First off we see that, more or less over the entire duration of the reign of King Ponzi Greenspan the parabolic increase in indebtedness promoting a regime of asset-stripping facilitated through the use of derivatives in a paradigm this reckless Venetian front man running the Fed euphemistically called "market-based risk mitigation" resulted in a downright persistent tendency for assets at the bottom of the capital structure to remain markedly overvalued on a P/E basis. The only more obviously reckless Capo Confetti—no less a Venetian front man espousing a fascist agenda wrapped in sophistry claiming an abundance of "excess capacity" would put a damper on inflation (when in fact the only "damper" Confetti's policy enjoys in a global dollar reserve system backed by a mighty nuclear arsenal effectively is circumstance delaying the day of reckoning invariably provoked by the Fed's overtly hyperinflationary policy)—has extended this tendency finding assets at the bottom of the capital structure markedly overvalued, albeit now somewhat less profoundly, which stands to reason in a "new normal" finding lenders of last resort "all in" rather than once removed behind the facade of an "implicit guarantee."
And in case you've been wondering to what degree has the "financialization" of the U.S. economy been a driver behind U.S. corporate earnings, simply consider the two periods in the post-Y2k period when assets at the bottom of the capital structure were being drained (this, no doubt, a consequence of some urgent need to raise capital to plug holes in leveraged positions up and down the capital structure). Just look at how earnings collapsed far, far more profoundly than the numerator—price—to sink the S&P 500's P/E rather notably. So much for "pristine balance sheets."
Yet the most provocative matter we might entertain here in light of the big picture presented above from the perspective of the industry benchmark at the bottom of the capital structure (the S&P 500) is our contention that, the Wiemar solution is being prepared in an effort to destroy sovereign nation-states the world over, with the constitutional republic of the United States at the top of the list of targets to be reduced to rubble. Well greased now with sophistry promoting the cause of avoiding another Great Depression in the aftermath of 2008's collapse of Adam Smith's Leveraged Ponzi Scheme ending the era of lender of last resort implicit guarantees, the way is paved for hyperinflationary hell more or less to destroy the last vestiges of the illusion of "American exceptionalism" echoing from extraordinary physical feats instrumental to defeating European fascism during World War II—the likes of which capacity has been persistently dismantled at an accelerating rate ever since the feckless, ill-advised Nixon destroyed the Bretton Woods system of fixed exchange rates on August 15, 1971. Our main difficulty here only is coming to terms with the means by which institutional entities, both in the public and private sectors, are to be brought to their knees and fatefully enslaved to oligarchy's despicable intention to impose hyperinflationary hell presaging some neo-feudal order in which strong sovereign nations binding common language cultures effectively are made a thing of the past—a Venetian modus operandi extending over many, many centuries now.
Being as we are all too aware of vile acts subversive scumbags are willing to perpetrate in broad daylight, we should on one hand even expect an encore like nothing else we have ever seen before. Yet on the other hand we should be more broadly on the lookout for any opportunity to sell a fairy tale for the ages, the likes of which some imposed circumstance deceptively would facilitate. Fairy tales are something about which New Orleans District Attorney Jim Garrison had something to say in the matter of the Warren Commission Report on the assassination of President John F. Kennedy, which vile act whose psychological effect fifty years after the fact still tweaks me to no end...
NBC TV: July 15, 1967
This friendly reminder of what a so called "free press" was capable of producing when it was a good bit less subverted than today is presented here at a moment when profound vulnerability to causes alien to peace and tranquility heightens probability circumstance conducive to promoting fairy tales could imminently come to pass, and in the aftermath open the gates to hyperinflationary hell. Seeing as certain deceptive conduits of spookdom over the recent period have been shining a light on nefarious intrigues of Saudi Arabia's intelligence chief, Bandar Bush, one wonders if energy markets are about to receive an historic shock, the likes of which, mind you, would swimmingly serve the steering mechanisms necessary for navigating the course through hyperinflationary hell.
Returning to our big picture presented from the perspective of the S&P 500's performance and underlying fundamental circumstance since August 15, 1971 in particular, a [manufactured] crisis sinking the index to levels last seen in the 1987-1994 period very well could be on the immediate horizon. Whether this would complete wave (IV) forming since Y2k peak, or whether this corrective wave might continue forming in a manner similar to that occurring from 1974-1982, this as wave IV of (III) completed, although years from being answered in hindsight, is a consideration we nevertheless should be mindful of, assuming possibility the market imminently craters in a big way indeed comes to pass.
So, what is it that makes index levels last seen in the 1987-1994 period a credible target in the framework of the Elliott Wave Principle? The answer begins with the assumption that, of the five waves forming off 1932 bottom the 5th and final wave was "extended." In the Elliott Wave Principle extended 5th waves initially correct to the point where the 5th wave extension began. Thus are index levels last seen in the 1987-1994 period targeted. This area marks where the S&P 500's 5th wave extension began. Nuances of this formulation in the Elliott Wave Principle need not be further detailed, as the basic matter of forming our well-founded outlook in the context of the S&P 500's 5th wave extension is adequately presented here.
Considering the parabolic increase in indebtedness during the post-Bretton Woods era transforming the trans-Atlantic banking system into a conduit perpetuating an historic Ponzi scheme, and now every indication a new Great Depression will be avoided at all costs, even at the risk of suffering a hyperinflationary blowout of Wiemar proportions, we can take a step back here and better appreciate the manner and degree to which manifestation of capitalism from the better part of the English-speaking world—that proceeding from the American System of Political Economy—has been and, indeed, will continue to be subverted.
Coinciding with formation of wave III of (III) was the build out of the greatest economic powerhouse the world has ever seen. Such provided sturdy foundation upon which typical "dynamism" associated with Elliott 3rd waves became manifest, having been facilitated in a climate where debt was made a blessing financing productive ends whose foremost effect raised capacity assuring debt could be easily extinguished (and many times over at that). Even the mere shadow of the American System of Political Economy FDR was able to summons for the sake of overcoming the Great Depression and defeating fascism provided a dynamic platform on which both the physical and financial economy could flourish.
The cannibalization of that foundation masked through the erection of an historic debt trap perpetuated with the promotion of the most elaborate Ponzi scheme the world has ever seen marks circumstance accompanying wave V of (III). A total ruse whose worst effect has turned the Ivy League into a dummy factory pumping out imperial monetarist chimps, all prepped for the political world to become easily subdued baboons. Definitely the kind of marks making for plump pickings on the road to and through hyperinflationary hell. The "to" already is proven, while the "through" is the frenetic chase to come in desperate attempt to somehow maintain purchasing power amidst financial and economic chaos set to accompany formation of wave (V). We should rather expect that, notwithstanding a powerfully rising market as wave (V) unfolds, overall, poverty and want, the gap between the haves and have nots, inhumane irrationality, xenophobia and totalitarianism all together will grow.
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