Working Poor: Masses struggle while Fed Bails Out Banksters

The Working Poor

The Fed paid banks $7 billion last year to do nothing with their money. Why is the Fed doing this? It keeps the velocity of money at a low level. What is the velocity of money? It is the speed at which money changes hands. When the economy is healthy the velocity of money increases and vice versa.

However, the Feds have been able to inject massive sums of money into the system, and the inflationary effects have been greatly minimised because the banks have not lent this money out to the masses. In fact, we have a deflationary situation, and that is why the precious metals sector collapsed, and prices are likely to remain off their highs for some time come. It is hard for Gold and other commodities to rally when inflation as the BLS measures and defines it is non-existent. We disagree with their fraudulent system which really does not take core factors into consideration, but that is a topic for another day. What matter is that the Masses accept this data without mounting a contest, so as far as the markets are concerned, inflation is well under control.

The negative interest wars that Central bankers have gladly embraced will add further pressure on commodities. Imagine having to pay banks interest to keep your money with them. Well, this is what is happening in Japan and Sweden.

Central bankers are raising the stakes; their ambition is to force everyone to speculate by making it expensive to keep the cash. This can be construed as another form of QE as the markets will eventually be flooded with a lot of extra cash. Lastly, we think the Fed will eventually allow banks to lend this money out, which will then serve as the bedrock to create a monster bubble the likes of which we have not seen. We can expect the market to soar to levels that one can only dream off today. Once known as the Middle Class, the same generation today is now known as the working poor.

Keep this in mind

The banks were given this money for free when they were bailed out after creating the crisis of 2008, and now they are getting paid extra to do nothing with this money. In essence, the masses struggle while Fed pays banks 7 billion to do nothing and, more importantly, this is your money that is being used to pay bandits.

Strategy To Get Out Of the Working Poor Camp

Live several levels below your means, don’t take on any debt other than the home mortgage and only buy a home if it is cheaper than renting. Save your excess money and when the stock market crashes or experiences a strong correction, use these funds to open positions in top-notch companies that are selling at a discount. Mass psychology states that trend is your friend everything else is your foe.

Market Update Nov 2019

Copper continues to put in a bullish pattern, and the pattern is dangerously close to generating a bullish signal. A bullish signal will/should have a positive impact on the overall market. Consider also that the current consolidation in copper has been relatively mild, so the odds of a strong move are quite significant.

The Tactical Investor alternative Dow Theory, states that if the utilities trade to new highs, it is almost always an indication signal that the Dow industrials will pursue a similar route and that’s what’s taking place right now. For the record, the Dow Utilities soared to new highs in September and so far the Dow is following in the footsteps of the utilities. The transport sector and copper should outperform the markets. While many experts were predicting a crash, we at most were looking for a pullback ranging from mild to wild. However, the long term trend is still bullish, and in such an atmosphere it is dangerous to short a market

vast amounts of money have left the market, demonstrating that the crowd is bailing out at precisely the wrong time. History has never been kind to the masses, and we don’t think the pattern is going to change shortly.

The masses beg for better prices, but when the opportunity presents itself, they do exactly the same thing as they did before; panic and flee for the hills and ignore the opportunity.

The Stock Market is mimicking the pattern of 2009; if this pattern completes, it will/should lead to an explosive upward move.

The Working Poor

Keep this in mind

Strategy To Get Out Of the Working Poor Camp

Market Update Nov 2019

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