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Russia Vows “Death For Death” Following “Night Of Terror” In Moscow (whatdoesitmean.com)
What You Aren’t Being Told About The World You Live In
How The “Conspiracy Theory” Label Was Conceived To Derail The Truth Movement
How Covert American Agents Infiltrate the Internet to Manipulate, Deceive and Destroy Reputations
March 23, 2024
Russia Vows “Death For Death” Following “Night Of Terror” In Moscow
By: Sorcha Faal, and as reported to her Western Subscribers
A beyond horrifying new Security Council (SC) report circulating in the Kremlin today first noting President Putin addressed the nation about the Crocus City Hall shooting, denouncing it as a bloody and barbaric terrorist attack and vowing to punish all involved, says this followed Deputy Prime Minister Tatyana Golikova revealing: “President Putin has wished all those injured in the Crocus City Hall terrorist attack a recovery and conveyed compliments to medical staff” and Health Minister Mikhail Murashko announcing: “The main work on providing care to those admitted is complete, the activities on stabilizing patients continue now”.
Following top Kremlin spokesman Dmitry Peskov declaring on behalf of the Russian Federation to the world for the first time “We are in a state of war” yesterday morning, this report notes, Moscow was struck with a “night of terror” when terrorist gunmen attacked the Crocus City Hall shopping and concert complex at around 8 p.m. local time.
According to the Investigative Committee (SLEDCOM), report, the official death toll was placed at 133, and they said this figure is “likely to rise further” while revealing: “According to preliminary data, the causes of death were gunshot wounds and poisoning by combustion products-smoke inhalation”—and reliable Russian media sources placed the death toll at 143.
Earlier today, this report details, the Federal Security Service (FSB) announced: “Eleven people have been detained over the terrorist attack on the Crocus Crocus City Hall concert venue outside Moscow...The arrested suspects include four terrorists who were directly involved in the terrorist attack on Crocus...All four terrorists were arrested in Russia’s Bryansk Region within several hours as a result of well-coordinated actions by the security services and the police...The detainees are now being transferred to Moscow”—and the FSB also revealed: “After committing the crime, the perpetrators attempted to flee, driving in a car in the direction of the Russia-Ukraine border...The perpetrators of the terrorist attack had contacts on Ukrainian soil”.
In a video released showing one of the arrested terrorists, this report notes, it was reported: “The suspect gave his name, which sounds similar to Fariddun Shamsutdin, as well as his date of birth - 17 September 1998...He had arrived from Turkey on 4 March...The detainee said that his handlers contacted him a month ago via Telegram and provided him with weapons...He was given the task of killing all the people in the hall and was offered about a million rubles for this...The defendant added that he committed the crime after a conversation with the preacher’s assistant”—and a second video sees another captured terrorist also confessing he received orders via the Telegram messaging service.
On 7 March, this report continues, the United States Embassy in Moscow issued the urgent bulletin “Security Alert: Avoid Large Gatherings Over The Next 48 Hours”, wherein it warned: “The Embassy is monitoring reports that extremists have imminent plans to target large gatherings in Moscow, to include concerts, and U.S. citizens should be advised to avoid large gatherings over the next 48 hours”—on 5 March, just prior to this urgent bulletin, United States Under Secretary of State Victoria Nuland was suddenly ousted from office after she cryptically threatened: “Putin is going to get some nice surprises”—the leftist New York Times reported this morning: “The Islamic State, through an affiliated news agency, claimed responsibility on Friday for the attack...U.S. security officials said they believed it was carried out by a branch of the terrorist group known as the Islamic State in Khorasan, or ISIS-K, which has been active in Pakistan, Afghanistan and Iran”—all of which caused Foreign Ministry spokeswoman Maria Zakharova to observe: “The main thing is that the US authorities do not forget how their information and political environment linked the terrorists who shot people at Crocus City Hall with the banned terrorist organization ISIS...Now we know in which country these bloody criminals planned to hide from persecution — Ukraine...The very country that, with the help of Western liberal regimes, has been turning into a center for the spread of terrorism in Europe for the past ten years”.
Joining Foreign Ministry spokeswoman Maria Zakharova in not believing anything the United States government and its leftist fake news media says about the monstrous terrorist attack on Moscow, this report details, is Editor-In-Chief Margarita Simonyan of the Russian state media group Rossiya Segodnya, who, on 1 March, published the audio recording where high-ranking German military officers discuss asking the British for help in planning an attack on the Crimean Bridge with Taurus missiles, and today assessed: “It immediately became obvious why US media were claiming in unison that it was ISIS...Basic sleight of hand...The level of a railway thimble-rigger...It has nothing to do with ISIS...It's Ukrainians...This is not ISIS...This is a well-coordinated team of several other, also widely known, abbreviations”.
As to the fate awaiting those who planned the “night of terror” terrorist attack on Moscow, this report concludes, Security Council Deputy Chairman Dmitry Medvedev warningly vowed: “If it is established that the Kiev regime’s terrorists are to blame, it will be impossible to deal with them and their ideologists otherwise...All of them must be tracked down and ruthlessly eliminated as terrorists...Including officials of the state that committed such an atrocity...Death for death”.
[Note: Some words and/or phrases appearing in quotes in this report are English language approximations of Russian words/phrases having no exact counterpart.]
https://www.whatdoesitmean.com/ccm21.png
https://www.whatdoesitmean.com/ccm22.png
March 23, 2024 EU and US all rights reserved. Permission to use this report in its entirety is granted under the condition it is linked to its original source at WhatDoesItMean.Com. Freebase content licensed under CC-BY and GFDL.
[Note: Many governments and their intelligence services actively campaign against the information found in these reports so as not to alarm their citizens about the many catastrophic Earth changes and events to come, a stance that the Sisters of Sorcha Faal strongly disagree with in believing that it is every human being’s right to know the truth. Due to our mission’s conflicts with that of those governments, the responses of their ‘agents’ has been a longstanding misinformation/misdirection campaign designed to discredit us, and others like us, that is exampled in numerous places, including HERE.]
[Note: The WhatDoesItMean.com website was created for and donated to the Sisters of Sorcha Faal in 2003 by a small group of American computer experts led by the late global technology guru Wayne Green (1922-2013) to counter the propaganda being used by the West to promote their illegal 2003 invasion of Iraq.]
[Note: The word Kremlin (fortress inside a city) as used in this report refers to Russian citadels, including in Moscow, having cathedrals wherein female Schema monks (Orthodox nuns) reside, many of whom are devoted to the mission of the Sisters of Sorcha Faal.]
Nothing Makes Sense Anymore—Prepare For The Worst
Americans Awaken To “Now Is The Time Of Monsters” Reality
Return To Main Page
What You Aren’t Being Told About The World You Live In
How The “Conspiracy Theory” Label Was Conceived To Derail The Truth Movement
How Covert American Agents Infiltrate the Internet to Manipulate, Deceive and Destroy Reputations
March 23, 2024
Russia Vows “Death For Death” Following “Night Of Terror” In Moscow
By: Sorcha Faal, and as reported to her Western Subscribers
A beyond horrifying new Security Council (SC) report circulating in the Kremlin today first noting President Putin addressed the nation about the Crocus City Hall shooting, denouncing it as a bloody and barbaric terrorist attack and vowing to punish all involved, says this followed Deputy Prime Minister Tatyana Golikova revealing: “President Putin has wished all those injured in the Crocus City Hall terrorist attack a recovery and conveyed compliments to medical staff” and Health Minister Mikhail Murashko announcing: “The main work on providing care to those admitted is complete, the activities on stabilizing patients continue now”.
Following top Kremlin spokesman Dmitry Peskov declaring on behalf of the Russian Federation to the world for the first time “We are in a state of war” yesterday morning, this report notes, Moscow was struck with a “night of terror” when terrorist gunmen attacked the Crocus City Hall shopping and concert complex at around 8 p.m. local time.
According to the Investigative Committee (SLEDCOM), report, the official death toll was placed at 133, and they said this figure is “likely to rise further” while revealing: “According to preliminary data, the causes of death were gunshot wounds and poisoning by combustion products-smoke inhalation”—and reliable Russian media sources placed the death toll at 143.
Earlier today, this report details, the Federal Security Service (FSB) announced: “Eleven people have been detained over the terrorist attack on the Crocus Crocus City Hall concert venue outside Moscow...The arrested suspects include four terrorists who were directly involved in the terrorist attack on Crocus...All four terrorists were arrested in Russia’s Bryansk Region within several hours as a result of well-coordinated actions by the security services and the police...The detainees are now being transferred to Moscow”—and the FSB also revealed: “After committing the crime, the perpetrators attempted to flee, driving in a car in the direction of the Russia-Ukraine border...The perpetrators of the terrorist attack had contacts on Ukrainian soil”.
In a video released showing one of the arrested terrorists, this report notes, it was reported: “The suspect gave his name, which sounds similar to Fariddun Shamsutdin, as well as his date of birth - 17 September 1998...He had arrived from Turkey on 4 March...The detainee said that his handlers contacted him a month ago via Telegram and provided him with weapons...He was given the task of killing all the people in the hall and was offered about a million rubles for this...The defendant added that he committed the crime after a conversation with the preacher’s assistant”—and a second video sees another captured terrorist also confessing he received orders via the Telegram messaging service.
On 7 March, this report continues, the United States Embassy in Moscow issued the urgent bulletin “Security Alert: Avoid Large Gatherings Over The Next 48 Hours”, wherein it warned: “The Embassy is monitoring reports that extremists have imminent plans to target large gatherings in Moscow, to include concerts, and U.S. citizens should be advised to avoid large gatherings over the next 48 hours”—on 5 March, just prior to this urgent bulletin, United States Under Secretary of State Victoria Nuland was suddenly ousted from office after she cryptically threatened: “Putin is going to get some nice surprises”—the leftist New York Times reported this morning: “The Islamic State, through an affiliated news agency, claimed responsibility on Friday for the attack...U.S. security officials said they believed it was carried out by a branch of the terrorist group known as the Islamic State in Khorasan, or ISIS-K, which has been active in Pakistan, Afghanistan and Iran”—all of which caused Foreign Ministry spokeswoman Maria Zakharova to observe: “The main thing is that the US authorities do not forget how their information and political environment linked the terrorists who shot people at Crocus City Hall with the banned terrorist organization ISIS...Now we know in which country these bloody criminals planned to hide from persecution — Ukraine...The very country that, with the help of Western liberal regimes, has been turning into a center for the spread of terrorism in Europe for the past ten years”.
Joining Foreign Ministry spokeswoman Maria Zakharova in not believing anything the United States government and its leftist fake news media says about the monstrous terrorist attack on Moscow, this report details, is Editor-In-Chief Margarita Simonyan of the Russian state media group Rossiya Segodnya, who, on 1 March, published the audio recording where high-ranking German military officers discuss asking the British for help in planning an attack on the Crimean Bridge with Taurus missiles, and today assessed: “It immediately became obvious why US media were claiming in unison that it was ISIS...Basic sleight of hand...The level of a railway thimble-rigger...It has nothing to do with ISIS...It's Ukrainians...This is not ISIS...This is a well-coordinated team of several other, also widely known, abbreviations”.
As to the fate awaiting those who planned the “night of terror” terrorist attack on Moscow, this report concludes, Security Council Deputy Chairman Dmitry Medvedev warningly vowed: “If it is established that the Kiev regime’s terrorists are to blame, it will be impossible to deal with them and their ideologists otherwise...All of them must be tracked down and ruthlessly eliminated as terrorists...Including officials of the state that committed such an atrocity...Death for death”.
[Note: Some words and/or phrases appearing in quotes in this report are English language approximations of Russian words/phrases having no exact counterpart.]
https://www.whatdoesitmean.com/ccm21.png
https://www.whatdoesitmean.com/ccm22.png
March 23, 2024 EU and US all rights reserved. Permission to use this report in its entirety is granted under the condition it is linked to its original source at WhatDoesItMean.Com. Freebase content licensed under CC-BY and GFDL.
[Note: Many governments and their intelligence services actively campaign against the information found in these reports so as not to alarm their citizens about the many catastrophic Earth changes and events to come, a stance that the Sisters of Sorcha Faal strongly disagree with in believing that it is every human being’s right to know the truth. Due to our mission’s conflicts with that of those governments, the responses of their ‘agents’ has been a longstanding misinformation/misdirection campaign designed to discredit us, and others like us, that is exampled in numerous places, including HERE.]
[Note: The WhatDoesItMean.com website was created for and donated to the Sisters of Sorcha Faal in 2003 by a small group of American computer experts led by the late global technology guru Wayne Green (1922-2013) to counter the propaganda being used by the West to promote their illegal 2003 invasion of Iraq.]
[Note: The word Kremlin (fortress inside a city) as used in this report refers to Russian citadels, including in Moscow, having cathedrals wherein female Schema monks (Orthodox nuns) reside, many of whom are devoted to the mission of the Sisters of Sorcha Faal.]
Nothing Makes Sense Anymore—Prepare For The Worst
Americans Awaken To “Now Is The Time Of Monsters” Reality
Return To Main Page
- Post #12,583
- Quote
- Mar 23, 2024 9:14pm Mar 23, 2024 9:14pm
- | Commercial Member | Joined Dec 2014 | 11,471 Posts | Online Now
https://finviz.com/futures_charts.ashx?p=i5&t=YM
www.avielforexlearningedge.com
TESTIMONIALS
"After the first meeting, I turned my financials over to AVIEL FOREX LEARNING EDGE. They go above and beyond."
Daniel Gates
https://0901.nccdn.net/4_2/000/000/038/2d3/forex.png
As an experienced forex trader and educator, I have helped many people learn how to trade forex successfully and earn a lot of money. My comprehensive approach to trading combines fundamental and technical analysis with risk management strategies to identify profitable trading opportunities.
If you're interested in learning forex trading and earning a lot of money, my 90-day course is the perfect place to start. This course covers everything from the basics of forex trading to advanced strategies for maximizing your profits. Best of all, for a limited time, I'm offering a 50% discount on the course fee.
During the 90-day course, you'll learn how to read and analyze charts, identify trends and patterns, and use technical indicators to make informed trading decisions. You'll also learn how to manage your risk and minimize losses so that you can maximize your profits.
One of the most important things you'll learn during the course is the psychology of trading. Trading forex can be stressful and emotional, and it's essential to develop a mindset that allows you to stay calm and focused under pressure. I'll teach you proven techniques for managing your emotions and staying disciplined so that you can make rational, well-informed trading decisions.
In addition to the 90-day course, I also offer a range of other educational resources, including webinars, coaching programs, and one-on-one mentoring. Whether you're a beginner or an experienced trader, my goal is to help you achieve success in forex trading and reach your financial goals.
If you're ready to learn forex trading from an experienced professional and start earning a lot of money, sign up for my 90-day course today. With the 50% discount, you'll get all the knowledge and skills you need to become a successful forex trader at a fraction of the usual cost.
SIGN UP FOR THE COURSE
Send an E Transfer of 125.00 Canadian dollars to: [email protected]
CONTACTS
Contact us any time - we look forward to meeting you!
My cellphone: 438 995 2549
By email: [email protected]
www.avielforexlearningedge.com
TESTIMONIALS
"After the first meeting, I turned my financials over to AVIEL FOREX LEARNING EDGE. They go above and beyond."
Daniel Gates
https://0901.nccdn.net/4_2/000/000/038/2d3/forex.png
As an experienced forex trader and educator, I have helped many people learn how to trade forex successfully and earn a lot of money. My comprehensive approach to trading combines fundamental and technical analysis with risk management strategies to identify profitable trading opportunities.
If you're interested in learning forex trading and earning a lot of money, my 90-day course is the perfect place to start. This course covers everything from the basics of forex trading to advanced strategies for maximizing your profits. Best of all, for a limited time, I'm offering a 50% discount on the course fee.
During the 90-day course, you'll learn how to read and analyze charts, identify trends and patterns, and use technical indicators to make informed trading decisions. You'll also learn how to manage your risk and minimize losses so that you can maximize your profits.
One of the most important things you'll learn during the course is the psychology of trading. Trading forex can be stressful and emotional, and it's essential to develop a mindset that allows you to stay calm and focused under pressure. I'll teach you proven techniques for managing your emotions and staying disciplined so that you can make rational, well-informed trading decisions.
In addition to the 90-day course, I also offer a range of other educational resources, including webinars, coaching programs, and one-on-one mentoring. Whether you're a beginner or an experienced trader, my goal is to help you achieve success in forex trading and reach your financial goals.
If you're ready to learn forex trading from an experienced professional and start earning a lot of money, sign up for my 90-day course today. With the 50% discount, you'll get all the knowledge and skills you need to become a successful forex trader at a fraction of the usual cost.
SIGN UP FOR THE COURSE
Send an E Transfer of 125.00 Canadian dollars to: [email protected]
CONTACTS
Contact us any time - we look forward to meeting you!
My cellphone: 438 995 2549
By email: [email protected]
- Post 12,090
- Cleanup
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- Nov 24, 2023 7:07am | Edited 7:31am
- Post #12,584
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- Mar 23, 2024 9:25pm Mar 23, 2024 9:25pm
- | Commercial Member | Joined Dec 2014 | 11,471 Posts | Online Now
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- Mar 23, 2024 9:27pm Mar 23, 2024 9:27pm
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NOTE: As of today, March 23, 2024, I am trading 5 demo accounts. I purposely allowed positions to stay open to show that EVEN with substantial drawdowns there is NO DANGER of a margin call.
The markets are ready to go back from the INSANE FOMO and come back to earth. There are so many experts out there who with no disrespect have no overall perspective on what is about to happen.
I will post again the John Hussman 100% ACCURATE assessment of WATCHOUT BELOW !!!
READ IT VERY CAREFULLY SO YOU UNDERSTAND why most of the knowledgeable folks on CNBC and Bloomberg have NO CLUE what is going on !!!!
Universal Capitulation and No Margin of Safety - Hussman Funds
Universal Capitulation and No Margin of Safety
https://www.hussmanfunds.com/wp-cont...utton60x60.jpg
https://www.hussmanfunds.com/wp-cont..._thumbnail.jpg
John P. Hussman, Ph.D.
President, Hussman Investment Trust
March 2024
The 1929 boom was, in fact, quite a narrow and selective one. It was a boom of the handful of stocks that figured in the daily calculation of the Dow Jones and New York Times indices, and that was why those well-publicized indexes were at record highs. It was also a boom of the most actively traded stocks bearing the names of the most celebrated companies, the stocks mentioned daily by the newspapers and millions of times by the board room habitués – and that was why it was constantly talked about. But it was emphatically not a boom of secondary stocks in which perhaps as many investors were interested.
– John Brooks, Once in Golconda, 1969
The Nifty Fifty appeared to rise from the ocean; it was as though all of the U.S. but Nebraska had sunk into the sea. The two-tier market consisted of one tier and a lot of rubble down below. What held the Nifty Fifty up? The same thing that held up tulip bulb prices long ago in Holland – popular delusions and the madness of crowds. The delusion was that these companies were so good that it didn’t matter what you paid for them; their inexorable growth would bail you out.
– Forbes Magazine, 1977, The Nifty Fifty Revisited
The market is in a two-tier frenzy between the ‘new economy’ stocks and the ‘old economy’ stocks. Anyone who has studied the concept-stock mania of 1968-69, or the ‘Nifty Fifty’ mania of 1972 has to be getting chills here. We’ve seen two-tiered markets before: most prominently in 1929, 1968-69, and 1972. The inconvenient fact is that valuation ultimately matters. That has led to the rather peculiar risk projections that have appeared in this letter in recent months. Trend uniformity helps to postpone that reality, but in the end, there it is. Given current conditions, it is increasingly likely that valuations will begin to matter with a vengeance.
– John P. Hussman, Ph.D., March 7, 2000
Based on the valuation measures we find best-correlated with actual subsequent S&P 500 total returns across a century of market cycles, the stock market presently stands at valuation extremes matched only twice in U.S. financial history: the week ended December 31, 2021 (the 2022 peak occurred the next trading day) and the bubble peak in the week ended August 26, 1929. While our investment discipline is to align our outlook with prevailing, observable market conditions, my impression is that investors are presently enjoying the double top of the most extreme speculative bubble in U.S. financial history.
