BTFATH: "Dude Where's The Economy?"

"China, dude"

The Elliot Straight Down Wave Visualized

"Free" trade visualized
Interest rates with U.S. Manufacturing jobs

Those who still believe that "hyper-inflation" is the inevitable price to be paid for cheap money, are totally fucking clueless as to the price that has already been paid for cheap money.

Alice in Blunderland

Without the U.S., ISIS would be nothing. Literally

Washington Post: "American Sniper misfires in Iraq"

Apparently, the Iraq war version of Rambo didn't sit well with the "savages" in Baghdad:

"After just a handful of sometimes rowdy screenings, the film has been pulled from Baghdad’s only movie theater amid complaints from the Iraqi government — as well as viewers — that it “insults” Iraqis."

"In Iraq, the movie has come as a reminder of the vast gulf that divides Iraqi and U.S. perceptions of the bloody, complicated war, which left more than 4,000 Americans and well over 100,000 Iraqis dead"

“It portrays Americans as strong and noble, and Iraqis as ignorant and violent.”

"Ahmed Kamal, 27, a teacher, who downloaded the film for free on a pirate Web site because he didn’t want to pay to see a movie in which the hero refers to Iraqis as “savages.”

ISIS recruitment, up 1,000%

Beggar Thy Neighbour. And Then Thyself

Mercantilism 101:

"The Balance of our Forraign Trade is The Rule of Our Treasure"

Canada: Current Account

Net importer aka. debtor

United Kingdom

Net importer aka. debtor

United States: In 1980, the U.S. was history's largest creditor nation. By 1990, the U.S. was history's largest debtor nation.

Net importer aka. debtor

China

Net exporter aka. buyer of worthless debt

We are led by some of the dumbest fucking people to ever walk this planet. The inherently stoned Soylent Idiocracy was born in 1980 during an episode of the Dukes of Hazzard. Henceforth they were brainwashed in Reagan/Thatcher trickle down dumbfuck-o-nomics.

"Reagan proved that deficits don't matter" - Dick Cheney

The Monkeys Got Hammered In 2008. But They Wanted More Pain.

Ask, and thou shalt receive...

Real Median Household Income, 15 year low
Median household wealth, 22 year low
Labor Participation Rate, 38 year low

Elliot Wave Visualized via "Consumer" Sentimentality aka. love of Walmart.
This disaster could only be possible if enough people shoved their heads up their own asses:

Trouble in paradise: The stoned Borg awakens to one more con job:

Ponzi World is Over. Except for the Crying.

Who wants more Kool-Aid?

Denialistic Self-Implosion: A Fitting End to the Idiocracy

Central bank buffoons are cutting interest rates every day now out of sheer panic. In Europe, they pay people to borrow money (negative interest rates). Global thought dealers had six years to fix the Ponzi economy, but instead they did the exact opposite, throwing away $45 trillion to make it far less equal. We are led by total fucking dunces. Crack smoking mayors in every direction.

Their idea of fixing inequality was to collapse the Middle Class down to Third World standards:
http://policy-practice.oxfam.org.uk/publications/wealth-having-it-all-and-wanting-more-338125

They 'fixed' a debt problem by borrowing more debt:
http://www.bis.org/statistics/ar2014stats.htm

They had six years to reduce our dependence on Middle East terrorist-sponsoring oil and adopt alternative (green) energy to save the planet, but instead they squandered trillions on fracking, because we all know that green energy is not "financially viable"

This is "financial viability" visualized:

They had six years to tell the truth, but instead they lied constantly

Out of Ammo

Now, it's all melting down in real-time despite short-term and now long-term interest rates approaching zero %. Free money all around, and yet they still can't keep it from collapsing. Three out of four BRICs already under the bus.

Global Macro:

The Ponzi Cycle: Coming Full Circle

Six years and $45+ trillion in taxpayer 'stimulus' wasted just to inflate billunaire wealth

($33 trillion through 2013 and another $11 trillion in 2014)

All to end up with a far larger and totally 'unexpected' collapse at the end of it all.

An appropriate end for the Idiocracy. Denialistic self-implosion.

Blow-off Top

I was looking for Tech stocks in late stage blow-off, but all I found were beer stocks. Tech rolled over two months ago...

