The Central Bankers Experiment; The Great Bust, Sept 15, '16, Doug Wakefield
"The six months under review have seen central bankers continuing what is surely the
greatest experiment in monetary policy in the history of the world. We are therefore in
uncharted waters and its is impossible to predict the unintended consequences of very
low interest rates, with some 30 percent of global governement debt at negative yields,
combined with quantitative easing on a massive scale." - Jacob Rothschild
All Is Calm, All Is Not Right, August 26 '16, Doug Wakefield
If we replace free markets with state controlled markets are we not embracing
socialism? Is this really a better option than free markets? Are you ready for the next
big shift, or waiting for Yellen, Draghi, or Kuroda to signal you or your advisor when
it is about to start?
The Soaring Risk of Flying In Bernanke's Helicopter, July 13 '16, Doug Wakefield
US stocks (SPX, INDU) and junk bonds (HYG) created new all time highs over the last
three days. Is this a gift from the central banking “helicopters”, or a desperate attempt to
keep from having US equities and junk bonds join the deflationary trend underway for
more than a year in major European and Asian equity markets?
Thinking Upside Down; Dow 18k Still Key, June 16 '16, Doug Wakefield
The central bankers’ policy has been that higher stock prices mean the economy will
follow. However, higher US stock prices have not levitated other major equity markets
to US levels, and quarter-after-quarter deflating economic pictures continue rolling in.
When Rare Market Data Screams, Listen, May 19 '16, Doug Wakefield
In 1981 the Dow's high was 1,050. In 1981 the US national debt broke 1 trillion
for the first time. In 2015 the Dow reached 18,351 on May 19th, its highest reading ever.
The last day of 2015 the US national debt level was 18.9 trillion.
Does there appear to be a connection? See a pattern?
Central Planners and Contrarian Logic, May 5 '16, Doug Wakefield
The problem with this level of central planning and intervention is that central bankers
have tried to redefine the very laws of physics. Newton's third law should now read;
"For every action by the natural forces of the global economy from too much debt and
assistance, more debt and assistance is applied to stop an opposite reaction."
Bubbles, Bubble, Toil And...Pop, April 21 '16, Doug Wakefield
As prices once again begin to descend away from the S&P 2100 and Dow 18,000 levels,
the illusion that centrally planned markets by Keynesian economists are the same as
free markets argued by Austrian economists will start to unravel. Far more is going to
change in the period ahead than merely watching inflated market prices leave their
mountain top experiences.
The Four Blind Mice At the Cliff, March 15 '16, Doug Wakefield
In this short article, I will share a few thoughts and charts which I believe reveal we are
at a major roadblock for central bankers and global markets. Since all we are left with
is a global casino anymore, monitoring "the game" has never been more crucial.
The Dow Elevator; 18, 17, 16..., Feb 11 '16, Doug Wakefield
What is taking place right before our eyes is not merely another boom that is going bust.
It is another wakeup call to everyone, that without an understanding of the history
underneath these massive rises and falls, trusting any theory is totally irrelevant.
Money Mind Games, Futures, And the Future, Jan 25 '16, Doug Wakefield
If the private sector does not learn to grow money, whether from markets that have been
hammered for years and thus must produce a powerful rise in the future, or markets
that have been artificially inflated that are now in the early innings of a bust, then the
"heavily financed" will only grow more powerful, and the "lightly financed" will grow
weaker, which ultimately, is destroying the very basis of the system serving the individual,
rather than the individual serving the state.
The Investor's Great Divide; Crossing the 200, Dec 11, '15, Doug Wakefield
So as everyone will wait and see if the Federal Reserve will finally raise rates on
December 16th, or yet again kick the decision down the proverbial road, markets
around the globe have certainly produced an extremely volatile picture far different
from US equities.