Present valuation extremes might only be a long-term concern if our measures of market internals were not also divergent and unfavorable here. It seems popular to imagine that “this time is different” – that the economy has entered a new era of permanently high-profit margins and credit expansion; that a narrow, selective, two-tier frenzy among large capitalization glamour stocks is enough to carry the market ever higher. History is not friendly to these ideas, but no forecasts are required. Our outlook will change as observable conditions change.
This month’s comment offers an expansive and data-rich dive into profit margins and market composition. The objective is not to argue, convince, or urge investors to do anything. We share our research, and we ask nothing in return. Still, if there is one suggestion that might be useful to investors here, it is simply to allow the possibility that market conditions will change. Whether your outlook is bullish or bearish, the notion that the current situation is permanent is exactly what will make you suffer.
This is the longest period of practically uninterrupted rise in security prices in our history… The psychological illusion upon which it is based, though not essentially new, has been stronger and more widespread than has ever been the case in this country in the past. This illusion is summed up in the phrase ‘the new era.’ The phrase itself is not new. Every period of speculation rediscovers it… During every preceding period of stock speculation and subsequent collapse, business conditions have been discussed in the same unrealistic fashion as in recent years. There has been the same widespread idea that in some miraculous way, endlessly elaborated but never defined, the fundamental conditions and requirements of progress and prosperity have changed, that old economic principles have been abrogated… that business profits are destined to grow faster, and without limit, and that the expansion of credit can have no end.
– The Business Week, November 2, 1929
Current market conditions
I think we can all agree on two propositions.
First, if enough speculators believe that stock market gains are driven by a tap-dancing squirrel monkey named Bobo, and Bobo starts tap-dancing, well, the stock market is going up, at least in the short run. Neither truth nor logic have anything to do with it.
Second, because stocks are ultimately a claim on future cash flows that must be delivered over time, higher starting valuations still mean lower long-term returns, which is why no speculative episode in history has ever ended well.
Both of these propositions can be true at the same time.
When investors are inclined to speculate, they tend to be indiscriminate about it. When speculation becomes highly selective, it’s typically an indication of subtle or emerging risk aversion. For that reason, we gauge investor psychology toward speculation and risk aversion based on the uniformity and divergence of market action across thousands of individual stocks, industries, sectors, and security types, including debt securities of varying creditworthiness.
I introduced our main gauge of “market internals” to our discipline in 1998, during the most speculative portion of the tech bubble, with minor adaptations since. As I noted in 2021, for example, we adopted a slightly more “permissive” threshold in our gauge of market internals when interest rates are near zero and certain measures of risk aversion are well-behaved. Given that we use market internals to gauge speculative psychology, a more permissive threshold captures the idea that tossing deranged Fed policy into the mix boosts the implications of a given improvement in market internals.
The chart below presents the cumulative total return of the S&P 500 in periods where our main gauge of market internals has been favorable, accruing Treasury bill interest otherwise. The chart is historical, does not represent any investment portfolio, does not reflect valuations or other features of our investment approach, and is not an assurance of future outcomes.
https://www.hussmanfunds.com/wp-cont.../mc240321a.png
Investor psychology, gauged by the uniformity and divergence of market action, is an essential consideration – particularly over periods shorter than a complete market cycle. This brings us to the second proposition, which is that long-term returns move opposite to starting valuations. That’s because every security is a claim to some future expected stream of cash flows that will be delivered over time. The higher the price investors pay for those cash flows, the lower the investment return they will enjoy. But this is a long-term, not a short-term proposition.
Investors increasingly question and ultimately abandon valuations during speculative episodes, imagining that rich valuations should be followed by market losses. That’s not how valuations work. The only way valuations can reach extremes like 1929, 2000, 2022 and today is by advancing through lesser valuations extremes again and again. The oversized past returns and extreme valuations at a bubble peak can convince investors that the relationship between valuations and subsequent returns has been broken, when in fact, the oversized past returns are precisely the result of those extreme bubble valuations.
The chart below shows our most reliable valuation measure, the ratio of nonfinancial market capitalization to gross value-added, including estimated foreign revenues (see the chart text for calculation details). We’ve observed greater extremes only twice in U.S. financial history: the week ended December 31, 2021, and the week ended August 26, 1929.
https://www.hussmanfunds.com/wp-cont.../mc240321b.png
Presently, the central elements of our investment discipline – market internals, valuations, and overextended conditions – uniformly hold us to a defensive outlook. I realize that some are waiting on a favorable shift in internals with increasing impatience, on the idea that the shift might justify speculation. While the S&P 500 is only a few percent ahead of Treasury bills since its January 2022 peak, it has recovered more significantly from its lows, yet internals remain divergent. Never mind that valuations now match those observed at the two greatest extremes in history – 1929 and 2022. Nothing prevents valuations from exceeding those extremes, particularly in the short run. A defensive position can feel excruciating, and investors can experience enormous psychological pressure to “get in” on the rally to obtain a feeling of relief.
Our approach to that impatience has been to test hundreds of modifications that might “force” a favorable shift here, without degrading the reliability of internals over the recent cycle and across history. We haven’t found even one that would do so. That’s probably because it’s ill-advised to force a constructive position amid market extremes and divergent internals, but there’s no harm in re-examining the data. Likewise, even if we were to apply a more permissive threshold here, with rates still well above zero, it would not shift our gauge of internals from their unfavorable status at present.
The market can certainly advance during periods of unfavorable internals, particularly over the short run. Still, these periodic advances tend to lag T-bills on average, and the gains are often abruptly surrendered. Accepting market risk during periods of unfavorable market internals always comes with elevated risk, and that risk becomes steeper when extreme valuations and overextended market action are present, as they are today. Put simply, I trust the guidance we have from valuations and internals, and our defensiveness here is both uncomfortable and intentional.
If you can’t stand “missing out” on any market advance, and speculative exuberance tempts you to abandon your discipline, you might benefit from some passive investment exposure – not because we think it will do well, but to relieve your psychological discomfort. That’s a personal decision, and we need not be involved. For our part, our outlook will change as observable conditions change.
This is what produces bull market tops. No one rationally would want to buy at the top, and yet enough people do to produce a top. It is quite amazing how time horizons and money goals can change when there are stocks around that are going up 100 percent in six months.”
– Adam Smith (GJW Goodman), The Money Game, 1967
The scatter plot below shows the relationship between starting valuations and subsequent 12-year S&P 500 average annual total returns. I’ve broken the chart into two subsets, not because I believe the long-term relationship has changed, but to isolate the effect of repeated speculative episodes since 1998. As I detailed more fully in The Structural Drivers of Investment Returns (see the section titled “You may not like this part”), the apparent “shift” in the relationship between valuations and returns is a reflection of speculative bubbles that front-load returns, and then resolve with negative returns, as usual.
https://www.hussmanfunds.com/wp-cont.../mc240321c.png
It’s worth noting that even based on optimistic year-ahead earnings estimates, the ratio of the S&P 500 to forward operating earnings is at levels, based on data since the 1980s, associated with average subsequent 10-year S&P 500 total returns close to zero. Our valuation concerns are certainly not limited to the measures we find most reliable.
https://www.hussmanfunds.com/wp-cont.../mc240321d.png
That said, we do find P/E ratios to be fraught with risky and unobserved assumptions. As Jeremy Grantham reminded investors last week, “If margins and multiples are both at record levels at the same time, it is double counting and double jeopardy – for waiting somewhere in the future is another July 1982 or March 2009 with simultaneous record low multiples and badly depressed margins.”
The 3D scatterplot below illustrates this point. The current S&P 500 operating P/E, operating margin, and associated 10-year return estimate is shown in green.
https://www.hussmanfunds.com/wp-cont.../mc240321e.png
The chart below places current extremes in a historical perspective, and also illustrates how bubbles can “front load” returns. Specifically, the effect of a bubble is to temporarily raise the level of valuations at the end of a given holding period. As a result, returns during that holding period are driven well above the returns one would have estimated based on valuations at the beginning of the holding period. For example, measured from 1988, the subsequent 12-year total return of the S&P 500 was much higher than one would have projected based on valuations at the time. Why? Because the end of those 12 years happened to be the 2000 bubble peak. The same has been true in recent years. Why? Because valuations are again at levels observed only near previous bubble peaks.
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As I’ve noted regularly, there’s one element of our discipline that gave us enormous difficulty during the speculative bubble of recent years. It was not internals. It was not even valuations. Rather, in prior market cycles, there were generally reliable “limits” to speculation – once certain combinations of overvaluation, overextended price action, and over-bullish sentiment emerged, the market would quickly encounter an air pocket, panic, or even crash in fairly short order. Amid the yield-seeking speculation encouraged by zero-interest rate policies (and the need for investors, in the aggregate, to hold 18-36% of GDP in zero-interest liquidity created by the Fed), those “limits” proved unreliable, and bearish positions were detrimental.
In 2017, we adapted our discipline to avoid adopting or amplifying a bearish investment outlook, even amid speculative extremes, in periods when our measures of market internals were favorable. Still, avoiding a bearish outlook is not the same as adopting a constructive one. In 2021, we further adapted our discipline to encourage a constructive outlook – regardless of the level of valuation – in periods when our measures of market internals are favorable. Those adaptations come with sufficient safety nets and position limits to qualify as what Benjamin Graham might describe as “intelligent speculation.”
Presently, we observe neither favorable valuations, nor favorable market internals, while our syndromes of overextension remain consistent with the risk of an abrupt air-pocket, panic, or crash. Even with the adaptations we’ve made in this cycle, present observable conditions encourage a strongly defensive stance here. Nothing in our discipline relies on a forecast, a collapse, or even a retreat to historically normal valuations, but we do take prevailing conditions seriously.
Universal capitulation
The ‘new era’ commencing in 1927 involved at bottom the abandonment of the analytical approach; and while emphasis was still seemingly placed on facts and figures, these were manipulated by a sort of pseudo-analysis to support the delusions of the period. The ‘new-era’ doctrine – that ‘good’ stocks (or ‘blue chips’) were sound investments regardless of how high the price paid for them – was at the bottom only a means for rationalizing under the title of ‘investment’ the well-nigh universal capitulation to the gambling fever.
– Benjamin Graham & David L. Dodd, Security Analysis, 1934
As we’ve discussed, every security is a claim on some set of cash flows that will be delivered to investors over time. Yet at any given moment, the only two things that determine the price of a stock are a) the highest price the most eager buyer is willing to pay, and b) the lowest price that the most eager seller is willing to accept. If enough buyers are eager and enough sellers are hesitant, the price will advance. If enough sellers are eager and enough buyers are hesitant, the price will decline. It doesn’t matter why.
In recent years, investor psychology has easily dominated valuations and overextended conditions. As the Federal Reserve gradually created 36% of GDP in zero-interest liabilities, someone had to hold them at every moment in time. Every dollar a buyer put “into” the market came right back “out” in the hands of the seller. Every dollar of “cash on the sidelines” stays “on the sidelines” because there are no “sidelines” in the first place. Every single dollar of base money (currency and bank reserves) created by the Fed has to be held by someone, passing from one holder to the next, until the Fed shrinks its balance sheet. For now, at least those liabilities earn 5.4% interest, so they no longer provoke speculation as they did when rates were zero.
While we’ve increasingly prioritized the condition of market internals in our discipline, valuations still matter. It’s just that they matter for long-term returns and have less reliable effects on short-term outcomes. Particularly with the adaptations we implemented in 2017 and 2021, the main effect of valuations in our discipline is to guide the size of our market exposure and the structure of any safety nets. Yet regardless of the level of valuations, in the majority of periods when internals are favorable, we expect our investment outlook to be constructive as well (though neutral in unusually extreme conditions). Internals will not remain divergent forever, and there will be enough investment opportunities that do not require chasing valuations that match the 1929 and 2022 highs.
I’ve become increasingly hesitant to discuss valuations, growth rates, profit margins, mega-cap glamour stocks, and the like. In our investment discipline, we’ve done as much as we possibly can to minimize the impact of valuations and speculative “limits” on our outlook when market internals are favorable – while still respecting the very real potential for poor market returns and profound full-cycle losses when market internals are divergent. Discussing valuations seems to lead investors to misinterpret our discipline and to imagine that our investment outlook depends sensitively on the particular valuation measures we use. The reality is that our outlook depends most on the combination of market internals and the general range of market valuations.
Meanwhile, as Graham and Dodd observed about the advance leading to the 1929 market peak, investors seem to have abandoned an analytical approach, except to the extent that it reinforces the idea that “good” stocks are sound investments regardless of how high their prices may be. Any discussion of valuations, except one that’s favorable to the idea that no price is too high, is readily dismissed. Forget that these valuations match the most speculative extremes in history. Universal capitulation and fear of missing out produce conformity of opinion, like a perfect row of ducks.
Yet despite the universal capitulation to passive investing at any price, the former finance professor in me still finds an analytical approach both useful and interesting. So, with the request that readers please keep in mind that our investment discipline relies on none of it, let’s talk about profit margins and mega-cap
stocks.
No margin of safety
Several facts seem to be taken as common knowledge among investors. They include the belief that earnings are the proper fundamental to use when valuing stocks; that the increase in profit margins over recent decades is owed primarily to improvements in technology that provide a permanent basis for elevated profitability; and that surging profit margins among mega-cap stocks, particularly technology companies, have been a central driver of these trends.
All of these propositions are incorrect.
Consider valuations. A reliable valuation ratio is nothing more than shorthand for a proper discounted cash flow analysis. You are saying “The fundamental in the denominator is representative and proportional to decades and decades of expected future cash flows that will be delivered to me over time.”
What you need most is for the denominator to be representative and proportional to decades and decades of future expected cash flows. If you simply take the current earnings figure at face value, but that earnings figure is distorted by recession, temporary government subsidies, unusually elevated or depressed interest rates, or temporarily depressed labor costs (especially when inflation and tight labor conditions are pushing labor costs higher), you’re making a longshot bet that the temporarily extreme profit margin will be sustained forever.
That’s why we find, across a century of cycles in the U.S. financial markets, that valuation ratios based on revenues and gross-value added, not prevailing earnings, are best-correlated with actual subsequent S&P 500 total returns. When you use a price/earnings ratio, you are quietly making the assumption that whatever profit margin happens to prevail at that time will also be sustained permanently.
The chart below offers a sense of the profit margins that investors quietly assume to be the permanent basis for decades and decades of future cash flows.
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Profit margins (earnings as a percentage of revenue or gross value-added) scale a bit differently in the national income accounts than they do in S&P 500 company earnings reports because of the way that inventory valuation, capital consumption, and extraordinary charges are handled. Still, these profitability ratios move largely in tandem. That’s not a surprise given that the profits and revenues of S&P 500 components make up the bulk of the economy-wide figures. In the analysis that follows, we’ll use both measures, depending on whether we’re examining economy-wide drivers of profit margins, or profit margins among particular subsets of S&P 500 components.
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It’s tempting for analysts to claim that S&P 500 valuations – particularly high price-to-revenue ratios – are justified by high profit margins. Yet as we’ve seen, S&P 500 price/earnings ratios are sky-high as well. Nor do high profit margins explain away the valuations of the largest S&P 500 components. The chart below shows the median operating P/E of the largest 50 S&P 500 components in monthly data from 1984 to the present, along with the subsequent 7-year total return of a portfolio comprised of the largest 50 S&P 500 components. The blue dots show the same analysis using a “pseudo” P/E computed by dividing the median price/revenue ratio of the largest 50 S&P 500 components by their median profit margin. Either way, valuations as of March 2024 are at levels consistent with zero total returns over the coming 7-year period.
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The chart below shows the median price/revenue ratio of S&P 500, from the 10% of components with the highest multiples to the 10% with the lowest multiples. Thanks to our resident math guru, Russell Jackson, for an enormous amount of programming to compile the data in these charts. Except for the most richly-valued 10% of S&P 500 components, every group stands at multiples beyond the 2000 and 2007 peaks.
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The chart below offers a similar perspective, showing the price/revenue ratios of the largest 10%, smallest 10%, and median S&P 500 components, sorted by market capitalization.
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It seems to be an article of faith among investors that profit margins among the very largest capitalization S&P 500 companies have improved disproportionately in recent decades, but that’s just not true. The chart below shows the median profit margin of the largest S&P 500 components representing 20% and 40% of total index capitalization, as a ratio to the median profit margin of all S&P 500 components. There’s certainly variation over time, but there’s no decisive trend.
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Stated another way, S&P 500 profit margins have not been higher in recent years because mega-cap glamour technology companies have skewed those profit margins disproportionately higher. Rather, profit margins have advanced across the board, and as it turns out, for reasons that are ordinary, unglamorous, and most likely temporary.
The chart below shows the profit margins of U.S. nonfinancial companies in data since 1948. The top line shows corporate profit margins before deducting interest and taxes, and the bottom line shows profit margins after those deductions.
Notice something. Despite all the bluster about technological improvements driving durable increases in corporate profitability over time, the fact is that corporate profit margins before interest and taxes have hovered around the same level for 75 years.
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Should investors rely on permanently elevated profit margins? Well, tax reductions have helped to boost margins, but the largest impact of corporate tax cuts on profit margins occurred by the early-1980’s; depressed labor costs following the global financial crisis boosted profits for several years after, but labor costs mainly drove cyclical fluctuations in profit margins and been normalizing in recent years; massive government subsidies and household dissaving provided a temporary boost to corporate profit margins following the pandemic, but these are being phased out; and progressively falling interest costs – the strongest driver of progressively rising profit margins – have already reversed, but margins don’t yet reflect that because corporations locked in record low rates during 2020-2021.
Let’s go through these points one by one. First, the chart below shows U.S. nonfinancial profit margins versus the (inverted) ratio of unit labor costs to the GDP deflator. Here’s how this works. Imagine selling a widget. You get the price of the widget as revenue for that unit, and you pay for the labor used to produce that unit (the “unit labor cost”). From an economy-wide perspective, the ratio of the unit labor cost to the price is the share of revenue that you spent on labor to produce that unit. Of course, profit margins will move in the opposite direction.
Notice that profit margins since the pandemic have been clear outliers from the perspective of labor costs, as they were just before the global financial crisis. In both cases, corporate profits were driven by household spending more than household income. As I’ve noted before, it’s an accounting identity that when one economic sector runs a deficit (consumption and net investment over income), some other sector must run a surplus. Corporations also benefited directly from massive government subsidies (in this case, the government also expanded its spending well above its income).
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The next chart shows nonfinancial corporate taxes as a share of revenues. What’s striking here is that the largest impact of tax reductions on corporate profit margins had already occurred by the early 1980s. Despite various changes in statutory tax rates, the actual amount of taxes paid as a share of corporate revenues hasn’t changed in 40 years.
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[Geek’s Note: If one assumes that current corporate tax rates are permanent, one could reasonably adjust current and historical price/revenue ratios to reflect the lower level of taxes as a share of revenues since the early1980s. Doing so would reduce the adjusted price/revenue multiple by about 30% relative to pre-1980s levels, but still leave the adjusted multiple dramatically above historical norms, beyond the 2000 peak, leaves projected 10-12 S&P 500 total returns at negative levels, and producing only minimal improvement in the historical correlation between valuations and subsequent returns].
Now consider interest costs. The red line in the chart below (right scale) shows nonfinancial corporate debt as a fraction of corporate revenues. Notice that nonfinancial corporate debt has progressively increased in recent decades, to the point where debt at roughly the same level as annual revenues (so a 1% increase in the cost of debt now impacts profit margins by that same 1%, though slightly less for companies in the S&P 500).
Notice also that after peaking in 1990, interest costs as a share of corporate revenues have declined progressively, even though debt as a fraction of revenues has increased. It’s this progressive decline in interest costs that has driven much of the improvement in corporate profit margins in recent decades.
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The chart below shows nonfinancial corporate interest costs as a fraction of total debt and loan obligations. Not surprisingly, the cost of debt service closely tracks corporate bond yields over time. With one exception. As interest rates hit record lows during the pandemic, corporations launched a record bout of debt refinancing. As a result, the higher interest rates of the past two years have not yet hit corporate interest costs or profit margins. Corporations will face an increasing wall of maturing debt and leveraged loans between 2024 and 2028, but those are just beginning.
