Tuesday, January 5, 2016

Financial Markets Quake Before Anticipated Collapse




Prior to the housing bubble implosion, prescient prognosticators were predicting an economic disaster the world hadn’t seen since the Great Depression.  Pollyannaish investors thought the sky was the limit.  Many thought there was no end to rising property values.  Boy, were they wrong.


We are in the throes of another pending disaster, one that will make 2008 look benign by comparison.  Yesterday, the rumblings of a financial crisis shook the world’s financial markets.  The Economic Collapse blog reported the following:


The first trading day of 2016 was full of chaos and panic.  It started in Asia where the Nikkei was down 582 points, Hong Kong was down 587 points, and Chinese markets experienced an emergency shutdown after the CSI 300 tumbled 7 percent.  When European markets opened, the nightmare continued.  The DAX was down 459 points, and European stocks overall had their worst start to a year ever.  In the U.S., it looked like we were on course for a truly historic day as well.  The Dow Jones Industrial Average was down 467 points at one stage, but some very mysterious late day buying activity helped trim the loss to just 276 points at the close of the market.  The sudden market turmoil caught many by surprise, but it shouldn’t have.  The truth is that a whole host of leading indicators have been telling us that this is exactly what should be happening.  The global financial crisis that began in 2015 is now accelerating, and my regular readers already know precisely what is coming next.



And in case anyone believes this was just a blip, take into consideration what is happening in South Korea. 

 This is yet another sign that tells us that the U.S. economy has already entered the next recession.
And what happens to the markets during a recession?
They go down.
In addition to the bad data that we got from the U.S. and China, there was another number that was also extremely troubling.
South Korean exports have traditionally been considered a key leading indicator for the entire global economy, and on Monday we learned that they were down a whopping 13.8 percent in December from a year earlier…

We can expect volatility in the markets from here on out, until the bottom finally falls out.


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