Have Men and Money Schemes Changed?, Nov 17, '15, Doug Wakefield
The downside of the Mississippi Scheme and the South Sea bubble impacted the
entire society in the 1700s. Should we not expect the same when this "assisted" mania
The Big Nasty D(eflation) Word Is Here, Sept 22, '15, Doug Wakefield
So as we look at the history unfolding in front of us, may we return to the history behind
us, and learn from it as fast as we can. Now the lessons from history become more than
some dry academic subject, but the deflationary realities of bear markets of the past.
The Stock Nirvana Has Been Broken, Aug 21, '15, Doug Wakefield
Is it possible to have a calm and boring market break down quickly in merely two trading
days? Is it possible that THIS is the start of breaking the “stock nirvana” illusion?
The Troika Loan Shark Stock Rally, July 31 '15, Doug Wakefield
For a society that has been groomed to believe that experience is far more important
than history, doing nothing has become the ultimate investment strategy. Trusting “the
state” to make sure that risk is never reflected in markets more than a few days, has
lead the public at large to totally miss out on incredible lessons from history. July was
yet one more for the books.
The End of Dow 18,000; Bailouts No Longer Extended, June 30 '15,
“Interest rates have never been so low for so long. They are low in nominal and real
(inflation-adjusted) terms and low against any benchmark.... Policy rates are even
lower than at the peak of the Great Financial Crisis in both nominal and real terms....
The economies hit by a balance sheet recession are still struggling to return to healthy
expansion… There is something deeply troubling when the unthinkable threatens to
become routine.” [The 85th Annual Report from the BIS, June 2015,pg 5]
Flatline Investing & Dead End Debt Schemes, June 26 '15, Doug Wakefield
As of today, the Dow has once again rallied up to break the magical 18,000 line, holding
this level after coming within inches of this level for the first time on Dec 5, 2014....
now 139 trading days ago. Does this mean that the patient is about to flat line, yet rather
than this being a huge negative; we will merely turn off the speed of light algos, close
down the “assistance”, and watch the Dow 18,000 live on into perpetuity?
Selling Out: Ignoring Corruption for the Temporary Wealth Image, June 16 '15,
During bull markets, when the majority are enjoying the ride up, ethics takes a
back seat to bottom lines. Only when trillions in losses are racking up across the
landscape, does ethics and the lessons from history become more important than
chasing the temporary wealth illusion.
When the Nuclear Money Option Fails, April 23, 2015, Doug Wakefield
"Economic textbooks refer to this process as ‘the nuclear option’ – only to be used when
no other method of financing can be applied effectively. This is a process that is easy to
start, but almost impossible to stop.” [The Big Reset: Gold Wars and the Financial
Endgame (2014), Willem Middlekoop, pg 11 of 250, Kindle Edition]
Investment Parachutes; Do You Have Yours?, March 27 '15, Doug Wakefield
The bells are continuing to get louder for anyone listening. As most of you know, once
the bells go off and the signal given to jump, the pressure from so many trying to jump at
the same time will be alarming to those who have not even thought about an exit
plan from the plane at these altitudes.
Free Money; What Could Go Wrong?, March 13, 2015, Doug Wakefield
We must stop accepting experience as a confirmation of where our futures are headed.
There is literally no way that we can cut interest rates any lower in order to continue the
"recovery" myth. This is not a short-term issue, but a structural one that will impact
everything worldwide for years to come. Any strategy based on "never sell no matter
how high" is complete madness. Someone is ALWAYS selling as well as buying.
To Create Unlimited Financial Liquidity or Not: That Is the Question, Jan 29 '15,
A massive loss of liquidity during times of extreme stress in markets is actually
a consequence of creating too much liquidity.