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The chart below shows the relationship between the Baa corporate yield and S&P 500 operating profit margins. Notice that the slope of this line was flatter in the blue data prior to 1981 and the red segment with interest rates above 10% (pre-1990) because the ratio of debt to revenue was much lower than it is today.
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As a side note, several very large capitalization companies in the S&P 500 presently have not only significant amounts of debt but also significant holdings of cash and cash equivalents. Having locked in lower rates on their debt, these companies have been particular beneficiaries of elevated short-term rates. For these companies, the current inversion of the yield curve is particularly helpful. As debt is gradually refinanced at higher rates, and short-term rates presumably move lower over time, much of this benefit is likely to dissipate.
The stock market presently stands at valuation extremes matched only twice in U.S. financial history: the week ended December 31, 2021, and the week ended August 26, 1929. Meanwhile, despite all the bluster about technological improvements driving durable increases in corporate profitability over time, the fact is that corporate profit margins before interest and taxes have hovered around the same level for 75 years. The largest impact of corporate tax cuts on profit margins occurred by the early-1980s. Progressively falling interest costs – the strongest driver of progressively rising profit margins – have already reversed, but margins don’t yet reflect that because corporations locked in record-low rates during 2020-2021.
Mega-cap stocks and the S&P 500
It has always perplexed me that every generation of investors seems to believe that the innovations occurring in their lifetime are the first and most important innovations in history. Imagine a world without automobiles, television, radio, aviation, pharmaceuticals, computing. All of these were new ideas and industries at earlier points in U.S. history. All of them sparked the imagination of investors. All of them provoked episodes of speculation. We can participate in them, and invest in companies involving them – indeed, some of our largest holdings at present are AI-related – but it is worth remembering that extreme speculation in “new economy” stocks typically ends badly if one becomes immune to valuations.
The chart below is from a study of the 1926-1933 period by Wuthisatian et al 2014, which includes an analysis of the rise and collapse of what they refer to as “innovative companies” of the time. At the time, these innovations included things we take very much for granted, such as cars, radio, and chemicals, but which were enormously profitable at the time because of their novelty and scarcity. As the authors note, “the criteria by which they were chosen are that all of them have introduced qualitatively radical innovations, using technologies that allowed for the production of new goods that led to the creation of completely new economic sectors. The criteria amount to complying with a technological ‘displacement’ (Minsky, 1982).”
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Notably, much of the loss from the speculative highs in these companies came before the Great Depression took hold. Other glamour-stock bubbles have had a similar pattern. An important risk to investors as a bubble burst is that previous high-fliers can look enormously attractive after they are down 20-30% from their highs. The apparent bargain can prove costly if, as often happens, the stock is headed for a 60-80% loss.
For example, in March 2000, I projected an 83% loss in tech stocks over the completion of that market cycle. The tech-heavy Nasdaq 100 lost more than 35% over the next two months, which made tech stocks look “cheap” compared with their recent highs. By October 2002, the index had lost another 73% of its value, for an overall loss, as it happened, of 83%. The point is that valuations matter, and the collapse of speculative valuations can be utterly punitive, particularly when market internals are unfavorable as was true during the 2000-2002 period.
The chart below shows the median price/revenue ratio of the largest 10 and 50 S&P 500 components, as of December 31 of each year. Suffice it to say that the multiples have become even more extreme in recent weeks.
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While investors often believe that mega-cap glamour stocks are somehow “above the law” and operate differently than the broad market, they put their pants on one leg at a time like every other stock. The chart below shows the 10 S&P 500 components with the largest market capitalizations each year since 1984, along with the subsequent 10-year capitalization-weighted total return for each cohort of stocks. Not surprisingly, rich valuations tend to produce poor subsequent returns.
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It should not be surprising that the growth rate of a company should slow as its size increases. If that were not the case, companies would quickly swallow the entire economy. Yet extrapolation is easy and becomes even easier when the promise of a new technology sparks the imagination of investors. For that reason, it’s worth noting that companies that join the 10 largest capitalization members of the S&P 500 tend to deliver progressively slower growth in the years that follow. Not in every instance, but the regularity is very clear.
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The chart below shows what this looks like for several high-growth cohorts in recent decades.
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Of course, growth doesn’t just slow once a company joins the largest 10 S&P 500 components. In most cases, these large stocks grew into their notoriety from much smaller levels, and growth rates had already been on a downward trajectory for years.
Consider the “Magnificent Seven.” In the following chart, the horizontal axis is a measure of “market saturation.” Specifically, it gauges the ratio of 12-month trailing revenues to 2023 revenues. The chart illustrates the progressive slowing of 2-year growth rates as these companies have approached maturity. That’s not to say that these companies cannot grow further. Rather, the point is that growth rates are best viewed as trajectories rather than as fixed numbers.
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One of the frequently parroted phrases on CNBC that makes me long for a better educational system is “These stocks have been getting cheaper as earnings have grown.” This sort of comment reflects a distressingly naïve understanding of how valuation multiples work.
Suppose for example that a company earned $1 last year and is expected to earn $2 in the coming year, at which point it will stop growing and pay out a $2 annual dividend forever. If investors expect a 10% long-term return from the stock, they’ll pay a price of $20 today, and the price will maintain that level forever. That gives investors a $2 dividend starting next year, a $20 price, and a 10% total return.
In the coming year, earnings will double from $1 to $2, and the P/E ratio will drop from 20 to 10. The stock will have gotten “cheaper” as earnings have grown. That is as it should be. The reason multiples are high for rapidly growing companies is that high valuation multiples already reflect expected growth. If the stock is correctly valued, the multiple should contract anytime fundamentals grow faster than the long-term return (capital gain) expected by investors.
Just like growth rates, profit margins are best viewed as trajectories, not as fixed numbers. Novel technologies and innovations typically enjoy the pleasant combination of very high demand and very high scarcity. New orders and order backlogs are high, and competition may still be a few years away. In that environment, profit margins may be very wide. The danger for investors is in assuming that the profit margins and growth rates are permanent, and pricing stocks on that basis. That’s how you get 80-90% losses in glamour stocks.
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A useful way to understand growth stocks, particularly large-capitalization glamour stocks, is to remember that economic growth is driven not just by innovation, not just by profits, but ultimately by the destruction of profits.
As I discussed in Alice’s Adventures in Equilibrium, when we examine economic history, it’s clear that the long-term expansion in living standards isn’t simply the result of a continuous increase in the production of some single “representative good.” Instead, growth emerges by the progressive introduction of new inventions, technologies, and products that satisfy previously unmet needs.
In his work on economic development, Joseph Schumpeter described the critical role of entrepreneurs in advancing economic growth. When Schumpeter wrote about “creative destruction,” he was referring to temporary profit opportunities that provide incentives to invent, innovate, and satisfy unmet needs. But he also observed that those profit opportunities would encourage a “swarm-like” activity of other entrepreneurs. As production expands, the unusually high profits that encouraged the new production and competition gradually self-destruct. Competition and gradually increasing production drive economic growth, but at the same time, it reduces scarcity and erodes excessive profits.
As the rise and decay of industrial fortunes is the essential fact about the social structure of capitalist society, both the emergence of what is, in any single instance, an essentially temporary gain, and the elimination of it through the working of the competitive mechanism, obviously are more than ‘frictional’ phenomena, as is the process of underselling by which industrial progress comes about in a capitalist society and by which its achievements result in higher incomes all around.
– Joseph Schumpeter, The Instability of Capitalism (1928)
In the short run, there’s no question that strong demand for new, scarce products, such as AI chips, can enable a company to enjoy extremely high-profit margins. Still, it’s dangerous for investors to treat these high-profit margins as permanent, and to value stocks as if those profit margins will be sustained indefinitely.
Put simply, the combination of a high growth rate and a high-profit margin has never proved to be permanent. The current crop of “glamour stocks” increasingly relies on both here.
No forecasts are required
For the sake of clarity, I’ll emphasize again that while we certainly prefer some valuation measures to others, our overall market view is not highly sensitive to our choice of valuation metrics. Instead, our investment discipline is to align our outlook with observable market conditions, primarily the uniformity or divergence of market internals, and the general range of market valuations.
Notably, our most reliable valuation gauge matches extremes seen only at the 1929 and 2022 market peaks. I believe that these extremes should be of great concern to long-term investors, but that doesn’t prevent valuations from breaching those extremes in the short run. We do believe that 10-12-year S&P 500 total returns are likely to be negative, and we do estimate that the S&P 500 is likely to lose something on the order of 50-70% from current highs over the completion of this market cycle. In short, we do have long-term views, it’s just that nothing in our investment discipline relies on those outcomes.
Again, if you can’t stand “missing out” on any market advance, and speculative exuberance tempts you to abandon your discipline, you might benefit from some passive investment exposure – not because we think it will do well, but to relieve your psychological discomfort. That’s a personal decision, and we need not be involved. For our part, our outlook will change as observable conditions change.
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Prospectuses for the Hussman Strategic Growth Fund, the Hussman Strategic Total Return Fund, and the Hussman Strategic Allocation Fund, as well as Fund reports and other information, are available by clicking the “The Funds” menu button from any page of this website.
Estimates of prospective return and risk for equities, bonds, and other financial markets are forward-looking statements based on the analysis and reasonable beliefs of Hussman Strategic Advisors. They are not a guarantee of future performance and are not indicative of the prospective returns of any of the Hussman Funds. Actual returns may differ substantially from the estimates provided. Estimates of prospective long-term returns for the S&P 500 reflect our standard valuation methodology, focusing on the relationship between current market prices and earnings, dividends, and other fundamentals, adjusted for variability over the economic cycle. Further details relating to Market Cap/GVA (the ratio of nonfinancial market capitalization to gross-value added, including estimated foreign revenues) and our Margin-Adjusted P/E (MAPE) can be found in the Market Comment Archive under the Knowledge Center tab of this website. Market Cap/GVA: Hussmann 05/18/15. MAPE: Hussman 05/05/14, Hussman 09/04/17.
The markets are ready to go back from the INSANE FOMO and come back to earth. There are so many experts out there who with no disrespect have no overall perspective on what is about to happen.
I will post again the John Hussman 100% ACCURATE assessment of WATCHOUT BELOW !!!
READ IT VERY CAREFULLY SO YOU UNDERSTAND why most of the knowledgeable folks on CNBC and Bloomberg have NO CLUE what is going on !!!!
Universal Capitulation and No Margin of Safety - Hussman Funds
Universal Capitulation and No Margin of Safety
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John P. Hussman, Ph.D.
President, Hussman Investment Trust
March 2024
The 1929 boom was, in fact, quite a narrow and selective one. It was a boom of the handful of stocks that figured in the daily calculation of the Dow Jones and New York Times indices, and that was why those well-publicized indexes were at record highs. It was also a boom of the most actively traded stocks bearing the names of the most celebrated companies, the stocks mentioned daily by the newspapers and millions of times by the board room habitués – and that was why it was constantly talked about. But it was emphatically not a boom of secondary stocks in which perhaps as many investors were interested.
– John Brooks, Once in Golconda, 1969
The Nifty Fifty appeared to rise from the ocean; it was as though all of the U.S. but Nebraska had sunk into the sea. The two-tier market consisted of one tier and a lot of rubble down below. What held the Nifty Fifty up? The same thing that held up tulip bulb prices long ago in Holland – popular delusions and the madness of crowds. The delusion was that these companies were so good that it didn’t matter what you paid for them; their inexorable growth would bail you out.
– Forbes Magazine, 1977, The Nifty Fifty Revisited
The market is in a two-tier frenzy between the ‘new economy’ stocks and the ‘old economy’ stocks. Anyone who has studied the concept-stock mania of 1968-69, or the ‘Nifty Fifty’ mania of 1972 has to be getting chills here. We’ve seen two-tiered markets before: most prominently in 1929, 1968-69, and 1972. The inconvenient fact is that valuation ultimately matters. That has led to the rather peculiar risk projections that have appeared in this letter in recent months. Trend uniformity helps to postpone that reality, but in the end, there it is. Given current conditions, it is increasingly likely that valuations will begin to matter with a vengeance.
– John P. Hussman, Ph.D., March 7, 2000
Based on the valuation measures we find best-correlated with actual subsequent S&P 500 total returns across a century of market cycles, the stock market presently stands at valuation extremes matched only twice in U.S. financial history: the week ended December 31, 2021 (the 2022 peak occurred the next trading day) and the bubble peak in the week ended August 26, 1929. While our investment discipline is to align our outlook with prevailing, observable market conditions, my impression is that investors are presently enjoying the double top of the most extreme speculative bubble in U.S. financial history.
Present valuation extremes might only be a long-term concern if our measures of market internals were not also divergent and unfavorable here. It seems popular to imagine that “this time is different” – that the economy has entered a new era of permanently high-profit margins and credit expansion; that a narrow, selective, two-tier frenzy among large capitalization glamour stocks is enough to carry the market ever higher. History is not friendly to these ideas, but no forecasts are required. Our outlook will change as observable conditions change.
This month’s comment offers an expansive and data-rich dive into profit margins and market composition. The objective is not to argue, convince, or urge investors to do anything. We share our research, and we ask nothing in return. Still, if there is one suggestion that might be useful to investors here, it is simply to allow the possibility that market conditions will change. Whether your outlook is bullish or bearish, the notion that the current situation is permanent is exactly what will make you suffer.
This is the longest period of practically uninterrupted rise in security prices in our history… The psychological illusion upon which it is based, though not essentially new, has been stronger and more widespread than has ever been the case in this country in the past. This illusion is summed up in the phrase ‘the new era.’ The phrase itself is not new. Every period of speculation rediscovers it… During every preceding period of stock speculation and subsequent collapse, business conditions have been discussed in the same unrealistic fashion as in recent years. There has been the same widespread idea that in some miraculous way, endlessly elaborated but never defined, the fundamental conditions and requirements of progress and prosperity have changed, that old economic principles have been abrogated… that business profits are destined to grow faster, and without limit, and that the expansion of credit can have no end.
– The Business Week, November 2, 1929
Current market conditions
I think we can all agree on two propositions.
First, if enough speculators believe that stock market gains are driven by a tap-dancing squirrel monkey named Bobo, and Bobo starts tap-dancing, well, the stock market is going up, at least in the short run. Neither truth nor logic have anything to do with it.
Second, because stocks are ultimately a claim on future cash flows that must be delivered over time, higher starting valuations still mean lower long-term returns, which is why no speculative episode in history has ever ended well.
Both of these propositions can be true at the same time.
When investors are inclined to speculate, they tend to be indiscriminate about it. When speculation becomes highly selective, it’s typically an indication of subtle or emerging risk aversion. For that reason, we gauge investor psychology toward speculation and risk aversion based on the uniformity and divergence of market action across thousands of individual stocks, industries, sectors, and security types, including debt securities of varying creditworthiness.
I introduced our main gauge of “market internals” to our discipline in 1998, during the most speculative portion of the tech bubble, with minor adaptations since. As I noted in 2021, for example, we adopted a slightly more “permissive” threshold in our gauge of market internals when interest rates are near zero and certain measures of risk aversion are well-behaved. Given that we use market internals to gauge speculative psychology, a more permissive threshold captures the idea that tossing deranged Fed policy into the mix boosts the implications of a given improvement in market internals.
The chart below presents the cumulative total return of the S&P 500 in periods where our main gauge of market internals has been favorable, accruing Treasury bill interest otherwise. The chart is historical, does not represent any investment portfolio, does not reflect valuations or other features of our investment approach, and is not an assurance of future outcomes.
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Investor psychology, gauged by the uniformity and divergence of market action, is an essential consideration – particularly over periods shorter than a complete market cycle. This brings us to the second proposition, which is that long-term returns move opposite to starting valuations. That’s because every security is a claim to some future expected stream of cash flows that will be delivered over time. The higher the price investors pay for those cash flows, the lower the investment return they will enjoy. But this is a long-term, not a short-term proposition.
Investors increasingly question and ultimately abandon valuations during speculative episodes, imagining that rich valuations should be followed by market losses. That’s not how valuations work. The only way valuations can reach extremes like 1929, 2000, 2022 and today is by advancing through lesser valuations extremes again and again. The oversized past returns and extreme valuations at a bubble peak can convince investors that the relationship between valuations and subsequent returns has been broken, when in fact, the oversized past returns are precisely the result of those extreme bubble valuations.
The chart below shows our most reliable valuation measure, the ratio of nonfinancial market capitalization to gross value-added, including estimated foreign revenues (see the chart text for calculation details). We’ve observed greater extremes only twice in U.S. financial history: the week ended December 31, 2021, and the week ended August 26, 1929.
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Presently, the central elements of our investment discipline – market internals, valuations, and overextended conditions – uniformly hold us to a defensive outlook. I realize that some are waiting on a favorable shift in internals with increasing impatience, on the idea that the shift might justify speculation. While the S&P 500 is only a few percent ahead of Treasury bills since its January 2022 peak, it has recovered more significantly from its lows, yet internals remain divergent. Never mind that valuations now match those observed at the two greatest extremes in history – 1929 and 2022. Nothing prevents valuations from exceeding those extremes, particularly in the short run. A defensive position can feel excruciating, and investors can experience enormous psychological pressure to “get in” on the rally to obtain a feeling of relief.
Our approach to that impatience has been to test hundreds of modifications that might “force” a favorable shift here, without degrading the reliability of internals over the recent cycle and across history. We haven’t found even one that would do so. That’s probably because it’s ill-advised to force a constructive position amid market extremes and divergent internals, but there’s no harm in re-examining the data. Likewise, even if we were to apply a more permissive threshold here, with rates still well above zero, it would not shift our gauge of internals from their unfavorable status at present.
The market can certainly advance during periods of unfavorable internals, particularly over the short run. Still, these periodic advances tend to lag T-bills on average, and the gains are often abruptly surrendered. Accepting market risk during periods of unfavorable market internals always comes with elevated risk, and that risk becomes steeper when extreme valuations and overextended market action are present, as they are today. Put simply, I trust the guidance we have from valuations and internals, and our defensiveness here is both uncomfortable and intentional.
If you can’t stand “missing out” on any market advance, and speculative exuberance tempts you to abandon your discipline, you might benefit from some passive investment exposure – not because we think it will do well, but to relieve your psychological discomfort. That’s a personal decision, and we need not be involved. For our part, our outlook will change as observable conditions change.
This is what produces bull market tops. No one rationally would want to buy at the top, and yet enough people do to produce a top. It is quite amazing how time horizons and money goals can change when there are stocks around that are going up 100 percent in six months.”
– Adam Smith (GJW Goodman), The Money Game, 1967
The scatter plot below shows the relationship between starting valuations and subsequent 12-year S&P 500 average annual total returns. I’ve broken the chart into two subsets, not because I believe the long-term relationship has changed, but to isolate the effect of repeated speculative episodes since 1998. As I detailed more fully in The Structural Drivers of Investment Returns (see the section titled “You may not like this part”), the apparent “shift” in the relationship between valuations and returns is a reflection of speculative bubbles that front-load returns, and then resolve with negative returns, as usual.
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It’s worth noting that even based on optimistic year-ahead earnings estimates, the ratio of the S&P 500 to forward operating earnings is at levels, based on data since the 1980s, associated with average subsequent 10-year S&P 500 total returns close to zero. Our valuation concerns are certainly not limited to the measures we find most reliable.
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That said, we do find P/E ratios to be fraught with risky and unobserved assumptions. As Jeremy Grantham reminded investors last week, “If margins and multiples are both at record levels at the same time, it is double counting and double jeopardy – for waiting somewhere in the future is another July 1982 or March 2009 with simultaneous record low multiples and badly depressed margins.”
The 3D scatterplot below illustrates this point. The current S&P 500 operating P/E, operating margin, and associated 10-year return estimate is shown in green.
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The chart below places current extremes in a historical perspective, and also illustrates how bubbles can “front load” returns. Specifically, the effect of a bubble is to temporarily raise the level of valuations at the end of a given holding period. As a result, returns during that holding period are driven well above the returns one would have estimated based on valuations at the beginning of the holding period. For example, measured from 1988, the subsequent 12-year total return of the S&P 500 was much higher than one would have projected based on valuations at the time. Why? Because the end of those 12 years happened to be the 2000 bubble peak. The same has been true in recent years. Why? Because valuations are again at levels observed only near previous bubble peaks.
