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Just Like In September 2008, Many Investors Fear That A Dangerous Chain Reaction Is Starting On Wall Street Do you remember the panic that swept through Wall Street in September 2008? Well, a lot of people believe that it is starting to happen again. And once selling starts to spiral out of control, it is going to be incredibly difficult to stop. On Monday, the Dow Jones Industrial Average fell 1,276 points. That was the seventh biggest single day decline in history, and on a point basis it was actually larger than anything that we witnessed back in 2008. Investors were bitterly disappointed by the monthly inflation report, because it showed that everything that the Fed has done so far has not worked. It appears to be inevitable that the Fed will continue to raise interest rates in a desperate attempt to get inflation under control, and that has put Wall Street in a very sour mood. The widespread selling that we saw on Tuesday was more than just a little bit frightening. The Dow just kept plunging throughout the day, and the S&P 500 and the Nasdaq actually performed even worse than the Dow did…
This was the worst day for stocks since the early days of the pandemic. But one bad day does not make a crisis. Hopefully tomorrow will be better. But when you compare the current behavior of the stock market to how it behaved just prior to the crash of 2008, the similarities are astounding. If you doubt this, just check out this chart. It certainly isn’t going to take much to spark a massive rush for the exits. If a bad inflation number can cause the sort of stampede that we witnessed on Tuesday, what would happen if we received some really bad news? Not that I am downplaying the severity of the inflation report. Consumer prices have now been going up for 27 months in a row, and what is happening to food is especially alarming…
If you have been to the supermarket lately, you already know that food prices have risen to very painful levels. And some of our most important staples such as milk, flour and eggs are leading the way…
The “experts” at the Fed don’t seem to understand that hiking interest rates won’t fix this. We are in the early stages of a historic global food crisis that is going to be with us for a long time to come. The biggest reason why food prices are increasing so aggressively is because there simply isn’t enough supply. So the Fed can try to hammer demand as much as it wants, but people are still going to have to buy food and hiking interest rates is not going to help us produce any additional food. If anything, higher rates may put a damper on food production. This is a totally different environment from the early 1980s, and those that believe that higher rates will tame inflation like they did back then are just being delusional. But just like we saw back in 2008, higher rates will crush the U.S. housing market and the economy as a whole. During a recent interview, billionaire John Catsimatidis asked the Federal Reserve to stop raising rates because if we stay on the path that we are on it will “destroy the rest of the country”…
Are you willing to go through an economic depression just to get the inflation rate back down to acceptable levels? If not, that is too bad, because the Federal Reserve is not accountable to you. And we are already starting to see signs that higher rates are having a really negative impact on hiring plans…
Just like in 2008, vast numbers of Americans will lose their jobs in the months ahead. Are you sure that your job is secure? Economic conditions are rapidly deteriorating all around us, and our short-term problems could get a whole lot worse if 100,000 railroad workers decide to initiate a work stoppage on Friday…
Let us hope that such a work stoppage can be avoided. But even if it can, there is no short-term hope on the horizon. Our current crop of leaders is the worst in all of U.S. history, and they have us on a path that leads to national economic suicide. So many of us have been pleading with Fed officials to stop raising rates, because higher rates will absolutely cripple our economy. Unfortunately, they don’t really care what any of us think, and they have made it quite clear that more extremely foolish rate hikes are dead ahead. I would encourage you to brace yourself for a full-blown national economic meltdown, because that is precisely where the Fed’s policies will take us. ***It is finally here! Michael’s new book entitled “7 Year Apocalypse” is now available in paperback and for the Kindle on Amazon.***
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