Messin' With My Financial Brain, Jan 16 '14, Doug Wakefield
In a world where the FOMO, or fear of missing out, is more powerful than one’s
understanding of historic changes and warnings at the system level, piling in has
proved very costly as we start 2015. No place is it more overpowering, than when central
bankers promise that allowing financial assets to deflate is not an option, while central
bankers also tell you that strangely enough, risk levels have surpassed those of previous
10 Years of "Why Sell Now?", Dec 11, 2014, Doug Wakefield
While finding the end of the largest financial bubble in history has proved very illusive
over the last three years for some of the most seasoned market technicians in the world,
the last fifteen have allowed us to have many reminders that wild rides to the final
top have always ended the same.
Destroy A Currency, Extend A Rally, Nov 7, 2014, Doug Wakefield
What was I thinking? Goodbye All Time Highs? I must have lost my mind to have
forgotten that central bankers have unlimited tools to inflate stock bubbles.
Actually, the last 2 weeks have only shown me even more, how desperate the actions
of central banks, and how passionate the majority of traders just to hear the
words, “all time high” one more time.
The Gallery of Crowd Behavior: Goodbye All Time Highs, Oct 24 '14
As world markets come into the Federal Reserve’s next scheduled press release on
Wednesday, Oct 29th, we are all waiting for two issues to be resolved; will they continue
their path since December 18, 2013 and announce that effective November 1st, QE III
funds go to zero, and will the Dow be able to break above 17,000 or will this line prove to
be the final wall of resistance before starting the next phase of selling?
A History of Unlimited Money: Learn From It or Repeat Its Mistakes, Aug 28 '14
In order that we are all clear that history is a great resource to avoid mistakes we
continue to ignore today, we will start with two events in the 1700s that demonstrate
why the "Icarus can print money to reach the stability sun" theory has already failed
miserably. Remember, these stories are centuries old.
The Three Stocketeers: One for All and ...., Aug 1,14, Doug Wakefield
Since crowds always chase a rising trend, thousand level markets always prove to be
a good way to seduce investors to chase a market higher. Yet once the level is
attained that we seem so determined to reach, we have to ask the question, "Now what?"
The Yuan Stops Here, July 15, '14, Doug Wakefield
My fellow Americans. Did you notice in the last few months that China has been
establishing agreement after agreement with various major financial centres around
the world, so that payments could be settled using the Chinese yuan? That's right. It
would appear that world leaders have been in a race to make certain the yuan stopped
at their country next.
Two Worlds Collide: The Financial/Political Elephant, May 19 '14, Doug Wakefield
Anyone looking solely at the patterns of US and European stock indices in the last three
months since Ukraine became the center of escalating tensions inside the nation and
outside between Russia and Europe & the US, would come to the conclusion none
of this had anything to do with the lives of billions depending on our global financial
markets. When we consider the cracking of the largest real estate bubble in history in
China, as they strengthen their relationship with Russia and Europe simultaneously, it
seems surreal to watch western markets give off the impression that none of these
events could impact their stock "nirvana" state.
Two Worlds Collide: Financial & Political Manipulation Accepted, May 8 '14,
"Federal Reserve policy is at a crossroads facing unpleasant paths in all directions.
Monetary policy around the world has reached the point where the contradictions
embedded in years of market manipulation have left no choices that do not involve
either contraction or catastrophic risk." The Death of Money: The Coming Collapse
of the International Monetary System (2014) James Rickards
Always Bet on Black, Mar 19, 2014, Doug Wakefield
So what do these "pessimistic" headlines have in common? US stocks bottomed at
or shortly after these headlines. That's right. None of them lead to a crisis or hard sell
off. All were "signals" to buy stocks.
What in the old days could have been explained as negative news that sent traders
and investors to the sidelines, in the brave new world, for 2 1/2 years, has been seen
as a "positive" for buying stocks.
Sochi Begins: 1929 Crash Warnings Accelerate, Feb 7 '14, Doug Wakefield
"When the market made its high on September 3 , there were 23 subsequent
trading days where the Dow Jones Industrial Average had a short-term bottom.
23 days aligns with the low on Monday [Feb 3, '14]. And subsequent to that, we had a
four-day rally, and then the market unraveled - went down 48%. We are currently at that
inflexion point. Like I said, so far, everything is aligned. We think the next two to three
days are extremely critical....
