It has nothing to do with the PPT that live at the north pole with Santa Claus. There are precious few places to park capital that is in anyway safe. The Dow is one of them. If you think that this is anything but a correction then you are wayyyyyy off. The Dow will turn and run to new highs. Once the bond market breaks in the very near future, say hello to 20,000 and beyond for the Dow.
The PPT is a mythical group which can be blamed for various perceived irregularities. Just like the Malay blame the Toyol.....whenever anything goes missing, especially money, it is inevitably blamed on the dark spirit "Toyol". PPT is superstitious nonsense. Now back to the Dow. The amount of capital that will flee the bond crash will be mind boggling. Very few markets can absorb that kind of money and the Dow is one of them. As the U.S. dollar skyrockets, thanks again to the bonds, it will be a no brainer. The rising market and rising currency will be like seagulls to chips, ( or flies to s...). It will be a self perpetuating rise. Interest rates will rise in the U.S. but it will not stop the dollar and the stockmarket from rising with it. It is foreign capital which will drive it to the stratosphere.
Eventually, yes. Understand that the Dow and the dollar will not last forever. The U.S. will be the last domino to fall. Of the ugly sisters, it is the least ugly. Once the Dow and the Dollar have reached such a level that all MSM analyst are on board talking about the new normal, then it is time to get out because that will be the start of the decline as capital will flee the U.S..
A 20 to 25 % fall is normal. Even gold did this in 1978. After moving well past its high, gold turned and dropped back down to near its previous high before it moved off again. the Dow could test the 15,000 mark without any damage. 12,000 would mean serious damage. Capital has to flow somewhere. MSM will be screaming crash, crash but the Dow has serious strength at the moment. Stand by to watch how a strong market regains ground over a short period and you will see that gold is not in the same league. Expect some choppiness but the cream will float.
Looking at it right now, a thousand point fall at the opening and now regained 750 points before lunch. That is impressive. It may yet end the day with a gain. Now that would be strength.
A Weekend's Heads Up Posted August 23rd, 2015 at 7:14 PM (CST) by Jim Sinclair & filed under Bill Holter. Dear CIGAs, Friday's action closed horribly in the U.S. with the Dow losing 530 for the day. This broke away from the support level of 17,200-17,300 which will now become overhead resistance. Global equity markets around the world are in crash mode as more than a dozen are already down 30-50% while the U.S. has just eclipsed the 10% correction zone. My guess is we will see a very weak opening with one or several rally attempts. An exhaustion bottom can be expected in the first half of the week with nervous strength later in the week. This scenario I believe is our best case. No matter how the week plays out, the credit bubble has been identified, recognized and "pricked", the equity markets are only a symptom. Do not be fooled by any strength this coming week, it should be used to raise cash. As September moves in, the September-October timeframe looks like a disaster. What may start out as circuit breakers being hit now, will ultimately be the plugs yanked out over the next couple of months. I believe a market closure is in our near term future. As for gold and silver, these markets are both REALLY tight if you want the physical metal. If you are trading paper metal oh well, can't help you. This is the Great Credit Unwind and as such, currencies of all sorts (including the dollar) will take turns crashing. Watch the various sovereign treasury prices and yields (also CDS credit default swaps) as a clue to which country is experiencing an "attack du jour". The most likely US/Fed response will be some sort of QE whether they call it QE4 or not, who knows? The Fed will be forced again into further monetization, any talk of a rate hike from here is a complete joke. The real danger lies in what or how the world responds to another QE. Do they hit the Fed's bid with full force? If I were a foreigner, I would certainly use the Fed as my "exit door" but this remains to be seen. Should foreign central banks (ie. China) sell into the Fed, game over and market closure could be quite rapid as in same or next day. This is much speculation on my part as to "timing and how" this might all play out. The fact that credit is now unwinding means there is only one question of importance, "when". Even this has become of less importance as "SOON" has jumped up as the answer. Gold and silver will be your only lifeboats as they are no one's liability in a world where everything including the money in your pocket is someone else's liability. IT'S OVER FOLKS! Please do not get caught up in what is mathematically coming! Standing watch, Bill Holter Holter-Sinclair collaboration [email protected]
He is an American focussing on America. He is blinded to the capital that lay off-shore which will not look at things the same as he does. The Chinese are probably very worried about another devaluation and will try get into U.S. dollar to pre-empt such a move. It does not matter whether it is the dollar or stocks and it isn't just the Chinese either. Sinclair is going to get this very wrong. Things are going to happen which are bad but not in the way he thinks they should happen. Capital will move to the lowest risk and he fails to see that the lowest risk is exactly where he is.