Central banks are exhausting their efforts, and a global snapshot of interest rates and central bank policies should cause the average person to scratch their head and wonder how long they will get away with this. Nicholas Green, of FMTAdvisory.com, has been saying that the markets will make the Fed cry uncle, and I think it's fair to say that we are seeing exactly that. Not only is it true here in the States, but around the world, central banks are crying uncle.
Recent news is showing that China cut their bank reserve requirements again, which now makes it the 5th cut since February 2015. It is no wonder, considering Chinese stocks have tumbled toward a 15-month low. China will get more and more desperate as their attempts to facilitate a stimulus in the markets exhaust themselves.
Here in the States, we don't seem to be getting too much positive economic news, which is giving the Fed (and next president) a task and a half to be able to cope with. Pending home sales dropped 2.5% in January when expectations were that we would see a .5% pop in this very number. This was the biggest drop since December 2013.
Manufacturing continues to struggle in the States as Chicago PMI collapses in February to 47.6, which was down 8 points from last month, below even the lowest estimates that came from economists. The worst part about manufacturing is that it is one of the strongest indicators for fundamental growth in our economy, but it's an area where we continue to see the most dismal news.
On a brighter note, gold is moving higher, and in February, gold has seen its best monthly gain since January 2012. This has been a fear trade, as well as gold's technically bullish patterns, which are setting up nicely here in 2016. With central banks losing control of markets, it's not too far of a leap to assume they will lose control of gold, too, and make for an exciting year in precious metals.
The question we all need to ask ourselves is how we are positioned financially. It's almost all entertainment reading all this global news… until it affects your pocketbook. Then it becomes personal!
Experts across the board are screaming hyper-inflation, hyper-deflation, stocks higher, stock lower, and the reality is no one will give you an exact, perfect prediction.So the best thing to do is position yourself the best way you can. One of the things that you will quickly find out regarding the financial markets is that they are irrational and can be irrational longer than any one person can stay liquid. This is the one reason why you have to be positioned to thrive in multiple scenarios and look for value opportunities that you can stick to.
Nicholas Green points out that many people are waiting for an apocalyptic crash to happen in the future, but fail to see crashes in areas that have already taken place.And for many of these same people,investor psychology will cause them to sit on their hands indefinitely anyways, regardless of what happens in front of them.
Have you taken a look at the crash in oil, precious metals, or individuals businesses which have been temporarily depressed?
"Don't let a good crash go to waste."
- Nicholas Green, of FMTAdvisory.com.
Over the weekend, we released some interviews with some of the greatest minds in the financial world! Some of which include John Williams, of Shadowstats.com, and John Rubino, of DollarCollapse.com. These are must-listen-to interviews that you don't want to miss.