The Federal Reserve (4th branch of government) has the U.S. stock market in a stranglehold. The damn thing is like an octopus with its tentacles out leaving slime all over the American people. Someone certainly appears to be pretty desperate to keep this bull market going. They will do whatever it takes to fool us into believing the economy has strength. The Fed is not supposed to be buying stocks outright as its not included as a power in Section 14 of the Federal Reserve Act, but I'm getting more and more suspicious that it could be happening. It truly feels some outside force with the same agenda is still propping us up big time. Most likely it's not the Fed themselves, but somebody very close doing the dirty work for them. A potential culprit would be someone like Government Sachs (Goldman). They have very close ties to government with many ex-employees working at different levels of politics. Current Secretary of the Treasury Mnuchin is just one example. This is the same guy putting out timely statements at key Dow Jones support levels. With people like this running government, of course they want stocks higher at all costs. What many don't realize is when the Fed buys trillions in bonds that money directly or indirectly trickles into stocks and acts like a shot of testosterone for the market. This is an economic strategy similar to Keynesian Economics (depression economics) that was developed by British economist John Keynes to better understand the Great Depression. Isn't the market running up a good thing you ask? Sure, for those investing in stocks who are smart enough to sell before the market comes back down. Until profits are taken, its just paper wealth. Longer term, when the market is running on artificial priming of the pump and not true economic strength, it destroys market credibility and leads to wealth destruction. Its like welfare for Wall Street elites in a sense and does not really benefit most of the American people (Main Street). The top 10% of American households own about 85% of stocks. These consistent market schemes, bubbles, and crashes aren't random but designed. It's no coincidence that artificial bulls always seem to last 10 years and then crashes in 2 years. Media, politicians, and whales are all part of it (some unknowingly). Media pundits are just parroting what the puppet masters tell them. It's slick and stealth, high-level, white collar crime. And it always ends up the same - with the theft of the American people.
After the 1987 crash Ronald Reagan created what is known as the "Working Group" (now called Plunge Protection Team). Basically, this group consists of the Secretary of treasury, Fed Chairmen, SEC, and Commodity Futures Trading Commission. Their purpose was supposed to be to fight volatility and restore investor confidence, but it likely was really about intervention in order to stop inevitable market crashes. Rumor has it, this is achieved by convincing banks to buy stock index futures or even having the Fed do it themselves. Does this sound like a natural free market to you? Of course it's not. There is nothing free about our stock market. In a free market there would be no Fed intervention whatsoever. Sadly, 90% of people in this world are living in a bubble and would never believe such a thing could happen. But its happening in plain sight and as clear as day. If you look at current holders in the SPY ETF you'll see that Institutional ownership is around 82% (extremely high) and therefore its pretty much entirely controlled. You'll notice that big players like JP Morgan, B of A, Goldman, and Morgan Stanley have large holdings. With it locked up this much these whales can simply all agree not to sell and then push it higher with light buying to protect their interests. As you can see, some of these players own both calls and puts which encourages them to keep up the sideways but volatile trend we have been in. Many of the big players are in bed with the Gov. Hell, the Gov. pretty much took over Fannie and Freddie Mac during the mortgage crisis (more control). You will notice the interesting 117 mill stake by Parplus Partners. Apparently this is the only holding they have, which is a little strange. If you dig further it appears a Japanese company named Waizu Holdings is an indirect owner of Parplus. If we aren't careful, we will end up like Japan. They are still trying to recover from a bubble burst that was created in the same way (through artificial pumping). As financial institutions grow even larger and the Fed is allowed to take even more drastic steps, the danger increases for the public. When you add in non-transparent dark pools, algorithms, an high frequency trading you have a nearly entirely controlled market place. The bottom line is the Federal Reserve needs to be audited and changes implemented. Wealth of the American people has been destroyed during these bubble crashes, the wealth gap is only widening, and very few politicians are actually addressing the problem. The few that are don't really have a plan. When the next inevitable crash comes its going to repeat the same story as 2008, but probably worse. To the elites it wont matter because they've made their money and the Americans will be left holding the bag again with more tax bailouts that don't fix (just enable) the same activities. Truth is, for the most part the elite politicians and other whales are not really interested in whats best for us. The Democrats and Republicans are so busy fighting each other for political power that nothing is getting done. Elections are just a dog and pony show to distract while the real power brokers continue to make moves behind the scenes. Most are really just concerned about their own interests. Presidents cant get much done anyway because Congress is so polarized. Until we all wake up and begin to fight back loudly we are going to head further down the path of more Gov. control. Schools don't teach you about what's really happening because they are Gov. entities. Our youth are naively support Socialism because they are being brainwashed so early. So, its up to you to self-educate. Motivational speaker Jim Rohn said "Formal education will make you a living, but self-education will make you a fortune." There are those who will deny this is happening of course and call it a conspiracy theory. But, there are plenty of facts. "Conspiracy theory" is a term invented by the CIA in the 60's as a means to attack anyone who challenges the "official narrative" (which is often a lie). They say the bigger the lie, the easier it is for people to believe. Well, let me tell you...We've been told a pack of lies and I'm tired of the baloney. I'm also tired of the American people getting sucked in and that's a big reason why I created this website...To help wake people up. It's time for us to get educated and get after it! And this needs to happen now, before its too late. It's our children that will pay the price! *If you enjoy our content and would like to see more, please donate to help us grow. Your support is greatly appreciated!
