Warning Signs a Stock Market Crash Is Coming

The Dow has soared 13% since Election Day, and just last week (Feb. 10), all three major indexes closed at all-time highs. The “Trump Rally” has been great for stocks, but some observers are starting to wonder if soaring highs mean a stock market crash is coming.

No one can predict a stock market crash with 100% certainty. But we want our readers to be as informed as possible about what could happen in the market.

That’s why we’re looking into historic stock market crashes to identify warning signs that can be used now.

China gold holdings jump 57pc, but buying not what it used to be

It’s just a guess, but in the near future you shouldn’t be surprised to see an announcement of a gold-backed Chinese currency. They’ve been increasing the inventory of gold for too long to not do something with it and they would love to put a dent in America’s global hegemon.

 

China’s gold reserves stood at 1658 tonnes at the end of June, the central bank said on Friday, up 57 per cent from the last time it adjusted its reserve figures more than six years ago.

Despite the tonnage increase, gold now accounts for 1.65 per cent of China’s total forex reserves, against 1.8 per cent in June 2009.

The reduced ratio suggests China will increase its bullion purchases, but the market had focused elsewhere, traders said.

Warren Buffett: Derivatives Are Still Weapons Of Mass Destruction And ‘Are Likely To Cause Big Trouble’

After all these years, the most famous investor in the world still believes that derivatives are financial weapons of mass destruction.  And you know what?  He is exactly right.  The next great global financial collapse that so many are warning about is nearly upon us, and when it arrives derivatives are going to play a starring role.  When many people hear the word “derivatives”, they tend to tune out because it is a word that sounds very complicated.  And without a doubt, derivatives can be enormously complex.  But what I try to do is to take complex subjects and break them down into simple terms.  At their core, derivatives represent nothing more than a legalized form of gambling.  A derivative is essentially a bet that something either will or will not happen in the future.  Ultimately, someone will win money and someone will lose money.  There are hundreds of trillions of dollars worth of these bets floating around out there, and one of these days this gigantic time bomb is going to go off and absolutely cripple the entire global financial system.

Bank of America: Markets Are in a ‘Twilight Zone’ and It’s Time to Hold More Cash and Gold

You can’t find a bigger warning of lately than what just came from BoA.

 

In a note sent out this morning, Bank of America Merrill Lynch has a warning for investors:

Investors remain trapped in “The Twilight Zone”, the transition period between the end of QE and the first rate hike by the Fed, the start of policy normalization…until (a) the US economy is unambiguously robust enough to allow the Fed to hike and (b) the Fed’s exit from zero rates is seen not to cause either a market or macro shock (as it infamously did in 1936-7), the investment backdrop will likely continue to be cursed by mediocre returns, volatile trading rotation, correlation breakdowns and flash crashes. For this reason we continue to advocate higher than normal levels of cash, adding gold and owning volatility in mid 2015. Given extremities of liquidity, profits, technological disruption, regulation, income inequality…potential for a cleansing drop in asset prices cannot be dismissed. Most likely catalysts: Consumer, Rates, A-shares, Speculation, High Yield.

Putin’s disappearance implies a Russian dictatorship

Russian President Vladimir Putin has gone missing from public view without any explanation and Russians are wondering why.

Berlin:  Russian President Vladimir Putin has disappeared. Well, not literally, but he hasn’t been seen in public for a full week and reports about his schedule on the presidential website seem suspect. The Kremlin denies that he is ill, and the Russian blogosphere is abuzz with speculation.

It’s still impossible for an outsider to tell where Putin is, or what he’s up to. But it isn’t too early to draw conclusions from this episode. It offers evidence enough that Russia has become an outright dictatorship. No other kind of state would be so opaque, nor its citizens so preoccupied with their ruler.

Hoping for a Historical Turning Point

CARACAS/BERLIN (Own report) – In the prelude to the German Chancellor’s visit to Latin America at the end of next week, government advisors in Berlin are predicting that the continent is facing a “historical turning point.” According to a new analysis by the German Institute for International and Security Affairs (SWP), it can be expected that the “resignation” of the seriously ill Venezuelan President Hugo Chávez will provoke serious upheavals – not only in Venezuela. Cuba also could be seriously affected, due to its dependence upon Caracas. Without Chávez, Alba, the international alliance that is resisting US-American and European hegemony on the continent, would be lacking a leadership, capable of achieving its objectives, says the SWP. The think tank sees herein a window of opportunity for Berlin. It can be expected that in the coming reshuffle, Brazil will be able to reinforce its standing in South America. In Berlin, this is seen as advantageous, because Brazil is one of Germany’s most important Latin American allies. In addition, writes the SWP, this opens up new opportunities for Berlin in the “promotion of democracy” and political “counseling” in Latin America.