Brewers were the only sector that peaked AFTER Lehman. To the right (now) is what's called a rising wedge, and yes it ends badly:

Anheuser-Busch

Gained 17% in January (558% annualized):

Sam Adams

Up 200% in the past two years

Nasdaq 100: Peaked Nov. 28th

"They don't wake you up from a drunken stupor at the top"

Brown Swan Event: Canadian Economy Implodes

Investing.com. Feb. 4th, 2015

Canadian PMI comes in at 45 versus expectations of 54. Readings below 50 signal economic contraction.

Now we know what this is all about

And this, for that matter...

The global economy just fell off a cliff

A Third Wave At Multiple Degrees of Trend

From Monday's EWI Short-term Update. If this count is right, then the acceleration phase comes next...
(In tonight's STU, for some totally unspecified reason, they were back to the usual - "the market could go up or it could go down bullshit". Which is what they said in 2007 at the very top i.e. they have a long history of losing their cajones at critical junctures, so we'll see if this is another example).

Fortunately Daneric hasn't changed his mind from last night, possibly because he hasn't posted again, as of this moment. Let's hope he takes the night off so that EW doesn't live up to its reputation as being half as consistent as a blind chimp throwing darts at a board.
http://danericselliottwaves.blogspot.com/2015/02/elliott-wave-update-3-february-2015.html

As we see, I don't change my fucking mind. This historically unrivaled disaster is going to fly apart in a way that evokes shock and awe in everyone. Even those sitting on big piles of cash. Whether it happens in the next 5 minutes, 5 days or 5 weeks is really quite irrelevant. My eyes will be open when it happens:

MW: Feb. 3, 2015

Dow Theory Sell Signal Just Triggered

i.e. Fourth lower high on below average (10/90 day) volume

MW: Feb. 3, 2015
All of the Pieces are In Place for Collapse
"Given the current setup, the odds of a faster move down are high again, and the fundamental data is not in favor of higher prices either. That leaves the central bankers to come to the rescue"

Elliot Wave and Reality v.s. Skynet and Harvard. Game On

The News Breaks With the Cycle

The premise of Elliot Wave Theory is that markets are primarily driven by social mood

Believe it or not, but whether or not blind dart throwers can nail the final squiggles prior to collapse is not the point. EW theory postulates that social mood is the primary driver behind markets and economies. Unfortunately, in the context of a liquidity driven market controlled by Central Banks and HFT Bots, Elliot Wave has been hijacked by a low volume, low volatility Jedi Mind Trick. As long as the "RISK ON" button remains in the "On" mode it's all good. 

In other words, markets have been driving Social Mood rather than the other way around. What better indication of that can we find than to see the correlation between consumer sentiment and the Dow? Most U.S. consumers don't even own stocks, but still they look to the Dow as the overwhelming indicator that everything is A-OK. Leave aside that median income has dropped 10% since 2007:

Unfortunately, Skynet was programmed for return on capital, not return of capital
As I've said many times, liquidity drip feed to HFT (Skynet) in a low volume, low volatility environment can appear to work just fine for long periods of time. However, at the point at which investor sentiment peaks and rolls over, then the name of the game is return of capital not return on capital. Which is impossible in aggregate of course.

The News Breaks With the Cycle
One of the related tenets of EW theory - and one I believe in much more than squiggles on a chart, is that investor perceptions to the news change over the course of the investment cycle. For years, now we've been in a 'glass half full' environment in which every article of bad news has been rationalized away. However,  on the other side of the sentiment peak, investors see the world as 'glass half empty'. In other words, situations for example like Greece which have been known about for months, all of a sudden become major problems. Like tonight when the S&P futures dropped 30 points in a few minutes on news that the ECB was rejecting Greek bonds as collateral. Wasn't that why Greek bonds were yielding 18% in the first place?

This is what we should expect in a Third Wave
A change in sentiment visualized.

Greece
Ukraine
Collapsing commodity prices
Widening credit spreads
Record low treasury yields
Artificially levitated stocks
Fake recovery
Growing deflation
Global recession
U.S. recession
Declining profits
Reversing Carry Trades
Middle East turmoil

Etc. Etc. These problems never went away. They were just all simmering in the background, waiting to return with a vengeance.

ALL AT THE SAME TIME.