Market Analysis In The Wake Of Trump’s Triumph

As I expected, not much happened in the market until the election.  The Dow Jones Index remained in the box it found itself in since early September, until last Friday when it broke down 4% from its last all-time high.  Then on Monday the stock market began a week that saw the Dow Jones gain 959 points in the wake of Donald Trump’s election victory.  Thursday and again on Friday the Dow closed at new all-time highs.  To be sure a very impressive week for the stock market.

However, at the close of the week only one other major market index found itself at a new all-time high.  Though a good portion of the indexes in the table below could close at new all-time highs next week should it prove to be just half as bullish as this past week.  If this is a bull market, I would expect a good follow through after the strong week we’ve just seen.  If not, the market in the weeks to come will be disappointing to the bulls. 

Let’s face it; since the Federal Reserve terminated its QE-3 two years ago we’ve continued seeing major market indexes rise up to new all-time highs, yet somehow they’ve failed to produce much in the way of capital gains.  The Dow Jones in November 2014 was seeing new all-time highs in the 17,600 range.  This makes Friday’s new all-time high for the Dow Jones (18,847) only a 7.0% advance from two years ago (11 November 2014). 

If a single-digit percentage advance in two years is a bull market to you, then to you it’s a bull market.  Speaking for myself, I believe the entrenched interests in Washington and Wall Street have for decades used the financial markets as political props to appease the public, keeping themselves entrenched in the process.  So seeing the Dow Jones make two new all-time highs this week isn’t bullish to me; quite the opposite.

In the chart below, it’s apparent that since late 2014 the Dow Jones (Red Plot) has found it easier to decline than to advance.  Also, since late summer 2015, the Dow Jones’ 200 count (Blue Plot: the number of days the Dow moves 2% or more from a previous day’s closing in a running 200 day count) has refused to decline to a zero count.  Currently it’s at six.  If the stock market is in a bull market, the Dow Jones’ 200 count will decline to the levels seen in the mid-1990s and 2000s, as well as from 2013 to 2015.  If not, we’ll see the count increase into double digits as the market deflates, as happened during the tech wreck and credit crisis bear markets.

The thing that keeps coming to my mind when studying the chart below is that all bull market advances are limited.  They continue only for so many days and points; and then the advance is over.  Since March 2009 the Dow Jones has advanced for almost eight years and 12,300 points.  How many more days and points is this aging bull good for? 

Speaking of new all-time highs; the Dow Jones Total Market Group (DJTMG) saw only four at week’s close, far from the quantities of new all-time highs it enjoyed at the end of QE-3; two years ago.

Below, the DJTMG’s “Top 20”; the number of groups within 20% of their last all-time highs ended the week at 44, a good way from its peak of 52 seen in July 2014.  But it’s not collapsing either, though it started to last January.  The last few years has been very frustrating for us market bears, as there are plenty of reasons for expecting a serious market decline, a market decline that somehow never materializes.  But unless the market bulls had invested in one of the few hot groups at the end of last January market downturn, which few did, there is little for them to boast about. 

Even our entrenched establishment, the people managing this mess can’t be happy with the market as it was Trump, not Hillary who seems to have benefitted from the “economic stability” seen above and below.  If Trump is good to his word of “draining the swamp”, I expect we bears will finally see our market decline as indictments from his Department of Justice are processed for the Clinton crime family in Washington and Wall Street.

Speaking of pending indictments from Trump’s Department of Justice, let’s move on to the gold market.  Below, gold and its step sum were doing good at the close of election day (November 8^th), and then the day after it got whacked – again.  What happened?  Well, over at King World News, Andrew Maguire reports that 6,800 tons of paper gold, gold that doesn’t exist was traded in a single day.  That’s more fictional gold changing hands in the gold market in a single day than what the entire global gold-mining industry digs out of the Earth in two years.  What’s remarkable is how well the gold market took this massive movement of fictional gold: for the week it declined only $76, not several hundred dollars.

http://kingworldnews.com/andrew-maguire-paper-gold-market-trades-6800-tonnes/

If President Trump is sincere in his promise to “drain the swamp”, he needs to include the New York banking establishment’s criminal activities such as this.  Let’s pray that 2017 will see gold, silver and their miners resume their bull markets with vigor as the Department of Justice goes to work under new management.

Gold almost saw its 15 count rise to double digits on November 4^th, taking the price of the yellow metal up $53 from its low of October 14^th.   Then the “policy makers” took over and hammered gold down $76 in the last three days of the week.  Don’t get discouraged.  This asymmetrical battle between “policy” and inflationary monetary-policy reality too shall pass.

Before the election most “expert opinion” on the markets predicted a crash should Donald Trump win Tuesday’s election.  Then came Wednesday, where he did yet the market didn’t.  In fact on Thursday, two days after the election, the Dow Jones closed at a new all-time high, and did it again on Friday’s close. 

President elect Trump is known for spectacular real estate projects that typically are completed under budget and ahead of schedule.  In light of the stock market now rising to new all-time highs, current reasoning is that someone with Trump’s business acumen managing national affairs, the economy and stock market has more to gain than to lose.

But I’m not so sure that will ultimately prove to be an accurate assessment of our current situation.  For instance, the bond market apparently sees the economic situation much as I do.  Below is a 30 year US T-bond that has been trading for the past ten years; a bond issued at the peak of the sub-prime mortgage bubble.  Since July of last summer when Trump won the Republican nomination, T-bond yields (Red Plot) have been rising.  But just last week (circle) they spiked in response to Trump winning the presidential election.

