Wednesday, April 13, 2016
By Paul Martin

APRIL 13, 2016

Yesterday we went over the state of the world and if you read the article you’ll find it’s not good. In fact, it’s downright disastrous. There are defaults and impending collapses all over the place, from China to Europe to South America and beyond.

What did the stock market do the very next morning? It went up 160 points for some reason.

So let me try again to expose the reality of what’s happening. And then I’ll try to provide some actions you can take from an investment and savings standpoint. Hey, no matter how bad it is, someone is always making a profit somewhere. It might as well be us. In fact it will be us. The market is turning fast now, and we’re turning with it.

News first. While the market was climbing some 160 points, the Atlanta Fed continued to downgrade the US economy. Since beginning the year with an announcement that GDP growth for the first quarter of 2016 would be above 1%, and calling for growth as high as 2.6% as recently as February, the Atlanta Fed has changed course immensely since March 15 and has called for growth estimates of .7%, .4%, and now .1% respectively since that date.

That’s just shy of a recession and I don’t believe the number anyway. Call the US’s economic condition whatever you want. I call it a depression, one that’s been taking place since at least 2008 and papered over with 8 years of 0% interest rates and waves of money printing that they are almost becoming like the Rocky movies. QE1… QE2… QE3. And QE4 is coming, but likely not until a few thousand points get shaved off the Dow in quick fashion… and even then the market will continue to drop as more people begin to realize what’s going on and begin to scramble out of stocks that are valued based upon a good economy.

Then there’s the IMF. The IMF came out once again and admitted it had been too optimistic. In its just released quarterly World Economic Outlook report, the agency chopped its growth forecast by another 0.2% for 2016, down to 3.2%. At one point, the IMF was forecasting 4.0% GDP growth in 2016. It doesn’t matter though, GDP numbers have no bearing on the growth of an economy despite what everyone tells you. And those numbers are SO FAR out of whack with the reality on the ground in almost every country in the world it is laughable.

And yesterday, while the US market was climbing, Italian banks went limit down. They’re broke and so is the government. Over the past 12 months, the Italian market is down by 1/3 and the banks are doing so badly that they can’t raise more equity – not in Italy, not anywhere. The government has had to engineer a series of bailouts.

The Rest…HERE

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