The percentages above may read like a bear market lottery listing, and in many ways, it is. From August 18, 2015, until the close of market on October 2, they represent the returns of the Dow Jones Industrial Average, the German DAX Composite Index, and the Shanghai Stock Exchange Composite Index. There are no particular takeaways that are optimistic in nature, aside from the old, tired argument that the U.S. markets are the best house in the worst neighborhood.

Looking purely at the numbers, the Dow Jones’ negative returns is less than half the magnitude of loss for both the DAX and the SSEC — a victory by comparative analysis. But given the fragile nature of the global economic recovery, one that has largely been financed with government IOUs, investors will want to see more than just a halving of negative returns to bother taking on the risk of today’s capital markets.

Essentially, the technical charts are reflecting this message of risk/reward imbalance that the global investment community has been screaming for quite some time. It is not the fact that international indices are registering losses — negative returns are quite natural and healthy, helping to bring free markets into equilibrium. Rather, it is the fact that several weeks of churning consolidation has not brought about any hint of a reversal of fortune.

Global Consolidation To Crash Markets

Consolidation patterns almost always net a binomial response — either the markets move higher, or they move lower. Rare is the third alternative of standing still, something that was familiar to Dell investors before the company was ultimately taken private.

However, global markets can only go private in the most fantastical of science fiction novels. On a more practical scale, the present sequence of consolidation patterns will either result in a breakout or a breakdown. And the fundamentals could not be more disconcerting.

The U.S. jobs market was complete crap in September, adding only 142,000 employment positions when a consensus among leading economists were forecasting more than 200,000. According to Reuters, “That marked the smallest two-month gain in employment in over a year and could fuel fears that the China-led global economic slowdown is sapping America’s strength.”

No kidding. With fewer jobs being created — whether of the seasonal Wal-mart variety or of more substantive offerings — there is of course lesser opportunities for the average American consumer to buy imported Chinese goods. While this is somewhat mitigated by a stronger dollar relative to international currencies, the greenback’s strength also encourages domestic cost-cutting tactics by American corporations, none of whom would want to pay the increasingly rising expenses of hiring from the domestic workforce.

It all points to a deflation of demand across the board…and yes, that would the global equities market.