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As I’ve noted regularly, there’s one element of our discipline that gave us enormous difficulty during the speculative bubble of recent years. It was not internals. It was not even valuations. Rather, in prior market cycles, there were generally reliable “limits” to speculation – once certain combinations of overvaluation, overextended price action, and over-bullish sentiment emerged, the market would quickly encounter an air pocket, panic, or even crash in fairly short order. Amid the yield-seeking speculation encouraged by zero-interest rate policies (and the need for investors, in the aggregate, to hold 18-36% of GDP in zero-interest liquidity created by the Fed), those “limits” proved unreliable, and bearish positions were detrimental.
In 2017, we adapted our discipline to avoid adopting or amplifying a bearish investment outlook, even amid speculative extremes, in periods when our measures of market internals were favorable. Still, avoiding a bearish outlook is not the same as adopting a constructive one. In 2021, we further adapted our discipline to encourage a constructive outlook – regardless of the level of valuation – in periods when our measures of market internals are favorable. Those adaptations come with sufficient safety nets and position limits to qualify as what Benjamin Graham might describe as “intelligent speculation.”
Presently, we observe neither favorable valuations, nor favorable market internals, while our syndromes of overextension remain consistent with the risk of an abrupt air-pocket, panic, or crash. Even with the adaptations we’ve made in this cycle, present observable conditions encourage a strongly defensive stance here. Nothing in our discipline relies on a forecast, a collapse, or even a retreat to historically normal valuations, but we do take prevailing conditions seriously.
Universal capitulation
The ‘new era’ commencing in 1927 involved at bottom the abandonment of the analytical approach; and while emphasis was still seemingly placed on facts and figures, these were manipulated by a sort of pseudo-analysis to support the delusions of the period. The ‘new-era’ doctrine – that ‘good’ stocks (or ‘blue chips’) were sound investments regardless of how high the price paid for them – was at the bottom only a means for rationalizing under the title of ‘investment’ the well-nigh universal capitulation to the gambling fever.
– Benjamin Graham & David L. Dodd, Security Analysis, 1934
As we’ve discussed, every security is a claim on some set of cash flows that will be delivered to investors over time. Yet at any given moment, the only two things that determine the price of a stock are a) the highest price the most eager buyer is willing to pay, and b) the lowest price that the most eager seller is willing to accept. If enough buyers are eager and enough sellers are hesitant, the price will advance. If enough sellers are eager and enough buyers are hesitant, the price will decline. It doesn’t matter why.
In recent years, investor psychology has easily dominated valuations and overextended conditions. As the Federal Reserve gradually created 36% of GDP in zero-interest liabilities, someone had to hold them at every moment in time. Every dollar a buyer put “into” the market came right back “out” in the hands of the seller. Every dollar of “cash on the sidelines” stays “on the sidelines” because there are no “sidelines” in the first place. Every single dollar of base money (currency and bank reserves) created by the Fed has to be held by someone, passing from one holder to the next, until the Fed shrinks its balance sheet. For now, at least those liabilities earn 5.4% interest, so they no longer provoke speculation as they did when rates were zero.
While we’ve increasingly prioritized the condition of market internals in our discipline, valuations still matter. It’s just that they matter for long-term returns and have less reliable effects on short-term outcomes. Particularly with the adaptations we implemented in 2017 and 2021, the main effect of valuations in our discipline is to guide the size of our market exposure and the structure of any safety nets. Yet regardless of the level of valuations, in the majority of periods when internals are favorable, we expect our investment outlook to be constructive as well (though neutral in unusually extreme conditions). Internals will not remain divergent forever, and there will be enough investment opportunities that do not require chasing valuations that match the 1929 and 2022 highs.
I’ve become increasingly hesitant to discuss valuations, growth rates, profit margins, mega-cap glamour stocks, and the like. In our investment discipline, we’ve done as much as we possibly can to minimize the impact of valuations and speculative “limits” on our outlook when market internals are favorable – while still respecting the very real potential for poor market returns and profound full-cycle losses when market internals are divergent. Discussing valuations seems to lead investors to misinterpret our discipline and to imagine that our investment outlook depends sensitively on the particular valuation measures we use. The reality is that our outlook depends most on the combination of market internals and the general range of market valuations.
Meanwhile, as Graham and Dodd observed about the advance leading to the 1929 market peak, investors seem to have abandoned an analytical approach, except to the extent that it reinforces the idea that “good” stocks are sound investments regardless of how high their prices may be. Any discussion of valuations, except one that’s favorable to the idea that no price is too high, is readily dismissed. Forget that these valuations match the most speculative extremes in history. Universal capitulation and fear of missing out produce conformity of opinion, like a perfect row of ducks.
Yet despite the universal capitulation to passive investing at any price, the former finance professor in me still finds an analytical approach both useful and interesting. So, with the request that readers please keep in mind that our investment discipline relies on none of it, let’s talk about profit margins and mega-cap
stocks.
No margin of safety
Several facts seem to be taken as common knowledge among investors. They include the belief that earnings are the proper fundamental to use when valuing stocks; that the increase in profit margins over recent decades is owed primarily to improvements in technology that provide a permanent basis for elevated profitability; and that surging profit margins among mega-cap stocks, particularly technology companies, have been a central driver of these trends.
All of these propositions are incorrect.
Consider valuations. A reliable valuation ratio is nothing more than shorthand for a proper discounted cash flow analysis. You are saying “The fundamental in the denominator is representative and proportional to decades and decades of expected future cash flows that will be delivered to me over time.”
What you need most is for the denominator to be representative and proportional to decades and decades of future expected cash flows. If you simply take the current earnings figure at face value, but that earnings figure is distorted by recession, temporary government subsidies, unusually elevated or depressed interest rates, or temporarily depressed labor costs (especially when inflation and tight labor conditions are pushing labor costs higher), you’re making a longshot bet that the temporarily extreme profit margin will be sustained forever.
That’s why we find, across a century of cycles in the U.S. financial markets, that valuation ratios based on revenues and gross-value added, not prevailing earnings, are best-correlated with actual subsequent S&P 500 total returns. When you use a price/earnings ratio, you are quietly making the assumption that whatever profit margin happens to prevail at that time will also be sustained permanently.
The chart below offers a sense of the profit margins that investors quietly assume to be the permanent basis for decades and decades of future cash flows.
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Profit margins (earnings as a percentage of revenue or gross value-added) scale a bit differently in the national income accounts than they do in S&P 500 company earnings reports because of the way that inventory valuation, capital consumption, and extraordinary charges are handled. Still, these profitability ratios move largely in tandem. That’s not a surprise given that the profits and revenues of S&P 500 components make up the bulk of the economy-wide figures. In the analysis that follows, we’ll use both measures, depending on whether we’re examining economy-wide drivers of profit margins, or profit margins among particular subsets of S&P 500 components.
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It’s tempting for analysts to claim that S&P 500 valuations – particularly high price-to-revenue ratios – are justified by high profit margins. Yet as we’ve seen, S&P 500 price/earnings ratios are sky-high as well. Nor do high profit margins explain away the valuations of the largest S&P 500 components. The chart below shows the median operating P/E of the largest 50 S&P 500 components in monthly data from 1984 to the present, along with the subsequent 7-year total return of a portfolio comprised of the largest 50 S&P 500 components. The blue dots show the same analysis using a “pseudo” P/E computed by dividing the median price/revenue ratio of the largest 50 S&P 500 components by their median profit margin. Either way, valuations as of March 2024 are at levels consistent with zero total returns over the coming 7-year period.
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The chart below shows the median price/revenue ratio of S&P 500, from the 10% of components with the highest multiples to the 10% with the lowest multiples. Thanks to our resident math guru, Russell Jackson, for an enormous amount of programming to compile the data in these charts. Except for the most richly-valued 10% of S&P 500 components, every group stands at multiples beyond the 2000 and 2007 peaks.
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The chart below offers a similar perspective, showing the price/revenue ratios of the largest 10%, smallest 10%, and median S&P 500 components, sorted by market capitalization.
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It seems to be an article of faith among investors that profit margins among the very largest capitalization S&P 500 companies have improved disproportionately in recent decades, but that’s just not true. The chart below shows the median profit margin of the largest S&P 500 components representing 20% and 40% of total index capitalization, as a ratio to the median profit margin of all S&P 500 components. There’s certainly variation over time, but there’s no decisive trend.
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Stated another way, S&P 500 profit margins have not been higher in recent years because mega-cap glamour technology companies have skewed those profit margins disproportionately higher. Rather, profit margins have advanced across the board, and as it turns out, for reasons that are ordinary, unglamorous, and most likely temporary.
The chart below shows the profit margins of U.S. nonfinancial companies in data since 1948. The top line shows corporate profit margins before deducting interest and taxes, and the bottom line shows profit margins after those deductions.
Notice something. Despite all the bluster about technological improvements driving durable increases in corporate profitability over time, the fact is that corporate profit margins before interest and taxes have hovered around the same level for 75 years.
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Should investors rely on permanently elevated profit margins? Well, tax reductions have helped to boost margins, but the largest impact of corporate tax cuts on profit margins occurred by the early-1980’s; depressed labor costs following the global financial crisis boosted profits for several years after, but labor costs mainly drove cyclical fluctuations in profit margins and been normalizing in recent years; massive government subsidies and household dissaving provided a temporary boost to corporate profit margins following the pandemic, but these are being phased out; and progressively falling interest costs – the strongest driver of progressively rising profit margins – have already reversed, but margins don’t yet reflect that because corporations locked in record low rates during 2020-2021.
Let’s go through these points one by one. First, the chart below shows U.S. nonfinancial profit margins versus the (inverted) ratio of unit labor costs to the GDP deflator. Here’s how this works. Imagine selling a widget. You get the price of the widget as revenue for that unit, and you pay for the labor used to produce that unit (the “unit labor cost”). From an economy-wide perspective, the ratio of the unit labor cost to the price is the share of revenue that you spent on labor to produce that unit. Of course, profit margins will move in the opposite direction.
Notice that profit margins since the pandemic have been clear outliers from the perspective of labor costs, as they were just before the global financial crisis. In both cases, corporate profits were driven by household spending more than household income. As I’ve noted before, it’s an accounting identity that when one economic sector runs a deficit (consumption and net investment over income), some other sector must run a surplus. Corporations also benefited directly from massive government subsidies (in this case, the government also expanded its spending well above its income).
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The next chart shows nonfinancial corporate taxes as a share of revenues. What’s striking here is that the largest impact of tax reductions on corporate profit margins had already occurred by the early 1980s. Despite various changes in statutory tax rates, the actual amount of taxes paid as a share of corporate revenues hasn’t changed in 40 years.
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[Geek’s Note: If one assumes that current corporate tax rates are permanent, one could reasonably adjust current and historical price/revenue ratios to reflect the lower level of taxes as a share of revenues since the early1980s. Doing so would reduce the adjusted price/revenue multiple by about 30% relative to pre-1980s levels, but still leave the adjusted multiple dramatically above historical norms, beyond the 2000 peak, leaves projected 10-12 S&P 500 total returns at negative levels, and producing only minimal improvement in the historical correlation between valuations and subsequent returns].
Now consider interest costs. The red line in the chart below (right scale) shows nonfinancial corporate debt as a fraction of corporate revenues. Notice that nonfinancial corporate debt has progressively increased in recent decades, to the point where debt at roughly the same level as annual revenues (so a 1% increase in the cost of debt now impacts profit margins by that same 1%, though slightly less for companies in the S&P 500).
Notice also that after peaking in 1990, interest costs as a share of corporate revenues have declined progressively, even though debt as a fraction of revenues has increased. It’s this progressive decline in interest costs that has driven much of the improvement in corporate profit margins in recent decades.
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The chart below shows nonfinancial corporate interest costs as a fraction of total debt and loan obligations. Not surprisingly, the cost of debt service closely tracks corporate bond yields over time. With one exception. As interest rates hit record lows during the pandemic, corporations launched a record bout of debt refinancing. As a result, the higher interest rates of the past two years have not yet hit corporate interest costs or profit margins. Corporations will face an increasing wall of maturing debt and leveraged loans between 2024 and 2028, but those are just beginning.
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The chart below shows the relationship between the Baa corporate yield and S&P 500 operating profit margins. Notice that the slope of this line was flatter in the blue data prior to 1981 and the red segment with interest rates above 10% (pre-1990) because the ratio of debt to revenue was much lower than it is today.
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As a side note, several very large capitalization companies in the S&P 500 presently have not only significant amounts of debt but also significant holdings of cash and cash equivalents. Having locked in lower rates on their debt, these companies have been particular beneficiaries of elevated short-term rates. For these companies, the current inversion of the yield curve is particularly helpful. As debt is gradually refinanced at higher rates, and short-term rates presumably move lower over time, much of this benefit is likely to dissipate.
The stock market presently stands at valuation extremes matched only twice in U.S. financial history: the week ended December 31, 2021, and the week ended August 26, 1929. Meanwhile, despite all the bluster about technological improvements driving durable increases in corporate profitability over time, the fact is that corporate profit margins before interest and taxes have hovered around the same level for 75 years. The largest impact of corporate tax cuts on profit margins occurred by the early-1980s. Progressively falling interest costs – the strongest driver of progressively rising profit margins – have already reversed, but margins don’t yet reflect that because corporations locked in record-low rates during 2020-2021.
Mega-cap stocks and the S&P 500
It has always perplexed me that every generation of investors seems to believe that the innovations occurring in their lifetime are the first and most important innovations in history. Imagine a world without automobiles, television, radio, aviation, pharmaceuticals, computing. All of these were new ideas and industries at earlier points in U.S. history. All of them sparked the imagination of investors. All of them provoked episodes of speculation. We can participate in them, and invest in companies involving them – indeed, some of our largest holdings at present are AI-related – but it is worth remembering that extreme speculation in “new economy” stocks typically ends badly if one becomes immune to valuations.
The chart below is from a study of the 1926-1933 period by Wuthisatian et al 2014, which includes an analysis of the rise and collapse of what they refer to as “innovative companies” of the time. At the time, these innovations included things we take very much for granted, such as cars, radio, and chemicals, but which were enormously profitable at the time because of their novelty and scarcity. As the authors note, “the criteria by which they were chosen are that all of them have introduced qualitatively radical innovations, using technologies that allowed for the production of new goods that led to the creation of completely new economic sectors. The criteria amount to complying with a technological ‘displacement’ (Minsky, 1982).”
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Notably, much of the loss from the speculative highs in these companies came before the Great Depression took hold. Other glamour-stock bubbles have had a similar pattern. An important risk to investors as a bubble burst is that previous high-fliers can look enormously attractive after they are down 20-30% from their highs. The apparent bargain can prove costly if, as often happens, the stock is headed for a 60-80% loss.
For example, in March 2000, I projected an 83% loss in tech stocks over the completion of that market cycle. The tech-heavy Nasdaq 100 lost more than 35% over the next two months, which made tech stocks look “cheap” compared with their recent highs. By October 2002, the index had lost another 73% of its value, for an overall loss, as it happened, of 83%. The point is that valuations matter, and the collapse of speculative valuations can be utterly punitive, particularly when market internals are unfavorable as was true during the 2000-2002 period.
The chart below shows the median price/revenue ratio of the largest 10 and 50 S&P 500 components, as of December 31 of each year. Suffice it to say that the multiples have become even more extreme in recent weeks.
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While investors often believe that mega-cap glamour stocks are somehow “above the law” and operate differently than the broad market, they put their pants on one leg at a time like every other stock. The chart below shows the 10 S&P 500 components with the largest market capitalizations each year since 1984, along with the subsequent 10-year capitalization-weighted total return for each cohort of stocks. Not surprisingly, rich valuations tend to produce poor subsequent returns.
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It should not be surprising that the growth rate of a company should slow as its size increases. If that were not the case, companies would quickly swallow the entire economy. Yet extrapolation is easy and becomes even easier when the promise of a new technology sparks the imagination of investors. For that reason, it’s worth noting that companies that join the 10 largest capitalization members of the S&P 500 tend to deliver progressively slower growth in the years that follow. Not in every instance, but the regularity is very clear.
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The chart below shows what this looks like for several high-growth cohorts in recent decades.
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Of course, growth doesn’t just slow once a company joins the largest 10 S&P 500 components. In most cases, these large stocks grew into their notoriety from much smaller levels, and growth rates had already been on a downward trajectory for years.
Consider the “Magnificent Seven.” In the following chart, the horizontal axis is a measure of “market saturation.” Specifically, it gauges the ratio of 12-month trailing revenues to 2023 revenues. The chart illustrates the progressive slowing of 2-year growth rates as these companies have approached maturity. That’s not to say that these companies cannot grow further. Rather, the point is that growth rates are best viewed as trajectories rather than as fixed numbers.
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One of the frequently parroted phrases on CNBC that makes me long for a better educational system is “These stocks have been getting cheaper as earnings have grown.” This sort of comment reflects a distressingly naïve understanding of how valuation multiples work.
Suppose for example that a company earned $1 last year and is expected to earn $2 in the coming year, at which point it will stop growing and pay out a $2 annual dividend forever. If investors expect a 10% long-term return from the stock, they’ll pay a price of $20 today, and the price will maintain that level forever. That gives investors a $2 dividend starting next year, a $20 price, and a 10% total return.
In the coming year, earnings will double from $1 to $2, and the P/E ratio will drop from 20 to 10. The stock will have gotten “cheaper” as earnings have grown. That is as it should be. The reason multiples are high for rapidly growing companies is that high valuation multiples already reflect expected growth. If the stock is correctly valued, the multiple should contract anytime fundamentals grow faster than the long-term return (capital gain) expected by investors.
Just like growth rates, profit margins are best viewed as trajectories, not as fixed numbers. Novel technologies and innovations typically enjoy the pleasant combination of very high demand and very high scarcity. New orders and order backlogs are high, and competition may still be a few years away. In that environment, profit margins may be very wide. The danger for investors is in assuming that the profit margins and growth rates are permanent, and pricing stocks on that basis. That’s how you get 80-90% losses in glamour stocks.
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A useful way to understand growth stocks, particularly large-capitalization glamour stocks, is to remember that economic growth is driven not just by innovation, not just by profits, but ultimately by the destruction of profits.
As I discussed in Alice’s Adventures in Equilibrium, when we examine economic history, it’s clear that the long-term expansion in living standards isn’t simply the result of a continuous increase in the production of some single “representative good.” Instead, growth emerges by the progressive introduction of new inventions, technologies, and products that satisfy previously unmet needs.
In his work on economic development, Joseph Schumpeter described the critical role of entrepreneurs in advancing economic growth. When Schumpeter wrote about “creative destruction,” he was referring to temporary profit opportunities that provide incentives to invent, innovate, and satisfy unmet needs. But he also observed that those profit opportunities would encourage a “swarm-like” activity of other entrepreneurs. As production expands, the unusually high profits that encouraged the new production and competition gradually self-destruct. Competition and gradually increasing production drive economic growth, but at the same time, it reduces scarcity and erodes excessive profits.
As the rise and decay of industrial fortunes is the essential fact about the social structure of capitalist society, both the emergence of what is, in any single instance, an essentially temporary gain, and the elimination of it through the working of the competitive mechanism, obviously are more than ‘frictional’ phenomena, as is the process of underselling by which industrial progress comes about in a capitalist society and by which its achievements result in higher incomes all around.
– Joseph Schumpeter, The Instability of Capitalism (1928)
In the short run, there’s no question that strong demand for new, scarce products, such as AI chips, can enable a company to enjoy extremely high-profit margins. Still, it’s dangerous for investors to treat these high-profit margins as permanent, and to value stocks as if those profit margins will be sustained indefinitely.
Put simply, the combination of a high growth rate and a high-profit margin has never proved to be permanent. The current crop of “glamour stocks” increasingly relies on both here.
