The WORST Contraction Since the Financial Crisis! Fed Pressured To CUT Before Crash

The WORST Contraction Since the Financial Crisis! Fed Pressured To CUT Before Crash

as time goes on we see more risk-taking more of a departure from a ality a time in which nothing makes sense but who cares let's party we're almost approaching 2020 and this is beginning to resonate from 100 years ago the roaring 20s a time in which the Fed opened the taps the people felt the affluence and everyone benefited and bathed in the infinite prosperity except that was a dream turn nightmare you came here for the truth so let me unveil that for you today I have several economic indicators to show you this is gonna be one of those old school money GPS videos I have so much to cover in one video let's get into it right away the Fed is about to cut rates for the first time since 2008 as the trade issues weigh on growth this is a topic that I have been covering over and over again I just wanted to start the video off with this because it is already priced in the market is feeling it is it gonna be 25 basis points is it gonna be 50 basis points that seems to be the only question at this point here we don't know what they will do but you are seeing this information right now before it happens if they actually do four go for that cut we are going to see the markets rejoice as a result a lot of it is already priced in they are already expecting it and demanding it so we'll see how it plays out will they suggest that 25 basis points is enough maybe they want 50 basis points that wasn't enough and I'm gonna react negatively to it I don't know but we have to go back to the original statement I had made about this is that if we are noting that the unemployment rate is really low that things are really hot right now why are we dropping rates that's the question I have let's move on investment for growth has varied after the start of the Fed cutting cycles look at the previous instances if you see the 90s we see 95 98 after their cuts they begin to of course do well however if you look at this leading up to the previous cycles it wasn't necessarily the case it might be hard to see on this chart here but essentially right in the center we are looking at where that first Fed cut is and then the results afterwards this is the index SMP 500 investment for growth and you could see the breakdown in there I don't know what's gonna happen but if it's like the previous two cycles it does not look good effective Fed rate and unemployment comparing this to the previous recessions that we have seen time and time again we are noting the exact same issues if you look at the red circles here that basically just depicts where we are at today and of course you can see that this isn't looking good because the Federal Reserve backed into a corner they are now beginning their cutting cycle that's the blue line and you see the Fed Funds rate and this of course shows us we've got a problem on our hands I want to make that very very clear every single time that they do this we end up in a recession it's not because necessarily the Federal Reserve is cutting rates but of course this is the effect regardless you could see that this has happened not once not twice but it happens over and over and over again this is a really good chart if you want to pause the video and take a look at it you can see what I love to always pay attention to Northmen trader what he had to say central banks between 2009 and 2008 eeen we will print 20 trillion and cut rates to nothing and that will reach our inflation goals central banks 2019 okay none of that work so let's print more and cut rates again it's crazy but this is what's happening he said trust us we know what we're doing people of course they don't have any other way to deal with it they simply say well they know what they're doing I'll just let them handle it I'm gonna keep investing in hope that they are willing to push this market higher even if it doesn't go that way I'm just gonna cross my fingers cuz I have no other options that's the majority of people and what they have gotten themselves into it's actually quite appalling you're looking at another comment that he made here perspective current US stock market capitalization a hundred and forty five percent of GDP peaked in 2017 at a hundred and fifty four percent the previous two peaks came in at 146 and 137 all right now if you see the chart down below you are witnessing actually going beyond the real economy yet again we are witnessing this because you can measure it and for example the total amount of debt you can look at the GDP you can look at the stock market and you can try and analyze these on their own but when you start comparing it to other metrics like the GDP and yes we know that all of these are manipulated but even if you stay within those parameters it is very telling right looking at this shows us that we have gone an accelerated far beyond the real economy and that is the truth I'm gonna show you some of the details that we look at all the time like the PMI is and so on that are weakening consistently look at the SMP 500 buybacks I mean it is crazy to see how bad this has become and I say bad because if they were not there the SMP would be significantly lower if they were doing what India is doing right now and taxing the buybacks I bet you wouldn't be going this way previously this was actually considered to be manipulation of the stock price apparently that doesn't exist anymore but here you go this is where we're at the buybacks going at an accelerated rate and this is something that people need to understand two things number one is that in a recession these companies will most likely not do buy a box or do much less of them number two is that you're gonna find many of these companies are going to reduce their dividends and that should be worrisome for a lot of people who intend on well I'll just hold off and I'll just wait and then the stocks will eventually go back to where they were before this wait-and-see mentality people need to understand the business world and they need to open up to other asset classes I really just I think that they are missing out big-time the yield curve picture is sending a message that suggests this is no insurance cut now we're talking this is part of Northmen traders article that he wrote and I wanted to show you this because when you see it all breaking down when you look at the actual indicators that the Federal Reserve doesn't talk about like the yield curve it is very important because this has been a 100% perfect indicator now you see this time and time again where it goes out of control we see the yield curve inversion and then a recession happens now whether that happens three months later a year and a half later all that's doing is telling you that we have a cycle that's repeating that's it that's all I'm trying to point out and hope you see that in this case here we are noting something which I've mentioned previously is that what we are being told is very different than what's actually happening and I think this makes it very very clear at least to me I'm sure it does to you as well record number of the fund managers in this survey are concerned about corporate leverage this is a number that continues to increase since the financial crisis this was not the case a few years ago of course but it has gone into this astronomical level at this point we are watching year after year after year as there's just be more leverage being used and I see people laughing about it how fantastic their gains have been because they've used leverage big big mistake of course but you only see that when everything starts to come down this is just again the yield curve spread showing you how this has persisted for the period of time throughout the financial crisis afterwards it has basically been coming down in a straight line and we are witnessing today what has happened 2000 2007 repeated patterns over and over again weekly hours worked in the manufacturing sector in the United States we have not seen a dip like this since the financial crisis this just tells us that we are noticing the exact same things the patterns appearing this happens to be connected in with the p.m. is what we are noting in the actual real valuable economy not with stock buybacks or some other garbage when you look at the eurozone yield curve spread we are watching the exact same thing looking at the last time I checked by the way we are now at thirteen point seven trillion dollars worth of negative yielding bet globally it is unbelievable a lot of that coming out of the eurozone Oh II see the growth and the PM eyes of the largest world economies take a look at this coming down yet again over the years this is a number that will fluctuate as you can see but of course we are watching the same thing again and again there are so many things are just happening repeatedly and we are watching this cycle coming to an end can the reducing of interest rates can more money printing actually in fact do what they say they will love it to do even though for the last 10 years it has not been the case it has not been successful negative interest rates we're not successful either it is a failure but at this point they really don't have any other options they're trying to instill confidence at the same time they are permanently destroying what they have it is going to be insane as this system unravels PMI of small open economies and large economies watch around the world same things are happening the manufacturing the exports the imports the slowdown it's all happening now not tomorrow not the year after we are watching this occur over and over again corporate profits with inventory valuation and capital consumption adjustment they'll take a look at this when they did their revisions you could see that corporate profits the red line was revised significantly lowere how many times have I told you about revisions whether it's coming from any of the government numbers that are coming out the jobs numbers and so on they're always revised down but nobody pays attention to it we are watching this to happen in basically all different industries and unfortunately most people they don't care they're not watching any of this they are just looking at the basic facts that are out put it there by Jim Cramer Jim Bear Sterns Cramer and all of those out there speaking on the teleprompters telling you what to think telling you what is right and unfortunately for most people they do very well for this stretch of period time and they think everything is good but ultimately it will be a very big burden on them when they're relying on their pension when they're relying on their 401 K and we're gonna see how that all plays out that's for sure if you found this video informative then you've got to hit that like what are you doing don't go anywhere click that one button you're supporting this channel I do appreciate that very much if you want the financial education you were not taught in school these two books have everything you need from top to bottom ages even get all the details at the link in the description check it out if you want the audiobook that's available at the money GPS com if you want to know what's going on in the real economy the real deal then you've got to watch this video definitely click on it and I will see you there

