When the next financial crisis comes – the big banks could save themselves by stealing right out of your checking account. Banking expert Ellen Brown, Public Banking Institute/Web of Debt/The Public Bank Solution will explain how in tonight’s Conversations with Great Minds. Here is a direct video link.
If you’ve ever been in a drug or convenience store and waited behind people gaming lottery tickets you may have noted an air of desperation or addiction in the players. Odds are you’d probably be right. As income-disparity has widened, mega-million prize pots are attracting the highest proportion of cash flow from low income families ever. At the same time, prizes have soared because the odds of winning big has plunged. And far from living the dream, large payouts ending in waste, heartache and ruin for the winners is the norm. As for government or charitable revenues collected from gaming, it frequently doesn’t end up in its advertised social programs. Widespread, easily accessible gambling is costing us all. See Powerball’s $1.3 billion swindle of Americans:
In October, the consortium of states that runs Powerball approved a series of rule changed that made it much harder to win the jackpot. Under the new rules you select five of 69 numbers, up from five out of 59 numbers. The choices for the Powerball was actually reduced from 35 to 26. Still, this decreased the odds of winning the jackpot from 1 in 175 million to 1 in 292 million…
Lotteries promise the low-income people who make up the biggest portion of ticket buyers that they’ll win either through a payout or increased services. But most of the time, neither is true. As one study put it, “lotteries set off a vicious cycle that not only exploits low-income individuals’ desires to escape poverty but also directly prevents them from improving upon their financial situations.”
As the Secular bear is mauling Canada, it would be a mistake to think that the S&P 500 is somehow immune or likely to escape the cyclical bear market already underway across the world. As shown below since 1996, years of reckless leverage and central bank interference have left a heinously over-valued S&P 500 staring down outrageous price risk. So far just 9% below its May 2015 cycle peak, the first significant downside test lies at least 25% lower in the 1500 area (first brown band) that marked the peak of the 2000 and 2007 cycles. As secular bears go, -34% would be an unusually mild mauling.
Indeed as shown above in the 2000-03 and 2007-09 cyclical bears, a decline towards the 2009 lows (green band) is also probable for the large cap US index this time. That would suggest an S&P 500 in the 800 area. And as shown in the lower panel (green line) above, each of these prior bear markets wrought 50%+ declines after the RSI (relative strength indicator) broke below 47. It did this again with last week’s close (46.72).