No forecasts are required
For the sake of clarity, I’ll emphasize again that while we certainly prefer some valuation measures to others, our overall market view is not highly sensitive to our choice of valuation metrics. Instead, our investment discipline is to align our outlook with observable market conditions, primarily the uniformity or divergence of market internals, and the general range of market valuations.
Notably, our most reliable valuation gauge matches extremes seen only at the 1929 and 2022 market peaks. I believe that these extremes should be of great concern to long-term investors, but that doesn’t prevent valuations from breaching those extremes in the short run. We do believe that 10-12-year S&P 500 total returns are likely to be negative, and we do estimate that the S&P 500 is likely to lose something on the order of 50-70% from current highs over the completion of this market cycle. In short, we do have long-term views, it’s just that nothing in our investment discipline relies on those outcomes.
Again, if you can’t stand “missing out” on any market advance, and speculative exuberance tempts you to abandon your discipline, you might benefit from some passive investment exposure – not because we think it will do well, but to relieve your psychological discomfort. That’s a personal decision, and we need not be involved. For our part, our outlook will change as observable conditions change.
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The REAL Reason the Market’s Soaring - The Daily Reckoning
https://dweaay7e22a7h.cloudfront.net...65-650x360.jpg
https://dweaay7e22a7h.cloudfront.net...BrianMaher.jpg
BY BRIAN MAHER
POSTED
MARCH 21, 2024
The REAL Reason the Market’s Soaring
The Federal Reserve began kinking its monetary hose two years back.
This is done through fevered interest rate elevations and quantitative tightening.
Yet the stock market put out its tongue, placed its thumbs in its ears, and wiggled its fingers in Mr. Powell’s face.
It has gone streaking to record heights — despite the Federal Reserve’s kinks.
A conundrum! Or is it?
We are informed that financial conditions are presently extravagant.
They are among the loosest in several decades. Mr. Simon White of Bloomberg:
Monetary policy remains exceptionally loose given one of the fastest rate-hiking cycles seen… policy overall remains very loose despite over 500 basis points of rate hikes…
Standing back and looking at the totality of monetary policy in this cycle, we can see that — far from conditions tightening — we have instead seen one of the biggest loosening's of them in decades.
Graphic Evidence
Is it evidence you seek? Then it is evidence you shall have:
https://images.ctfassets.net/vha3zb1...1-03-21-24.png
Source: Bloomberg
The steeply ascending red represents the Federal Reserve’s target rate.
The largely descending blue represents financial conditions as Bloomberg gauges them.
The Federal Reserve has undertaken four rate elevation cycles within the past 30 years.
None has yielded a greater financial loosening than the present cycle. Again, the graphic evidence:
https://images.ctfassets.net/vha3zb1...2-03-21-24.png
Source: Bloomberg
The black represents the hiking cycles. The gold represents financial conditions.
As demonstrated, the present cycle represents the “biggest effective loosening seen.”
How do you explain it?
It’s All About the “Pivot”
Here Mr. Joe Weisenthal and Ms. Tracy Alloway — they of the Odd Lots newsletter — hazard an attempt:
It certainly feels like there’s a pattern where the mere whisper of rate cuts sparks easier financial conditions (as markets rally), while hawkish moves seem to do hardly anything…
As Viktor Shvets over at Macquarie put it this week: “Any hint of the Fed considering an even minor pivot significantly eases financial conditions while a more hawkish tone only barely tightens.”
We believe there is justice here.
Further disentangling this perplexing knot — perhaps — is a certain Stephane Renevier.
Interest rates aren’t the be-all and end-all of financial conditions. Yes, higher rates generally mean pricier loans — but there are a whole lot of other factors that affect how easy or tough it is for firms and everyday folks to get financing and keep the economic show on the road.
Think about the cost for companies to borrow (credit spreads), how well the stock market is doing (that’s another source of financing), and how strong the dollar is (a weaker dollar means cheaper loans for people around the world who take on debt in greenbacks, pumping more cash into the global economy).
Since the end of last year, all those factors have turned more positive and have offset the U.S.’ towering interest rates, making financial conditions looser, not tighter.
So That Explains It
The stock market ebbs and flows with shifting financial conditions… as the tide ebbs and flows with the moon’s shifting humor.
Is it a wonder — then — that the stock market has ebbed with the ebbing financial tide?
https://ads.agorafinancial.com/www/d...&cb=ef83b20f2a
We hazard it is no wonder whatsoever.
For financial conditions are as loose and lax as a harlot’s virtue — if not looser and laxer.
Yet the Federal Reserve believes it has guarded its virtue with fantastic ferocity.
It believes its anti-inflationary whim-whams have choked financial conditions nearly to death. Mr. Powell yesterday:
“We think financial conditions are weighing on the economy.”
Has this fellow trained his eyes upon the figures?
We must conclude he has not. Or — or — he is aware of them and intends to depress rates regardless.
For what purpose… we are reduced to speculation. We do not know.
How Easy Will Conditions Be When the Fed Lowers Rates?
This we do know:
Wall Street heavily expects the Federal Reserve to soon execute its cherished pivot — perhaps in June.
And we believe Wall Street is correct. The Federal Reserve will soon commence its rate-depressing campaign.
And so a question rises into the air:
If financial conditions are lenient while rates have taken an extended hike… how much more lenient will they be once the Federal Reserve depresses rates?
Will they rocket the stock market to truly cosmic heights? Will they kindle inflation’s flames?
The above-cited Renevier:
Since easier financial conditions are like steroids for the economy, and inflation is a result of stronger economic growth, it makes sense that investors are expecting inflation to rise again.
Now, that does go against what the Federal Reserve says it’s trying to achieve — i.e. keeping inflation around its 2% target. And if the central bank does cut interest rates three times this year, as it suggested just this week, that could lead to even cushier financial conditions — and further stoke the risk of an inflation comeback.
We contest the claim that inflation is the consequence of economic growth. We nonetheless permit the case to proceed…
The Fed’s Walking a Razor-Thin Line
These policymakers are betting that inflation will dial down as the job market cools, and are probably expecting those other factors (credit spreads, the stocks’ rally, and dollar weakness) to mellow out too — all of which could take some heat off inflation. But at the same time, they’re also placing a wager on stronger economic growth. It’s a razor-thin line they’re trying to walk.
And in the meantime, we’re in a weird spot: economic growth picking up, inflation flirting with a comeback, and financial conditions easing way more than you’d expect, given where interest rates are. That mixed vibe is why oil and copper prices are on a tear (they both like strong growth and a whiff of inflation), why gold and Bitcoin are hitting it big (they’re the cool kids when financial conditions loosen and inflation flexes), and why stocks are smashing it against all odds (they thrive on robust growth and easy money conditions, and aren’t overly bothered by inflation).
We might not be in this peculiar position for long: Inflation could turn the heat way up, and put financial conditions into a deep freeze, and all of that could put a damper on growth.
But for now, the party’s on.
The Fed’s Party Won’t End Well
What will Mr. Powell and his mates do then?
Yet then is then and now is.
Indeed… for now… the party is on.
Today the balloons and streamers were abundant within 11 Wall Street — the New York Stock Exchange — as the major indexes once again went rampaging.
We nonetheless decline the invitation.
That is because the Federal Reserve is this party’s host. And we do not trust its management of the liquor that sustains it.
We hazard the attendees… presently thrilling to alcoholic excitements… are in for one royal hangover.
https://dweaay7e22a7h.cloudfront.net...65-650x360.jpg
https://dweaay7e22a7h.cloudfront.net...BrianMaher.jpg
BY BRIAN MAHER
POSTED
MARCH 21, 2024
The REAL Reason the Market’s Soaring
The Federal Reserve began kinking its monetary hose two years back.
This is done through fevered interest rate elevations and quantitative tightening.
Yet the stock market put out its tongue, placed its thumbs in its ears, and wiggled its fingers in Mr. Powell’s face.
It has gone streaking to record heights — despite the Federal Reserve’s kinks.
A conundrum! Or is it?
We are informed that financial conditions are presently extravagant.
They are among the loosest in several decades. Mr. Simon White of Bloomberg:
Monetary policy remains exceptionally loose given one of the fastest rate-hiking cycles seen… policy overall remains very loose despite over 500 basis points of rate hikes…
Standing back and looking at the totality of monetary policy in this cycle, we can see that — far from conditions tightening — we have instead seen one of the biggest loosening's of them in decades.
Graphic Evidence
Is it evidence you seek? Then it is evidence you shall have:
https://images.ctfassets.net/vha3zb1...1-03-21-24.png
Source: Bloomberg
The steeply ascending red represents the Federal Reserve’s target rate.
The largely descending blue represents financial conditions as Bloomberg gauges them.
The Federal Reserve has undertaken four rate elevation cycles within the past 30 years.
None has yielded a greater financial loosening than the present cycle. Again, the graphic evidence:
https://images.ctfassets.net/vha3zb1...2-03-21-24.png
Source: Bloomberg
The black represents the hiking cycles. The gold represents financial conditions.
As demonstrated, the present cycle represents the “biggest effective loosening seen.”
How do you explain it?
It’s All About the “Pivot”
Here Mr. Joe Weisenthal and Ms. Tracy Alloway — they of the Odd Lots newsletter — hazard an attempt:
It certainly feels like there’s a pattern where the mere whisper of rate cuts sparks easier financial conditions (as markets rally), while hawkish moves seem to do hardly anything…
As Viktor Shvets over at Macquarie put it this week: “Any hint of the Fed considering an even minor pivot significantly eases financial conditions while a more hawkish tone only barely tightens.”
We believe there is justice here.
Further disentangling this perplexing knot — perhaps — is a certain Stephane Renevier.
Interest rates aren’t the be-all and end-all of financial conditions. Yes, higher rates generally mean pricier loans — but there are a whole lot of other factors that affect how easy or tough it is for firms and everyday folks to get financing and keep the economic show on the road.
Think about the cost for companies to borrow (credit spreads), how well the stock market is doing (that’s another source of financing), and how strong the dollar is (a weaker dollar means cheaper loans for people around the world who take on debt in greenbacks, pumping more cash into the global economy).
Since the end of last year, all those factors have turned more positive and have offset the U.S.’ towering interest rates, making financial conditions looser, not tighter.
So That Explains It
The stock market ebbs and flows with shifting financial conditions… as the tide ebbs and flows with the moon’s shifting humor.
Is it a wonder — then — that the stock market has ebbed with the ebbing financial tide?
https://ads.agorafinancial.com/www/d...&cb=ef83b20f2a
We hazard it is no wonder whatsoever.
For financial conditions are as loose and lax as a harlot’s virtue — if not looser and laxer.
Yet the Federal Reserve believes it has guarded its virtue with fantastic ferocity.
It believes its anti-inflationary whim-whams have choked financial conditions nearly to death. Mr. Powell yesterday:
“We think financial conditions are weighing on the economy.”
Has this fellow trained his eyes upon the figures?
We must conclude he has not. Or — or — he is aware of them and intends to depress rates regardless.
For what purpose… we are reduced to speculation. We do not know.
How Easy Will Conditions Be When the Fed Lowers Rates?
This we do know:
Wall Street heavily expects the Federal Reserve to soon execute its cherished pivot — perhaps in June.
And we believe Wall Street is correct. The Federal Reserve will soon commence its rate-depressing campaign.
And so a question rises into the air:
If financial conditions are lenient while rates have taken an extended hike… how much more lenient will they be once the Federal Reserve depresses rates?
Will they rocket the stock market to truly cosmic heights? Will they kindle inflation’s flames?
The above-cited Renevier:
Since easier financial conditions are like steroids for the economy, and inflation is a result of stronger economic growth, it makes sense that investors are expecting inflation to rise again.
Now, that does go against what the Federal Reserve says it’s trying to achieve — i.e. keeping inflation around its 2% target. And if the central bank does cut interest rates three times this year, as it suggested just this week, that could lead to even cushier financial conditions — and further stoke the risk of an inflation comeback.
We contest the claim that inflation is the consequence of economic growth. We nonetheless permit the case to proceed…
The Fed’s Walking a Razor-Thin Line
These policymakers are betting that inflation will dial down as the job market cools, and are probably expecting those other factors (credit spreads, the stocks’ rally, and dollar weakness) to mellow out too — all of which could take some heat off inflation. But at the same time, they’re also placing a wager on stronger economic growth. It’s a razor-thin line they’re trying to walk.
And in the meantime, we’re in a weird spot: economic growth picking up, inflation flirting with a comeback, and financial conditions easing way more than you’d expect, given where interest rates are. That mixed vibe is why oil and copper prices are on a tear (they both like strong growth and a whiff of inflation), why gold and Bitcoin are hitting it big (they’re the cool kids when financial conditions loosen and inflation flexes), and why stocks are smashing it against all odds (they thrive on robust growth and easy money conditions, and aren’t overly bothered by inflation).
We might not be in this peculiar position for long: Inflation could turn the heat way up, and put financial conditions into a deep freeze, and all of that could put a damper on growth.
But for now, the party’s on.
The Fed’s Party Won’t End Well
What will Mr. Powell and his mates do then?
Yet then is then and now is.
Indeed… for now… the party is on.
Today the balloons and streamers were abundant within 11 Wall Street — the New York Stock Exchange — as the major indexes once again went rampaging.
We nonetheless decline the invitation.
That is because the Federal Reserve is this party’s host. And we do not trust its management of the liquor that sustains it.
We hazard the attendees… presently thrilling to alcoholic excitements… are in for one royal hangover.
- Post #12,595
- Quote
- Mar 24, 2024 9:48am Mar 24, 2024 9:48am
- | Commercial Member | Joined Dec 2014 | 11,471 Posts | Online Now
https://www.armstrongeconomics.com/a...-road-to-2032/
WEC 2023 – The Road to 2032
Blog/ECM
Posted Sep 23, 2023 by Martin Armstrong
Spread the love
https://www.armstrongeconomics.com/w...ad-to-2032.png
We are rapidly approaching 2032, where there will be the real Great Reset. We can all now “feel” 2032 coming. Our computer has made forecasts that no human being could have possibly made on such a consistent basis. Sure, someone can luck out and claim to have forecast one thing, but so many consistently is just not humanly possible.
https://www.armstrongeconomics.com/w...-Annotated.png
Back in 1985, the political forecast was set in stone. The 2016 election would be the first time a third-party candidate could win in American history.
The 2015.75 target was to be the peak in the CONFIDENCE and trust of the government. Trump fulfilled that role as the career Republicans and Democrats hated his guts. People like Romey are still desperately trying to protect the corruption in Washington. The 2024 election showed that there would be only a 10% chance that it would be a free and fair election. With 91 charges against Trump and treasonous lawsuits were launched against Trump in Colorado to block him from the Ballot under the pretense of the 14th Amendment calling January 6th an insurrection when not a single person in more than 1,000 people charged faced the Insurrection Statute. Such a lawsuit violated Due Process and shows just how desperate these people are to maintain the Deep State that is crumbling before our eyes.
https://www.armstrongeconomics.com/w...Conference.png
I stood up at the 2011 WEC and warned that the War Cycle and the Civil Unrest Cycle bottomed in 2014, and we would be looking at war for the end of this cycle into 2032. The computer in 2013 even targeted Ukraine, where this would all begin.
https://www.armstrongeconomics.com/w...Everything.png
Schwab has taken that forecast and is trying to push everything in his direction of a totalitarian state where we lose all our privacy and freedom. As I have said, Schwab is a control freak. He has to know everything in his WEF applying that standard to the world.
https://www.armstrongeconomics.com/w...ing-Future.jpg
Saving the Future is not going to be easy. Kevin McCarthy is an absolute disgrace, but it should not be a surprise that he has no problem sending endless money to Ukraine and sending millions of people to their deaths because that is the Neocons’ dream. Coming from California, probably the most corrupt political state in the nation and morally bankrupt, we should not place any hope in McCarthy to prevent World War III.
Russian Foreign Minister Sergei Lavrov called Ukrainian proposals for restoring its pre-invasion territory absolutely laughable. Unless the Ukrainians wake the hell up and remove Zelensky by force, they will NEVER have a country to return to. The West does not care about them. They are cannon fodder for the Neocons, who care about nothing but their insane wars. There will not be a wonderland of investment that Zelensky is preaching. Lavrov has thrown down the gauntlet, for Putin cannot ignore the hardliners who have been right all along – they are at war with the USA and NATO, not Ukraine.
Lavrov said that they could have war if Ukraine’s allies wanted war. Behind the curtain, these warmongers are creating World War III, and this war is likely to go on for years.
https://www.armstrongeconomics.com/w...er_9030074.gif
Based on the numerous requests to try to lay a map into 2032, this year’s event may be one of the more interesting during the past ten years: November 17, 18, and 19 in Orlando.
Categories: ECM, World Economic Conference
« The ECM of Ancient Times
REGISTER FOR BLOG UPDATE ALERTS
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BLOG CATEGORIES
WEC 2023 – The Road to 2032
Blog/ECM
Posted Sep 23, 2023 by Martin Armstrong
Spread the love
https://www.armstrongeconomics.com/w...ad-to-2032.png
We are rapidly approaching 2032, where there will be the real Great Reset. We can all now “feel” 2032 coming. Our computer has made forecasts that no human being could have possibly made on such a consistent basis. Sure, someone can luck out and claim to have forecast one thing, but so many consistently is just not humanly possible.
https://www.armstrongeconomics.com/w...-Annotated.png
Back in 1985, the political forecast was set in stone. The 2016 election would be the first time a third-party candidate could win in American history.
The 2015.75 target was to be the peak in the CONFIDENCE and trust of the government. Trump fulfilled that role as the career Republicans and Democrats hated his guts. People like Romey are still desperately trying to protect the corruption in Washington. The 2024 election showed that there would be only a 10% chance that it would be a free and fair election. With 91 charges against Trump and treasonous lawsuits were launched against Trump in Colorado to block him from the Ballot under the pretense of the 14th Amendment calling January 6th an insurrection when not a single person in more than 1,000 people charged faced the Insurrection Statute. Such a lawsuit violated Due Process and shows just how desperate these people are to maintain the Deep State that is crumbling before our eyes.
https://www.armstrongeconomics.com/w...Conference.png
I stood up at the 2011 WEC and warned that the War Cycle and the Civil Unrest Cycle bottomed in 2014, and we would be looking at war for the end of this cycle into 2032. The computer in 2013 even targeted Ukraine, where this would all begin.
https://www.armstrongeconomics.com/w...Everything.png
Schwab has taken that forecast and is trying to push everything in his direction of a totalitarian state where we lose all our privacy and freedom. As I have said, Schwab is a control freak. He has to know everything in his WEF applying that standard to the world.
https://www.armstrongeconomics.com/w...ing-Future.jpg
Saving the Future is not going to be easy. Kevin McCarthy is an absolute disgrace, but it should not be a surprise that he has no problem sending endless money to Ukraine and sending millions of people to their deaths because that is the Neocons’ dream. Coming from California, probably the most corrupt political state in the nation and morally bankrupt, we should not place any hope in McCarthy to prevent World War III.
Russian Foreign Minister Sergei Lavrov called Ukrainian proposals for restoring its pre-invasion territory absolutely laughable. Unless the Ukrainians wake the hell up and remove Zelensky by force, they will NEVER have a country to return to. The West does not care about them. They are cannon fodder for the Neocons, who care about nothing but their insane wars. There will not be a wonderland of investment that Zelensky is preaching. Lavrov has thrown down the gauntlet, for Putin cannot ignore the hardliners who have been right all along – they are at war with the USA and NATO, not Ukraine.
Lavrov said that they could have war if Ukraine’s allies wanted war. Behind the curtain, these warmongers are creating World War III, and this war is likely to go on for years.
https://www.armstrongeconomics.com/w...er_9030074.gif
Based on the numerous requests to try to lay a map into 2032, this year’s event may be one of the more interesting during the past ten years: November 17, 18, and 19 in Orlando.
Categories: ECM, World Economic Conference
« The ECM of Ancient Times
REGISTER FOR BLOG UPDATE ALERTS
If you are human, leave this field blank.
