In less than one year, 46 trillion dollars in financial wealth has been wiped out. If that isn’t a “crash”, how would you define one? Since last November, stocks and bonds have been plunging all over the globe. When there is a good day like we saw on Monday, sometimes that can fool us into thinking that everything is going to be okay. But in order to understand what is really going on we need to step back and look at the bigger picture. And when we look at the bigger picture, it becomes exceedingly clear that we are in the midst of a historic worldwide market crash. According to Bank of America, a whopping 46.1 trillion dollars in financial wealth has already been wiped out since last November…
It’s been a tough year for investors, with global stock and bond markets erasing $46.1 trillion in market value since November 2021, according to Bank of America.
The massive drawdown has led to forced liquidations on Wall Street, the bank’s chief investment strategist Michael Hartnett said in a Friday note, highlighting the recent break below 2018 support in the NYSE Composite Index.
When I first came across that number I could hardly believe it.
But it is accurate.
Stocks have been falling and falling and falling, and Bank of America is warning that this is one of the worst global bond market crashes that we have ever seen…
Analysts at BofA liken it to going “Cold Turkey” and blame it for causing the third “Great Bond Bear Market.”
They calculate the 20% plus losses suffered by government debt investors over the last year are now a par with the post World War I and II years of 1920 and 1949, and the Great Depression rout of 1931.
The combined collapse in global stock and bond markets means global market capitalisation has been slashed by over $46 trillion.
That is an amount of money that is difficult to comprehend.
The total value of all goods and services produced in the United States last year was approximately 23 trillion dollars.
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So we are talking about an amount of money that is roughly twice as large as our GDP for an entire year.
When the Federal Reserve and other central banks around the world took the punch bowl away, it was obvious that something like this would happen.
Central bank intervention pushed global financial markets to absolutely absurd levels, and there was no way that they could remain there once the artificial support was removed.
Here in the United States, all of the major stock indexes have fallen for three quarters in a row, and tech stocks have been leading the way down…
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The S&P 500 Index closed on Friday at 3,586, down 25.6% from its intraday high on January 3, and where it had first been in November 2020.
The Russell 2000, which tracks small-cap stocks, is down 31.8% from its high on November 5, having thereby maintained its function as early warning signal.
The Nasdaq closed at 10,576, down 34.8% from its intraday high on November 22, the very day Microsoft CEO Satya Nadella dumped 50.2% of his Microsoft stock in a bunch of frenzied trades, totaling $285 million. On the list of best-timed insider trades ever, he must be at the very top. Since then, Microsoft shares have plunged 33.4%, to $232.90, the lowest closing price since March 2021.
As I discussed a few days ago, the wealthiest tech tycoons have collectively lost 315 billion dollars over the past year.
Ouch.
The Federal Reserve giveth and the Federal Reserve taketh away.
The same thing is true for the housing market. Fed policies created the largest housing bubble in our history, but now that bubble is bursting.
In fact, it is being reported that we just witnessed “the largest single-month price declines” since the last financial crisis…
… today Black Knight confirmed that the US housing market has turned decidedly ugly with the two biggest monthly declines since the global financial crisis.
According to a Monday report from mortgage-data provider, median home prices fell 0.98% in August from a month earlier, following a 1.05% drop in July.
The two periods marked the largest monthly declines since January 2009. In fact, at the current pace of declines, we may soon see a record drop in home prices, surpassing the largest historical slide hit during the global financial crisis.
The report noted that July and August 2022 mark the largest single-month price declines seen since January 2009 and rank among the eight largest on record.
If the Federal Reserve does not reduce rates, things will soon get really, really ugly for the housing market.
Unfortunately, the Fed is actually going to keep raising rates because Fed officials are scared to death of the raging inflation crisis that they originally helped to create.
Thanks to the Fed, grocery prices were up 13.5 percent in August…
We’ve seen the higher prices at the grocery store, and it looks like they won’t be coming down anytime soon.
New government data shows grocery prices climbed 13.5% in August from the year before. That’s the highest annual increase since March 1979.
