The moment in history when an Empire collapses is always a terrifying experience for those living in that nation which is the center of the realm. Unfortunately for Americans and the West, sometimes a planned collapse can spiral out of control of the powers that wanted it, creating a greater level of chaos in the world, thus resulting in a larger problem beyond their ability to stop it.
America might be at that moment of Romulus Augustus in 476 A.D. where the disintegration of our Constitutional based system comes to an end.
An individual I have been listening to for years has warned of the day which could rapidly be approaching. Gary Kaltbaum has long been saying that when the world loses complete faith in the U.S. government and the Federal Reserve’s Ponzi scheme that the crash would be of epic proportions.
In other words, America would undergo a Great Reset, and the rest of the West because of the U.S. Dollar’s reserve currency status would endure the pain also. The Kabul Kabuki theater might just be that marker and the rumors are flying about bigger events to come.
It’s easy to finish penning an article like this as Dow Futures are indicated down almost 400 points this morning, but it has nothing to do with current market action but the culmination of a long term bull market coming to a violent end. The list below is a brief summary of what and why the crash will hit and will result in the much dreaded Kondratieff Winter.
While this author tends to agree with the over all wave theory displayed above, I also theorize that their are smaller sub-wave trends which interact within the larger waves. While Kondratieff waves indicate large societal movements thanks to capitalism, I also believe that there is an intersection where all of the declining waves coalesce at a bottom, where civilizations and empires fade from power creating a much longer and darker winter for parts of the globe. The wave America could well be entering is the decline and fall of America as an economic and global superpower, which is the end of freedom in the world as we have known it since the end of World War II.
I. Technical Nightmare in U.S. Markets
The recent all time highs did not verify and yesterday’s action simply reflects the distribution which has been hitting markets as the “big boys” pull the ripcord and bail out taking their profits with them. The action during the daily new highs in the Dow, NASDAQ, and S&P 500 are hollow, for lack of a better word, with poor breadth, terrible internals, and worse a lack of conviction with no volume. The sucking in of the “retail” investor towards the top is also indicative of a major cumulative top indicator.
II. The End of the Super Bull Market
Since the “boom” and breakout of the internet era of technological innovation the up move, despite blunders of greed by investors in 2002, 2007, and 2020, created a long term bull market. When the 200 and 300 day moving averages are violated this time however, with volume, it is my opinion that the game is up and bull market will end. The short term key level of course is the 50 day moving average (DMA) but the long term target violation of 3772 will indicate a decisive break of 2950 which should be hit before the end of this year; barring the Federal Reserve being allowed to hyper-inflate by purchasing equities directly to “save” the market.
This crash with a long term target around S&P of 1482, probably in early to mid 2022, will unfortunately result in a demographic displacement far greater than the Great Depressions of 1929 and 1837. The elderly put their retirement faith into a system managed by corruption and guaranteed with paper promises by a political system which has destroyed the global reserve currency system. This will not and can not end well.
III. A Loss of Faith
What causes great crashes like this to happen? A loss of faith in everything; political institutions, the judicial system, corruption in the elites, pandemics, war, and finally, the eradication of a stable financial trading platform for nations to use.
The end game for the U.S. dollar could well be here, as this means the Federal Reserve’s fifty year Ponzi scheme is over. Heading into this crash is a possible global liquidity crisis as highlighted recently by Jim Rickards:
It’s impossible to predict exactly when a global liquidity crisis will hit the headlines if it even becomes that acute. But these trends have been growing stronger since March, indicating that pressures are building and a crisis may emerge as early as this October.
This crisis impacting at a time of political instability in the U.S. and an overdue technical correction in U.S. markets will create a panic, a virtual bank run which will become a real one on a global scale as citizens realize the degree of failure by not only the Federal Reserve and European Central Bank, but by the political class to guarantee economic stability.
As individuals lose faith in everything, no longer able to trust corporations, politicians, bankers, neighbors, or nations trusting nations, everything crashes. Few people realize it is happening until they are unemployed, broke, and total dependent on government handouts (if available) for survival.
Why else would the elites be fleeing with their money and protection to fortified islands in preparation for what is about to come?
The new global elites have decided already and are now waiting to impose a Great Reset to fix this problem they have created.
IV. The End of Pax Americana
As I highlighted earlier this week, this is the End of the Modern Pax Americana. There is no European nation or union capable of replacing the United States on the global stage. As the withdrawal of U.S. forces begins in Iraq and Syria the entire Middle East will become so unstable as it threatens a complete destruction of fifty years of “statecraft” where the U.S. became a global enforcement force preventing large outbreaks of conflict.
The coming hostage crisis and absurd surrender of our civilians to the terrorist Taliban government is nothing more than a 1979 Tehran moment which guarantees that the shift in global power will have a permanence in it for some time to come.
Without this stability, financial markets can not function as before. China and Russia are neither economically nor militarily ready to fill that void except on a regional basis. This must be what the world looked like in 477 A.D., with no central power to maintain a civilized peace.
V. The Last Emperor
The rumors are swirling now and the confirmation could well be forthcoming. The figurehead installed to be President of the United States is obviously mentally incapacitated from performing his duties. The rumors are swirling that his new “vacation” to Delaware beginning today for a long weekend are due to exhaustion (from vacation?). The Washington, D.C. elites are speculating that at least five members of the Biden cabinet are ready to invoke the 25th Amendment if Jill Biden refuses to resign.
Yes, Jill Biden.
Much like Edith Wilson ran the nation after Woodrow Wilson’s illness at the end of his term, Jill Biden apparently has been running the affairs of the Presidency in the background for many months now, much to the consternation of the insiders of D.C. There is a growing assessment that his dementia has created an inability to lead and her intransigent refusal to listen to intelligence, military, and economic experts is going to make the crash leading into the Reset far worse than it needs to be, further destabilizing the world even more.
As the internal conflicts become apparent and an incompetent President Kamala Harris causes global markets to shudder even more dramatically, look for a divestment of U.S. assets. In the short term, cryptocurrencies, the U.S. Dollar, and precious metals will become the safe havens as trillions of dollars of asset re-allocation occur and/or disappear.
I could go on about the pandemic which is being used to justify the destruction of basic human freedoms in Western democracies, the regional conflicts about to explode, or the mismanagement of the greater economies by the Central Banks. The reality is that those are symptoms of the overall all decline and fall, the proverbial gasoline on an existing fire. As the collapse accelerates into the end of 2021, not only will equity markets and economies decline, but so will freedom and global peace. The solution to this crash is already planned and the old systems and liberties must be sacrificed for the “greater good” will be the theme of recovery.
Winter is coming.