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https://www.zerohedge.com/political/...-anti-semitism
Alan Dershowitz & Elon Musk On Free Speech & Anti-Semitism
https://zh-prod-1cc738ca-7d3b-4a72-b.../picture-5.jpg
BY TYLER DURDEN
FRIDAY, OCT 06, 2023 - 09:30 PM
Via The Gatestone Institute,
Alan Dershowitz & Elon Musk On Free Speech & Anti-Semitism
https://zh-prod-1cc738ca-7d3b-4a72-b.../picture-5.jpg
BY TYLER DURDEN
FRIDAY, OCT 06, 2023 - 09:30 PM
Via The Gatestone Institute,
- No country in history has ever really tested free speech: has seen whether the marketplace of ideas works or whether we can really have a society without censorship; where every idea is tested only on its merits, rather than for political benefit. This cannot be a right-left issue. — Alan Dershowitz.
- You [Elon] are trying, for the first time, a great experiment to see whether we can survive with a marketplace of ideas, without censorship, where all thoughts and all ideas are treated equally. — Dershowitz
- What we need is to create a circle in which things that are illegal, such as abusing children, are outside the circle, but anything else has to be inside the circle. So if something is permitted for one idea or "-ism," it has to be permitted for the others. This is exactly what universities are failing to do. They are creating a line on which favored groups fall on one side and disfavored groups fall on the other side. — Dershowitz.
- People will always want to censor but not be censored. — Dershowitz.
- I am in favor of no prior censorship except things that are overtly illegal. Let the marketplace decide and make sure that there is an opportunity for everyone to answer. One cannot draw a line on hate speech. One person's hate speech is another person's love speech. It is important to open up the marketplace of ideas. — Dershowitz.
- [Y]ou can post anything on the platform ["X"] even if it is hateful, provided that it is lawful. But then there is a separate question of what is promoted or not promoted.... Our current approach is to say, okay, you can say things that are hateful but legal on the platform, but we are not going to recommend them to others. — Elon Musk.
- Advertisers, certainly, have a right to say what content they will appear next to because that's their right too, but not to dictate what can be said on the platform. — Musk.
- Today the greatest danger to free speech comes from the left.... At the moment, it is the left that is educating our future leaders, so the left poses a far greater danger of censoring free speech and of skewing the marketplace of ideas. "X" has to be perceived as equally open to both sides. — Dershowitz.
- That is our aspiration, that is our goal. Now the reality of it for anyone who is paying attention -- and I'm sure you saw this -- was that prior to the acquisition, Twitter was very left and getting even more left. They had a massive thumb on the scale on elections. Frankly, worldwide on the side of left, and would suppress Republican voices at a rate, sometimes perhaps an order of magnitude greater than Democrats. There was a tremendous amount of bias. Now we are moving from a system where there was a massive electoring bias to a system that is now more inclusive, where at least, say, 80% of America -- perhaps the world -- could be on the platform and feel that it is finally a level playing field, fair to people with a wide range of views. That is our goal and that is what we are doing now. — Musk.
- If you start on the left and you move to the center, you are necessarily moving right. Our goal is not to move to the right; it is that we are moving right in order to get to the center. — Musk.
- [Y]our historic neutrality might be destroyed if "X" is not perceived as being from the center. So everything you do needs to be designed to create a neutral space... where the only answer to false speech is true speech, and where the marketplace determines how many people listen to it... We have to have more confidence in our ability to answer bad speech. I do not want to censor my enemies. — Dershowitz.
- [W]e actually have massively broadened what can be said on the platform... but we have tried to guide our algorithm to promote things that are positive more than things that are negative; frankly, to have a love bias, if you will. This is not in terms of what can be said, but in terms of what is promoted to others. If somebody wants to accuse me of saying it is wrong to have a slight bias towards love and positivity, then I am rightly accused of that. — Musk.
- As I have said, I think the overarching goal is how do how do we make this platform serve as a positive force for humanity. I think the free exchange of ideas does result in a positive force for humanity -- if somebody feels that even if their ideas are wrong, they are not being squashed or censored. I think being squashed and censored breeds hatred and resentment and simply sends people to "hate echo chambers" that are outside of the mainstream. I think where you get the sort of people who go kill and do mass shooting, is because they are in some sort of "hate echo chamber." — Musk.
- I believe one is always wrong to some degree; we simply aspire to be a little less wrong over time and eventually we can get to a really good place. The idea is how do we make "X" a positive force for humanity where we can increase the sum of human knowledge.
- It's a place where I hope people would know that if their ideas are based on false premises, especially hateful ideas, that perhaps we can point out that the reason that they have this hatred is because of things that are not true. It is like actually you are hating this or that group for things that are not true, or perhaps, in some cases, things that happened a long time ago for which it was a great-great-grandfather or something, that that did the bad thing. — Musk.
- I think there is a lot of wisdom in forgiveness and turning the other cheek... I think it is actually a sign of strength. By the same token if you turn the other cheek and you're just getting slapped all day, at a certain point you stop turning the cheek, but the general notion of forgiveness is incredibly important. Do not hold some grudge for you know a long time, in some cases centuries.
- Let it go and, to take another take a quote from the New Testament, the truth shall set you free, as John said. — Musk.
https://assets.zerohedge.com/s3fs-pu...?itok=qB2_Wxcw
Elon Musk and Alan Dershowitz. (Photos by Joel Saget/AFP via Getty Images and Mario Tama/Getty Images)
Alan Dershowitz: Let me start with a statement that many will disagree with. No country in history has ever really tested free speech: has seen whether the marketplace of ideas works or whether we can really have a society without censorship; where every idea is tested only on its merits, rather than for political benefit. This cannot be a right-left issue. Elon, you may be the first person who has really tried. Thomas Jefferson, Alexander Hamilton and Abraham Lincoln all compromised. You are trying, for the first time, a great experiment to see whether we can survive with a marketplace of ideas, without censorship, where all thoughts and all ideas are treated equally. For instance, where there are judgments on the basis of whether something is pro-right, pro-life, anti-Jewish, pro-Christian, anti-Christian. What we need is to create a circle in which things that are illegal, such as abusing children, are outside the circle, but anything else has to be inside the circle. So if something is permitted for one idea or "-ism," it has to be permitted for the others. This is exactly what universities are failing to do. They are creating a line on which favored groups fall on one side and disfavored groups fall on the other side.
Can one define the kind of speech that must be permitted -- the legal kind -- without focusing on the content of the speech itself? Can one do that without focusing on whether it is right or left or politically correct or anything of that kind? One has to create a framework that is absolutely neutral. Then maybe fewer people will want to censor because they will realize that they will not be able to have "free speech for me but not for thee." People will always want to censor but not be censored.
No idea should be censored. Oliver Wendell Holmes put it well. He said every idea is an incitement. There should be no lines between advocacy and incitement. We fail every time we have tried to do that -- most recently, with former President Trump's ill-advised, but in my view, but constitutionally protected "January 6 speech". We also failed during McCarthyism as well as in trying to distinguish between lawful advocacy of revolution and unlawful incitement of violence.
Do not listen to special pleaders on behalf of minorities. Do not listen to the people who are self-serving and want, say, to serve the Jewish community, or serve Israel or the Palestinians. I am in favor of no prior censorship except things that are overtly illegal. Let the marketplace decide and make sure that there is an opportunity for everyone to answer. One cannot draw a line on hate speech. One person's hate speech is another person's love speech. It is important to open up the marketplace of ideas. If everyone is allowed to express ideas openly, no one is going to censor the "enemy" when they know that next, he or she will be the one being censored.
Elon Musk: We are experimenting with this idea of freedom of speech, but not reach. Meaning that you can post anything on the platform even if it is hateful, provided that it is lawful. But then there is a separate question of what is promoted or not promoted, what enters into our recommendation engine, and if so, with what promise? Our current approach is to say, okay, you can say things that are hateful but legal on the platform, but we are not going to recommend them to others. This is the current approach that we have.
Alan Dershowitz: That can be abused and become a form of censorship too.
Elon Musk: I agree. Advertisers, certainly, have a right to say what content they will appear next to because that's their right too, but not to dictate what can be said on the platform.
Alan Dershowitz: I would agree with that. There is one other danger: of "X" being perceived as a right-wing reaction to left-wing censorship. I am -- and identify -- more with the left than the right, but I oppose strongly efforts by both the left and the right to censor. It would be a very serious mistake if "X" or you were perceived as some way implicitly favoring the right over the left. Perhaps you might have a small group of advisors, who represent different perspectives. Today the greatest danger to free speech comes from the left.
Elon Musk: Yes, agree.
Alan Dershowitz: Violence comes from both sides. The right-wing attack abortion clinics and kill Jews in synagogues. The 2020 "summer of love" came from the left: they burned down parts of cities, tore down statues, vandalized buildings; according to reports, numerous Americans were killed, including retired police Captain Daniel Dorn; thousands of police officers were assaulted, many sustaining injuries.
At the moment, it is the left that is educating our future leaders, so the left poses a far greater danger of censoring free speech and of skewing the marketplace of ideas. "X" has to be perceived as equally open to both sides.
Elon Musk: That is our aspiration, that is our goal. Now the reality of it for anyone who is paying attention -- and I'm sure you saw this -- was that prior to the acquisition, Twitter was very left and getting even more left. They had a massive thumb on the scale on elections. Frankly, worldwide on the side of left, and would suppress Republican voices at a rate, sometimes perhaps an order of magnitude greater than Democrats. There was a tremendous amount of bias. Now we are moving from a system where there was a massive electoring bias to a system that is now more inclusive, where at least, say, 80% of America -- perhaps the world -- could be on the platform and feel that it is finally a level playing field, fair to people with a wide range of views. That is our goal and that is what we are doing now.
Given that it started so far off the left, it is accurate to say that it is moving right because it is moving to the center. So technically it is true that it is moving right. Not that it is suddenly popped over and instantaneously became, you know, from a left-wing propaganda arm to a right-wing propaganda arm but necessarily if it was pretty damn far on the left, it is going to have to move to the right in order to get to the center, and that is that is our goal.
As Einstein would say, all motion is relative. If you start on the left and you move to the center, you are necessarily moving right. Our goal is not to move to the right; it is that we are moving right in order to get to the center.
Alan Dershowitz: But some people perceive this as a movement to right. You might want to make it absolutely clear that you are the only platform in the world that does not take a "left -right" position -- that yours is the platform that is pro-free speech, and that you are the first person in history ever to try to create a true marketplace of ideas. John Stuart Mill advocated it, Jefferson advocated it. But nobody ever achieved it. You are in a position where you can achieve it. I am just concerned that your historic neutrality might be destroyed if "X" is not perceived as being from the center. So everything you do needs to be designed to create a neutral space -- a marketplace of ideas where the only answer to false speech is true speech, and where the marketplace determines how many people listen to it.
We have to have more confidence in our ability to answer bad speech. I do not want to censor my enemies.
Elon Musk: Absolutely, and to be clear we actually have massively broadened what can be said on the platform. But we have -- and perhaps you disagree with this -- but we have tried to guide our algorithm to promote things that are positive more than things that are negative; frankly, to have a love bias, if you will. This is not in terms of what can be said, but in terms of what is promoted to others. If somebody wants to accuse me of saying it is wrong to have a slight bias towards love and positivity, then I am rightly accused of that.
I think our overlap in agreement is very high so I would certainly value your opinion in the future because this is something that we should debate frequently. As I have said, I think the overarching goal is how do how do we make this platform serve as a positive force for humanity. I think the free exchange of ideas does result in a positive force for humanity -- if somebody feels that even if their ideas are wrong, they are not being squashed or censored. I think being squashed and censored breeds hatred and resentment and simply sends people to "hate echo chambers" that are outside of the mainstream. I think where you get the sort of people who go kill and do mass shooting, is because they are in some sort of "hate echo chamber."
Alan Dershowitz: I think we all should sacrifice our own parochial interests, even on issues like anti-Semitism, to a far greater humanitarian interest in promoting open and complete dialogue. Complete free speech in the marketplace of ideas: only you can do that.
Elon Musk: Well, thank you. I'll do my best here and your sort of advice would certainly be very much appreciated. I believe one is always wrong to some degree; we simply aspire to be a little less wrong over time and eventually we can get to a really good place. The idea is how do we make "X" a positive force for humanity where we can increase the sum of human knowledge. It's a place where I hope people would know that if their ideas are based on false premises, especially hateful ideas, that perhaps we can point out that the reason that they have this hatred is because of things that are not true. It is like actually you are hating this or that group for things that are not true, or perhaps, in some cases, things that happened a long time ago for which it was a great-great-grandfather or something, that that did the bad thing.
I think there is a lot of wisdom in forgiveness and turning the other cheek. When I was younger, I actually thought turning the other cheek was not a sign of weakness. Now, I think it is actually a sign of strength. By the same token if you turn the other cheek and you're just getting slapped all day, at a certain point you stop turning the cheek, but the general notion of forgiveness is incredibly important. Do not hold some grudge for you know a long time, in some cases centuries. Let it go and, to take another take a quote from the New Testament, the truth shall set you free, as John said. I am a big believer in that the road to morality is truth and curiosity. And if you care about truth and you are curious, I think this is a natural outflowing from that.
- Post #12,597
- Quote
- Mar 24, 2024 9:53am Mar 24, 2024 9:53am
- | Commercial Member | Joined Dec 2014 | 11,471 Posts | Online Now
https://www.zerohedge.com/markets/bo...message-stocks
The Bond Market's Bearish Message For Stocks
https://zh-prod-1cc738ca-7d3b-4a72-b.../picture-5.jpg
BY TYLER DURDEN
SUNDAY, NOV 05, 2023 - 11:00 AM
Authored by Jesse Felder via TheFelderReport.com,
There’s a growing disconnect between the prices of stocks and bonds.
"It seems bonds are adjusting to a post-QE world but for some reason equities haven't. If you had told me that rates were gonna be where the are now on Jan. 1 and earnings would be flat and the S&P would be up 12-13%, that's not part of my process." https://t.co/IkAAQkkgBK
— Jesse Felder (@jessefelder) November 1, 2023
Bonds have begun to reflect the reality of a “post-QE world” while stocks have yet to do so.
"The historical relationship between bond yields and the S&P 500 P/E multiple suggests that the recent disconnect can be corrected in one of two ways — either the equity market has further downside or yields will move lower." https://t.co/AKvLOrUJ1x pic.twitter.com/5kELvTpJn0
— Jesse Felder (@jessefelder) October 31, 2023
Moreover, the growing “liquidity hole” suggests bonds may not yet be done pricing it in.
'If the T-bill rate stays at 5% or higher, to get a risk premium in bonds you need a bond yield of 5.5% or higher. And given the liquidity hole, demand will need to come from private sector investors, who will require a risk premium relative to cash.' https://t.co/PtBw3eW5AX
— Jesse Felder (@jessefelder) October 31, 2023
Meanwhile, the message being sent by the yield curve is not, by any means, bullish for the broad stock market.
'The arrows in the graph below show the occasions where the spread between the 3-month T-Bill yield and the 10-year T-Bond yield was inverted, and it either became un-inverted, or the slope of the curve steepened by at least 100 basis points.' https://t.co/0T80AgQKTL pic.twitter.com/zi9kHKOBNO
— Jesse Felder (@jessefelder) October 30, 2023
And the forward guidance out of the corporate sector apparently confirms this view.
'At just over the half-way mark of the reporting period, "weak demand" is among the top trending phrases on earnings calls. If the pace of mentions holds for the next few weeks, it would be the most on record, according to data going back to 2000.' https://t.co/3jQDCthcH4 pic.twitter.com/sg3a6hVxrj
— Jesse Felder (@jessefelder) November 3, 2023
WWW.AVIELFOREXLEARNINGEDGE.COM
The Bond Market's Bearish Message For Stocks
https://zh-prod-1cc738ca-7d3b-4a72-b.../picture-5.jpg
BY TYLER DURDEN
SUNDAY, NOV 05, 2023 - 11:00 AM
Authored by Jesse Felder via TheFelderReport.com,
There’s a growing disconnect between the prices of stocks and bonds.
"It seems bonds are adjusting to a post-QE world but for some reason equities haven't. If you had told me that rates were gonna be where the are now on Jan. 1 and earnings would be flat and the S&P would be up 12-13%, that's not part of my process." https://t.co/IkAAQkkgBK
— Jesse Felder (@jessefelder) November 1, 2023
Bonds have begun to reflect the reality of a “post-QE world” while stocks have yet to do so.
"The historical relationship between bond yields and the S&P 500 P/E multiple suggests that the recent disconnect can be corrected in one of two ways — either the equity market has further downside or yields will move lower." https://t.co/AKvLOrUJ1x pic.twitter.com/5kELvTpJn0
— Jesse Felder (@jessefelder) October 31, 2023
Moreover, the growing “liquidity hole” suggests bonds may not yet be done pricing it in.
'If the T-bill rate stays at 5% or higher, to get a risk premium in bonds you need a bond yield of 5.5% or higher. And given the liquidity hole, demand will need to come from private sector investors, who will require a risk premium relative to cash.' https://t.co/PtBw3eW5AX
— Jesse Felder (@jessefelder) October 31, 2023
Meanwhile, the message being sent by the yield curve is not, by any means, bullish for the broad stock market.
'The arrows in the graph below show the occasions where the spread between the 3-month T-Bill yield and the 10-year T-Bond yield was inverted, and it either became un-inverted, or the slope of the curve steepened by at least 100 basis points.' https://t.co/0T80AgQKTL pic.twitter.com/zi9kHKOBNO
— Jesse Felder (@jessefelder) October 30, 2023
And the forward guidance out of the corporate sector apparently confirms this view.
'At just over the half-way mark of the reporting period, "weak demand" is among the top trending phrases on earnings calls. If the pace of mentions holds for the next few weeks, it would be the most on record, according to data going back to 2000.' https://t.co/3jQDCthcH4 pic.twitter.com/sg3a6hVxrj
— Jesse Felder (@jessefelder) November 3, 2023
WWW.AVIELFOREXLEARNINGEDGE.COM
- Post #12,598
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- Mar 24, 2024 9:57am Mar 24, 2024 9:57am
- | Commercial Member | Joined Dec 2014 | 11,471 Posts | Online Now
www.avielforexlearningedge.com
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As an experienced forex trader and educator, I have helped many people learn how to trade forex successfully and earn a lot of money. My comprehensive approach to trading combines fundamental and technical analysis with risk management strategies to identify profitable trading opportunities.
If you're interested in learning forex trading and earning a lot of money, my 90-day course is the perfect place to start. This course covers everything from the basics of forex trading to advanced strategies for maximizing your profits. Best of all, for a limited time, I'm offering a 50% discount on the course fee.
During the 90-day season course, you'll learn how to read and analyze charts, identify trends and patterns, and use technical indicators to make informed trading decisions. You'll also learn how to manage your risk and minimize losses so that you can maximize your profits.
One of the most important things you'll learn during the course is the psychology of trading. Trading forex can be stressful and emotional, and it's essential to develop a mindset that allows you to stay calm and focused under pressure. I'll teach you proven techniques for managing your emotions and staying disciplined so that you can make rational, well-informed trading decisions.
In addition to the 90-day course, I also offer a range of other educational resources, including webinars, coaching programs, and one-on-one mentoring. Whether you're a beginner or an experienced trader, my goal is to help you achieve success in forex trading and reach your financial goals.
If you're ready to learn forex trading from an experienced professional and start earning a lot of money, sign up for my 90-day course today. With the 50% discount, you'll get all the knowledge and skills you need to become a successful forex trader at a fraction of the usual cost.
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and join the course.
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TESTIMONIALS
"After the first meeting, I turned my financials over to AVIEL FOREX LEARNING EDGE. They go above and beyond."
Daniel Gates
https://0901.nccdn.net/4_2/000/000/038/2d3/forex.png
As an experienced forex trader and educator, I have helped many people learn how to trade forex successfully and earn a lot of money. My comprehensive approach to trading combines fundamental and technical analysis with risk management strategies to identify profitable trading opportunities.
If you're interested in learning forex trading and earning a lot of money, my 90-day course is the perfect place to start. This course covers everything from the basics of forex trading to advanced strategies for maximizing your profits. Best of all, for a limited time, I'm offering a 50% discount on the course fee.
During the 90-day season course, you'll learn how to read and analyze charts, identify trends and patterns, and use technical indicators to make informed trading decisions. You'll also learn how to manage your risk and minimize losses so that you can maximize your profits.