What we're seeing right now, if the market does unravel, I think we'll have a correction
of 40% off the high,which would put us at about 1100 [on the S&P Index]." Tom DeMark,
founder and CEO of DeMark Analytics, Feb 5, 2014
Who Needs God, We Have Bankers, Oct 30 '13, Doug Wakefield
It is my belief, that the greatest challenge to the period of time in front of us are our
deeply ingrained beliefs that can easily be proven are false. We don't want to change,
and we especially don't want to think that we are depending on ideas that cannot possibly
be true, such as borrowing our way to success.
The Easy Money Addiction Exit Plan, Oct 2 '13, Doug Wakefield
If we look at the price of US stocks since that time, we can see why investors were so
optimistic about the PAST 5 years of “Quick and Easy” money that they poured their
own money into equity mutual funds at record levels right before the latest Sept 18th
announcement from “the addiction dealers”.
Recognizing Bubbles After Creating Them, Aug 23 '13, Doug Wakefield
Are these two individuals, holding the most powerful political and financial offices
in the United States, completely ignorant of the history they have helped create as
well as the history that came before them?
The Nirvana Trade, July 24 '13, Doug Wakefield
As we head into August, I would like to present you with data I believe supports the reality
that millions of investors are soon to be stunned once again like they were in 2008. Like
the Tsunamis we have watched in the last 10 years, we must remind ourselves and
others that the bursting of global stock bubbles don’t care about our long term plans,
they change the landscape for everyone, including central bankers.
Not So Sweet Sixteen, May 28 '13, Doug Wakefield
Will 16,000 on the Nikkei and Dow be reached?
Only time, and less and less of it seems to be required, will tell.
But one thing is for certain. If we don’t understand that when the short term loans for
speculation are called once again that the borrower will once again be slave to the
demands of the lender, we have refused to learn lessons that span three millennium,
not just three hundred years.
The Lost Art of Being Early, Mar 22 '13, Doug Wakefield
As I write this article, on Friday, March 22, 2013, the EXPERIENCE of prices in US
equities only builds more confidence in taking on MORE risk, not LESS. I mean, with the
banks loaning money like crazy to speculate on higher and higher prices, what could
possibly go wrong, right?
When Everyone Sees, Jan 23 '13, Doug Wakefield
It would appear that the age of image is coming to an end and the age of character
through pain is rising. The rally periods are getting shorter, and the problems from
supporting MORE speculation by central bankers continue to mount. Soon, the can will
refuse to be kicked any further down the road.
Unlimited Means Limited, Dec 15 '12, Doug Wakefield
Are these men liars or fools or both? What is it that keeps the public in denial that as
John Mauldin comments from his own book, “There are no good endings once you start
down a deleveraging path”? Do they or we really believe in the “unlimited Santa”?
Selling the Announcement, Nov 7 '12, Doug Wakefield
Over the last year, we have read very dire headlines, while watching markets RISE
right into "the announcement". The result appears to have given the public the idea that
without constant intervention from central bankers, our lives would not continue as
"normal". What can be learned from the political side of this market noise?
Powder Kegs and Photo Ops, Sept 19 '12, Doug Wakefield
[in html format]
"When people are not thinking about how something is provided for their benefit – just
expecting it to continue – they come to the conclusion that somebody else is going to take
care of them." Dr. Janice Dorn, from her interview for the Dec '06 issue of The Investor's
Mind. Her comments are even more pertinent today, after the recent central banker's
"all in" debt scheme announcements.
East Meets West: State Monopolists Unite, July 31'12, Doug Wakefield
[in html format]
Did the socialist central planning bankers in the West teach the Chinese about
“too big to fail” policies, or the other way around? Either way, the problem with always
rescuing the businesses most closely aligned with “the Party”, is that too big to fail
eventually becomes too big to possibly save, both leading to extremely negative
Too Calm: Strength or Seduction, June 15 '12 , Doug Wakefield
[in html format]
The Dow closed today 4.2% lower than its 38 month high on May 1st. To avoid so many
negative world events taking place, does this continued bullishness show the Dow's
great strength, or seductive nature to delude.
