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‘There’s no stopping it,’ warns Ron Paul: A ‘calamity’ could cut this market in half

Posted by freedomforall 7 years, 1 month ago to Business
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“The correction is going to be huge, and I don’t think anybody can predict, but I think this correction we had in ‘08 and ‘09 wasn’t allowed to really go its course and restore some sensibility to the market,” he explained to CNBC. “I think that’ll be a mild correction to what could happen.”


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  • Posted by 7 years, 1 month ago in reply to this comment.
    Yes, the banksters cried "save the economy (from our manipulation and our gambling in the opposite of the advice we gave our customers)" and the treasury dept-run by banksters for 30 years (or more) said "we are so scared (of losing our phoney baloney jobs) that we will give you a trillion in taxpayer funding to prevent your being tarred and feathered by your shareholders and customers."
    Damn right it was a conspiracy! An obvious conspiracy since 1913 for anyone willing to open his eyes, analyze the evidence, and think. The market has been manipulated for the entire time.
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  • Posted by $ Abaco 7 years, 1 month ago in reply to this comment.
    The debt will likely be the big blow. And, it continues to balloon under Trump, to the tune of another 1.5T each year. Completely uncharted territory now....

    As for the election, you have to look at the SP500 for just a couple months around the election. I had positioned myself for a Hillary win and had to lick my wounds for a week while I repositioned.
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  • Posted by $ blarman 7 years, 1 month ago
    Though not a financial insider, my business background has had me watching the market closely since the turn of the century and I am concerned about its trajectory. There really is no true investment market right now - its a speculation market. True investments guarantee a continuing return in dividends - like bonds and preferred stock. But bond rates are in the toilet meaning almost zero return on them and most stock issued is common stock with no dividends. Housing is also turned to speculation because of the absurdly low interest rates artificially inflating home prices. The market is a house of straw waiting for the huffing and puffing of the Big Bad Wolf. And there is no house of bricks to go hide in because we dismantled it!

    I, too, am waiting for the correction with baited breath.
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  • Posted by Lucky 7 years, 1 month ago
    " .. correction we had in ‘08 and ‘09 wasn’t allowed to really go its course "
    What does "allowed" mean?
    That government, or the reserve, or some conspirators intervened to stop the market dropping? I reckon that to stop a panic on Wall St would be beyond even Soros.

    So, I follow the argument but, if the logic is right, why did it not happen 5 years ago? The golden years of Fed money creation was during the prev regime, now the Fed chair is talking tighter money, ok it is only talk so far, but could be an trigger for the panic 5 years overdue .
    Anyone who says I do not understand macroeconomics is right, I blame it on grad school Keynsianism mushing my head.
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  • Posted by CircuitGuy 7 years, 1 month ago in reply to this comment.
    I agree with Ron Paul on many things too. A bigger concern than markets responding to politicians is just the amount of debt. The Fed gov't runs huge deficits. Part of the way it can borrow cheaply is the Fed Reserve buys the debt, and that only works because the dollar is such an esteemed reserve currency, which only happens because people have faith in the US gov'ts ability to tax and the ability of the people to keep producing value that can be taxed. If the gov't spent the money on a war during a recession, it could be good for the economy (not that war is worth it) because eventually there will be incentive to end the war and stop borrowing. We're borrowing for a global empire the world feels like it needs for basic security, a large prison system, and domestic programs that people have become dependent upon-- all stuff that's hard to shut off. They're already taxing half of what high-earners make. There's no political will to tax the average citizen, who pays almost no Fed income tax. On top of all that, Social Security is like a back-door debt to people who paid into it and reasonably expect to get benefits from it; and on top of that there's a lot of consumer debt. So we end up going from crisis to crisis. I think if they keep pushing it, we may see a crisis at a moment when Bitcoin is poised to put national bank currencies, even the USD, out of business. That might now be so bad because right now having a national bank is enabling the gov't's "debt abuse" problem.

    I used to disagree on principal with Ron Paul in that I think fractional reserve banking is a good thing, really a beautiful thing where people put their money in the bank, which lends it out to the next person with a good idea to create wealth, and the money supply expands with all the good ideas out there to invest in. Ron Paul says even politicians who campaign on tight fiscal/monetary policy invariably want loose policy once in office. That's happening right now, making me start to change my mind. Maybe a central bank is great in theory, like the concept of a wise benevolent dictator, that is impractical.

    I did not follow your observation the presidential election and the stock market, but in any case I think the connection is overstated. It's a noisy system, like the distribution of clouds or stars in the sky. Pareidolia makes us see patterns in the noise. In my world, it appears as "AWGN", but the random walk is everywhere. I do NOT dismiss the idea, though, that big elections can affect market psychology. I just think excessive debt is the huge elephant in the room and rational market participants are not fired up about politics.

    tldr; Our open policy of living beyond our means, is a bigger problem than clandestine market manipulation.
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  • Posted by $ Abaco 7 years, 1 month ago in reply to this comment.
    I think he is too. I tend to agree with Ron Paul on a lot of things, though. I can talk about this now, but I also worked several years in the financial industry (sold that business a year ago). The market has been manipulated heavily with W Bush in the White House, and hasn't really been what I'd consider to be a natural market since. For one, the market is too-closely tied to politicians, reacting too much to the whims and actions of elected officials. Also, many people in positions of power have been allowed to alter the market with things like tweets, etc. Not to name names, but one of them is a blonde lady with big calves. She has dinged me several times, big time.

    Anyway, the market isn't make a lot of sense. And, it hasn't for a long time. I use a method of trend following that ignores the noise. And, I also think we should have a big correction soon - we're overdo. Want to see something funny? Look at a graph of the S&P 500 up to and through the Trump election. Pretty funny...
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  • Posted by CircuitGuy 7 years, 1 month ago
    People post a lot of hyperbole, conspiracy theory crap, childish propaganda from politicians needing support from the uneducated, and general misanthropy to this site. This article is not part of that. Ron Paul is correct. I don't pretend to know what the markets will do, but the value of large-cap equities being cut in half in a matter of years is not at all far-fetched. We are playing with fire. It's not that the world might end. There are more opportunities in America during financial crises then in most other times and places in human history. So things are fine by historical standards. But we are grossly mismanaging fiscal policy. We are acting like a bloated empire. The longer we wait, the more painful the adjustments.

    The best and most probably scenario is the crisis prompts us to take action, we partly fix the problems, and partly kick the can down the road. The worse case is how Germany degenerated into a fascist state. (We will not let the worse case happen.) The scenario where letting the problems go leads to a great flood wiping away decadence leaving behind the righteous Noahs and Utnapishtims of the world is a form of denial.

    There's no shortcut to just starting now to fix the problems. Ron Paul is correct.
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