One of the most important things you'll learn during the course is the psychology of trading. Trading forex can be stressful and emotional, and it's essential to develop a mindset that allows you to stay calm and focused under pressure. I'll teach you proven techniques for managing your emotions and staying disciplined so that you can make rational, well-informed trading decisions.
In addition to the 90-day course, I also offer a range of other educational resources, including webinars, coaching programs, and one-on-one mentoring. Whether you're a beginner or an experienced trader, my goal is to help you achieve success in forex trading and reach your financial goals.
If you're ready to learn forex trading from an experienced professional and start earning a lot of money, sign up for my 90-day course today. With the 50% discount, you'll get all the knowledge and skills you need to become a successful forex trader at a fraction of the usual cost.
APPLY FOR THE COURSE
Send an E-transfer for 125.00 Canadian dollars to [email protected]
and join the course.
Contact Bruce Warren Margolese at [email protected]
Follow Us
- Post #12,599
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- Mar 24, 2024 10:26am Mar 24, 2024 10:26am
- | Commercial Member | Joined Dec 2014 | 11,471 Posts | Online Now
Bruce —
Friday's meeting of the International Peace Coalition released an emergency statement, which begins as follows:
Let us mince no words. The world is now on a direct, short path to thermonuclear war. Don’t blame Russia or China. We, in the trans-Atlantic world, are the problem, and with us lies the solution. If we continue to wait to “see what happens,” if we want those in the “military-monetary power structure” to come to their senses, we will be too late to stop humanity’s last war. The time to act is now.
The British and their neocon disciples have not been faring well in any of their wars. The Republicans in the US Congress have continued to drag their feet on authorizing funds for Ukraine, forcing the Pentagon to dip into the slush fund it generated by cooking its books last year. After an initial US-led stampede to cut the funds for UNRWA's mission to provide desperately needed food, water, and medical care to the beleaguered inhabitants of Gaza, nations are beginning to realize that they had been conned by the Likudniks in Israel and the US.
Over the past week, Australia, Canada, Sweden, and the European Commission all restored funding.
It is imperative to keep in mind the strategic context for these wars: the "new paradigm" is gaining momentum. As the BRICS and the Global South become more and more assertive, and the nations of the Anglosphere become increasingly bankrupt and isolated, war becomes the only option for the "Unipolar World" advocates.
As Helga Zepp-LaRouche put it in this week's International Peace Coalition meeting, "insanity has gripped the minds of many leaders in the West," and she cited as an example, French President Macron's "incomprehensibly crazy statement to send French troops on the ground into Ukraine."
https://ecp.yusercontent.com/mail?ur...mw.4EuaGng--~D
President Macron as Napoleon - web art gallery on DeviantArt
The Russians have no illusions about what all this means. Kremlin spokesman Dmitry Peskov said on Friday, "We are in a state of war. Yes, this began as a special military operation, but as soon as that clique was formed—the collective West plus Ukraine, when the collective West became a participant on the side of Ukraine—for us it became a war." These words were spoken before a group of men in camouflage broke into the Crocus-City Hall in the northwest Moscow Region near Krasnogorsk on Friday, launching an attack with firearms and bombs that has claimed 133 lives.
Also on Friday, Egyptian Foreign Minister Sameh Shoukry, with a stone-faced Tony Blinken standing next to him, warned that the Arab and Muslim world’s continued cooperation with the United States and the so-called “rules-based order” is being called into question by the refusal to act to end the military and humanitarian assault on the Palestinians.
https://ecp.yusercontent.com/mail?ur...qMacGtBDTw--~D
Vladimir Putin - Presidential Executive Office of Russia
There was an eruption of frantic media spin-doctoring this week in the wake of the Russian election, in which Vladimir Putin was elected to a fifth term as President with a historically high percentage of the vote. Harley Schlanger provided an antidote to the pervasive disinformation, in his daily video update for March 19.
The panic-driven bellicosity of the neocons has brought the world to a tipping point, and the policy initiatives of the would-be Anglo-American Empire are growing more desperate and reckless because they are losing. Without understating the danger of an escalation to full-blown nuclear war, it is important that we take heart from their desperation, and find ways to press our advantage.
What You Can Do
Please continue to distribute the open letter by Mexican Congressman Robles to your elected officials. These officials can either sign it or put out a similar letter demanding a new international security and development architecture. Watch and share this important video on the Oasis Plan, LaRouche's solution to the long-festering crisis in Southwest Asia. Also, please register for our April 13th conference.
In addition, please consider supporting our work. We rely on contributions to fund our activities day in and day out.
Anything you can do is appreciated!
Donate
Join the Discussion! Upcoming Events
Mon. Mar. 25:
8:30 pm (Eastern)
The LaRouche Movement Activists Call
Contact host Tim Rush at [email protected] for a Zoom link
Thurs. Mar. 28:
9 pm (Eastern)
"Fireside Chat"
(267) 807-9605, access code 536662#
Sat. Mar. 30:
2 pm (Eastern)
Manhattan Project Town Hall
Every Weekday:
Watch the LaRouche Organization's Harley Schlanger who gives a daily update—a crucial tool to stay up to date on the strategic situation
Daily Harley Updates
Onward,
Daniel Platt
Friday's meeting of the International Peace Coalition released an emergency statement, which begins as follows:
Let us mince no words. The world is now on a direct, short path to thermonuclear war. Don’t blame Russia or China. We, in the trans-Atlantic world, are the problem, and with us lies the solution. If we continue to wait to “see what happens,” if we want those in the “military-monetary power structure” to come to their senses, we will be too late to stop humanity’s last war. The time to act is now.
The British and their neocon disciples have not been faring well in any of their wars. The Republicans in the US Congress have continued to drag their feet on authorizing funds for Ukraine, forcing the Pentagon to dip into the slush fund it generated by cooking its books last year. After an initial US-led stampede to cut the funds for UNRWA's mission to provide desperately needed food, water, and medical care to the beleaguered inhabitants of Gaza, nations are beginning to realize that they had been conned by the Likudniks in Israel and the US.
Over the past week, Australia, Canada, Sweden, and the European Commission all restored funding.
It is imperative to keep in mind the strategic context for these wars: the "new paradigm" is gaining momentum. As the BRICS and the Global South become more and more assertive, and the nations of the Anglosphere become increasingly bankrupt and isolated, war becomes the only option for the "Unipolar World" advocates.
As Helga Zepp-LaRouche put it in this week's International Peace Coalition meeting, "insanity has gripped the minds of many leaders in the West," and she cited as an example, French President Macron's "incomprehensibly crazy statement to send French troops on the ground into Ukraine."
https://ecp.yusercontent.com/mail?ur...mw.4EuaGng--~D
President Macron as Napoleon - web art gallery on DeviantArt
The Russians have no illusions about what all this means. Kremlin spokesman Dmitry Peskov said on Friday, "We are in a state of war. Yes, this began as a special military operation, but as soon as that clique was formed—the collective West plus Ukraine, when the collective West became a participant on the side of Ukraine—for us it became a war." These words were spoken before a group of men in camouflage broke into the Crocus-City Hall in the northwest Moscow Region near Krasnogorsk on Friday, launching an attack with firearms and bombs that has claimed 133 lives.
Also on Friday, Egyptian Foreign Minister Sameh Shoukry, with a stone-faced Tony Blinken standing next to him, warned that the Arab and Muslim world’s continued cooperation with the United States and the so-called “rules-based order” is being called into question by the refusal to act to end the military and humanitarian assault on the Palestinians.
https://ecp.yusercontent.com/mail?ur...qMacGtBDTw--~D
Vladimir Putin - Presidential Executive Office of Russia
There was an eruption of frantic media spin-doctoring this week in the wake of the Russian election, in which Vladimir Putin was elected to a fifth term as President with a historically high percentage of the vote. Harley Schlanger provided an antidote to the pervasive disinformation, in his daily video update for March 19.
The panic-driven bellicosity of the neocons has brought the world to a tipping point, and the policy initiatives of the would-be Anglo-American Empire are growing more desperate and reckless because they are losing. Without understating the danger of an escalation to full-blown nuclear war, it is important that we take heart from their desperation, and find ways to press our advantage.
What You Can Do
Please continue to distribute the open letter by Mexican Congressman Robles to your elected officials. These officials can either sign it or put out a similar letter demanding a new international security and development architecture. Watch and share this important video on the Oasis Plan, LaRouche's solution to the long-festering crisis in Southwest Asia. Also, please register for our April 13th conference.
In addition, please consider supporting our work. We rely on contributions to fund our activities day in and day out.
Anything you can do is appreciated!
Donate
Join the Discussion! Upcoming Events
Mon. Mar. 25:
8:30 pm (Eastern)
The LaRouche Movement Activists Call
Contact host Tim Rush at [email protected] for a Zoom link
Thurs. Mar. 28:
9 pm (Eastern)
"Fireside Chat"
(267) 807-9605, access code 536662#
Sat. Mar. 30:
2 pm (Eastern)
Manhattan Project Town Hall
Every Weekday:
Watch the LaRouche Organization's Harley Schlanger who gives a daily update—a crucial tool to stay up to date on the strategic situation
Daily Harley Updates
Onward,
Daniel Platt
- Post #12,600
- Quote
- Mar 24, 2024 11:42am Mar 24, 2024 11:42am
- | Commercial Member | Joined Dec 2014 | 11,471 Posts | Online Now
https://www.zerohedge.com/political/...ional-security
In Memory Of JFK: The First US President To Be Labeled A Terrorist & Threat To National Security
https://zh-prod-1cc738ca-7d3b-4a72-b.../picture-5.jpg
BY TYLER DURDEN
MONDAY, NOV 22, 2021 - 10:20 PM
Authored by Cynthia Chung via The Saker blog,
In April 1954, Kennedy stood up on the Senate floor to challenge the Eisenhower Administration’s support for the doomed French imperial war in Vietnam, foreseeing that this would not be a short-lived war.
In July 1957, Kennedy once more took a strong stand against French colonialism, this time France’s bloody war against Algeria’s independence movement, which again found the Eisenhower Administration on the wrong side of history. Rising on the Senate floor, two days before America’s own Independence Day, Kennedy declared:
“The most powerful single force in the world today is neither communism nor capitalism, neither the H-bomb nor the guided missile – it is man’s eternal desire to be free and independent. The great enemy of that tremendous force of freedom is called, for want of a more precise term, imperialism – and today that means Soviet imperialism and, whether we like it or not, and though they are not to be equated, Western imperialism. Thus, the single most important test of American foreign policy today is how we meet the challenge of imperialism, what we do to further man’s desire to be free. On this test more than any other, this nation shall be critically judged by the uncommitted millions in Asia and Africa, and anxiously watched by the still hopeful lovers of freedom behind the Iron Curtain. If we fail to meet the challenge of either Soviet or Western imperialism, then no amount of foreign aid, no aggrandizement of armaments, no new pacts or doctrines or high-level conferences can prevent further setbacks to our course and to our security.”
In September 1960, the annual United Nations General Assembly was held in New York. Fidel Castro and a fifty-member delegation were among the attendees and had made a splash in the headlines when he decided to stay at the Hotel Theresa in Harlem after the midtown Shelburne Hotel demanded a $20,000 security deposit. He made an even bigger splash in the headlines when he made a speech at this hotel, discussing the issue of equality in the United States while in Harlem, one of the poorest boroughs in the country.
Kennedy would visit this very same hotel a short while later, and also made a speech:
“Behind the fact of Castro coming to this hotel, [and] Khrushchev…there is another great traveler in the world, and that is the travel of a world revolution, a world in turmoil…We should be glad [that Castro and Khrushchev] came to the United States. We should not fear the twentieth century, for the worldwide revolution which we see all around us is part of the original American Revolution."
What did Kennedy mean by this? The American Revolution was fought for freedom, freedom from the rule of monarchy, and imperialism in favor of national sovereignty. What Kennedy was stating, was that this was the very oppression that the rest of the world wished to shake the yoke off and that the United States had an opportunity to be a leader in the cause for the independence of all nations.
On June 30th, 1960, marking the independence of the Republic of Congo from the colonial rule of Belgium, Patrice Lumumba, the first Congolese Prime Minister gave a speech that has become famous for its outspoken criticism of colonialism. Lumumba spoke of his people’s struggle against “the humiliating bondage that was forced upon us… [years that were] filled with tears, fire, and blood,” and concluded vowing “We shall show the world what the black man can do when working in liberty, and we shall make the Congo the pride of Africa.”
Shortly after, Lumumba also made clear, “We want no part of the Cold War… We want Africa to remain African with a policy of neutralism."
As a result, Lumumba was labeled a communist for his refusal to be a Cold War satellite for the western sphere. Rather, Lumumba was part of the Pan-African movement that was led by Ghanaian President Kwame Nkrumah (who later Kennedy would also work with), which sought national sovereignty and an end to colonialism in Africa.
Lumumba “would remain a grave danger,” Dulles said at an NSC meeting on September 21, 1960, “as long as he was not yet disposed of.” Three days later, Dulles made it clear that he wanted Lumumba permanently removed, cabling the CIA’s Leopoldville station, “We wish to give [sic] every possible support in eliminating Lumumba from any possibility resuming governmental position.”
Lumumba was assassinated on Jan. 17th, 1961, just three days before Kennedy’s inauguration, during the fog of the transition period between presidents, when the CIA is most free to tie its loose ends, confident that they will not be reprimanded by a new administration that wants to avoid scandal on its first days in office.
Kennedy, who clearly meant to put a stop to the Murder Inc. that Dulles had created and was running, would declare to the world in his inaugural address on Jan. 20th, 1961, “The torch has been passed to a new generation of Americans.”
La Resistance
Along with inheriting the responsibility of the welfare of the country and its people, Kennedy was to also inherit a secret war with communist Cuba run by the CIA.
The Bay of Pigs set-up would occur three months later. Prouty compares the Bay of Pigs incident to that of the Crusade for Peace; the Bay of Pigs being orchestrated by the CIA, and the Crusade for Peace sabotaged by the CIA, in both cases to ruin the U.S. president’s (Eisenhower and Kennedy) ability to form a peaceful dialogue with Khrushchev and decrease Cold War tensions. Both presidents took the onus for the events respectively, despite the responsibility resting with the CIA. However, Eisenhower and Kennedy understood, if they did not take onus, it would be a public declaration that they did not have any control over their government agencies and military.
Further, the Bay of Pigs operation was in fact meant to fail. It was meant to stir up a public outcry for a direct military invasion of Cuba.
On public record is a meeting (or more aptly described as an intervention) with CIA Deputy Director for Plans Richard Bissell, Joint Chiefs Chairman Lyman Lemnitzer, and Navy Chief Admiral Burke basically trying to strong-arm President Kennedy into approving a direct military attack on Cuba. Admiral Burke had already taken the liberty of positioning two battalions of Marines on Navy destroyers off the coast of Cuba “anticipating that U.S. forces might be ordered into Cuba to salvage a botched invasion.”[7] (This incident is what inspired the Frankenheimer movie “Seven Days in May.”)
Kennedy stood his ground.
“They were sure I’d give in to them,” Kennedy later told Special Assistant to the President Dave Powers.
“They couldn’t believe that a new president like me wouldn’t panic and try to save his own face. Well, they had me figured all wrong.”
Incredibly, not only did the young president stand his ground against the Washington war hawks just three months into his presidential term, but he also launched the Cuba Study Group which found the CIA to be responsible for the fiasco, leading to the humiliating forced resignation of Allen Dulles, Richard Bissell, and Charles Cabell. (For more on this refer to my report.)
Unfortunately, it would not be that easy to dethrone Dulles, who continued to act as head of the CIA, and key members of the intelligence community such as Helms and Angleton regularly bypassed McCone (the new CIA Director) and briefed Dulles directly.
But Kennedy was also serious about seeing it through all the way, and vowed to “splinter the CIA into a thousand pieces and scatter it to the winds.”
* * *
There is another rather significant incident that had occurred just days after the Bay of Pigs, and which has largely been overshadowed by the Cuban fiasco in the United States.
From April 21-26th, 1961, the Algiers putsch, or Generals’ putsch, was a failed coup d’état intended to force President de Gaulle (1959-1969) not to abandon colonial French Algeria. The organizers of the putsch were opposed to the secret negotiations that French Prime Minister Michel Debré had started with the anti-colonial National Liberation Front (FLN).
On January 26th, 1961, just three months before the attempted coup d’état, Dulles sent a report to Kennedy on the French situation that seemed to be hinting that de Gaulle would no longer be around, “A pre-revolutionary atmosphere reigns in France… The Army and the Air Force are staunchly opposed to de Gaulle…At least 80 percent of the officers are violently against him. They haven’t forgotten that in 1958, he had given his word of honor that he would never abandon Algeria. He is now reneging on his promise, and they hate him for that. de Gaulle surely won’t last if he tries to let go of Algeria. Everything will probably be over for him by the end of the year—he will be either deposed or assassinated.”
The attempted coup was led by Maurice Challe, whom de Gaulle had reason to conclude was working with the support of U.S. intelligence, and Élysée officials began spreading this word to the press, which reported the CIA as a “reactionary state-within-a-state” that operated outside of Kennedy’s control.
Shortly before Challe’s resignation from the French military, he had served as NATO commander in chief and had developed close relations with a number of high-ranking U.S. officers stationed in the military alliance’s Fontainebleau headquarters.
In August 1962 the OAS (Secret Army Organization) made an assassination attempt against de Gaulle, believing he had betrayed France by giving up Algeria to Algerian nationalists. This would be the most notorious assassination attempt on de Gaulle (who would remarkably survive over thirty assassination attempts while President of France) when a dozen OAS snipers opened fire on the president’s car, which managed to escape the ambush despite all four tires being shot out.
After the failed coup d’état, de Gaulle launched a purge of his security forces and ousted General Paul Grossin, the chief of SDECE (the French secret service). Grossin was closely aligned with the CIA and had told Frank Wisner over lunch that the return of de Gaulle to power was equivalent to the Communists taking over in Paris.
In 1967, after a five-year enquête by the French Intelligence Bureau, it released its findings concerning the 1962 assassination attempt on de Gaulle. The report found that the 1962 assassination plot could be traced back to the NATO Brussels headquarters, and the remnants of the old Nazi intelligence apparatus. The report also found that Permindex had transferred $200,000 into an OAS bank account to finance the project.
As a result of the de Gaulle exposé, Permindex was forced to shut down its public operations in Western Europe and relocate its headquarters from Bern, Switzerland to Johannesburg, South Africa, it also had/has a base in Montreal, Canada where its founder Maj. Gen. Louis M. Bloomfield (former OSS) proudly had his name amongst its board members until the damning de Gaulle report. The relevance of this to Kennedy will be discussed shortly.
As a result of the SDECE’s ongoing investigation, de Gaulle made a vehement denunciation of the Anglo-American violation of the Atlantic Charter, followed by France’s withdrawal from the NATO military command in 1966. France would not return to NATO until April 2009 at the Strasbourg-Kehl Summit.
In addition to all of this, on Jan. 14th, 1963, de Gaulle declared at a press conference that he had vetoed British entry into the Common Market. This would be the first move towards France and West Germany’s formation of the European Monetary System, which excluded Great Britain, likely due to its imperialist tendencies and its infamous sin City of London.
Former Secretary of State Dean Acheson telegrammed West German Chancellor Konrad Adenauer directly, appealing to him to try to persuade de Gaulle to backtrack on the veto, stating “if anyone can affect Gen. de Gaulle’s decision, you are surely that person.”
Little did Acheson know that Adenauer was just days away from signing the Franco-German Treaty of Jan 22nd, 1963 (also known as the ÉlyséeTreaty), which had enormous implications. Franco-German relations, which had long been dominated by centuries of rivalry, had now agreed that their fates were aligned. (This close relationship was continued to a climactic point in the late 1970s, with the formation of the European Monetary System, and France and West Germany’s willingness in 1977 to work with OPEC countries trading oil for nuclear technology, which was sabotaged by the U.S.-Britain alliance.
The Élysée Treaty was a clear denunciation of the Anglo-American forceful overseeing that had overtaken Western Europe since the end of WWII.