Forgetting the Past, Mar 16 '12, Doug Wakefield
[in html format]
Life is good. Today, Apple’s new Ipad went on sale, and yesterday, March 15th, its stock
topped $600 a share. The company’s market size is larger than the entire US retail
sector. There is even talk of the company reaching $1 trillion in market size, after reaching
the half a trillion mark on February 29th.
Yet, something appears wrong with this story of “unlimited wealth”. Something seems
familiar about this story from our past. The headlines today, read like ones I have read
Making Our Lives Stable, Mar 2 '12, Doug Wakefield
[in html format]
It is obvious from examining the charts above (in the article), that increasing debt and
lot's of it, has been the long-term objective of central bankers the world over. To state
"central bankers seeking stability" is an oxymoron.
Coming Off A High, Jan 20 '12, Doug Wakefield
[in html format]
After living through two bubbles, fueled by cheap credit, we are afraid to admit that our
entire society is once again caught up in a third credit bubble, and this too, like all before
it, will end very, very badly. Our markets have become the place for “financial flippers”
(remember the condo flippers) who are addicted to central planning schemes, never
considering what it will be like when we come off “the high”. Like a drug addict, we all
know there will very painful side effects.
Darwin's Dangerous and Deceptive Devices, Oct 28 '11, Doug Wakefield
[ in html format ]
When we read news headlines that state that investors bought or sold certain markets
for some specific reason explained in a news article, and yet the majority of the trades
on the largest exchanges in the world are electronic and can react to changes almost
instantaneously, are we really watching a crowd of investors reacting to the latest news,
or computers reacting to changing math patterns? To understand, one must understand
the evolution of capital markets in the last decade and the role of high frequency trading.
Peeling Onions, Sept 21 '11, Doug Wakefield
[ in html format ]
Like peeling onions, we are watching events today that have, and will, set up millions
for that “burning sensation” with their financial capital, and why there is a desire to avoid
peeling back any more layers of the onion.
“The influence of these business leaders was so great that the Morgan and Rockefeller
groups acting together, or even Morgan acting alone could have wrecked the economic
system of the country merely by throwing securities on the stock market for sale, and
having precipitated a stock market panic, could then have bought back the securities they
had sold at a lower price. Naturally, they were not so foolish as to do this, although
Morgan came very close to it in precipitating the ‘panic of 1907’, but they did not hesitate
to wreck individual corporations, at the expense of the holders of common stocks, by
driving them to bankruptcy.” Dr. Carrol Quigley, Tragedy and Hope: A History of the
World In Our Time (1966)
The Gallery of Crowd Behavior Returns, May 2 '11, Doug Wakefield
[in html format]
"In a market that is in a stage of old age; it is particularly important to be attuned to
symptoms of a potential end to the current trend. To use the life insurance analogy,
most people who become involved in the stock market don’t know the difference
between a twenty-year old and an eighty-year-old." Trader Victor Sperandeo.
If we compare the final 31 trading days before the Dow topped in 2000 and 2007,
to the 31 days after March 16 '11, we find some extremely important parallels. When
added to the current juncture of the largest currency pair trade in the world, the
stakes become even higher for every investor, advisor, and trader.
Remember the Past, Remember the Wolf, Apr 8 '11, Doug Wakefield
[in html format]
"The so-called 'surprises' of history have emerged not because other countries did
not have information, but because they refused to believe it." (pg 919)
Carroll Quigley, Tragedy and Hope: A History of the World in Our Time (1966)
A further examination of crowds and credit in history with charts of market collapses
from the last 11 years.
