Head of the Snake

The Federal Reserve 

"If the American people ever allow private banks to control the issue of their currency, first by [asset] inflation, then by [asset] deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered.

I believe that banking institutions are more dangerous to our liberties than standing armies.  The issuing power should be taken from the banks and restored to the people, to whom it properly belongs."

Thomas Jefferson

The Crash Of The “Everything Bubble” Started In 2018 - Here’s What Comes Next In 2019

In almost every instance during which the Fed created a crash environment, banking institutions were able to use the opportunity to snatch up hard assets for pennies on the dollar, as well as steal more political and social power. 

During the Great Depression, major banks absorbed thousands of smaller local banks as well as all the assets those banks held. In 2008, banks and corporations enjoyed a deluge of easy money paid for by American taxpayers for generations to come, while also vacuuming up hard assets like distressed home mortgages. 

An even greater prize for banking elites is global centralization of economic authority, which is what I believe their goal is as the next engineered crash runs its course. 

As crisis leads to catastrophe, it will be institutions driven by globalism like the International Monetary Fund (IMF) and Bank for International Settlements (BIS) that step in to “save the day”.

This is a controlled demolition of the economy and markets. The Fed will jawbone as much as possible to keep the system from imploding too fast, because jawboning is the only tool that is left. In the meantime, 

Powell will keep cutting assets and raising interest rates on schedule. 

This will inevitably translate into lower prices in equities as the system is “steam valved” down. Blind faith by investors will only go so far. They will be left holding the bag, right along with pensions.

 

DYI:  Once again the Federal Reserve along with all other 1^st world central banks have blown another bubble that will pop at the time of their choosing sending asset prices spiraling down from 60% to 75% for stocks and at the very least 50% for high yielding corporate bonds [BBB quality]. Large numbers of junk bonds will simply go to zero with the remaining on life support down 80% to 90%!  The question is how long this total inversion from peak secular high to trough secular low will take.  My guess – admittedly is not much help – 3 to 8 years [see chart below].  Will it be similar to the 1929 to 1932 or the long dragged out market decline from 1968 to 1982 with multiple cyclical market ups and downs before bottoming out?  Who knows?

 

What DYI does know our valuation based averaging formula will only add to our asset allocation model as valuation(s) improve substantially increasing future return systematically.  Until that happens DYI’s model portfolio remains with plenty of dry powder for the hunt when valuations improve.

     Updated Monthly

AGGRESSIVE PORTFOLIO - ACTIVE ALLOCATION - 01/1/19

Active Allocation Bands (excluding cash) 0% to 50%

68% - Cash -Short Term Bond Index - VBIRX

29% -Gold- Global Capital Cycles Fund - VGPMX

 3% -Lt. Bonds- Long Term Bond Index - VBLTX

 0% -Stocks- Total Stock Market Index - VTSAX  

DYI

Recession

Coming to a Country near You?

Matthew Lynn: 

Next eurozone crisis has begun and will lead to more money creation

Industrial output is in crashing. Retail sales have stagnated. Business confidence has dropped, and investment is heading south. A sharp slowdown might have been expected for Britain heading out of the European Union, America where the President is busily ripping up half a century worth of carefully constructed trade agreements, or China, which has been on a decade of wild, credit-fuelled growth. 

But the real slowdown is happening in the one place where few economists expected it. It is now painfully obvious that the eurozone is heading into a sharp recession.

The fleeting recovery of the 2017 and early 2018 now looks to have been fuelled purely by the two trillion of freshly minted euros the ECB threw at the economy. It has proved incapable of creating a self-sustaining recovery. Th ECB was expected to start normalising policy this year, ending QE and raising interest rates. In the face of the latest data, a rise in rates can now be ruled out. The central bank is far more likely to have to start printing money again by the spring -- but by then it may already be too late to pull the zone out of a slump.

 DYI

Budget

Busters

Empire in Decline? 

Medicare’s Trust Fund Is Set to Run Out in 8 Years. Social Security, 16.

The Medicare trust fund will be depleted in 2026, the administration said. By contrast, the government said last year that the trust fund would be exhausted in 2029. 

