Monday, April 9, 2018

The Status Quo Is Primed to Explode

America is run by and for thieves and criminals who rob from the working class to give to the rich. Theft in broad daylight being just the latest form of American "capitalism". Not to be confused with the other lines of business: mass outsourcing, bailouts, money printing, and plundering grandchildren. This con job is going to explode in their fucking faces. And the best part is they don't see it coming...

The Borg have adopted the habits of their corporate overlords - always seeking short-term gratification at the expense of long-term consequences. And questioning absolutely NOTHING.

Per my blog description above, the mantra of Generation Madoff is "this is all going to explode, but fortunately not in my lifetime". Unfortunately, when you live in an old age home it's easy to miss the steady degeneration. The end always comes suddenly and "unexpectedly". 

To wit, multinational corporations have successfully destroyed the global economy, the environment, retirement and health care systems, and the health and well-being of the human race. That's all.

These people are fucking thieves. Nothing more, nothing less. They used Social Security deductions to pay for serial tax cuts, so now they have to reduce pension payments:

The pursuit of the consumption-oriented lifestyle is competitive self-destruction. With respect to mental and physical health, intellectual capacity, and economic well-being. 

Now, corporations are self-destructing as well. Having fed off the carcass of 2008 for an additional decade, they've run out of human materiel to harvest and are now self-cannibalizing via debt funded stock buybacks.

Corporate debt is at its highest level relative to U.S. GDP since the financial crisis EVER.

Low rates have encouraged companies to borrow, but instead of using the money to expand, they have used it to boost their share prices"

I'm detecting somewhat of a pattern here:

"The corporate debt market has been in the spotlight after this month's sell-off in high-yield bonds triggered concerns the riskiest issues may be sending a warning to the broader markets"

"We're keeping an eye on it but it looks like it was one of those typical productive corrections, rather than the beginning of the end," 

Subsequent to the above article being written in November, junk took another leg down in February on massive volume.

Companies with the largest buybacks are the weakest part of the market, because they're papering over stagnant revenue with stock buybacks and massive leverage:

What it all means is this:

Going into the coming recession, the Federal government will be constrained on fiscal policy due to the exploding deficit. 

The Fed will be constrained on monetary policy due to the lack of normalization post-2008. 

And corporations will be maxed out on debt. Meaning many of them will go bankrupt, leaving the shareholders with nothing.

Stocks will be priced accordingly.