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Trump Tells Americans To Flee The Stock Market As The Dow Falls For A 7th Day In A Row

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Donald Trump - VOA Public Domain

One thing that you have to appreciate about Donald Trump is that unlike most politicians, he actually says what is on his mind. On Tuesday, Trump told Fox Business that he had already gotten out of the stock market, and that he foresees “very scary scenarios” ahead for investors. And of course things have already started to get a bit ominous for those holding stocks over the last week and a half. The Dow Jones Industrial Average has now closed down for seven days in a row, and that is the longest losing streak that we have seen since the panic of last August. Over the past 12 months we have seen virtually every other major global stock market experience at least one major crash. Could the U.S. markets be next?

 

What Trump told Fox Business earlier today was actually right on the money. Our financial markets have been artificially inflated by the Federal Reserve, and all artificial bubbles of this nature eventually burst. The following comes from a Bloomberg article that was posted on Tuesday entitled “Trump Urges Exit From Market Boosted by ‘Artificially Low’ Rates“…

Donald Trump on Tuesday said interest rates set by the Federal Reserve are inflating the stock market and recommended 401(k)-holders to get out of equities, just like he did.

“I did invest and I got out, and it was actually very good timing,” the Republican presidential nominee said in a phone interview with Fox Business. “But I’ve never been a big investor in the stock market.”

“Interest rates are artificially low,” Trump said. “The only reason the stock market is where it is is because you get free money.”

Trump’s comments come at a time when we are getting a whole host of bad news about the U.S. economy. We just learned that U.S. GDP grew at a meager 1.2 percent annual rate during the second quarter, the rate of homeownership in the United States just hit an all-time record low, and corporate earnings have now been falling for five quarters in a row.

But perhaps most alarming of all is what is happening to the price of oil. As I discussed yesterday, the price of oil has plunged well over 20 percent since June 8th, and it was down again on Tuesday.

As I write this article, the price of U.S. oil is sitting at just $39.66. The psychologically-important 40 dollar barrier has been broken, but the price of oil doesn’t even have to go down another penny to do immense damage to the U.S. economy. If it just stays at this price, we are going to bleed more energy industry jobs, more energy companies are going to default on their debts, and more financial institutions that are exposed to the energy industry are going to get into serious trouble.

All the ingredients are there for a major financial crisis, and perhaps that explains why so many investors are flocking to precious metals such as gold and silver right now.

The price of gold has gone up for six trading days in a row, and silver is approaching 21 dollars an ounce.

Meanwhile, things continue to unravel on the other side of the planet. In Europe, let’s just say that the recent bank stress tests did not go as well as many were hoping

If the goal of the EBA Stress Tests was to reassure investors and regain confidence that ‘all is well’ in Europe’s increasingly fragile and systemically interconnected banking system, then it has utterly failed. The broadest European bank stock index is now down 7% from the post-stress-test spike highs, Italian banks are at record lows and being halted (despite Renzi’s promises), Commerzbank is struggling with capital raise chatter, and Deutsche Bank and Credit Suisse are tumbling after being booted from the Stoxx 50.

It is funny – every time I write a major article about Deutsche Bank, their stock goes to a new record low.

And it has just happened again. Less than a week ago, I posted this article, and on Tuesday Deutsche Bank plummeted to a brand new record low as renewed fears about the health of the bank spooked investors.

Problems at Deutsche Bank and Credit Suisse are now becoming so obvious that even mainstream analysts are admitting that they are “causing some anxiety”

Deutsche Bank and Credit Suisse … are dropping to where they were after the Brexit vote,” said Bruce Bittles, chief investment strategist at Baird. “That’s causing some anxiety.”

Deutsche and Credit Suisse’s U.S.-listed shares closed down 3.75 percent and 4.67 percent, respectively.

In Europe nobody is waiting for financial stocks to crash, because they are already crashing.

A “too big to fail” crisis is rapidly unfolding across the entire continent, but most Americans are totally oblivious to what is going on over there. Instead, our major news outlets are feeding us an endless barrage of negative headlines about Donald Trump and a steady stream of positive headlines about Hillary Clinton.

I wonder who they want to win the election?

Of course I am being sarcastic. The days when the mainstream media at least pretended to be “independent” are long gone.

But as far as the stock market is concerned, I am quite confident that Donald Trump will be vindicated.

And if you don’t want to believe Donald Trump, I would encourage you to consider what Jeffrey Gundlach, the chief executive of DoubleLine Capital, has been saying. He has been right about the markets in recent years over and over again, and just a few days ago he publicly stated that “stocks should be down massively” and that now is the time to “sell everything“.

Unfortunately, very few people are likely to change course at this stage. Most of those that could see the warning signs have already gotten out of the market, and those that prefer to have blind faith in the system are not likely to listen to warnings from men like Trump and Gundlach.

So now it is just a waiting game.