In a companion report, federal officials said the Social Security Trust Funds for old-age benefits and disability insurance, taken together, could be depleted in 2034, the same year projected in last year’s report. The fund that helps tens of millions of retirees is expected to be depleted a year earlier than projected last year, while the outlook for the disability trust fund is more favorable. 

 “The current trajectories in health spending are both unsustainable and unmatched by increases in quality,” Alex M. Azar II, the secretary of health and human services and a trustee of Medicare and Social Security, said on Tuesday. 

A major reason for Social Security’s long-term financial problems is a decline in the number of workers for each beneficiary. 

In 1960, there were about five workers for every Social Security beneficiary. The ratio of workers to beneficiaries fell to 3.3 in 2005 and then to 2.8 in 2016. It will decline further to about 2.2 by 2035, when most baby boomers will have retired, officials said. 

The aging of the population is another factor in the growth of the two entitlement programs. The number of Medicare beneficiaries is expected to surge to 87 million in 2040, from 60 million this year, according to Medicare actuaries. And the number of people on Social Security is expected to climb to 90 million, from 62 million, in the same period.

DYI:  The trust funds that are nothing more than IOU’s between government agencies in this case Social Security/Medicare/Medicaid and the Treasury Department.  Medicare will run out in 8 years requiring a 76% decline in benefits to maintain this as a stand alone program if Congress does not intervene.  The same can be said of Social Security slated to run out of trust funds in the year 2034 requiring a 21% decline in benefits to put this program back into balance if Congress does not intervene.

 

These projections do not take into the very real possibility of recessions/depressions that would clip a few years off of these projections.  With a recession possibility coming in 2019 trust fund depletion could easily be clip by two or three years making the day of reckoning especially for Medicare/Medicaid within five years the new political hot potatoes. 

So far no sitting President will enforce 100 year old laws – Robinson/Patman, Clayton, and Sherman Anti Trust acts – to reign in the medical industrial complex that colludes to price fix and now moving from local to regional monopolies.  This industry pumps out more campaign money than the military industrial complex that is clearly the impediment to any reform.  Add on Social Security trust funds realistically running out in 2028 [DYI’s estimate] these two massive programs colliding with the military industrial complex.

Simply put if zero reform arrives official budget deficits will soar by 750 to 1,000 billion per year!  This will be bye bye to world domination by the U.S. military as U.S. Federal debt will come into question – dropping quickly to single A [possibly BBB] status by Standard & Poors – jacking up interest rates as investors demand compensation for the new perceived risk thus ballooning deficits ever higher for another round of ever higher rates compensating the never ending increased risk of default by inflation.

In the short term DYI’s forecast is first a deflationary smash as these programs funding problems come into focus along with massive corporate debt that will be defaulting during the next economic downturn.  Interest rates will drop significantly with the likely hood with Treasury notes of 5 years or less going negative.  Unless reform is forthcoming markets for our government debt will come into question thus moving rates up all during an economic downturn that could easily move from recession to depression as politicians crank up the money creation – thus inflating off – government liabilities.

DYI

9/11

Inside Job!

U.S. General: Military should round up ‘disloyal’ Americans, ‘radicals’ in internment camps

In a stunning interview, General Wesley Clark (U.S. Army, Retired) called for the revival of military internment camps in the United States as a solution for peace and security for the duration of the “War on Terror.” 

The interview took place on MSNBC’s Thomas Roberts Show.  Gen. Clark related the current conflict to World War 2, and said that the U.S. Government should work to determine which citizens might be “likely to be radicalized,” and detain them before they have the opportunity to act.  Clark’s disturbing proposal even included using unemployment and relationship break-ups as an indicator of radicalization potential.

ROBERTS: So, how do we fix self-radicalized lone wolves, domestically? 

CLARK:  Well, we’ve got to identify the people who are most likely to be radicalized. We’ve got to cut this off at the beginning.  There are always a certain number of young people who are alienated — they don’t get a job; they lost a girlfriend; their family doesn’t feel happy here — and we can watch the signs of that and there are members of the community who can reach out and bring them back in and encourage them to look at their blessings here. 

