If you don’t want to read something based and prefer bubblecope then please stop reading.
I’ve decided to prepare for Black Monday 2 by buying just about any inverse leveraged fund I can get my grubby hands on.
I suspect it’s going to be a bloodbath.
It’s going to be even better than the last Black Monday because this one will be caused by genuine socioeconomic conditions and not by runaway algos.
The war in Ukraine, businesses failing, the delayed impact of COVID on the markets, supply chain disruptions, the increasing interest rates, the burst of the tech bubble, the debt the fed bought that will go toxic, the 1.5 trillion lent to banks for short term loans that will turn toxic with a lack of collateral.
All these factors are going to finally start making dents in earnings reports as well.
We’re also going to be seeing global food shortages this year and they will impact industrialized nations within the next few months.
High gas prices and the fears of monkeypox will be the nail in the coffin that brings it all down. To make it worse, due to the recent rise of equities-backed mortgages in the corporate and retail spheres this will all bleed the housing market dry as well.
The fed has been propping up the market like crazy because they know it’s on a shaky foundation.
Too much has changed too fast and we are going to hit the turning point in sentiment.
Far too many have been far too optimistic for far too long.
That sentiment is going to change. But it’s not just sentiment that will change.
The conditions people are living in are going to change. This will impact everyone’s bottom line. The economy is a slave economy largely driven by those in lower income brackets who have no choice but to produce for others while suffering poverty themselves. That system only works as long as they can meet their basic survival needs.
Corporate greed has lost sight of that fact. When they can’t eat they won’t show up to work.
The biggest red flag recently is the government trying to ban abortions. They know the economy needs more people in dire socioeconomic straights to exploit to keep it running. Every year the US has 610 million chemical abortions and about 600,000 surgical abortions.
They’re also pushing back against gay marriage because they want more babies to feed into the machine. This is how low they are willing to sink to try to prevent the inevitable collapse.
Our education system is also failing which is possibly by design again for the above reasons.
But the impact this all will have on the middle class will be the biggest driving factor. There hasn’t been a real middle class for a while. It’s been sustained by debt. That can’t keep going forever. People are in debt and the cost of everything is going up. Their debt only has value as long as they can repay it.
Increased gas prices, increased food costs, increased housing costs…anyone subjected to those is going to prioritize food and transport over repayment of debt.
People are going to start selling everything when they can’t make ends meet. Everything from stocks and bonds to physical assets and properties.
Jack and Jill went up the hill to fetch a pail of water. Jack fell down and broke his crown and Jill came tumbling after.
We’re going to be hitting the point soon where with all of the above conditions the artificial growth pressure the fed pumped into the market is going to snap back like a rubber band and take everything down.
I don’t know if it will really be Monday, or Tuesday, or if it will be this week or this month. Maybe next.
But it is going to happen and I am actively betting on a near total collapse.
Leave a Reply