We shall see if Trump and Gundlach are right, and those that end up on the correct side of the equation are probably going to make a boatload of money during the months ahead.

(Originally published on The Economic Collapse Blog)

*About the author: Michael Snyder is the founder and publisher of The Economic Collapse Blog and End Of The American Dream. Michael’s controversial new book about Bible prophecy entitled “The Rapture Verdict” is available in paperback and for the Kindle on Amazon.com.*

 

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  • Don_in_Odessa

    Looks to me as if the S&P is going to 2100, maybe 2063. Then up to all time highs before the “big one Elizabeth” comes to a brokerage account near you. But I’m an idiot when it come to trading. Time frame? I have no idea…

  • men at work

    this guy is full of horse dung he puts garbage gloom and doom articles up on his websites. he is telling people to get out of the stock market when he should be telling you to short it, also he doesn’t mention how to avoid a TAXABLE EVENT, when you do exit the market.

  • men at work

    ol mikey and his wife are making money by selling books and videos, and from different links to other websites that advertise their over priced wares!

  • DJohn1

    The real problem here is no one can afford for the market to crash.
    We have multiple pension funds and 401K funds all backed by the economy.
    IF the banks and credit unions crash then it takes anywhere from 6 months to a year for the Federal Insurance to kick in and pay people back.
    In the meantime you will more than likely have a massive currency collapse.
    Plus most of our funds are direct deposited by law to the banks. How do you alter that in a hurry if the system collapses?
    Most of your Social Security Checks are direct deposited any more.
    So are your pensions. So are everyone’s pay check for money earned.
    That right there is probably about 1/3rd of the flow of money into the banks.
    Obnoxious Trump is at it again. He is telling people his version of the truth. And his truth is run for the hills the banks are falling.
    I don’t quite see it that way though there is a lot of truth in what he says whether we want to hear it or not.
    As a good lawyer, Michael, you are trained to present problems. Most lawyers spend three years learning to present problems and one year of law school learning to resolve them. The money of course is in the presentation of the problems.
    Since most of the Congress that create laws are lawyers the same pattern tends to occur.
    Rather than stop at presenting the problem, we need solutions fast.
    I see no solutions coming from the problem presenters.
    Under the current system of economics it means a massive increase in taxes when what we really need is to back off of Obamacare and declare it unconstitutional.
    The real economic problem here is discretionary income has gone down the tubes when we went to a health care system that is massively expensive.
    What has to happen is the available money has to go back to the public working for a living which means a contradictory tax break and doing away with the expense of Obamacare in its current form.
    I would rather have a person in office that tells the truth no matter how obnoxious it is than a liar in office. So you know how I am going to vote.

  • men at work

    the real problem is american labor got to expensive so all are industry moved off shore. if i owned a company, i to would rather pay some poor schmuck 10 cents an hour rather than $25.00, plus have no workman’s comp or ssa tax to pay on my workers nor offer any bennifits too!

  • William

    Then there would be at least two smucks, one working and one oppressing.

  • William

    It’s called work and marketing… but what would a guy with no business know about that? Especially one who “if they had a business” only wants to pay 10 cents an hour…. so I’m not surprise you’re trashing Michael.

    Did the government cut your welfare payments or something?

  • men at work

    how is offering a certain amount of pay considered oppressive? if you don’t like what i have to offer then you do not have to work for me, plus i am not your mom and dad it is not my responsibility or any of my business to give you health care or a pension for your old age. i can see having to pay you if you get hurt on the job, IF it is my fault

  • men at work

    i have a business and employees, what they are paid is an agreed upon wage between them and me. now i realize people have to live, but it is not my responsibility to support them either. i am a small business owner, thankfully my business is not in america or europe. i will not hire someone who wants $15.00 an hour to do a $5.00 an hour job. you americans have ruined your economy with your socialist labor and minimum wage laws to the point america has no manifacturing industry left, face it america doesn’t produce any goods to sell to the rest of the world cheap enough or in a big enough numbers. the only reason america was so great during the fifties and sixties was do to the fact america was one of the only countries that didn’t have their infastructure ruined from the two previous world wars. economies are not built over night, it takes decades to build trade treaties. the only thing keeping america afloat now is due to the fact oil is priced in dollars so that forces other countries to purchess dollars to settle trade accounts, hopefully that will end soon and other currencies will be used.

  • William

    Exactly, so if people want to buy Michael’s items at his determined price, that’s an agreed upon exchange. Same as if someone is foolish enough to work for you at 10 cents an hour, that’s between the poor person who obviously is opresses by his life’s circumstanes and your capitalizing on their misfortune. So, if you so devalue others, why then should anyone value you or your opinion?

  • men at work

    i don’t devalue others, life is what you make of it, i pay people what i can afford and they seem happy enough with what they get, like i said i am not their mom and dad, i pay them an honest wage for honest work so quit spouting karl marx and get out of your parents basement and do something useful with yourself.