This 30-year bond was issued with a 4.5% coupon.  During the mortgage bubble it peaked above 5% several times before its current yield collapsed to 1.64% just four months ago in July.  Since then its current yield has spiked to 2.50%.  Anyone who purchased this or any other long-term T-bond when Trump was nominated by the Republicans last summer is still receiving their minuscule, less than 2.23% return on their investment of last summer.  A pathetic return when one realizes that since last summer the price of this now 20-year bond collapsed by 12%.  The current 30-year bond is down 15%.

Since the autumn of 2008, few if anyone purchased these bonds for income.  Currently the above bond still has twenty years before it matures, and with a current yield of 2.5% it’s still dangerously underpriced, as it has been during the entire Obama Administration.  Not that it mattered, as the entire T-bond market (aka: the US national debt) has become the playing field for the dynamic duo of leveraged speculators and central bankers.  The potential for a seismic shift upward in the yield curve is huge.

Here’s a chart of the national debt since the January 2001 George W. Bush inauguration.  The national debt increased over 80% under both Bush and Obama, money squandered on bureaucratic growth and wars.  And now Trump promises to reinvigorate the economy by refurbishing the nation’s civic infrastructure and upgrading the military, along with reducing socialist’s economic regulations that really do little but make life harder on everyone.  I’m all for that, but reviewing  what bond yields have done since Republican’s nominated Trump last July, I wonder what bond yields will ultimately rise to should President Trump attempt to increase the national debt just 30-40% in the next eight years?

President Trump has promised to “drain the swamp”, which to my mind is a commitment to prosecute the criminal activity by “policy makers” now managing Wall Street and the Federal Reserve.  To do so is all well and good.  However we need to note it was precisely this criminal element managing “monetary and economic policy” that ensured market values remained inflated, and interest rates and bond yields depressed.  When the members of the FOMC and Wall Street’s banking elite see their day in court, don’t be surprised if bond yields approach, and maybe exceed double digits long before he runs for his second term.

Prosecuting the criminal empire that supports our current low interest rates, in a world wallowing in insupportable, consumptive debt will result in massive defaults in the debt market.  Ultimately this is going to happen anyway, as economic calamity and personal tragedy for billions of people was engineered into the system.  So my advice to President Trump is: if confronted with the choice of statutory justice or “economic growth” as he drains the swamp; he needs to enforce the law come what may. 

I used to discount much of what I read about the “New World Order.”  Things like Henry Kissinger, and other peddlers of “policy” being pedophiles.  But then WikiLeaks released their John Podesta e-mails revealing pedophilia and actual Satanism: that’s not a type o; SATANISM as well as pedophilia are enthusiastically engaged in by members of Hillary Clinton’s inner circle.

https://www.google.com/?gws_rd=ssl#q=infowar+Podesta+emails+satanic

Interestingly, people at the highest levels of politics whose personal e-mails have been leaked have never claimed these e-mails are forgeries.  Rather they have verified that they were actually true by attempting to blame Russian intelligence for hacking their e-mail accounts and threaten actual war in retaliation.   As it turned out, it was American intelligence that provided Wiki Leaks with the e-mail data, because they refusal to serve under a government run by people possessed by demons.  I’m not making this up!

I can’t believe I’m saying this.  It’s like a movie plot for a cheap horror film!  But the Podesta email disclosures by Wiki Leaks are only the tip of the Satanic iceberg that the American political system, economy and financial markets have run aground on.  The NYPD has obtained a computer used by former congressman Anthony Weiner in a pedophilia investigation.  I’m very anxious to see just who is involved in Weiner’s “social” life.  Weiner’s computer has over 600,000 compromising e-mails, including much from Hillary Clinton during her days at the State Department.

https://www.google.com/?gws_rd=ssl#q=anthony+weiner+computer+pedophilia

The fact that Wiki Leaks and the NYPD have gone public on the broad outline of very compromising information on political operatives at the highest levels of American politics, and the fact that the mainstream media (MSM) has chosen to remain silent on this information from solid respected sources, strongly suggests that the MSM at its highest levels is criminally compromised in the NYPD’s pedophilia investigation.  Small wonder the MSM supported confusing the gender lines in America’s public restrooms last summer; their dark lord insisted upon it.

So why bring this topic up in an investment article?  Because it explains so much of why the MSM and government market regulators has failed to protect the public since President Clinton dismantled the Glass Steagall Banking Act, and allowed the massive and fraudulent OTC derivative market to operate unregulated since 1999. 

Go look at the links provided above and then ask yourself how else would a financial market operated when under the supervision of blood-drinking Satanic pedophiles?  These people are disgusting!

I’m sure President Elect Trump has great plans for his first term of office.  But unless he gives priority to prosecute these evil people, whoever they are on Wall Street, in Washington, the media and Hollywood; he does us all an injustice.   Especially to the many young children these monsters have victimized.  It would be an evil act to allow anyone involved in this to remain in power, or at liberty in society for the sake of “economic stability.”

If there was ever a time for my readers to contact their elected officials in Washington, demanding to know exactly what THEY ARE GOING TO DO ABOUT THIS, this is that time.  In all too many cases, I’m sure Washington’s elected officials first response after receiving a letter from my readers would be to remain silent, and get a good lawyer.

Mark J. Lundeen

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