  But I do think on a national policy level, we need to look at what self-radicalization means, because we are at war with this group of terrorists.  They do have an ideology.  In World War 2, if someone supported Nazi Germany at the expense of the United States, we didn’t say that was freedom of speech, we put them in a camp.  They were prisoners of war.  

So, if these people are radicalized, and they don’t support the United States, and they’re disloyal to the United States as a matter of principle, fine, that’s their right. 

  Its our right and our obligation to segregate them from the normal community for the duration of the conflict. 

  And I think we’re going to have to get increasingly tough on this; not only in the United States but our allied nations like Britain and Germany and France are going to have to look at their domestic law procedures.

DYI:  General Wesley Clark U.S. Army (retired) this is Kenneth E. Royer purveyor of this blog and ex U.S. Army.  9/11 was an inside job by rogue elements of our government with many of the tasks outsourced to the Israeli Mossad.  This was for the bidding of Israel’s control of the Middle East and for the U.S. to completely dominate oil/gas, drugs (Afghanistan) and for endless revenues/profits for the military industrial complex.  In a word General the war on terror is all based upon a massive LIE!

Are you going to send me to an internment camp for the duration of this never ending war on terror?

 DYI

9/11

Inside Job!

A Majority of Americans Do Not Believe the Official 9/11 Story

The media has NEVER EXAMINED the evidence or explained the analysis provided by scientists, architects, engineers, pilots, and the first responders who experienced the explosions of the World Trade Center twin towers. The media has never asked for the release of the multiple videos that recorded whatever struck the Pentagon. The media has never investigated whether cell phones worked in 2001 from the altitudes at which the official story claims calls were made. 

Instead two-bit punk presstitutes, such as the BBC’s Chris Bell and the Huffington Post’s Jess Brammer and Chris York, label experts with knowledge and integrity “conspiracy theorists.” These presstitutes knowingly use a cover-up term that the CIA put into use via its media assets to discredit the expert skeptics of the Warren Commission Report on the assassination of President Kennedy. 

The fact that the carefully presented evidence is NEVER ENGAGED EXCEPT WITH NAME-CALLING is a strong indication that the evidence is true and cannot be refuted. 

Obviously, Washington expects the Justice (sic) Department to escape from the bind into which it has been put by the Lawyer’s Committee, an escape that the presstitute media will aid and abet. Nevertheless, the escape will likely reinforce the public’s view that the government is afraid of the evidence and is no more likely to follow it than in the case of President Kennedy’s assassination, Robert Kennedy’s assassination, the Israeli attack on the USS Liberty and a large number of other officially covered up crimes.

 DYI

DYI:  Whether State or Federal prisons one method to maintain vigilance over the inmate population is with an intense [cameras everywhere] CCTV Network looped back to multi-screen TV’s monitored by the command and control center’s facility.  Any suspicious activity is immediately met with stop and searched for contraband such as drugs and especially anything that can be used as a weapon.  This extra step is alongside routine checkpoints within the facility that have metal detectors/scanners with systematic pat downs.  Every piece of snail mail is opened, searched and read by prison guards along with every telephone call – including conversation with a lawyer – is monitored and recorded.  When the prison routine is disturbed the warden will immediately order a lockdown.

Does any of this sound familiar?

Surveillance cameras are popping faster than mushrooms.  Stores, government buildings, street corners all alongside with police cars outfitted with license plate readers capable of reading and cataloging 1,800 plates per hour tied in with a GPS locator determining location.  Police roadblocks/checkpoints perform searches for contraband despite motorist objections is now almost routine.  The Fed’s – Border Patrol – has determined that the border extents 100 miles inland over the past 25 years permanent checkpoints.  The NSA [National Security Agency] stores, catalogues, every e-mail, phone call, cell or landline conversation in the U.S. [including many other countries.  The U.S. Post office when mail is being processed goes through an optical scanner that photographs the address that is stored in a database available to police and other government agencies.  The Fed’s – think of this as the warden – wanting to do a test run lockdown with the staged faked Boston bombing.

