I have no idea what Prechter is saying right now, I can only guess. He's saying that Trump - right, wrong, indifferent - is merely a sign of the times. A demagogue in a fraught era. What the mob demanded and what the mob got. Prechter's general hypothesis is that most people are just along for the ride. They don't question the mores of the day. If right is now wrong, they adjust accordingly. Whatever keeps them in the competition. Because the race itself must never be questioned.
In The Lonely Crowd terms, what Prechter describes is the "outer-directed" individual. Someone who has neither a strong traditional background to guide them nor an inner moral voice. One who believes that if everyone else is doing it and you can get away with it, then it must be ok. Prechter is right, if only to the extent that The Lonely Crowd predicted the predominant rise of the amoral individual, over sixty years ago. A breed of human fixated on relative comparison and hence oblivious to absolute reality or principle. A consumption-oriented Borg seeking circular consensus from like-minded automatons.
All of which is the long way of saying that they don't see this coming. Because from a markets perspective, consensus is wrong on both ends and right in the middle. Just as the herd was terrified ten years ago, now amid asinine risk they haven't a concern in the world. Those who say that perma-bears have been wrong for ten years are the ones who got conned again. Their way of proving just how "wrong" we've been. With logic like that, who needs enemies?
The deadliest time to seek consensus is at the end of the cycle:
All of which is the long way of saying that they don't see this coming. Because from a markets perspective, consensus is wrong on both ends and right in the middle. Just as the herd was terrified ten years ago, now amid asinine risk they haven't a concern in the world. Those who say that perma-bears have been wrong for ten years are the ones who got conned again. Their way of proving just how "wrong" we've been. With logic like that, who needs enemies?
The deadliest time to seek consensus is at the end of the cycle:
Fifty years ago, 1968 was a seminal year. MLK assassinated. Robert Kennedy assassinated. The Viet Cong launched the surprise Tet counter-offensive. President Lyndon Johnson abdicated. Rioting and anarchy ensued at the Chicago Democratic National Convention in August 1968. Divided and polarized, the country shifted to the right. Nixon was elected just over two months later. Fifty years now past that seminal shift and the reign of the right is ending in anarchy, divisiveness, and corruption unprecedented in U.S. history.
November will be a referendum on ClownTopia. And needless to say, unwinding Trump's corruption is not "priced in". With each day that the odds of the Democrats winning back Congress increase, the corruption premium will come out of the casino. And each day that the premium comes out of the casino, the odds of the Democrats winning back Congress will increase. A social mood feedback loop on steroids.
"If it holds, that 12 percentage point margin would suggest a "blue wave" large enough to switch control of not just the House but also the Senate."
In Elliott Wave terms, the decade since 2008 has been a 'B' wave. Despite exceeding the previous high in terms of nominal price, 'B' waves are considered corrective. The fundamentals underlying the rally are eroding constantly: solvency, debt accumulation, Ponzi GDP, money printing, capacity utilization, quality of jobs, real wage growth, distribution of wealth, malinvestment etc.
Every aspect of a 'B' wave is fake.
U.S. stocks / Federal debt:
Which is why this decline will be one trend degree larger than 2008...
This is what the Borg were told to believe this week:
They were told that a three wave corrective bounce off of an all time high, is an all-clear sign. And they were also told that 25% of global GDP is now "Global markets".
The only stock market outside the U.S. making new highs up until this week was the Bombay Sensex which got pounded this week:
"Experts said the market fall was aggravated due to a sudden winding up of leveraged bets by panic-stricken investors"
...we have a radically overvalued financial sector. It is a house of cards"
Unfortunately, it was the only part of the Emerging Markets stock basket that was still "working"
If that's how they want to describe a house of cards...
