…The failure of Trump and reform movements in Europe are the catalyst to send the stock market to record highs once again as people lose confidence in government completely…Money will pour into equities, not because of earnings, but because capital is fleeing from government and banks and it just needs a place to park…to survive the political chaos on the horizon.
The comments above & below are edited ([ ]) and abridged (…) excerpts from the original article by Martin Armstrong (ArmstrongEconomics.com)
When you reach a point that you no longer trust banks, the currency, or government, where does big money go? Individuals can buy gold…[but] big money parks in blue chips and tangible assets like real estate…
The 2009 peak in the PE Ratio reflects that moment of a complete collapse in confidence. This is the key point we must understand…Nobody can stop this – not Trump, not Le Pen, or any other reactionary politician – they are simply the fuel to ignite the collapse in public confidence.
We have crossed the point of no return because nobody is talking about restructuring the entire monetary system and debt system. That will not take place UNTIL we crash and burn. Nobody changes anything until they have to…
…Trump WILL FAIL! This much is inevitable. The trend is against him and you can not fight the trend…When he fails to reverse the global trend…that is when the stock market starts to rise for reasons that will confuse most. This is not the “Trump Rally” but the collapse in public confidence rally.
This is the Year from Political Hell on a global scale. This is all about capital flows…and whatever he does with taxes, he better do it fast, for when the politics shift again, taxes will only rise because governments; federal, state, and local, are broke and that will not change…
This is the collapse in confidence in government and Trump cannot reverse that trend. In fact, Trump has raised hopes among the silent majority that things will change. His failure, especially on trade, will sour the confidence in government completely… This is when civil unrest becomes really dangerous.
The same is true in Europe. The loss of the extreme right in the Netherlands has only emboldened Brussels assuming this is just a short-lived “populist” movement that will die out. This defeats any possible reform movement and ensures we will crash and burn starting in 2018.
At the end of the day, the next level of resistance is still in the 23000 level. After that, we cross the threshold into a Phase Transition. That is when everything begins to get truly confusing and crazy.
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