American Police State?

The only difference is bars on the doors and windows for the inmates after that everything else is the same.

DYI

Trends

How Medicaid Recovers the Cost of Long-Term Care From Your Estate After You Die

If Medicaid pays for nursing home care, the state can try to collect reimbursement for these costs from the person's assets after he or she dies.

The federal government has an established policy requiring that all states must try to recover the costs paid on behalf of those who received certain types of Medicaid coverage during their lifetime. All states attempt to recover long-term care costs, including home health services and hospitalizations while in long-term care, and some try to recover regular Medicaid costs as well (though they can generally only recover costs paid for those who were 55 or older or institutionalized when they received Medicaid benefits). 

While individual state laws on estate recovery vary, they all boil down to two different ways to recover costs paid: recovering from the deceased person's estate and putting liens on the person's property.

 DYI:  As we approach the 2020’s here is one of the trends that will accelerate as one under funded government program after another comes under intense scrutiny.  Bottom line taxes will go up and benefits will be decreased.  Placing liens against individuals who receive benefits is simply a different form of taxation.  Anticipate State governments through the 2020’s all the way to 2040 to aggressively collect additional taxes.  Only until the huge Boomer generation is firmly planted in their graves [This blogger is one of them (age 64)] is when the financial pressure will subside.

 DYI

Medical

Industrial Complex

Kiss What Is Left of Your Medical Data Privacy Goodbye

Matt Stoller warned back in 2012 that insurers would increasingly induce, then force, customers to agree to surveillance. 

But a Wall Street Journal story tonight describes how insurers and medical providers, meaning your doctor’s employers, are actively cooperating, so as among other things, 

to help Big Pharma peddle more drugs to you. 

Stoller warned that over time, insurance companies would make it prohibitive and eventually impossible to refuse to agree to intensive monitoring: 

But the Wall Street Journal describes what amounts to a full bore war on individual medical privacy, including linking medical histories to credit records. And the author puts a big smiley face on this effort by depicting it as breaking down silos. “Silos” is a dog-whistle word in Corporate America. Silos are bad! Sharing is good! 

DYI:  Here we go again with big pharma in bed with insurance companies, testing laboratories, along with a litany of data collection points up to and including grocery stores all to determine a medical profile profit potential.  No doubt privacy is now a thing of the past.

DYI

Arriving

Bear Market?

Opinion: Stock-market investors, it’s time to hear the ugly truth

For years critics of U.S. central-bank policy have been dismissed as Negative Nellies, but the ugly truth is staring us in the face: 

Stock-market advances remain a game of artificial liquidity and central-bank jawboning, is not organic growth. 

And now the jig is up.

What’s the larger message here? Free-market price discovery would require a full accounting of market bubbles and the realities of structural problems, which remain unresolved. Central banks exist to prevent the consequences of excess to come to fruition and give license to politicians to avoid addressing structural problems. And by preventing these market forces from playing out at each sign of trouble, the can gets kicked further and further down the road. Each successive recovery keeps the illusion alive, but “accommodation” requires ever-lower rates before the monsters return. In the meantime, debt keeps expanding, while each recovery produces less and less organically driven growth, and ever-higher wealth inequality. This is what this system produces. 

And that’s the ugly truth. But you won’t hear it from the Fed.

DYI:  If this is the beginning of the long awaited bear market a drop of 60% to 75% is in the making.  How long this will take is anyone’s guess; 3 to 8 years if history is any sort of guide.  Stocks based on dividend yield are trading at 109% above their average or mean yield of 4.34% [23 times dividends] a compounding drought for the long term investor.  Anything above 100% DYI’s averaging formula kicks us out of the market – and rightfully so – for at that point the market as a whole is devoid of value hence minuscule returns or outright losses averaged over a 10 year holding period.

The Great Wait may soon be replaced with the Great Bear!     

