Salient to Investors:
In a bear market poised to plunge again. Markets drop twice as fast as they rise because fear is a stronger emotion than greed.
- Broken down from the 6-year bearish Rising Wedge pattern.
- First bearish moving average cross for 4 years
- Volume on the recent plunge was the heaviest for 4 years
- Global debt saturation and sovereign debt crisis in Europe
- Insoluble debt crisis in an aging Japan
- Ballooning US deficits
- Bursting debt bubble in China
- Collapsed commodity markets
- Collapsing Emerging Markets
- Record margin debt
- Huge derivatives pyramid
- A world in denial
The Fed wants to raise interest rates to start to reduce its huge balance sheet and head off a collapse of the dollar and Treasury market, but doing so would collapse the stock market and create a depression.
Market will crash whether or not the Fed raises rates in September.
The Fed would sacrifice the stock market in order to save the dollar and bond market – the resulting rate differential would induce fund inflows into the US and create a cushion: and end up supporting the stock market regardless of the state of the economy.
Read the full article at http://www.clivemaund.com/article.php?art_id=3559
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