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(Alt-Market)—In 2022 there was considerable debate among alternative economists what the Federal Reserve was likely to do in the face of rising stagflation. There were people who argued that the Fed would capitulate to stock market demands, stop raising interest rates and return to QE. These analysts operated on the assumption that the central bank WANTS to save the US economy from substantial deflationary crisis and that they will happily print money forever in order to delay such an event.
Some of us, however, understand that the Fed is not loyal to the US economy, nor is it necessarily interested in self preservation as an institution. In 2022 in my article ‘It’s A Fact That Needs Repeating: The Federal Reserve Is A Suicide Bomber’ I predicted:
“This leads us to the final question – What happens next? That’s easy to answer: The fed continues to hike rates well into next year and will not reverse course or capitulate and return to stimulus. The dovish predictions were wrong. The people that said the Fed would not raise rates were wrong. The people that said the Fed would never remove support from stock markets were wrong. This process is ongoing and the effects will grow as the months pass, but those that were hoping for a manic return to the days of bailouts and QE are going to be deeply disappointed.”
This prediction proved correct. I noted at the time that the Fed is not following its own program, it’s following a global program coordinated by the IMF and BIS. In order to understand why the Fed does the things it does, one must accept that they don’t care about the current world order. They care about facilitating a new world order.
Of course, part of that agenda requires that the central bankers never receive blame for their role in any economic crisis. They have no problem blowing up the system as long as there’s a convenient scapegoat. They’ve done it before and they’ll do it again.
I usually don’t put much energy into tracking stocks because I see them as a side show. Equities are primarily built on delusions, false hopes and unchecked fiat and the bubble will pop when those delusions are inevitably dashed by reality. Stock markets are not a leading indicator; they are a trailing indicator and they crash long after numerous other alarms have been triggered. That said, every once in a while the smoke and mirrors lift and you can get a glimpse of what is really happening behind the scenes.
The central bank has removed the primary backstop supporting US and European markets – The low interest rates that were feeding cheap money into corporate buybacks. Despite endless spin and false data from the Biden Administration the deflationary side of the crisis is starting to rear its ugly head.
A weaker-than-expected jobs report last week has fueled concerns about a potential economic recession and calls for an interest rate cut. Employers hired 114,000 workers last month, falling well short of economist expectations of 185,000 jobs, U.S. Bureau of Labor Statistics data showed. The unemployment rate climbed to 4.3%, the highest level since October 2021. It’s only going to get worse from now on and I wouldn’t be surprised to see an unemployment avalanche in 2025.
Keep in mind that BLS jobs data has been rigged by the Biden White House for years; the majority of jobs “created” during Biden’s term are low wage part-time jobs and most have been going to illegal immigrants, not to American citizens. The same illegal immigrants that Biden has allowed into the country through open border and amnesty policies.
This trend is only going accelerate by winter. Why? Because the effects of the high interest rates are taking hold. It happens slow at first, then all at once. But how have stocks remained so high during this time period? A recent market shock may help us to understand…
As noted, the August stock slump has been partly driven by weaker-than-expected U.S. economic data at the end of last week. The readings led investors to worry that the Federal Reserve may be behind the curve in cutting interest rates to fend off a recession. But why does the Fed continue to keep rates high if this is the case?
There are two reasons.
First, as I have mentioned over and over since 2018, the end of QE and the raising of interest rates is a Catch-22; a trap. Not for the Fed, but for the US economy. Our financial system has become so addicted to cheap money from the central bank that it can barely function without it. We are seeing the addict begin to crash. Covid stimulus held up the system for another few years, but now that hit of sweet helicopter money is fading and the high is over.
At the same time we’re being crushed with a stagflationary hydraulic press. Prices continue to climb on most necessities and the cumulative inflation is around 30% (officially) on average since 2021. Compare grocery receipts from 2020 to today, though, and you’ll find a 30% to 100% increase in prices on most necessary goods and services.
The establishment (and the DNC) has been operating on the narrative that inflation has been defeated. The Fed knows that this is a lie. The moment they cut rates inflation will spike again and the illusion will be exposed. There’s FAR too many dollars floating around chasing too few goods. For those that believe a rate cut is in the works to support the Kamala Harris campaign, I would suggest such a move might actually hurt her chances (whatever those chances may be) because her entire economic platform requires doubling down on the “success” of Bidenomics. If CPI spikes again in October then her campaign is sunk.
