantly. Now, how can more women be working when more women are stay at home moms?

Okay, let me solve a few riddles that seem to be baffling to most humans. While we are to believe there is no inflation, the guy that sleeps in the White House is proposing an increase in the federal minimum wage. Okay, I won’t even address the preposterous lie that there is no inflation. There is. This is why people can’t live on the current minimum wage. The same can be said for food stamp recipients. As any person trying to live on food stamps can attest, it is hard to buy groceries when prices keep rising. Politicians are trying to propose more money to food stamp recipients.

This is all wrong. Why raise the minimum wage? Why increase food stamp pay? Yes, inflation is killing the currency and destroying purchasing power of the currency. But why do people always think in inflationary terms? Rising wages mandated by regime whims will only push prices higher and continue the demise of living standards. 

No one needs more money. What we all need is lower prices. Why do prices rise all the time? Because the Federal Reserve Bank creates money to give to their bankster conspirators thus stimulating inflation. As Andrew Jackson proved, the abolishment of the Fed Bank results in no inflation. If we want lower prices and no inflation, then we must simply abolish the Fed Bank. Any other conversation is just stupid. The reason this won’t happen is inflation helps the elite who own all the stocks and all the real estate. Deflating prices help the poor and hurt the rich. Since the regime is the puppet of the super elite, prices of everything will continue to inflate. 

Finally, everyone is wondering what happened to the Malaysian airplane that disappeared last month. Given the criminality of everything that goes on at governmental levels these days, we should consider the following possibility. 

Let’s just say that a certain regime is desperate to retain power. The regime lies to its subjects about literally everything. The regime runs a spy agency to keep an eye on everyone. Let’s say that there was someone on that Malaysian airplane who had worked with that spy agency. He, and his group were headed to China for some reason. Let’s just say that this group may have known something that the spy agency didn’t want the rest of us to know. Let’s just say that the regime had the capability, you know, with their military being the ‘global force for good’, to blow the airplane out of the sky and then scoop up the debris below. Then to make sure nothing was found, the regime started a game of misdirection. 

First, we were told there was an Iranian with a stolen passport on board. Can we imagine? An Iranian on an airplane. They’re all terrorists aren’t they? Turns out the guy was just on his way to see his Mom. A few days passed.

Okay, then the pilot had erased some files on his computer. Gee, none of the rest of us have ever erased a computer file. A few more days passed.

Then a fisherman has spotted some debris off the coast of Malaysia. It wasn’t a plane. A few more days passed.

Then satellite photos located some debris in the Indian Ocean. Turns out the regime’s satellite saw nothing. But a few more days passed

Then some more satellites spotted something floating off the coast of Australia. Nothing. The clock kept ticking.

Have the black boxes stopped pinging yet? If not, then there was debris floating towards Hawaii. Maybe it was spotted off the coast of Cuba. Maybe it was off the coast of Chile. Keep looking, people. Some casualties of war are never found. 

What we know is this airplane took off from Malaysia headed to Shanghai, China. It dropped off radar contact not long after takeoff. Supposedly, the plane flew on for hours after it veered off somewhere in the Indian Ocean. Really? With over 200 people on board, no one noticed that the plane was now way off course? It seems to me that the flight attendants would have notice that something was wrong. It seems to me that business men onboard would have noticed something was wrong. And no one picked up a cell phone to call for help? It seems to me that the NSA tracks everybody’s email, cell call, and underwear change but yet they don’t know what happened to a big old jet plane? 

Maybe there is a good reason that the entire world is in riot mode against their own government regimes. Maybe we all just want the same thing. The TRUTH!

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.