ECONOMIC UPDATE: Decline on Horizon
The Federal Reserve and other central banks will do all they can to artificially prop up sagging economies and equity markets.
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It’s all in the numbers and the numbers are negative for both corporate profits and the servants of the Bigs… the Plantation Workers of Slavelandia.
Don’t buy the Wall Street White Shoe Boy hype sold to the public by the Presstitutes, the media whores who get paid to put out by their corporate pimps and their government whore masters.
Today, the U.S. Labor Department reported that there were 8.73 million job openings in October… the lowest level since the depth of the COVID War back in March 2021.
Thus, the guess on The Street is that when the Fed meets next week, it will freeze interest rates and start lowering them in March 2024… a trend that we had long forecast.
Today, the U.S. Labor Department reported that there were 8.73 million job openings in October… the lowest level since the depth of the COVID War back in March 2021
Thus, the guess on The Street is when the Feds meet next week they will hold interest rates where they are and begin lowering them around March of next year… a trend that we had long forecast.
Worst is Yet to Come
Since the beginning of the COVID-19 War, started in January 2020, we said lockdowns, mask mandates, and isolation would destroy billions of lives and livelihoods around the world. We were correct.
The bottom line is the reality that the happy days of cheap stimulus money to artificially prop up economies to fight the COVID War is long over and economic decline is on the near horizon. -Celente
We also said equity markets and economies would crash.
We were wrong.
Why?
Because we underestimated the criminality of the government system.
Think about it.
Lacking a scintilla of scientific evidence, politicians locked down entire economies, forced people to stay at home, colleges closed down, people weren’t even allowed to go to the beach, and kids could not play in the parks. The list of draconian lockdown mandates expanded to virtually every aspect of life, yet equity markets boomed and consumer spending skyrocketed.
ZELENSKY TURNING UKRAINE INTO AUTHORITARIAN STATE: TOP OPPONENT
Yes, government criminality artificially boosted equities and economies as the same gang that invented the lockdowns also invented artificial COVID stimulus by lowering interest rates to zero and/or keeping rates in negative territory… while at the same time flooding economies with countless trillions free-COVID stimulus cash.
Again, equity market and economic spikes were a total fraud that bellied reality and now, barely reported, is that the International Monetary Fund (i.e. International Mafia Federation) said that, as a result of the COVID War lockdowns, economic output will decline by $14 trillion through 2024.
On another side of reality, China, the world’s second-largest economy, which launched the COVID War in January 2020 on its Lunar New Year, “The Year of the Rat,” and imposed three years of zero-COVID policy that destroyed the lives and livelihoods of hundreds of millions… is also paying a heavy economic price. Today, as a result of slowing economic growth and the property sector crisis—which we have been reporting in detail—Moody’s Investors Service downgraded China’s sovereign credit rating to negative.
Feeling the downward pressure, China’s blue-chip index CSI 300 has fallen to its lowest level since February 2019.
And, the Organization for Economic Cooperation and Development predicts that, as a result—as also evidenced by its manufacturing activity contracting for the second month—China’s “structural stresses,” is a downside risk to global growth.
And the downside is showing up around the world. Europe’s largest economy and the fourth-largest in the world, Germany is feeling the economic pain.
Yesterday, Germany’s Ifo Institute in Munich survey found that German companies “significantly reduced their investment plans,” falling from 14.7 in their March survey to just 2.2 in their recent November poll and just 1.2 for 2024.
Lara Zarges at Ifo Center for Macroeconomics and Surveys, said “The investment climate has deteriorated noticeably, and “is the result of increased financing costs, weak demand and economic policy uncertainty.”
Illustrating the depth of the global economic decline, investing in the manufacturing sector had the biggest cuts with the investment index plunging from 21.4 in March to 6.8 in the current Ifo survey.
Facing the reality that consumers will be buying less products, the retail sector has reported big cuts in future investments which have turned negative for this year and next, the Ifo reported.