Of course, over 54% of mainstream economists and investors polled now expect a rate cut next month and some Fed officials have mentioned the possibility. I remain doubtful, but it will certainly make the election cycle even more interesting if they do.
The second issue is what appears to be a “carry trade trap.”
Carry trades refer to operations in which investors borrow in a currency with low interest rates, such as the Japanese yen, and reinvest the proceeds in higher-yielding assets elsewhere (the US). The strategy is a considerable driver of US stock markets and has kept stocks alive despite the Fed’s removal of QE.
This month’s stock plunge was triggered by fears that the Bank of Japan might hike interest rates, coupled with expectations that the Fed will cut rates in the near term due to the recession threat. This would kill the carry trade that has kept stocks going. To prevent a destructive carry trade unwind the Fed would have to coordinate with the BOJ and introduce a new stimulus program to soften the blow. But as I mentioned above, if the Fed returns to QE inflation will skyrocket yet again.
The public will demand an explanation as to how it’s possible for there to be deflation in markets and jobs and inflation in prices all at the same time? The Fed won’t have answers for them. It’s a Catch-22 on top of a Catch-22.
I believe there is no way out of this situation and that central banks deliberately maneuvered the US into this predicament. The only thing left for them to do is pull the plug when the timing is most advantageous. After the elections makes the most sense, especially if conservatives come out on top and there is a red sweep in 2025. Then, the whole mess can be wrapped up and thrown in their laps.
One thing the events of this month prove is that the system is so unstable that even a hint of a change in the status quo could mean disaster. Don’t assume that banks will keep trying to kick the can down the road; they’re operating on a timeline that serves the interests of the global establishment, not the American public.
Five Things New “Preppers” Forget When Getting Ready for Bad Times Ahead
The preparedness community is growing faster than it has in decades. Even during peak times such as Y2K, the economic downturn of 2008, and Covid, the vast majority of Americans made sure they had plenty of toilet paper but didn’t really stockpile anything else.
Things have changed. There’s a growing anxiety in this presidential election year that has prompted more Americans to get prepared for crazy events in the future. Some of it is being driven by fearmongers, but there are valid concerns with the economy, food supply, pharmaceuticals, the energy grid, and mass rioting that have pushed average Americans into “prepper” mode.
There are degrees of preparedness. One does not have to be a full-blown “doomsday prepper” living off-grid in a secure Montana bunker in order to be ahead of the curve. In many ways, preparedness isn’t about being able to perfectly handle every conceivable situation. It’s about being less dependent on government for as long as possible. Those who have proper “preps” will not be waiting for FEMA to distribute emergency supplies to the desperate masses.
Below are five things people new to preparedness (and sometimes even those with experience) often forget as they get ready. All five are common sense notions that do not rely on doomsday in order to be useful. It may be nice to own a tank during the apocalypse but there’s not much you can do with it until things get really crazy. The recommendations below can have places in the lives of average Americans whether doomsday comes or not.
Note: The information provided by this publication or any related communications is for informational purposes only and should not be considered as financial advice. We do not provide personalized investment, financial, or legal advice.
Secured Wealth
Whether in the bank or held in a retirement account, most Americans feel that their life’s savings is relatively secure. At least they did until the last couple of years when de-banking, geopolitical turmoil, and the threat of Central Bank Digital Currencies reared their ugly heads.
It behooves Americans to diversify their holdings. If there’s a triggering event or series of events that cripple the financial systems or devalue the U.S. Dollar, wealth can evaporate quickly. To hedge against potential turmoil, many Americans are looking in two directions: Crypto and physical precious metals.
There are huge advantages to cryptocurrencies, but there are also inherent risks because “virtual” money can become challenging to spend. Add in the push by central banks and governments to regulate or even replace cryptocurrencies with their own versions they control and the risks amplify. There’s nothing wrong with cryptocurrencies today but things can change rapidly.
As for physical precious metals, many Americans pay cash to keep plenty on hand in their safe. Rolling over or transferring retirement accounts into self-directed IRAs is also a popular option, but there are caveats. It can often take weeks or even months to get the gold and silver shipped if the owner chooses to close their account. This is why Genesis Gold Group stands out. Their relationship with the depositories allows for rapid closure and shipping, often in less than 10 days from the time the account holder makes their move. This can come in handy if things appear to be heading south.
Lots of Potable Water
One of the biggest shocks that hit new preppers is understanding how much potable water they need in order to survive. Experts claim one gallon of water per person per day is necessary. Even the most conservative estimates put it at over half-a-gallon. That means that for a family of four, they’ll need around 120 gallons of water to survive for a month if the taps turn off and the stores empty out.
Being near a fresh water source, whether it’s a river, lake, or well, is a best practice among experienced preppers. It’s necessary to have a water filter as well, even if the taps are still working. Many refuse to drink tap water even when there is no emergency. Berkey was our previous favorite but they’re under attack from regulators so the Alexapure systems are solid replacements.
For those in the city or away from fresh water sources, storage is the best option. This can be challenging because proper water storage containers take up a lot of room and are difficult to move if the need arises. For “bug in” situations, having a larger container that stores hundreds or even thousands of gallons is better than stacking 1-5 gallon containers. Unfortunately, they won’t be easily transportable and they can cost a lot to install.
Water is critical. If chaos erupts and water infrastructure is compromised, having a large backup supply can be lifesaving.
Pharmaceuticals and Medical Supplies
There are multiple threats specific to the medical supply chain. With Chinese and Indian imports accounting for over 90% of pharmaceutical ingredients in the United States, deteriorating relations could make it impossible to get the medicines and antibiotics many of us need.
Stocking up many prescription medications can be hard. Doctors generally do not like to prescribe large batches of drugs even if they are shelf-stable for extended periods of time. It is a best practice to ask your doctor if they can prescribe a larger amount. Today, some are sympathetic to concerns about pharmacies running out or becoming inaccessible. Tell them your concerns. It’s worth a shot. The worst they can do is say no.
If your doctor is unwilling to help you stock up on medicines, then Jase Medical is a good alternative. Through telehealth, they can prescribe daily meds or antibiotics that are shipped to your door. As proponents of medical freedom, they empathize with those who want to have enough medical supplies on hand in case things go wrong.
Energy Sources
The vast majority of Americans are locked into the grid. This has proven to be a massive liability when the grid goes down. Unfortunately, there are no inexpensive remedies.
Those living off-grid had to either spend a lot of money or effort (or both) to get their alternative energy sources like solar set up. For those who do not want to go so far, it’s still a best practice to have backup power sources. Diesel generators and portable solar panels are the two most popular, and while they’re not inexpensive they are not out of reach of most Americans who are concerned about being without power for extended periods of time.
Natural gas is another necessity for many, but that’s far more challenging to replace. Having alternatives for heating and cooking that can be powered if gas and electric grids go down is important. Have a backup for items that require power such as manual can openers. If you’re stuck eating canned foods for a while and all you have is an electric opener, you’ll have problems.
Don’t Forget the Protein
When most think about “prepping,” they think about their food supply. More Americans are turning to gardening and homesteading as ways to produce their own food. Others are working with local farmers and ranchers to purchase directly from the sources. This is a good idea whether doomsday comes or not, but it’s particularly important if the food supply chain is broken.
Most grocery stores have about one to two weeks worth of food, as do most American households. Grocers rely heavily on truckers to receive their ongoing shipments. In a crisis, the current process can fail. It behooves Americans for multiple reasons to localize their food purchases as much as possible.
Long-term storage is another popular option. Canned foods, MREs, and freeze dried meals are selling out quickly even as prices rise. But one component that is conspicuously absent in shelf-stable food is high-quality protein. Most survival food companies offer low quality “protein buckets” or cans of meat, but they are often barely edible.
Prepper All-Naturals offers premium cuts of steak that have been cooked sous vide and freeze dried to give them a 25-year shelf life. They offer Ribeye, NY Strip, and Tenderloin among others.
Having buckets of beans and rice is a good start, but keeping a solid supply of high-quality protein isn’t just healthier. It can help a family maintain normalcy through crises.
Prepare Without Fear
With all the challenges we face as Americans today, it can be emotionally draining. Citizens are scared and there’s nothing irrational about their concerns. Being prepared and making lifestyle changes to secure necessities can go a long way toward overcoming the fears that plague us. We should hope and pray for the best but prepare for the worst. And if the worst does come, then knowing we did what we could to be ready for it will help us face those challenges with confidence.
