On Jan. 31, Wal-Mart said the reduction in food-stamp benefits by as much 5.5% in November hurt its profits last quarter and were the reason the company’s comparable-store sales were negative (-0.4%) rather than flat at its Walmart stores.
This is an astounding figure - much worse than I thought. Extrapolating linearly, which I think is valid, it would mean if the food stamp program were eliminated, Wal-Mart's same store sales would fall 7-8%. Absolutely astounding.
Maybe this bears repeating, I don't know.
If things were structured like they were 80 years ago with the small Main Street businesses I would say yes, it is possible and likely that things hold together, for that reason alone. But the size of the mega corporations and their high fixed costs preclude a middle of the road outcome in my opinion. Their profit margins are high now but a lot of that is due to government aid in many forms as well as corruption that is unsustainable. That translates back to why the need for $1 trillion per year in QE and deficits. The corporations need that because they don't operate at a profit without it. For example, I heard one aspect of that today in an interview on King World News where they were talking about the fact that a 5% reduction in food stamps caused Wal-Mart's sales to go down significantly enough to warrant mentioning. I would say (as you know) that a 1/3 to 1/2 retrace or corrective move is a normal outcome of natural systems, including economics. When sales contracted 1/3 in the 1930s everything was basically OK. The sales of the mega corporations haven't grown much in a decade. Anything that retraces those sales by 1/3, be it a collapse in US bond prices, a pandemic, a cutoff in oil supplies from overseas, a collapse of the Japanese government or other likely events would I think bankrupt every Dow 30 company because their profit margins in normal times over the past 30 years average in single digits as a percentage of sales. If every Dow 30 company goes bankrupt it's not the end of the world but things will be significantly harder than they were in the 1930s. How people take it from there will determine the further outcome but I am not optimistic about that either. But it starts with the fact (I'm 95% sure it's a fact) that the Dow 30 US based mega corporations cannot survive without government aid and their actions (lobbying, price fixing, political system control, media control, etc.) show that. That would include the gold and bond price fixing by the Fed which is done solely for their benefit.
While the periphery breaks down rather slowly at first, the capital cities of the hegemon should collapse suddenly and violently.
In Days of Destruction, Days of Revolt by Chris Hedges and Joe Sacco, inverted totalitarianism is described as a system where corporations have corrupted and subverted democracy and where economics trumps politics.[5] In inverted totalitarianism, every natural resource and every living being is commodified and exploited to collapse and the citizenry are lulled and manipulated into surrendering their liberties and their participation in their government by excess consumerism and sensationalism.
a, I'm in the process of exiting all short positions tonight. I'm 75% out. The reason is a simple one - the damn thing simply isn't going down very much. There was an outside reversal bar on the daily today, but how many reversals have we seen that were negated. There was a huge one 2 Thursdays ago. I'll get back in when the market starts to free fall for real or on a retrace back up.
While the periphery breaks down rather slowly at first, the capital cities of the hegemon should collapse suddenly and violently.
Reality Check wrote:This guy is predicting intentional hyperinflation ( relative to the dollar ) and the U.S. voluntarily replacing the U.S. controlled FED with an internationally controlled IMF board where the countries of Russia and China having a veto.
Where is Vince to weigh in on this one?
The IMF SDR is based on the Euro, Yen, Pound, and Dollar. If these all hyperinflate (which I expect) then the SDR hyperinflates too. If the IMF were to add gold to make 5 components to the SDR, then the SDR would eventually just be gold (as other 4 became worthless) and then the SDR or gold would take over. I have not seen anyone propose adding gold to the SDR, but I would if I was in charge.
Higgenbotham wrote:a, I'm in the process of exiting all short positions tonight. I'm 75% out. The reason is a simple one - the damn thing simply isn't going down very much. There was an outside reversal bar on the daily today, but how many reversals have we seen that were negated. There was a huge one 2 Thursdays ago. I'll get back in when the market starts to free fall for real or on a retrace back up.
Told ya. shorting the market right now and in the past several years has been a suckers bet.
The PTB will not allow this thing to tank(implode) . it has to explode from excess pressure. Not there yet as the debt is spread everywhere. We get a blow out and then it will be too late to jump in with shorts, until then it is throwing darts with a blindfold on.
Higgenbotham wrote:a, I'm in the process of exiting all short positions tonight. I'm 75% out. The reason is a simple one - the damn thing simply isn't going down very much. There was an outside reversal bar on the daily today, but how many reversals have we seen that were negated. There was a huge one 2 Thursdays ago. I'll get back in when the market starts to free fall for real or on a retrace back up.
Told ya. shorting the market right now and in the past several years has been a suckers bet.
The PTB will not allow this thing to tank(implode) . it has to explode from excess pressure. Not there yet as the debt is spread everywhere. We get a blow out and then it will be too late to jump in with shorts, until then it is throwing darts with a blindfold on.
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The market has "only" been up 1% in the past month I have been going short, rather than the "normal" 2% per month it has been up over the past couple years.
The only thing that I've found that works in this market is some version of "Maximum Ruin" except on a shorter term basis. The way it works is to look everything over and evaluate it based on logic and normal experience. After doing that, determine where to put a stop or, in other words, where the market would be unlikely to go. I've found that very often over the past year it will go to almost exactly that place.
As an example, last night I thought if I went long the Russell 2000 I would put a stop at 1142.70, as it would be unlikely for the market to get there if the GDP report was in line. After an in line GDP report was released, the market sold off early this morning and came down to within 1 tick of that number.
While the periphery breaks down rather slowly at first, the capital cities of the hegemon should collapse suddenly and violently.
I sold this evening's rally in the S&P futures, getting back in short where I got out last evening. Today's action looked bearish to me; the market failed to rally from the selloff like it has in the past.
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While the periphery breaks down rather slowly at first, the capital cities of the hegemon should collapse suddenly and violently.
