The Federal Reserve Has Just Given Financial Markets The Greatest Sell Signal In Modern American History - Michael Snyder THE ECONOMIC COLLAPSE BLOG

The Federal Reserve Has Just Given Financial Markets The Greatest Sell Signal In Modern American History Posted: 05 Nov 2017  Michael Snyder  THE ECONOMIC COLLAPSE BLOG Why have stock prices risen so dramatically since the last financial crisis?  There are certainly many factors involved, but the primary one is the fact that the Federal Reserve has been creating trillions of dollars out of thin air and has been injecting all of that hot money into the financial markets.   But now the Federal Reserve is starting to reverse course, and this has got to be the greatest sell signal for financial markets in modern American history.  Without the artificial support of the Federal Reserve and other global central banks, there is no possible way that the massively inflated asset prices that we are witnessing right now can continue. The chart below comes from Sven Henrich, and it does a great job of demonstrating the relationship between the Fed’s quantitative easing program and the rise in stock prices.  During the last financial crisis the Fed began to dramatically increase the size of our money supply, and they kept on doing it all the way through the end of October 2017… Unfortunately for stock traders, the Federal Reserve has now decided to change course, and that means that the process that has created these ridiculous stock prices is beginning to go in reverse.  In fact, according to Wolf Richter this reversal just started to go into motion within the past few days… On October 31, $8.5 billion of Treasuries that the Fed had been holding matured. If the Fed stuck to its announcement, it would have reinvested $2.5 billion and let $6 billion (the cap for the month of October) “roll off.” The amount of Treasuries on the balance sheet should then have decreased by $6 billion. And that’s what happened. This chart of the Fed’s Treasury holdings shows that the balance dropped by $5.9 billion, from an all-time record 2,465.7 billion on October 25 to $2,459.8 billion on November 1, the lowest since April 15, 2015 Does anyone out there actually believe that the immensely bloated balance sheet that the Fed has accumulated can be unwound without having an enormous negative impact on Wall Street? And even more frightening is the fact that central banks all over the planet appear to be acting in coordinated fashion.  I really like how Brandon Smith made this point… An observant person, however, might have noticed that central banks around the world seem to be acting in a coordinated fashion to remove stimulus support from markets and raise interest rates, cutting off supply lines of easy money that have long been a crutch for our crippled economy.  The Bank of England raised rates this past week, as the Federal Reserve indicated yet another rate hike in December.  The Europeans Central Bank continues to prep the public for coming rate hikes, while the Bank of Japan has assured the public that “inflation” expectations have been met and no new stimulus is necessary.  If all of this appears coordinated, that is because it is. When interest rates are low and central banks are injecting money directly into the financial system, that tends to promote economic activity. But when they raise interest rates and pull money out of the financial system, the exact opposite is true. At this point Americans are more optimistic about the stock market than they have ever been before, and it is at this exact moment that the Fed is pulling the financial markets off of life support. And it isn’t as if the “real economy” ever recovered in any meaningful way.  Most American families are still living paycheck to paycheck, and a new economic crisis would push millions more out of the middle class. For a long time I have been warning that the only reason why stock prices ever got this high was because of the central banks, and I have also been warning that they could crash the markets if they wanted to do so. Hopefully there is nothing nefarious going on, but I do find it very strange that all of the major global central banks are moving toward tightening at the exact same time. If things go south for the global economy in the months ahead, we will know exactly where to point the blame… Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

Mass Shooting At Texas Church Shows Why Every Church In America Needs To Have Armed Security Posted: 05 Nov 2017 02:37 PM PST The mass shooting at the First Baptist Church in Sutherland Springs, Texas on Sunday morning is already being called the deadliest church shooting in modern U.S. history, and we need to be in prayer for the victims and for their families.  At about 11:30 AM, a heavily armed man entered the sanctuary and began shooting.  At this point it is being reported that “at least 27 people have been killed” and at least another 30 have been injured.  Tragically, reports indicate that several small children are among those that were murdered. As I write this, we are still waiting to hear from authorities about a motive.  We do know that the gunman is dead, but we haven’t been given any information about his identity. But whatever the motive was, this just goes to show that something like this could literally happen anywhere.  Only about 400 people live in Sutherland Springs, and I am sure that nobody ever expected something like this to happen on a Sunday morning… At least 27 people have been killed and 30 people have been injured in a mass shooting at a church in Sutherland Springs, Texas. A witness reported seeing the as-yet unidentified man walk into First Baptist Church and began shooting around 11:30 a.m. Sunday. Wilson County commissioner Albert Gamez Jr. told a CNN reporter that the gunman fled in a vehicle after the shooting and is now dead after a brief pursuit. Of course Democrats were already calling for gun control within minutes of this being reported by the national news. But gun control won’t stop tragedies such as this.  The bad guys are always going to find ways to get guns, and so disarming the rest of the population is a really, really bad idea. What we really need to do is to make sure that there is armed security at every church in America from now on.  If there had been armed security at the First Baptist Church in Sutherland Springs on Sunday morning, a whole lot of lives could have potentially been saved. Instead, the gunman was able to murder innocent people at will, and at one point he even stopped to reload his gun… The gunman was said to have fired a semi-automatic weapon into the packed congregation of about 50 during the middle of the service – stopping only to reload his gun, before fleeing. So many of us are victims of “normalcy bias” when it comes to tragedies such as this.  Since we grew up in an America where things like this rarely ever happened, we just assume that we don’t need armed security at churches, schools and other public events. But times have changed, and so must we.  Islamic terror is on the rise, Republican members of Congress are being attacked, anti-Christian hate is at unprecedented levels, and the number of mentally unstable people running around in our society has never been higher. So let’s do a couple of things. Number one, like President Trump let us grieve with the people of Sutherland Springs.  The following comes from Fox News… President Trump, who’s currently traveling in Asia, tweeted: “May God be w/ the people of Sutherland Springs, Texas. The FBI & law enforcement are on the scene. I am monitoring the situation from Japan.” Number two, let us push for armed security at all of our churches from now on.  Someday it may be your church that is attacked, and when that happens having armed security on hand will make all the difference. Personally, I am promising all of you that when I go to Congress I will never back down even a single inch when it comes to defending the 2nd Amendment. The left wants to take away all of our guns so that the bad guys with weapons can have free reign like they currently do in major cities such as Chicago. But the truth is that an armed society is a polite society, and we need to greatly resist any efforts by the left to take our guns away. Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.