23 thoughts on “The WORST Contraction Since the Financial Crisis! Fed Pressured To CUT Before Crash

  1. I’m new to this channel, so I would appreciate concrete steps and advice on how to prepare for the coming crises.

  2. I am a novice 20yearold investor. What are some ways to gain the most out of the inpending doom that I am more and more convinced we're heading towards?

  3. Almost a Trillion Dollars in BuyBacks on the S&P… ? Almost a Trillion Dollar U.S. Budget Deficit… ? Another QE Binge… ?
    This is Total Insanity !! Get your money out of the market !!

  4. I just met ignorance.
    Ignorance has friends, it is wastefulness, violence, hard-heartedness, mockery and arrogance, and hate. There were also others. They all looked ugly.
    The lies and the perversions had laughing grimaces.
    I asked, how you got so much success.
    Ignorance told me. I crept into the hearts with selfishness and consumerism.
    And that is why I am so popular with people.
    And I have made them stupid.
    Then I asked…. what will come….
    The ignorance grinned and said…
    I am about to write a big bill to mankind

  5. Things are shitty, getting shittier. As long as Joe Sixpack thinks everything is A okay, our consumer debt driven economy will keep speeding towards that cliff.

    I think ole' Joe is gonna get the message, 4th quarter 2020.

  6. Failure of the central banks to normalize interest rates since the crash of '08 is very ominous. All they can do now, is continue to expand the money supply, resulting in a lower dollar vis a vis gold, and hope for the best.

  7. 1920s had biggest gap between rich and poor in history, except for today. This is the real problem, not central banks. Money gps is bs.

  8. And their was a coinbase ad before this, bahaha! 😂

    "You dont have to buy a whole bitcoin, you can buy as much or as little as you want!"

    😂 ok how about, I already have a little bitcoin and am never buying more ever again? 😚 it's a fake bill of goods, it doesn't mean anything in the real world without an internet connection. 🤔

  9. "Jim Bear Stearns Cramer" LMAO! I remember Cramer literally SCREAMING at a caller, to not sell BearStearns, this was just before it collapsed. That guy is so transparent, so compromised, I cant beleive his bullsht lying ass is on TV. But then, thats the matrix for you. Keep the rubes losing money at the tables, while mostly just the house profits.

  10. Well, thank you very much for the info but I wonder for how long you’re already been talking about how thinks bad are and how close to the crash we are. Eventually crash will happen and you’ll probably make the video like “I told you guys”. A lot of people lost so many opportunities by watching this types of videos but I understand that “fear” is the easiest thing to sell.

  11. 3:45 "The definition of insanity is doing the same thing over and over again, but expecting a different result".
    -Albert Einstein

  12. Boy, if you just pile up enough silver and crypto, enough MREs and canned food, you sure won't ever have to trust God, right? I mean, we sure showed Him, we mastered everything, we can impose our will and run our lives and blah blah blah. We don't own a thing but one heartbeat. You can't trade all you own for one more tick of your heart.

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