Home
Economy
Economy
by
Chris Martenson
Executive Summary
- China’s critical role in keeping the party going (and why China is in a weaker position this time)
- Despite current stock prices, the economic data is awful and fast getting worse
- A recession is near-unavoidable at this point
- What to do if you’re not in the top 0.1%
If you have not yet read Part 1: It’s 2016 All Over Again. Or Is It?, available free to all readers, please click here to read it first.
I know that it seems as if the US equity markets cannot ever go down and, truthfully, those indexes receive a ton of help from the Fed, the media, and from corporate buybacks.
The trouble, as always, when it begins will not be detected in the large, successful companies first. Amazon and APPL will be among the last to go down.
The trouble will start at the outside and work its way inwards. This “outside in” phenomenon is pretty robust and it has not yet been repealed by the interventionistas at the Fed.
In the US we might look to the small cap stocks to give way first, and I think they have. It’s in that universe where we will find an outsized majority of the zombie companies.
From a fundamental standpoint the small caps are a certified balance sheet mess. Their net debt has been on a 40-degree, ruler-straight rise since 2010 even as their EBIDTA has risen at only a 10-degree trajectory. The current gap is eye popping.
This is a huge increase in debt, and it makes these companies especially vulnerable to any economic downturn or rise in interest rates.
Accordingly, while all eyes are on the Nasdaq powering to a brand new all time high, the small caps in the Russell 2000 are definitely not making new highs and seem to be sneaking out the back door.
If you are looking for a place to short US equities at the index level, the small caps are the …
Why This Better Work
PREVIEW by Chris MartensonExecutive Summary
- China’s critical role in keeping the party going (and why China is in a weaker position this time)
- Despite current stock prices, the economic data is awful and fast getting worse
- A recession is near-unavoidable at this point
- What to do if you’re not in the top 0.1%
If you have not yet read Part 1: It’s 2016 All Over Again. Or Is It?, available free to all readers, please click here to read it first.
I know that it seems as if the US equity markets cannot ever go down and, truthfully, those indexes receive a ton of help from the Fed, the media, and from corporate buybacks.
The trouble, as always, when it begins will not be detected in the large, successful companies first. Amazon and APPL will be among the last to go down.
The trouble will start at the outside and work its way inwards. This “outside in” phenomenon is pretty robust and it has not yet been repealed by the interventionistas at the Fed.
In the US we might look to the small cap stocks to give way first, and I think they have. It’s in that universe where we will find an outsized majority of the zombie companies.
From a fundamental standpoint the small caps are a certified balance sheet mess. Their net debt has been on a 40-degree, ruler-straight rise since 2010 even as their EBIDTA has risen at only a 10-degree trajectory. The current gap is eye popping.
This is a huge increase in debt, and it makes these companies especially vulnerable to any economic downturn or rise in interest rates.
Accordingly, while all eyes are on the Nasdaq powering to a brand new all time high, the small caps in the Russell 2000 are definitely not making new highs and seem to be sneaking out the back door.
If you are looking for a place to short US equities at the index level, the small caps are the …
by
Adam Taggart
by
Chris Martenson
If you've not been watching our Real Estate investing webinar series, you're missing out on a wealth of learning.
Our last episode, Episode #3, received rave reviews. It was a 2-hour romp through the math involved in valuing real estate property. Russell Gray does an excellent job de-mystifying the numbers for newbies and the math-phobic, walking through the calculations and showing how virtually anyone can derive empirical answers to questions like:
- What's a fair value for this property? Is it under/overvalued?
- What's my expected return if I purchase this property?
- What are the investments can I make that will have the biggest impact on increasing my equity? Or my income?
Don't forget to register for our upcoming Episode #4, in which Russ will build on his earlier material, explaining how to secure capital for investment property, how leverage can be used (prudently, not recklessly) to increase your returns, and what tax implications (and often benefits) to expect.
Fun With Numbers
by Chris MartensonIf you've not been watching our Real Estate investing webinar series, you're missing out on a wealth of learning.
Our last episode, Episode #3, received rave reviews. It was a 2-hour romp through the math involved in valuing real estate property. Russell Gray does an excellent job de-mystifying the numbers for newbies and the math-phobic, walking through the calculations and showing how virtually anyone can derive empirical answers to questions like:
- What's a fair value for this property? Is it under/overvalued?
- What's my expected return if I purchase this property?
- What are the investments can I make that will have the biggest impact on increasing my equity? Or my income?
Don't forget to register for our upcoming Episode #4, in which Russ will build on his earlier material, explaining how to secure capital for investment property, how leverage can be used (prudently, not recklessly) to increase your returns, and what tax implications (and often benefits) to expect.
Total 3620 items
Community
Top Conversation
Fauci's Private Diary Exposes Stark Contradictions on Lab Leak, Lethality, Lockdowns & Vaccines
by sand_puppy 
eQRP: Self-Directed Retirement
Learn more