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It's very clear for those who are paying attention that the Fed and Trump are pulling an Elon Musk strategy, but on the entire stock market. Sometimes it even appears they are day traders watching technicals and then making moves based on charts. At a minimum they are micromanaging the market. Every time the Dow Jones seems weak, somehow bullish comments emerge by either of the two. Some Fed President puts out bullish verbiage or Trump tweets out that we are nearing a China deal for the 5th time. Similarly, Elon has posted timely tweets whenever Tesla stock was in key support areas or showing weakness. The $420 private buyout tweet is just one example. This type of behavior triggers huge short squeezes and its easy to do because whales have cornered the market. It almost feels as if the government and the Fed have become a hedge fund. They are gaining control of the entire market and who knows what kind of massive manipulation would happen if the Fed were able to buy stocks outright (they are working on that too). We are losing control of our free market and its happening in plain sight. This supposed China deal is being dangled in front of us like a large carrot in the face of a donkey. Even if there was a deal, the stock market has already priced it in. Imagine if it falls through. I keep hearing media pundits saying "The U.S. is the hottest game in town," but that doesn't mean much if there is global weakness. The reverse view could be that we are simply the least of all other evils.
Its time for people to wake up and understand that the economy is not anything near what is being portrayed. Trump and the Fed want you to believe a strong market equals a strong economy and its just simply not the case. While Trump has been making moves that stimulate the market such as lower taxes and relaxed regulation, little has actually changed with the economy itself. We are in a similar place to 2008. Trump is doing what he can, but has only been in office a short time. This is not Trumps fault of course as he inherited this mess. The market has already run up huge in the short time since he was elected. Growth remains slow globally and domestically. The Fed is really the main problem and it all started when Greenspan was appointed as Fed Chairman in 1987. His Ayn Rand philosophy of no regulation is a major reason the big banks were allowed to grow so powerful and crash the market in 2008. I am not a fan of over-regulation as businesses cannot thrive, but too little can allow Wall Street to run wild. There has to be a happy medium. I want to be clear that I am fan of Musk as an innovator and entrepreneur. He has helped create some great services such as PayPal, Tesla, and SpaceX, but I am not a fan of the way he has participated in the Tesla stock manipulation. This kind of behavior hurts traders and investors alike and reduces faith in the company and markets. Elon has been through some tough times and put his own money on the line when Tesla was in trouble. This demands respect. And its understandable that he gets tired of the Twitter barrage of haters. But, trying to squeeze shorts for fun and operating Tesla with a ponzi scheme like model is unacceptable. My biggest complaint about Trump is that he is always so busy promoting, its tough to know what is real and what is being exaggerated. The economy being strong is an illusion. Government debt, corporate debt, student debt, credit-card debt, auto-loan debt, yield curve inversion, over-dovishness, and slowing growth are major problems. But an ever bigger problem is politicians and the Fed creating a false narrative. Sure some things are positive, but there are also a lot of serious problems that are being conveniently ignored. Bottom line is Elon Musk, The Fed, and Trump are one in the same when it comes to using their reach to mislead in order to further their agendas. I do want to be clear that I respect the fact that Trump is going after the China situation. They have been taking advantage of us for far too long. But, we know he has always spun things as "yuge and wonderful." He is a master promoter and has done a hell of a job promoting the Dow up to the 26,000 range. Musk needed to get Tesla stock higher to use investor funds, Trump needs the stock market higher to tout the economy and help to get re-elected, and the Fed needs to keep the market up to unload $4 trillion in assets. Be smart and start taking some profits. I know due to recent market strength this is likely to fall mostly on deaf ears. It feels like the bull will never end just as it does in all bubbles. And that's always how people get caught. Regardless of how high the market goes