DYI

American

Propaganda

Sandy Hook Hoax

Revisited

Photo Shopped

 Demonic

Make Believe Killer

1.)  We are to believe that an emaciated, totally underweight 6'2 112lb adult was able to even walk not to mention drive!? You know that if that was real, he would be very ill and hospitalized with a feeding tube inserted into him.

His so called psychiatrist Dr. Fox who only saw him 2x alongside an assigned psychologist who saw him all of 4x diagnosed him with Asperger's and PDD. Asperger's being a very high functioning, articulate, intelligent person on the Autism Spectrum who will likely suffer from being clumsy (many tend to walk with the step taken from the ball of their foot as if to have a hop like appearance to their walk) making them trip easier than a typical person would but nonetheless are for the most part very successful in life due to their high intelligence.

Take into consideration that it is stated that Adam was 6'2" 112lbs and wore a size 8 shoe! This disproportionate body would surely make him even more uncoordinated. Asperger's has also be labeled "social awkwardness" for decades because of they tend to be more shy, timid, and obviously not great at speaking or feeling comfortable in social settings yet PDD which is Pervasive Developmental Disorder being on the opposite end of the Autism spectrum causes one to have sever anxiety, fear of being out in public (angora phobia) severe reactions to BRIGHT LIGHTS and LOUD NOISES, reclusive and not very verbal or intelligent. I like the shills to explain intelligently how it was possible for Adam to drive to the school, pack 50 lbs. of gear and shoot all those 26 bodies Rambo style in 10 minutes.

2.)  We are to believe that an active elementary school has no LEGAL ADA compliant handicap markings? Can't be a real school in operation, if so, unless it's merely a spook agency prop (considering what went on at the nearby Lima school...).

3.)  We are to believe that ALL the parents of kindergarteners were in their 40's, with the exception of one family. That is statistically impossible for 19 out of 20 parents of kindergarteners to be THAT OLD...

4.)  We are to believe Gene Rosen's bullshit story of an imaginary bus driver dropping 6 kids off to a complete strangers home after a school massacre to take care of them with stuffed animals he had laying around!??

5.)  We are to believe that 'glamour girl', Kaitlyn-Roig DeBullshit fits herself, and 15 first graders into a 3' x 4' x 6' toilet, which even she admitted was so small, that she felt uncomfortable using it as it was too small for her alone?? At least now she is admitting that the door opened inward. So now she has to say that she couldn't close the door without "rearranging" the children. Were they lying on floor stacked like a wood pile? All standing up? Even giving her the leeway of three on top of the tank (oh, and one on the TP dispenser so she had to hold that one on), It is impossible to fit that many people in that space.

BTW, first graders are bigger than you think, especially since so many now are overweight. How did they last 45 minutes? Pretty tough to get enough oxygen when hyperventilating in a small sardine can. Common sense would tell you they would have been crying (all too varying extents), trying to breathe and not suffocate, rolling over up down however she says she placed them to stretch out. You've heard of stampedes? People don't all die from trauma but because they were pushed down so hard they’re smothered. Oh!! Don't forget having to open the door (squash everyone behind it?) and grab that ineffective book case to barricade a door that opens inward. And she sure did this in record time. 

6.)  We are to believe that a trained FBI sniper, who bares very strong resemblance to David Wheeler, carries and assault rifle by the magazine pointing backwards!?

This event was so absurd and unreal that I tend to believe the CIA staged it sloppy on purpose to evaluate who believes the official narrative and who doesn't.

7.)  We are asked to believe that Shannon Hicks and John Voket could not produce more images of 450 kids and 70 adult staffers fleeing in masse? Only two conga lines of 15 kids?  (Oh that's right, Hick's did a video slide show of the event bearing metadata info of 12/13/12 and she was caught uploading it on the eve. BUSTED!  Of course, the Newtown Bee deleted then re-uploaded Hicks' masterwork since the revelation to cover their asses.)

8.)  We are asked to believe that ALL the parents give smiling, giggling interviews after their child was gunned down in a school massacre, exhibiting absolutely no grief and sorrow!??

The Alleged Sandy Hook Tragedy

Sandy Hook and the Smith-Mundt Act of 1948: Legalization of Propaganda

DYI