I was reviewing all of the news, the bear market patterns, the reactions of medias (there’s the state controlled, bank controlled, and independent now) and after careful consideration, there are about 20 events that I think are logically possible, if not probable, that should and will terrify stock market participants. For the record, at this time outside of an IRA, I hold no shares in any companies mentioned nor have any positions that would exploit these predictions as of the time of this posting.
1. During one of July’s bounce back rallies, Elon Musk liquidates his position in Twitter and files with the SEC to notify shareholders and the public he is withdrawing his bid for the company. After withering criticism from everyone on the social media website and in the financial media, he follows up that announcement that he is quitting Twitter as a participant also sending shares far below $20 per share.
2. A major crypto holding company fails sometime in July or August causing an over $5000 drop in Bitcoin in one day. The panic is palpable as numerous “shitcoins” follow suit going to zero causing problems for smaller crypto holding companies. Thousands of investors beg the US government for a bailout and regulatory intervention warning it could become a “systemic” crisis.
3. After the July 12-13 Prime Day on Amazon flops again, AMZN begins reviewing the number of employees and its distribution center structure. The hints are already being dropped as this story highlights:
At some point in mid-August, Amazon announces over 20,000 layoffs and the closure of smaller, less efficient distribution centers throughout the country. To offset a surge in gas and diesel prices, Amazon also announces a larger fuel surcharge to all orders under $500 regardless of Prime membership status.
4. Russia completes the seizure of the Lugansk region and begins a new siege of Kharkov(already happening by the time I finished this piece on July 4th). Along with the completion of the operations in that region, a new summer offensive to encircle the major city of Zaporozh’ye and cut off access to Dnipro begins. As a consequence the EU announces further sanctions against Russia and its oligarchs.
5. As a result of the sanctions mentioned above, Russia retaliates by announcing a new policy in late August or September that all strategic minerals, fertilizer, raw materials, and energy supplies will be cut off to any nation providing material or military support to the Kiev regime. This will happen during a major heat wave in Europe causing natural gas prices in Europe to increase by another 50% and panic on world markets moving Brent crude oil prices to over $150 per barrel.
6. The United States suffers the blow of two large category 4 plus hurricanes hitting the Gulf of Mexico region damaging wells and processing facilities for the domestic petroleum industry. Regular unleaded gasoline prices top $6 per gallon on average nationally and rationing begins in some northeastern US states. The following Tweet and associate chart by Horizon Kinetics succinctly sums up how losing the refining capacity within the US Gulf Coast states will result in such a stratospheric rise in prices:
Observation #45:— HorizonKinetics (@HorizonKinetics) July 1, 2022
Lost refining capacity since March 2020
Since mid-2020, the United States has lost the ability to process over 1 million barrels of crude per day. This is the largest drop on record. pic.twitter.com/XyRoRSbNpK
7. A new Covid variant is discovered in New York causing the re-introduction of lockdowns and masking in most of the state. New York City real estate prices plummet. The severity of the outbreak is overblown so as to re-introduce mail-in only balloting in the November New York elections as the “outbreak” reportedly spreads to other states causing them to follow suit with election “safety” and other such nonsense.
8. After a brief respite from the high inflation numbers for June with CPI-U coming in slightly lower at 8.2%, a resurgence due to shortages and labor strife in July creates panic as bonds sell off when the reading for August comes in north of 9%.
9. The US 10 year Treasury yield briefly drops to kiss the 2.85% area again before surging to over 3.5% by the end of August to first of September time span.
10. The major US automakers announce 30 plus day shutdowns starting in August or early September due to supply chain issues.
11. After cratering to just below $17 per ounce, silver skyrockets to north of $28 by the end of the year as a flight to precious metals and safe assets begins in August. As the global political situation becomes more dire, spot gold experiences its first $100 increase in one day by the end of November. Gold tests the lower $1700 range before investors start a stealth liquidation of dollar based holdings (see: GOAT).
12. China tests America’s resolve this autumn with a naval blockade of Taiwan. The United States convenes a “global(ist)” peace conference to resolve the situation. The Biden junta’s inability to resolve the situation ends with the Chinese occupying Taiwan after token resistance by the end of November.
The resulting market crash will mark the final wave down, or bottom for the bear market as China threatens to ban exports to the US if sanctions are imposed or if the US military attempts to intervene.
13. The failure of the CHIPS bill in the Senate due to all of the pork and unaffiliated bills tagged with it causes TMSC, Samsung, and Intel to permanently shelve all expansion plans inside the United States. The chip shortage results in not only manufacturing shortages, but directly impacts consumer goods causing phone and computer manufacturers to delay new product releases. Semiconductor delivery times blow out to over 200 days as the industry loses faith in the ability of the US government and the Taiwan conflict.
14. Longshoreman union members for the West Coast US ports eventually go on strike in mid to late July causing even more supply chain issues for manufacturers. After layoffs begin in mid-August causing a further slow down in manufacturing and inflationary price increases of imported consumer goods, the Biden administration eventually intervenes and orders the workers back to work. The issues remain unresolved until October as the returning workers engage in a “safety slowdown” keeping the supply chains snarled.
15. To add insult to injury, the implementation of AB5 in California for the trucking industry creates a shortage of truckers willing to service the state. The current regulations plus onerous fuel taxes already have created an imbalance along with the container backlog in California ports. With the implementation of AB5 starting July 1st, owner operators, trucking companies not based in California with owner operators, and independent port drayage operations may quit the state completely. As a result, the short reprieve from increases in the rate of inflation are quickly reversed in August and September as consumers experience massive shortages of fresh produce and goods imported from Asia.
Everyone can thank this moron for imposed government meddling in the transportation network, thinking she is the modern day reincarnation of Wesley Mouch:
The California Trucking Association issued a statement with the appropriate warning that few are paying any attention to:
“Gasoline has been poured on the fire that is our ongoing supply chain crisis,” the organization said. “In addition to the direct impact on California’s 70,000 owner-operators who have seven days to cease long-standing independent businesses, the impact of taking tens of thousands of truck drivers off the road will have devastating repercussions on an already fragile supply chain, increasing costs and worsening runaway inflation.”
16. President Biden’s incompetence along with the loss of faith in the Federal Reserve’s ability to manage its responsibilities within the economy result in the long predicted crash of the Michigan Consumer Sentiment gauge to below 50 for the first time in history, surpassing the worst days of the Jimmy Carter era:
17. Bank failures begin to occur again this autumn as consumers begin defaulting on automotive, HELOC, and other personal lines of credit at a pace unseen since 2008. For the record the last recorded bank failure in the US was Almena State Bank on October 23, 2020.
18. Ford and General Motors retest the 2020 China Virus stock price lows as they announce a postponement of the release of 2023 year model vehicles until January of 2023 due to plant shutdowns from the ongoing supply chain crisis.
19. Retailers speculate openly about not having a “Black Friday” this year due to inventory issues.
20. Saudi Arabia and the smaller Gulf Cooperation Council members join the BRICS international economic group as a hedge against a collapse of the West.