Back in the States
Yesterday, the U.S. Commerce Department reported that factory orders declined more than expected, falling 3.6 percent in October with durable goods orders for transportation equipment plunging 14.7 percent and durable goods orders falling 5.4 percent.
While the manufacturing sector in the U.S. accounts for some 11 percent of the U.S. Gross Domestic Product, it is essential to note that consumer spending makes up nearly 70 percent of the nation’s GDP. Thus, the lower manufacturing rates in China, the U.S. and Germany illustrate that with less products being produced consumers will be buying less which will in turn put negative pressure on GDP growth in major economies.
TREND FORECAST: The bottom line is the reality that the happy days of cheap stimulus money to artificially prop up economies to fight the COVID War is long over and economic decline is on the near horizon. However, the Federal Reserve and other central banks will do all they can to artificially prop up sagging economies and equity markets.
Thus, we maintain our forecast that the U.S. Fed will lower interest rates early next year to prop up the equity markets.
And, as we had long forecast, the lower interest rates fall the higher gold and bitcoin prices will rise. And now it is just making the news. Several months to late, but making it seem as though they called it, this is the front page of the Financial Times:
Bets on cuts boost bitcoin
Bitcoin hit its highest level in 20 months yesterday while gold reached a record peak, as investors bet that interest rates were likely to start falling early next year.
What they are not forecasting, but we are, is, as this week’s Trends Journal cover illustrates, “THE DEATH OF THE DOLLAR, THE FUTURE IS PAVED WITH GOLD.” Simply, the lower the Fed lowers interest rates, the deeper the dollar will fall. And the deeper the dollar falls, the higher gold and bitcoin prices would rise. Also, if Bitcoin was not in the game, gold prices would be at least 30 to 40 percent higher.
Add to these trends the gigantic debt bubble that collapsed the MBS market and housing market in 2007-08, but which has doubled since then, and what we are facing is not another great depression, but an economic breakdown crisis. The which will lead not only to the collapse of physical production of goods necessary for continued existence but the collapse of credit and finances that support physical production. Imports of basic economic necessities will cease to exists. There were many added to the list after the U.S. swallowed the poison represented by GATT, WTO and NAFTA reforms which combined to end U.S. industrial driven progress altogether. The U.S. physical economy measured in terms of GDP, fell below breakeven during the interval 1967-1970. Deregulation in the 80s and 90s took the U.S. over the edge. Cancellation of Glass-Steagall in 1999 was the last straw. Hyperinflationary forces took over. The Fed compensated Investment Banks with QE while Main St was credit starved. The disastrous results can be seen but are not limited to cities along the Great Lake Region. Agro-Industrial economic activity in the U.S. has collapsed while demand has remained steady or increased. A sure recipe for what is about to hit the U.S. Hyperinflation like that of 1923 Weimar, Germany! What stopped it then was gold. Pegging gold to the Reichsmark ended inflation of the currency but it didn't stop the physical collapse of the German economy.
To prevent hyperinflation the U.S. must 1. restore Glass-Steagall and return to prudent banking practices in the Commercial Banking system. Cancel all derivatives obligations.
2. Create a credit system and national bank, to finance the physical recovery of the U.S. economy.
3. New issues of government directed credit for long term productive investment in economic infrastructure will kick start a real recovery. Credit, Interest rates, and Lending authorization must be restored to the U.S. Treasury Dept.
A U.S. two tier credit system will dry out speculation while spurring investment in agro-industrial activity of the U.S. physical economy.
4. Science driver projects. A crash fusion research program. Manned space exploration mission to explore nearby and deep space beginning with the U.S. Moon-Mars mission. We, together with China, Russia, and other space exploring nations, will colonize and develop living conditions on the Moon and Mars, and beyond.
These are the Four Laws of economic recovery of Lyndon LaRouche. LaRouche's Four Laws if acted on by the federal government, will produce the desired outcome most Americans will support.