The globalized economy is a colossal Ponzi Scheme in which the vast majority survive on the bread crumbs falling off the table. The possibility of 7 billion people achieving a consumption-oriented lifestyle is zero, so the World Bank conveniently set the poverty line at $1.25/day to legalize global slavery. As long as someone else's children are doing the suffering, it's "all good". Post-2008, this illusion was extended merely by plundering all future generations.
Monday, February 15, 2016
The Madoff Moment aka. Global Third Wave Down.
"At the end they were trading worthless pieces of paper back and forth pretending to be wealthy" 12 week realized volatility (S&P) w/NYSE Composite:
"Only printing money can increase the value of stocks. It's called CasinoNomics. In China they call it 'Shanghai Surprise'"
Central Banks propped up stock markets while economies collapsed. Monetary policy was handmaiden to collapse. Now Central Banks are ALL IN as stock markets get repriced based upon fundamentals and solvency instead of liquidity. Generation Madoff doesn't know the difference between liquidity and solvency, but they will learn. What some dunce paid for a stock last week has no bearing on what it's worth today...
The Global synchronized rallies get shorter and steeper. We don't know what time zone the Madoff Moment will begin, but we know it will go 24/7 thereafter...
Case in point, the Nikkei had its biggest decline since 2008 last week and its biggest rally since 2008 last night, on news that economy is in recession:
In other words it bounced off the support line:
Down -28%, up 7%
Current price level is blue arrow, JPY in red
This is the third rally. Volatility is highest since 2008: