As STB called from 1290 drop then pop and rise to set daily divergences then go poof. SPX cash came within 8 points of my targeted area yesterday. STB has been calling for a miserable November for some time now. So far so good on both accounts.
Now, STB has been on this larger call for some time - They need an event or market crash to allow for the debt ceiling vote to be more accommodating and to scare the markets into allowing one more massive stimulus. A move to 1040 should allow for that.
I have been questioning why the super committee has been so quiet. Why all the bickering in June and July and nothing now? Another problem with the DC is that they have already spent half of what they have yet to approve. STB is speculating that they must go large. So large it is totally outrageous. How can they do that and cut spending? Well, if markets are crashing, the EU is imploding and the financial system is in total turmoil you first need a distraction.
There you get one of two things, a false flag 9/11 type of event or the war with Iran is on. We all know that Obummer needs all the help he can get with his reelection and presidents in the past (especially considering the integrity of our current Nobel adorned "leader") have done similar to save their jobs.
It has been discussed since 2008 that no depression (yes, it is still going despite what they say) of this magnitude has ever ended without a war. Are tensions and troops where they need to be for one simple spark to set off the first EMP? I think so.
We should assume that they would not want Iran to drop the rods and turn the key on the nuclear plant, which they are ready to do within the next two weeks (barring another stuxnet virus which halted this event a year ago September). So, markets crash, EU crumbles and defaults start, the super committee (which has not done a darn thing at this point knowing all this is coming) is delivered the decree that the administration needs so much money it would make the Man upstairs blush, They deliver a $3 to $4 trillions dollar stimulus with NO cuts. Then a massive $2 trillion QE3 by the Fed gets you thru the election and keeps the TBTF's from being nationalized for another 6 months to a year. The next FOMC meeting is the first week in December.
This is the chart I have been showing for months with my long time speculated Head and Shoulders formation and the two scenarios - 1) they either save it thru the election, or 2) it simply turns to dust at any moment. The previous QE's were brilliant, but they have proven to have diminished returns. A third, no matter how large, will only maintain current levels and will not drive the markets to higher highs. It will also be the last and the final nail in the coffin for our economy as the added debt burden and the dollar devaluation that comes with it will destroy our currency for good. Add to that the spike in oil from the war and you get a real economic mess.
Of course all of this is being laid out plain and simple where Wall Street can place their bets prior to the action.War is about making money and lots of it. Why not get it all off to a good start?
The problems are all debt related and the banks are sinking fast. The quadrillions of CDS out there that CNBS does not discuss are the real issue. As STB speculated in 2008, this will all end in massive global default. The math dictates it must happen. Care to tell me how Greece is gonna cover $90billion in CDS this century? Italy's problems are so big the EFSF and the IMF combined can't bail them out. Idiot Cramer this morning called for an immediate rescue. Buy the bonds now he said. OK, has it not occurred to him that everyone knows the gig is up and that buying bonds now is more akin to shoveling dollars into a furnace just stoking the fire?
Then comes the question can they contain the war? Can they keep Russia and China out of it? I think the spoils will have been divided up prior to the first puff of smoke. Some saber rattling will happen, but we do the bombing and they get the oil is the way we keep them quiet. I don't think Iran launches but two or three missiles before they are reduced to mush.
What happens to Israel sitting in the powder keg that is the middle east? Do they sacrifice Israel for global financial stability (for another month or two at least)? Maybe the humanitarian group that just took Libya down and turned it over to al Qaeda just runs rough shot over all of MENA and eliminates Israel's threats in one sweep. That begs the question - does Israel get the Temple Mount back? We all know what happens after that.
OK, some of you may think I have lost my marbles. If so, stop mentally at the point where I mentioned false flag distraction and forget I said the rest. Some sort of distraction is coming, that you can bet on. It is all speculation, but I have a pretty solid record at putting these things together.
What you must realize is we're dealing with a corrupt system that is 100% controlled by the banking institutions (think beyond the Fed to Rothschilds and Rockefellers). That banking system is in real danger of losing its grip on the world. What happens when they do finally lose their grip? That is another post and a whole new set of scenarios. Hint - think Argentina.
My morning post will have current charts and targets for this fall. It appears we're finally in the dreaded wave three (in EWI parlance - I hate EWT). STB predicted a minimum of two market closures in this great fall. One in wave 3 of one and the other in wave 3 of 3. This move should be a sharp fall to a slight recovery then a massive jolt south which should involve a market closure. That, of course is if the last great stick save is not implemented. If so, it only delays it a year at most.
Always remember the reason for the season!
GL and GB.
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