Food producers say the surge is a result of paying higher prices for labor and packaging materials. They also point to extreme weather, disease and supply issues.
As long as we keep seeing numbers like that, the Fed is going to keep raising rates.
And the price of gasoline just hit another all-time record high in Los Angeles…
Gas prices hit a record high in Los Angeles County of $6.466 per gallon on Monday morning, soaring past the previous record set during the nationwide price surge this past spring.
If you think that is bad, just wait until California residents are paying 10 dollars a gallon for gasoline.
The cost of living has become incredibly oppressive, and one recent survey found that 73 percent of Americans believe that their incomes are “falling behind inflation”…
Scott Rasmussen’s Number of the Day survey results on Ballotpedia also found that 73% of Americans say that over the past year, their income has been falling behind inflation. The survey’s sample size was 1,200 registered voters, and it was conducted online by pollster Scott Rasmussen on Sept. 15-17. The margin of error for the full sample is +/- 2.8 percentage points.
Until inflation is under control, the Fed is going to keep raising rates.
And inflation is not likely to be under control any time soon, because the vast majority of U.S. manufacturers are planning more price increases in 2023…
In a new Forbes/Xometry/John Zogby Strategies survey shared with Secrets about the impact of inflation and the continued supply chain crisis under President Biden, 87% of manufacturing CEOs said they planned to increase prices in 2023.
Many cited the ongoing supply chain crisis, problems getting materials from China, and sellers taking advantage of the economic mess to jack up prices.
“Our margins are under pressure as costs creep up throughout the supply-chain network,” one CEO told the poll conducted by Jeremy Zogby, the managing partner of John Zogby Strategies.
So the Federal Reserve will not be riding to the rescue of the financial markets this time around.
Fed officials are absolutely petrified of high inflation, and so rates will continue to go up.
And that means that this financial bubble will continue to implode. As Eric Peters has aptly noted, market crashes can take a long time to fully play out…
“It’s important to remember that the bursting of a bubble takes a long time to play out. It may feel fast and chaotic at various points in the process, but it isn’t really. Look at 2008. Everyone thinks of Lehman’s Bankruptcy on September 15, 2008, as the big catalyst for that crisis, but the S&P 500 had peaked the previous November. Bear Sterns failed on March 13th, 2008. From the Friday before Lehman’s bankruptcy to the end of that month, the S&P was only down 7%. The real weakness was in October with a local low in November.”
The final bottom wasn’t until March of the next year. “The bubble was bursting before Lehman Brothers.” That was just the large cathartic event that caught our attention, ignited our imagination. “And even after that it took months for the market to bottom. Markets don’t clear imbalances instantaneously. So we should be preparing ourselves for a marathon, not a sprint.”
We are still only in the very early chapters of this story.
As I have been relentlessly warning my readers, things are going to eventually get really, really bad.
The Federal Reserve and other central banks flooded the global financial system with money, and so now we are facing a horrific worldwide inflation crisis.
They are attempting to fix things by rapidly raising rates, but that is causing absolutely enormous problems for global financial markets.
This isn’t going to end well, and we have finally gotten to a point where this should be exceedingly obvious to everyone.
***It is finally here! Michael’s new book entitled “7 Year Apocalypse” is now available in paperback and for the Kindle on Amazon.***
About the Author: My name is Michael and my brand new book entitled “7 Year Apocalypse” is now available on Amazon.com. In addition to my new book I have written five other books that are available on Amazon.com including “Lost Prophecies Of The Future Of America”, “The Beginning Of The End”, “Get Prepared Now”, and “Living A Life That Really Matters”. (#CommissionsEarned) When you purchase any of these books you help to support the work that I am doing, and one way that you can really help is by sending digital copies as gifts through Amazon to family and friends. Time is short, and I need help getting these warnings into the hands of as many people as possible.
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I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions.
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Article cross-posted from The Economic Collapse Blog.
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.
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The money wasn’t lost; it was stolen.
It went somewhere.