Crowds and Credit, Feb 4 '11, Doug Wakefield [in html format]
As I continue to watch markets ignore world events like rioting in Egypt, Jordan,
Yeman, and Tunisia, or the deterioration in sovereign debts across major European
nations as bankers propose more debt to cover yesterday's debt, I contemplate
"the reason" the public will be given at the start of the next decline in prices that far
so long have been elevated from reality.
Riders on the Storm: Short Selling in Contrarian Winds, originally released
Jan '06, Doug Wakefield w/ Ben Hill - posted on Feb 4 '11
Due to extreme market conditions like that of the fall of 2007, I decided to release
the entire research paper to the public for free. For more information about our latest
insights into this incredible period of market history, and applicable trading ideas,
click here to subscriber to The Investor's Mind: Anticipating Trends through the Lens
John's Economic Worldview, Sept 16 '10, Doug Wakefield [in html format]
Today, we are faced with a period of unprecedented change. The scope of these
changes requires each of us to ask the question, "What is my own wordview?", and
to learn about other worldviews. This requires a level of reflection we are seldom
asked to explore in today's fast paced financial world. It is my hope that each individual
reading this article will glean new ideas, and grasp the critical importance of learning
from other periods in history similar to our own.
The Efficient Wealth Transfer, August 11, 2010, Doug Wakefield
One of the most widely taught theories in the financial world over the last few decades,
has been the Efficient Markets Hypothesis. This theory, is totally incompatible with the
financial history, which reveals that our markets have been moving at an ever faster pace,
where the big get even bigger and gain even more influence over the lives of the millions
who depend on them worldwide.
A Simple, but Painful Lesson, April 30, 2010, Doug Wakefield
Our lives, like our market commentary, are being lived out on a week by week basis.
What could previous generations tell us about their credit bubbles, and the price changes
they watched unfold in just two generations? What could these lessons, as well as
a long history of our national debt before and after the "stability" of our money was
placed in the hands of the Federal Reserve? If you are ready to move away from
the short term perspective, as well as learn from another time in American history, your
thinking will be challenged by this piece.
Too Costly To Bear, February 5, 2010, Doug Wakefield with Ben Hill
"I have often stopped to ponder our human condition – specifically, our uncanny ability to
dismiss the seriousness of an event beforehand and to lament our lack of preparation
after it has happened. In some form or fashion, how many New Orleans residents stated
that they never expected the storm to break the levees?
It’s easy to look back, after an
event, and wonder why people didn’t heed the warnings. But don’t we act similarly every
Still, history is replete with examples of ignored warnings before cataclysmically
destructive events. Be it the passengers on the Titanic or the investors in 1929,
unheeded warnings combined with ignorance to produce tragedy."
Financial Lessons of the Ages, January 8, 2010, Doug Wakefield with Ben Hill
"And as long as the public believes that up markets mean the elixir of capitalism is
working and we are getting better and that down markets are only temporary, trite sayings
will suffice. Human nature being what it is, I suppose we would rather seek “advice” that
allows us see things the way we want them to be, rather than address how corporate and
political corruption and unsustainable debt could impact our collective future.
Powershift, October 28, '09, Doug Wakefield with Ben Hill
According to Jim Rickards, director of market intelligence for scientific consulting firm
Omnis, the unannounced purpose of the G20 Summit in Pittsburgh on September 24
was that “the IMF is being anointed as the global central bank.” Rickards said in a CNBC
interview on September 25 that the plan is for the IMF to issue a global reserve currency
that can replace the dollar.
Jerusalem: City at the Crossroads of History, October 2 '09,
Doug Wakefield with Ben Hil
Regardless of your religious beliefs, the lessons from this historical account of
Jerusalem - which does not even scratch the surface of all that is written on this city -
should prove pertinent to the events surrounding the Israeli - Palestinian peace talks
which involve many of today's leaders. In the end, I hope this presentation will
increase your understanding of our world - today, and in the years to come.