Quote: (08-07-2015 12:21 PM)MaleDefined Wrote:
Deepdiver,
You seem very adamant about a significant loss in value on the market in the near future.
I don't pretend to be an expert investor, besides a dollar cost average investment strategy that goes like clockwork.
If you could provide a strategy for a more passive investor for the next year, I'm sure many other members in addition to myself would appreciate it.
I am on vacation for the rest of August chasing deepwater Eastern Brook Trout and Migratory Ocean Striped bass - however I have been doing some research into this with 5 out of 6 of my most Optimistic newsletters and my retired hedge fund friend - the most reputable of all forecasting major corrections and even currency wars volatility I was thinking if TPSHTF the proverbial sludge hits the fan ... why not make a trading opp out of it?
My investment advisory newsletters all look at Global Trading opportunities since the USA now generates more than 50% of its global economic activity internationally:
Warning: Global Recession Now Imminent
By Dennis Slothower
Editor, Stealth Stocks Daily Alert
Stocks were absolutely smashed on Tuesday after China’s devalued its currency, signaling a growing concern of slow growth from one of the world’s biggest importers of raw materials. After moving sharply higher Monday, stocks completely reversed to the downside on Tuesday.
The major indexes climbed a bit off their worst levels going into the close but remained firmly in negative territory. The Dow tumbled 212 points (-1.2%) to 17,402, the Nasdaq plummeted 65 points (-1.3%) to 5,037 and the S&P 500 fell 20 points (-1.0%) to 2,084. The NYSE finished at -0.95% and the small cap Russell 2000 at -0.94%.
In overseas trading, stock markets across the Asia-Pacific region moved to the downside –Japan's Nikkei 225 Index fell by 0.4 percent, while Hong Kong's Hang Seng Index edged down by 0.1 percent.
The major European markets saw greater weakness. While the U.K.'s FTSE 100 Index dropped by 1.1 percent, the French CAC 40 Index plunged by 1.9 percent and the German DAX Index plummeted by 2.7 percent.
The sell-off came on the heels of news of the People's Bank of China's surprise move to devalue its currency. The bank set the value of the currency, known as the yuan or renminbi, at 6.2298 versus the U.S. dollar, 1.85 percent lower than Monday's official fixing rate.
The move raised concerns about the Chinese economy as well as the possibility that it could start a currency war.
China’s Dangerous Currency Decision
Following weak export and import data from China over the weekend, the communist nation once again sought to control its own currency by devaluing it in order to prop up its slowing economy. The Yuan posted its biggest one-day loss in two decades.
This set off a chain reaction of events.
1. It makes it more difficult for Janet Yellen and crew to raise interest rates in September now that China just cheapen its currencies and goods. Raising U.S. interest rates would strengthen the dollar and make our goods even less competitive. As a consequence, US government bonds rallied sharply Tuesday on the notion the government isn’t likely raise interest rates.
2. Crude oil prices fell to a six year low on the growing global weakness if China has to devaluate its currency like this.
3. This should set off a currency war as other countries seek to protect its markets. China could devalue its currency further.
4. It doesn’t bode well for U.S. companies that sell goods to the Chinese.
5. It argues that a global recession is imminent.
The Atlanta GDPNow model recently projects that lower inventory investment will subtract 1.7 percentage points from third quarter real GDP growth. There is a key reason why there is a lower inventory investment and that is because inventories are soaring to recessionary levels!
Goods are backing up. The key point to remember is that building inventories are subtracted from the GDP and we are now at similar levels as we saw in the recession of 2008 and 2000.
China sees a recession coming as well and may well be sacrificing something it has keenly wanted for a very long time – for the Yuan to be part of the IMF special drawing rights, “SPR” when this decision comes due in the fall.
One of the reasons why China was rejected in 2010 was its currency was not widely held by the world’s central banks because of their constant manipulating and devaluing of their currency. If you’re a central bank who wants to hold an unstable currency that is constantly being devaluated.
Tuesday’s devaluation hardly argues that China’s currency is stable. Perhaps China has given up on the idea the IMF will grant its currency SPR, with the U.S. having veto powers. On the other hand, U.S., Japan and Euro zone have all been devaluing their currencies over the last few years, as well.
Will IMF ruling crush U.S. dollar? (Expected Oct 20th)
Currency Expert: Watch what happens to U.S. Dollar after big announcement from the International Monetary Fund rumored for Oct. 20th. This announcement could start a domino effect, that will basically determine who in America gets rich in the years to come... and who struggles. This story is likely to explode in the months to come and initiate a transfer of wealth, unlike anything we've seen in more than three decades...
Get all the facts about this announcement – including the surprising country behind it all – right here.
Now we see a possible reason why President Obama set up the Pacific Rim trade agreement – to stop having to be so dependent on trading with China. Let’s give the jobs to illegal immigrants coming to America rather giving jobs to enrich China.
This devaluation helped to boost the U.S. dollar and it sent crude oil prices down sharply by $1.88 to close at $43.08 and making an intraday low of $42.69. Oil should find support at the winter lows at $42.03. This is key test. If we breach this support, next support levels are back down to the lows of December 2008 at $32 a barrel.
WTF $32 a barrel oil what does that do to Russia's 5 and 10 year economic plans - with Oil the Chinese Stock market and Yuan collapsing the Chinese reneged on a $25 Billion USD payment to Russia to kick off their $400 Billion pipelines and oil and natgaz fields joint exploration projects. So that's it for Putin's pivot towards the east. Putin's Grand Master status on the Global Geopolitical chessboard of life is now seriously in doubt. Can you say MEGAlomaniac FAIL?
Once again, the investment bankers kept the S&P 500 index above its 200-day moving average defending this support level while they can, while the broad market is clearly breaking down through key long-term supports.
I have 3 books on my desk:
1. The Death of Money - the Coming Collapse of the International Monetary System, James Rickards CIA Financial War Games facilitator.
2. America 2020 - The Survival Blueprint - Forward by Dr. Ron Paul - Author Porter Stansberry
3. Where to Stash your Cash Legally in Offshore Financial Centers of the World
Authors Robert Bauman and Ted Bauman of the Sovereign Society
Plus a number of newsletters with actionable information - will summarize the takeaways when I get a chance before the Mid Sept/Oct correction.