from here, it's ludicrous and greedy to not do so. Trade the market, but take some green off of the table. Remember, use common sense and know that you don't have to buy into the baloney that politicians, media, CEO's, and Wall Street in general are working hard to sell you. Cannabis stocks have no doubt been on fire in recent months. Ticker TLRY has run nearly 500% since it's recent ipo. CGC and CRON have moved around 100% in the same period. However, the run could be short lived. Clearly investors have gotten ahead of themselves. Valuations are becoming outlandish and the stocks are starting to run on hype alone. Everyone knows the Canadian legalization is coming and therefore prices are already baked in. Understandably, day traders have been attacking the momentum due to volatility and lack of other options in this highly grinding, dull, and bullish market. Moreover, the buy the rumor and sell the news scenario is going to come into account. Cannabis companies know their stocks are way over-valued and are taking advantage by releasing almost daily PR's to attempt to keep the run going. Most of these press releases are meaningless with prices up at these levels. Next we will being to see a press release of this nature..."Tilray sells fabulous ounce of cannabis to new customer and they may become a repeat buyer!" We saw the same thing with the last cannabis rush back in 2014. It would be wise to take a look at the 5 year chart on stocks like CANN and ATTBF to see how that ended. Yes, they are OTC stocks, but the charts are no less relevant. Below are some important factors to consider going forward... 1. Investors usually overestimate "next big thing" 2. Overall market in a euphoric state 3. Stock valuations are at overblown levels 4. Profitability and dilution are forgotten 5. Investors chasing due to lack of options 6. Big dogs will be taking profits 8. Buy the rumor, sell the news scenario 9. There are still legal issues to consider 10. There have been recent downgrades The cannabis situation reminds me a lot of the recent blockchain bubble. As many know, people tend to forget or ignore the past, despite the fact that it always tends to repeat itself. Of course, the majority of trading websites and investor publications are talking bullish on cannabis. The big fish always need to find ways to suck chasing retail longs into buying their sells and ways to squeeze retail shorts into buying to cover up at these levels. Just as I warned everyone about the dangers of Bitcoin at the peak of that bubble, I'm now warning people of the same with cannabis. I'm not saying that long term some of these stocks can't be a good investment, but it is far too soon to know which ones will end up being the winners. We are at a record level bull and the market could potentially correct at any time. No bull market lasts forever and you don't want to be caught at the top of a hyped up cannabis sector when the crash happens. TLRY has an $8 bill valuation (about 200 X yearly revenues) with a net loss that increased 600% year-over-year. CGC has a $10 billion valuation (roughly 100 X yearly revenues) with a net loss that jumped 1000% year-over-year. The market cap of CRON is $2 billion (about 165 X yearly revenues). Clearly these market caps are beyond ridiculous and it would do everyone good to take a look at the following chart as a reminder of what can happen to investors that get sucked into hype and don't lock at least partial profits... In light of the current overdone valuations my recommendation it to lock some short terms profits and wait for a correction before considering taking a longer term position at a more reasonable valuation. Greed is one of the biggest factors that contributes to trading losses and not taking some gains here could end up being pretty foolish. Bitcoin investors that didn't take profits when prices were at bubble levels are now in hindsight kicking themselves. The ability to have foresight is what really matters in this game. Many ended up losing all gains or got crushed after chasing the peak charts. Keep in mind that cannabis has a strong following, but many buyers are not the most sophisticated or experienced investors. Some may even be high on TLRY, CGC, or CRON products as they purchase shares at these inflated prices. Investing stoned is probably not the best strategy and will likely make for great candidates to bet against. Common trading sense should tell you to expect at least a reasonable correction and that sticking with day trading these cannabis movers makes the most sense for now. Trade smart, lock some profits, and best of luck to all cannabis players long and short! |
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