Readers will note I have been hunkered down in my bunker – but that hasn’t kept me from keeping up to date with financial markets. As you will no doubt agree – they simply have gone crazy. The grand concept of Quantitative Easing has been taken to the absurd extreme in Japan – not wanting to be outdone by their equally hapless counterparts in New York. And Europe. The result has been – in my opinion – the acceleration of the coming global financial collapse. The end days leading to crisis are marked by crazy volatility – and that volatility is here.
There Is No Recovery in Housing in the US
I first want to dispel one of the current myths in the US housing market. Yes, average housing sale prices are going up – and have come off lows. But what we don’t see is the quality (or lack thereof) inherent of the homes changing hands. The housing market is full of over-priced, poor-quality homes at the median price level – and over-priced outright tear-downs at the bottom end. Houses are changing hands, true – but my money tells me the good ones have gone, and what’s left isn’t worth buying. My instinct tells me the market is going to fall out of housing again – sooner rather than later. A blip up in interest rates and it’s all over again. We may not even have to wait that long.
European Youth Unemployment a Destabilizing Force
Friends at zerohedge.com have been reporting on the 60+% youth unemployment rates in several towns in Spain and at least one in Greece – with generally high rates all over. Even passive Sweden youth riots have already happened this spring – and their unemployment rate was only in the low 20s. It is NOT going to be a fun summer in Greece or Spain. Count on it. Did I mention markets don’t like riots, uncertainty, and volatility?
Looking for a Spark – Where is Marie Antoinette When You Need Her
Seriously – all we need is a catalyzing spark. Some really good ammo was fired this week in the testimony by Apple CEO Tim Cook – but the message was lost on the sleepy Americans (not) listening to it. Apple has billions in earnings stashed in US banks on US soil on which they have paid (essentially) zero taxes (total – let alone US)? Any world citizen who didn’t think that global finances weren’t rigged against them before should have figured it out this week (thanks Testosterone Pit). Oddly enough that damning revelation didn’t catch on anywhere. The story was largely buried. So what event or misstep will be the spark that brings the meltdown? Will it be China’s efforts to thwart the copper carry-trade financing schemes that are inflating the yuan? Will Japanese savers finally say “Enough!” and put an early end to Abenomics and Quantitative Easing there? Will someone at the Fed finally screw up and admit that US Quantitative Easing has resulted in a WIDENING, rather than a NARROWING of income inequality in the US?
In the end that is what it is all about anyway. That’s what the last decade has been about: income and economic inequality. The cabal has pushed the debt-slaves to the very edge of the cliff and they are falling off in droves. One wonders which country’s youth will be first to fight back. One thing is certain: it’s going to be a very hot summer in Spain, Italy, and Greece.