Coming Volatility
QUESTION: If war in the Middle East prostpones the Sovereign Debt Crisis into 2020, will the eonomic decline after the peak of the ECM in 2015 be milder decline in stocks and other private assets?
Kind regards
j.k
ANSWER: The postponement can be largely a suspension as was the case during World War II. However, these types of wars are also generally 3 to 5 years maximum. So we are still looking at 2017 as a key target. With each turn there will be greater volatility. So what we see 2015.75 to 2020.04 should be a greater period of volatility that what we saw 2007.15 to 2011.45.
Obama has a list of reasons why he needs a war. He has paid off the Arab League. He has Kerry calling this the worse crime in history forgetting Hitler and Stalin I suppose. We did not invade Russia to stop the mass murders by Stalin. So who gave Obama the right to violate international law? Like Napoleon, he is crowning himself. What about the innocent collateral damage – the civilians who always die in these attacks? Is that not a war crime?
Obama is determined to go to war. But the War Cycle is turning up. That means there is a high risk of this escalating into World War III. Russia could easily enter the war and demonstrate its power. Its advisers in Syria would love the opportunity to test Russian weapons against American ships for live practice. When events like this take place during a down-cycle, they do not spread. However, when the cycle turns up, these things get out of hand. So the volatility is likely to increase but Obama may then order the Fed to keep the stimulus going and there will be no tapering. Watch for that in September. Create a war and the Fed must comply.
Market Recap
A closing today below 14806 in the Dow Jones Industrials will warn that we should see lower lows in September. The important support lies at 14450. A closing beneath this level will warn of a more dramatic decline of a serious nature.
In Gold, we need a closing above 1425 to signal a sustainable breakout. To actually confirm a change in trend we need a monthly closing above the 1698 level. The key turning point still appears to be January.
Obama Desperate to Attack Syria to Distract People from Budget Crisis
Sources directly from Capitol Hill revealed that three separate letters were sent to Obama from members of Congress warning him not to take action on Syria before they return. That has been the whole point. Obama faces a debt ceiling battle in September and the Treasury runs out of money in October. John Boehner is a country-club Republican who really stands for nothing. This is the guy that removed any Congressman from financial committees who supported the Tea Party and Ron Paul. He stands for nothing but business as usual. Consequently, it is debatable whether or not he will be able to deliver the Republican vote because he stands for compromise not principle.
Britain has rejected this nonsense of attacking Syria and this is leaving Obama with no support whatsoever internationally. The Press sells this Syrian war to the public for that is what the Obama Administration has been instructing them. The Guardianreported Obama’s plans were in disarray. CNN has reported that Obama wants to act anyway unilaterally against the entire world, Russia, China, and the UN and deny Congress and the American people the right to vote on anything. Obama is acting like a dictator, not as the leader of the free world. This conduct is an absolute disgrace.
The motive against Syria has nothing to do with the gas attack. He wants to raise taxes $1.6 trillion. This entire incident is to gain cover for his economic agenda. His comments on the Trayvon Martin incident saying it could have been him is irresponsible and may lead to racial tension and riots like the 1960s when the economy turns down. There have been now many retaliations against whites in the name of Trayvon Martin. Many are seeing this reemerge thanks to Obama’s statements that are reigniting the racial tensions . This will also provide cover so it turns people against people rather than against government.
The economy is not growing to expand for the youth in the US or Europe, I have been warning the school is a costly waste of time and that education is becoming worthless.Forbes Magazine reported that 60% of college graduates cannot find work in the field they specialized in. Even teens have been finding it very hard to get jobs during the summer.
The Democrats cannot see that raising taxes reduces employment. People have less to spend and business profits decline, so where are the jobs supposed to come from? This is why Obama needs a war. He is trying to box Congress in to force higher taxes to pay for the war effort that will then become permanent. This is always divide and conquer while distracting everyone and make sure the press sells his nonsense on Syria. Ask yourself, do you think it is worth it to have a family member dead or permanently injured for life to assist religious zealots in Syria?
This is a ploy for more tax increases and to head off the debt ceiling problems. Obama wants to tax the “rich” as if this were closer to a communistic state to even the net income regardless of work. He is focused solely on how much money someone has and not what they did to earn that money. To him, Henry Ford did nothing to earn his fortune and fails to see he made the automobile a part of American life that provided countless jobs. Detroit is a shinning success of what happens when politicians run the show. They just cannot keep their hands out of other people pockets.