Saturday, January 16, 2016

Message of the Markets: Chickens Coming Home to Roost

Message of the Markets: Chickens Coming Home to Roost

by Stephen Lendman

Black Friday may be signaling big trouble ahead. What can’t go on forever won’t and never will. Eventually day of reckoning time arrives. Whether now is the moment of truth remains to be seen.

Paul Craig Roberts calls the US economy “a house of cards.” Phony government data created “the illusion of recovery.” 

Monied interests never had it better for years, profiting hugely from Wall Street-orchestrated casino capitalism and manipulated markets, creating an unprecedented, unsustainable wealth effect, an open-ended near zero-interest rate climate money grab - doing nothing to create jobs and economic growth.

Wealth transference from ordinary people to super-rich elites and corporate interests was never greater in world history - reflecting government-sanctioned unprecedented greed and grand theft.

The vast majority endures protracted Main Street Depression conditions - getting worse, not better. Poverty, unemployment, underemployment, homelessness, hunger, overall deprivation and human suffering are growth industries - in America and developed economies.

America spends unlimited trillions of dollars for militarism and endless imperial wars. Vital popular needs increasingly go begging. The world’s richest country was thirdworldized, transformed into Guatemala, control maintained by police state harshness.

The misnamed Federal Reserve isn’t federal and has no reserves. It’s wholly owned, controlled and operated by major Wall Street banks, solely for their own self-interest, public welfare be damned.

Money printing madness substituted for stimulative growth policies. Unprecedented, unsustainable, unrepayable debt levels were created.

The greatest ever ill-conceived experiment in monetary policy may produce global economic collapse. Systemic crisis can happen any time.

US equities posted sharp losses Friday, posting the worst 10-day start in US market history, greater than during the depths of the Great Depression - signaling economic weakness at best, looming crisis at worst.

The late Bob Chapman predicted an eventual economic train wreck, only its timing and duration unknown. “Untenable political and financial decisions put US and European economies on a collision course with disaster,” he said. 

“Bailouts and market manipulation delay(ed) the inevitable.” A tipping point approaches. Unprecedented debt accumulated is “unrepayable,” he explained.

“How can anyone have confidence in a broken system? Unsustainable is the operative world.” Political courage to change things responsibly is nonexistent. Corrupt Republicans and Democrats are in bed with Wall Street crooks and other corporate favorites.

An astonishing $15 trillion in global wealth was lost since the Dow closed at 18,312 last May. Whether it’s just the beginning of looming crisis remains to be seen.

Plunging oil and other commodity prices along with China’s equity market collapse signal financial and economic trouble.

The Baltic Dry Index reflecting global trade is lower than during the depths of the 2008 financial crisis. 

On Friday, Zero Hedge headlined “Welcome To The Recession - Industrial Production Crashes Most in 8 Years…the fastest pace of collapse since May 2008 and a level that has never not produced a recession.”

The Royal Bank of Scotland (RBS) advised clients to “sell everything,” saying 2016 will be “cataclysmic…Investors should be afraid.”

The average US equity is down over 20%, reflecting bear market conditions. TV talking head touts downplay things, claiming buying opportunities to get nonexistent bargains, urging mom and pop investors to buy what they want to sell - one of the oldest, dirtiest games in the book.

Investment strategist John Canally explained “(m)arkets rely on confidence and certainty. Right now there is neither.”

Economist Tim Quinlan calls “(t)he probability of going back into recession…higher than at any point” since 2009.

IMF head Christine Lagarde highlighted world economies “entering a dangerous phase.” No credible plans exist to get unsustainable debt levels under control.

Hedge fund manager Uri Landesman said “(c)ounting on the Fed to get us out of this (mess) is a mistake.”

The year’s brutal, chaotic start may signal much worse ahead. The fullness of time will tell.

Stephen Lendman lives in Chicago. He can be reached at 

His new book as editor and contributor is titled "Flashpoint in Ukraine: US Drive for Hegemony Risks WW III."

Visit his blog site at 

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