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Subject Stock markets breaking record highs, on hope that FED lowers rate.JUST DOES NOT MAKE SENSE!

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[quote:LlTTLE MlCHAEL 1588220:MV80MDg1OTI1Xzc0MDY2ODU1XzM0NUM0MzJF]
Well the trend from 1982 until now or 37 years was buy bonds like mad.

The reverse of the trend from 1945 until 1982, or 37 years, was sell bonds like mad.

In the above you can see the red dots?

The red lines are recessions.

Yield rates rise up and then there are recessions that follow.

Why do yield rates rise?

When there are more sellers than buyers of bonds the price to buy bonds collapses while the yields rise.

See that long period of time where yield rates went sideways from 2009 to 2015?

The zero barrier.

If it were possible for yield rates to drop below that line...They would have...Until they reached the maximum potential and then popped back up again.

Why didn't they drop below the zero line?

Lets say you go to work and after a 40 hour work week your employer demands you pay them 100 dollars.

That is what negative rates of return are.

Your employer invests 100 dollars into you.

You work and the return on that investment of 100 dollars is -100 dollars.

The FED does not set Interest rates.

Never did, Do not now, and never will.

Just like people do not actually pull rabbits out of hats or saw girls in half.

The net producers in the system are the supply of yield while the net consumers in the system are the demand for yield.

When the demand by the consumers becomes greater than the producers supply...The FED is forced to lower yield rates.

Well actually the consumers of yield are forced to do with less than they demand.

But why do yield rates rise then?

Exhaustion.

Money flowing into the bond markets begins to dry up.

Actually new credit creation begins to slow down.

This cuts off the supply of circulating credit flowing through the bond markets which turns the more buyers than sellers situation into the more sellers than buyers situation.

In that situation the price of bonds decrease while the yields increase.

The FED of course proffers excuses as to why they are then forced to raise rates.

They sell lies that you all trample over each other to buy.

From 1945 to 1982...Yield rates kept rising higher and higher from out of the Great depression/bankruptcy reorganization of the global trade system where yield rates collapsed into.

That is where we are headed.

Yield rates rising higher and higher....Higher highs and higher lows.

15 Dollar minimum wage?

Heard about that over the years?

Designed to force this inflation.

What is the purpose of the Carbon taxes?

How about the tariffs?

Well all these increases you all are crying about cause or demand prices to rise.

Higher prices force people to request more money from banks when they ask for loans.

I could go into long detailed descriptions...

But I will just fast forward to the key problem.

The labor component of this scheme.

I just do not think it exists.

Think of the work ethic around 1945 and the work ethic now.

37 years up followed by 37 years down.

That is 74 years.

The last 37 years you all have been growing weaker and weaker due to the globalization effect where you can live off the yield derived from labor in other parts of the planet.

That has reached maximum potential.

The ability to engineer rates lower and lower like what has been going on for the past 37 years is basically over.

At my location the revenue stream stopped 2014 to 2015....Hey right around where yield rates began to rise.

I thought that there would have to be government wage freezes at least.

Nope...

Everyone not directly impacted just continued on as though there was no problem.

Now all the budgets are being blown out.

Minor adjustments that could have been made in the past but were not lead to major corrections that will need to be made in the future.
[/quote]

Original Message I recall back in the 70 approx. when the market was booming the FED raised rates to keep things from overheating. Now the prospect of raising rates will kill the markets. Plus that yield curve inversion thingy where rates favor short term and discourage long term is a big RED FLAG!
Keeping all investors in check before they pull the rug out from under you.
Markets will crash when we go to war. There is no doubt that we will, it had been planned a long time ago!

Pictures (click to insert)





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