US stock message: 1- confidence, fraud 2-Asian bank failures
the distracting immediately obvious message concerns investor eroded confidence, widespread corporate accounting fraud, liberal abuse of stock options, and all manner of exposed horseshit to line executive pockets
BUT ANOTHER FAR MORE DANGEROUS SIGNAL CAN BE INFERRED
this one is far more difficult to read clearly
it stems from the declining USdollar
I ask: what besides falling US stocks will be the fallout within the world banking system?
can the world financial reserve currency drop 10% without any observable effect?
I say no, not a chance, not even a slight chance
so we will see some ugly events unfold
but what will it be?
what is the big decline in stocks forewarning?
the stock market never tells you exactly what is going on
it tells you of something brewing, a threat upcoming
so what will it be?
bear in mind that 75% of world bank reserves are now in the form of USTBonds
MY GUESS, MY INFERENCE, MY CONCLUSION:
the entire Asian PacRim banking systems will default in stages
2-3 South American national defaults will follow Argentina
but the real story will be Asia
South America will be a lesser event, compounding pain
Brazil is doomed to default, only a matter of time
that will be 3x larger than Argentina's recent default
China is on the edge of bank failure
Japan has been "Walking Dead" for two years in bank failures
(they have already been rendered DEAD, just propped now)
I have read that 200 million Chinese farmers are not unemployed
with 10's of millions of unemployed in the cities
4 Chinese banks service 75% of the nation's banking
1000's of corporate bankruptcies are happening
DEFLATION IS KILLING CHINA
but the official state reports are "all is well"
(dont want to encourage discontinued foreign capital)
I THINK WE ARE SOON TO SEE A SECOND ASIAN MELTDOWN
IT WILL BE FAR MORE DANGEROUS AND DEVASTATING THAN 1997
IT WILL INVOLVE CHINA AND JAPAN, BOTH
BUT IT WILL TAKE DOWN THE ENTIRE ASIAN PACRIM
it will also involve Taiwan, Korea, HongKong also
and the little Thailand, Singapore, Malaysia, Philipines
the little guys never recovered since 1997
this whole Asian region has been weak since 2000
but now add a 5-10% decline in their USTBonds
their banks are in trouble outside the TBond issue
now add reduced capex purchases from USA
now add time from two years of deterioration
ASIA BANKS WILL DEFAULT, FAIL, AND LEAD TO TOTAL CHAOS
it will severely affect US financial markets
first, because 1000's of joint American projects underway in China
second, because Asian banks hold over $500 billion in USTBonds
third, Asian profit margins just shrank 5-10% on both finished products and components shipped to US markets
the stock market moron pundits have been dispensing their WISDOM about US multi-nationals benefitting from a declining dollar
but with failed multi-$M projects in China, these same US firms will instead take serious hits
where is the rise in Gillette, GenlElectric, Caterpillar, etc?
instead, we saw CAT issue a harsh warning
coming this autumn, winter, spring
get a solid athletic supporter
buy gold, which will skyrocket
/ jim |