On June 28th, 1961, Kennedy wrote NSAM #55. This document changed the responsibility of defense during the Cold War from the CIA to the Joint Chiefs of Staff and would have (if seen through) drastically changed the course of the war in Vietnam. It would also have effectively removed the CIA from Cold War military operations and limited the CIA to its sole lawful responsibility, the collecting, and coordination of intelligence.
By Oct 11th, 1963, NSAM #263, closely overseen by Kennedy[14], was released and outlined a policy decision “to withdraw 1,000 military personnel [from Vietnam] by the end of 1963” and further stated that “It should be possible to withdraw the bulk of U.S. personnel by 1965.” The Armed Forces newspaper Stars and Stripes had the headline U.S. TROOPS SEEN OUT OF VIET BY ’65.
It would be the final nail in the coffin.
Treason in America
“Treason doth never prosper; what is the reason? Why, if it prospers, none dare call it treason.”
– Sir John Harrington
By Germany supporting de Gaulle’s exposure of the international assassination ring, his adamant opposition to western imperialism and the role of NATO, and with a young Kennedy building his own resistance against the imperialist war of Vietnam, it was clear that the power elite was in big trouble.
On November 22nd, 1963 President Kennedy was brutally murdered in the streets of Dallas, Texas in broad daylight.
With the assassination of Ngo Dinh Diem, likely ordained by the CIA, on Nov. 2nd, 1963, and Kennedy just a few weeks later, de facto President Johnson signed NSAM #273 on Nov. 26th, 1963 to begin the reversal of Kennedy’s policy under #263. And on March 17th, 1964, Johnson signed NSAM #288 that marked the full escalation of the Vietnam War and involved 2,709,918 Americans directly serving in Vietnam, with 9,087,000 serving with the U.S. Armed Forces during this period.
The Vietnam War would continue for another 12 years after Kennedy’s death, lasting a total of 20 years for Americans, and 30 years if you count American covert action in Vietnam.
Two days before Kennedy’s assassination, a hate-Kennedy handbill was circulated in Dallas accusing the president of treasonous activities including being a communist sympathizer.
https://assets.zerohedge.com/s3fs-pu...?itok=oyU7X4GT
On November 29th, 1963 the Warren Commission was set up to investigate the murder of President Kennedy.
The old Congressman Hale Boggs of Louisiana was a member of that Warren Commission. Boggs became increasingly disturbed by the lack of transparency and rigor exhibited by the Commission and became convinced that many of the documents used to incriminate Oswald were in fact forgeries.
In 1965 Rep. Boggs told New Orleans District Attorney Jim Garrison that Oswald could not have been the one who killed Kennedy. It was Boggs who encouraged Garrison to begin the only law enforcement prosecution of the President’s murder to this day.
Nixon was inaugurated as President of the United States on Jan 20th, 1969. Hale Boggs soon after called on Nixon’s Attorney General John Mitchell to have the courage to fire J. Edgar Hoover.
It wasn’t long thereafter that the private airplane carrying Hale Boggs disappeared without a trace.
Jim Garrison was the District Attorney of New Orleans from 1962 to 1973 and was the only one to bring forth a trial concerning the assassination of President Kennedy. In Jim Garrison’s book “On the Trail of the Assassins”, J. Edgar Hoover comes up several times impeding or shutting down investigations into JFK’s murder, in particular concerning the evidence collected by the Dallas Police Department, such as the nitrate test Oswald was given and which exonerated him, proving that he never shot a rifle the day of Nov 22nd, 1963.
However, for reasons only known to the government and its investigators this fact was kept secret for 10 months.
It was finally revealed in the Warren Commission report, which inexplicably didn’t change their opinion that Oswald had shot Kennedy.
Another particularly damning incident was concerning the Zapruder film that was in the possession of the FBI and which they had sent a “copy” to the Warren Commission for their investigation. This film was one of the leading pieces of evidence used to support the “magic bullet theory” and showcase the direction of the headshot coming from behind, thus verifying that Oswald’s location was adequate for such a shot.
During Garrison’s trial on the Kennedy assassination (1967-1969), he subpoenaed the Zapruder film that for some peculiar reason had been locked up in some vault owned by Life magazine (the reader should note that Henry Luce the owner of Life magazine was in a very close relationship with the CIA). This was the first time in more than five years that the Zapruder film was made public. It turns out the FBI’s copy that was sent to the Warren Commission had two critical frames reversed to create a false impression that the rifle shot was from behind.
When Garrison got a hold of the original film it was discovered that the headshot had actually come from the front. In fact, what the whole film showed was that the President had been shot from multiple angles meaning there was more than one gunman.
When the FBI was questioned about how these two critical frames could have been reversed, they answered self-satisfactorily that it must have been a technical glitch…
There is also the matter of the original autopsy papers being destroyed by the chief autopsy physician, James Humes, to which he even testified during the Warren Commission, apparently, nobody bothered to ask why…
This would explain why the Assassination Records Review Board (ARRB), reported in a July 1998 staff report their concern for the number of shortcomings in the original autopsy, that “One of the many tragedies of the assassination of President Kennedy has been the incompleteness of the autopsy record and the suspicion caused by the shroud of secrecy that has surrounded the records that do exist.” [emphasis added]
The staff report for the Assassinations Records Review Board contended that brain photographs in the Kennedy records are not of Kennedy’s brain and show much less damage than Kennedy sustained.
There is a lot of spurious effort to try to ridicule anyone who challenges the Warren Commission’s official report as nothing but a fringe conspiracy theory. And that we should not find it highly suspect that Allen Dulles, of all people, was a member and pretty much leader of said commission. The reader should keep in mind that much of this frothing opposition stems from the very agency that perpetrated crime after crime on the American people, as well as abroad. When has the CIA ever admitted guilt, unless caught red-handed? Even after the Church Committee hearings, when the CIA was found guilty of planning out foreign assassinations, they claimed that they had failed in every single plot or that someone had beaten them to the punch, including in the case of Lumumba.
The American people need to realize that the CIA is not a respectable agency; we are not dealing with honorable men. It is a rogue force that believes that the ends justify the means, that they are the hands of the king so to speak, above government and above law. Those at the top such as Allen Dulles were just as adamant as Churchill about protecting the interests of the power elite, or as Churchill termed it, the “High Cabal.”
Interestingly, on Dec. 22nd, 1963, just one month after Kennedy’s assassination, Harry Truman published a scathing critique of the CIA in The Washington Post, even going so far as to state “There is something about the way the CIA has been functioning that is casting a shadow over our historic position [as a] free and open society, and I feel that we need to correct it.”
The timing of such a scathing quote cannot be stressed enough. Dulles, of course, told the public not to be distressed, that Truman was just in entering his twilight years.
In addition, Jim Garrison, New Orleans District Attorney at the time, who was charging Clay Shaw as a member of the conspiracy to kill Kennedy, besides uncovering his ties to David Ferrie who was found dead in his apartment days before he was scheduled to testify, also made a case that the New Orleans International Trade Mart (to which Clay Shaw was director), the U.S. subsidiary of Permindex, was linked to Kennedy’s murder. Col. Clay Shaw was an OSS officer during WWII, which provides a direct link to his knowing Allen Dulles.
Garrison did a remarkable job with the odds he was up against, and for the number of witnesses that turned up dead before the trial…
This Permindex link would not look so damning if we did not have the French intelligence SDECE report, but we do. And recall, in that report Permindex was caught transferring $200,000 directly to the bankroll of the OAS which attempted the 1962 assassination on de Gaulle.
Thus, Permindex’s implication in an international assassination ring is not up for debate. In addition, the CIA was found heavily involved in these assassination attempts against de Gaulle, thus we should not simply dismiss the possibility that Permindex was indeed a CIA front for an international hit crew.
In fact, among the strange and murderous characters who converged on Dallas in Nov. 1963 was a notorious French OAS commando named Jean Souetre, who was connected to the plots against President de Gaulle. Souetre was arrested in Dallas after the Kennedy assassination and expelled to Mexico, not even kept for questioning.
What Does the Future Hold?
After returning from Kennedy’s Nov. 24th funeral in Washington, de Gaulle and his information minister Alain Peyrefitte had a candid discussion that was recorded in Peyrefitte’s memoir “C’était de Gaulle,” the great General was quoted saying:
“What happened to Kennedy is what nearly happened to me… His story is the same as mine. … It looks like a cowboy story, but it’s only an OAS [Secret Army Organization] story. The security forces were in cahoots with the extremists.
…Security forces are all the same when they do this kind of dirty work. As soon as they succeed in wiping out the false assassin, they declare the justice system no longer need be concerned, that no further public action was needed now that the guilty perpetrator was dead. Better to assassinate an innocent man than to let a civil war break out. Better an injustice than the disorder.
America is in danger of upheavals. But you’ll see. All of them together will observe the law of silence. They will close ranks. They’ll do everything to stifle any scandal. They will throw Noah’s cloak over these shameful deeds. In order to not lose face in front of the whole world. In order to not risk unleashing riots in the United States. In order to preserve the union and to avoid a new civil war. In order to not ask themselves questions. They don’t want to know. They don’t want to find out. They won’t allow themselves to find out.”
The American people would do well to remember that it was first John F. Kennedy, acting as the President of the United States, who was to be declared a terrorist and threat to his country’s national security.
Thus is it not natural that those who continue to defend the legacy of Kennedy should be regarded today as a threat, not truly to the nation’s security, but a threat to the very same grouping responsible for Kennedy’s death and whom today have now declared open war on the American people.
This will be the greatest test the American people have ever been confronted with, and it will only be through an understanding of how the country came to where it is today that there can be sufficient clarity as to what the solutions are, which are not to be found in another civil war. To not fall for the trapping of further chaos and division, the American people will only be able to rise above this if they choose to ask those questions if they choose to want to know, to want to find out the truth of things they dared not look at in the past for fear of what it would reveal.
“Whenever the government of the United States shall break up, it will probably be in consequence of a false direction having been given to public opinion. This is the weak point of our defenses, and the part to which the enemies of the system will direct all their attacks. Opinion can be so perverted as to cause the false to seem true; the enemy, a friend, and the friend, an enemy; the best interests of the nation to appear insignificant, and the trifles of the moment; in a word, the right the wrong, the wrong the right. In a country where opinion has sway, to seize upon it is to seize upon power. As it is a rule of humanity that the upright and well-intentioned are comparatively passive, while the designing, dishonest, and selfish are the most untiring in their efforts, the danger of public opinion’s getting a false direction is four-fold since few men think for themselves.”
-James Fenimore Cooper (1789-1851)
We must dare to be among the few who think for ourselves.
In Memory Of JFK: The First US President To Be Labeled A Terrorist & Threat To National Security
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BY TYLER DURDEN
MONDAY, NOV 22, 2021 - 10:20 PM
Authored by Cynthia Chung via The Saker blog,
In April 1954, Kennedy stood up on the Senate floor to challenge the Eisenhower Administration’s support for the doomed French imperial war in Vietnam, foreseeing that this would not be a short-lived war.
In July 1957, Kennedy once more took a strong stand against French colonialism, this time France’s bloody war against Algeria’s independence movement, which again found the Eisenhower Administration on the wrong side of history. Rising on the Senate floor, two days before America’s own Independence Day, Kennedy declared:
“The most powerful single force in the world today is neither communism nor capitalism, neither the H-bomb nor the guided missile – it is man’s eternal desire to be free and independent. The great enemy of that tremendous force of freedom is called, for want of a more precise term, imperialism – and today that means Soviet imperialism and, whether we like it or not, and though they are not to be equated, Western imperialism. Thus, the single most important test of American foreign policy today is how we meet the challenge of imperialism, what we do to further man’s desire to be free. On this test more than any other, this nation shall be critically judged by the uncommitted millions in Asia and Africa, and anxiously watched by the still hopeful lovers of freedom behind the Iron Curtain. If we fail to meet the challenge of either Soviet or Western imperialism, then no amount of foreign aid, no aggrandizement of armaments, no new pacts or doctrines or high-level conferences can prevent further setbacks to our course and to our security.”
In September 1960, the annual United Nations General Assembly was held in New York. Fidel Castro and a fifty-member delegation were among the attendees and had made a splash in the headlines when he decided to stay at the Hotel Theresa in Harlem after the midtown Shelburne Hotel demanded a $20,000 security deposit. He made an even bigger splash in the headlines when he made a speech at this hotel, discussing the issue of equality in the United States while in Harlem, one of the poorest boroughs in the country.
Kennedy would visit this very same hotel a short while later, and also made a speech:
“Behind the fact of Castro coming to this hotel, [and] Khrushchev…there is another great traveler in the world, and that is the travel of a world revolution, a world in turmoil…We should be glad [that Castro and Khrushchev] came to the United States. We should not fear the twentieth century, for the worldwide revolution which we see all around us is part of the original American Revolution."
What did Kennedy mean by this? The American Revolution was fought for freedom, freedom from the rule of monarchy, and imperialism in favor of national sovereignty. What Kennedy was stating, was that this was the very oppression that the rest of the world wished to shake the yoke off and that the United States had an opportunity to be a leader in the cause for the independence of all nations.
On June 30th, 1960, marking the independence of the Republic of Congo from the colonial rule of Belgium, Patrice Lumumba, the first Congolese Prime Minister gave a speech that has become famous for its outspoken criticism of colonialism. Lumumba spoke of his people’s struggle against “the humiliating bondage that was forced upon us… [years that were] filled with tears, fire, and blood,” and concluded vowing “We shall show the world what the black man can do when working in liberty, and we shall make the Congo the pride of Africa.”
Shortly after, Lumumba also made clear, “We want no part of the Cold War… We want Africa to remain African with a policy of neutralism."
As a result, Lumumba was labeled a communist for his refusal to be a Cold War satellite for the western sphere. Rather, Lumumba was part of the Pan-African movement that was led by Ghanaian President Kwame Nkrumah (who later Kennedy would also work with), which sought national sovereignty and an end to colonialism in Africa.
Lumumba “would remain a grave danger,” Dulles said at an NSC meeting on September 21, 1960, “as long as he was not yet disposed of.” Three days later, Dulles made it clear that he wanted Lumumba permanently removed, cabling the CIA’s Leopoldville station, “We wish to give [sic] every possible support in eliminating Lumumba from any possibility resuming governmental position.”
Lumumba was assassinated on Jan. 17th, 1961, just three days before Kennedy’s inauguration, during the fog of the transition period between presidents, when the CIA is most free to tie its loose ends, confident that they will not be reprimanded by a new administration that wants to avoid scandal on its first days in office.
Kennedy, who clearly meant to put a stop to the Murder Inc. that Dulles had created and was running, would declare to the world in his inaugural address on Jan. 20th, 1961, “The torch has been passed to a new generation of Americans.”
La Resistance
Along with inheriting the responsibility of the welfare of the country and its people, Kennedy was to also inherit a secret war with communist Cuba run by the CIA.
The Bay of Pigs set-up would occur three months later. Prouty compares the Bay of Pigs incident to that of the Crusade for Peace; the Bay of Pigs being orchestrated by the CIA, and the Crusade for Peace sabotaged by the CIA, in both cases to ruin the U.S. president’s (Eisenhower and Kennedy) ability to form a peaceful dialogue with Khrushchev and decrease Cold War tensions. Both presidents took the onus for the events respectively, despite the responsibility resting with the CIA. However, Eisenhower and Kennedy understood, if they did not take onus, it would be a public declaration that they did not have any control over their government agencies and military.
Further, the Bay of Pigs operation was in fact meant to fail. It was meant to stir up a public outcry for a direct military invasion of Cuba.
On public record is a meeting (or more aptly described as an intervention) with CIA Deputy Director for Plans Richard Bissell, Joint Chiefs Chairman Lyman Lemnitzer, and Navy Chief Admiral Burke basically trying to strong-arm President Kennedy into approving a direct military attack on Cuba. Admiral Burke had already taken the liberty of positioning two battalions of Marines on Navy destroyers off the coast of Cuba “anticipating that U.S. forces might be ordered into Cuba to salvage a botched invasion.”[7] (This incident is what inspired the Frankenheimer movie “Seven Days in May.”)
Kennedy stood his ground.
“They were sure I’d give in to them,” Kennedy later told Special Assistant to the President Dave Powers.
“They couldn’t believe that a new president like me wouldn’t panic and try to save his own face. Well, they had me figured all wrong.”
Incredibly, not only did the young president stand his ground against the Washington war hawks just three months into his presidential term, but he also launched the Cuba Study Group which found the CIA to be responsible for the fiasco, leading to the humiliating forced resignation of Allen Dulles, Richard Bissell, and Charles Cabell. (For more on this refer to my report.)
Unfortunately, it would not be that easy to dethrone Dulles, who continued to act as head of the CIA, and key members of the intelligence community such as Helms and Angleton regularly bypassed McCone (the new CIA Director) and briefed Dulles directly.
But Kennedy was also serious about seeing it through all the way, and vowed to “splinter the CIA into a thousand pieces and scatter it to the winds.”
* * *
There is another rather significant incident that had occurred just days after the Bay of Pigs, and which has largely been overshadowed by the Cuban fiasco in the United States.
From April 21-26th, 1961, the Algiers putsch, or Generals’ putsch, was a failed coup d’état intended to force President de Gaulle (1959-1969) not to abandon colonial French Algeria. The organizers of the putsch were opposed to the secret negotiations that French Prime Minister Michel Debré had started with the anti-colonial National Liberation Front (FLN).
On January 26th, 1961, just three months before the attempted coup d’état, Dulles sent a report to Kennedy on the French situation that seemed to be hinting that de Gaulle would no longer be around, “A pre-revolutionary atmosphere reigns in France… The Army and the Air Force are staunchly opposed to de Gaulle…At least 80 percent of the officers are violently against him. They haven’t forgotten that in 1958, he had given his word of honor that he would never abandon Algeria. He is now reneging on his promise, and they hate him for that. de Gaulle surely won’t last if he tries to let go of Algeria. Everything will probably be over for him by the end of the year—he will be either deposed or assassinated.”
The attempted coup was led by Maurice Challe, whom de Gaulle had reason to conclude was working with the support of U.S. intelligence, and Élysée officials began spreading this word to the press, which reported the CIA as a “reactionary state-within-a-state” that operated outside of Kennedy’s control.
Shortly before Challe’s resignation from the French military, he had served as NATO commander in chief and had developed close relations with a number of high-ranking U.S. officers stationed in the military alliance’s Fontainebleau headquarters.
In August 1962 the OAS (Secret Army Organization) made an assassination attempt against de Gaulle, believing he had betrayed France by giving up Algeria to Algerian nationalists. This would be the most notorious assassination attempt on de Gaulle (who would remarkably survive over thirty assassination attempts while President of France) when a dozen OAS snipers opened fire on the president’s car, which managed to escape the ambush despite all four tires being shot out.
After the failed coup d’état, de Gaulle launched a purge of his security forces and ousted General Paul Grossin, the chief of SDECE (the French secret service). Grossin was closely aligned with the CIA and had told Frank Wisner over lunch that the return of de Gaulle to power was equivalent to the Communists taking over in Paris.
In 1967, after a five-year enquête by the French Intelligence Bureau, it released its findings concerning the 1962 assassination attempt on de Gaulle. The report found that the 1962 assassination plot could be traced back to the NATO Brussels headquarters, and the remnants of the old Nazi intelligence apparatus. The report also found that Permindex had transferred $200,000 into an OAS bank account to finance the project.
As a result of the de Gaulle exposé, Permindex was forced to shut down its public operations in Western Europe and relocate its headquarters from Bern, Switzerland to Johannesburg, South Africa, it also had/has a base in Montreal, Canada where its founder Maj. Gen. Louis M. Bloomfield (former OSS) proudly had his name amongst its board members until the damning de Gaulle report. The relevance of this to Kennedy will be discussed shortly.
As a result of the SDECE’s ongoing investigation, de Gaulle made a vehement denunciation of the Anglo-American violation of the Atlantic Charter, followed by France’s withdrawal from the NATO military command in 1966. France would not return to NATO until April 2009 at the Strasbourg-Kehl Summit.
In addition to all of this, on Jan. 14th, 1963, de Gaulle declared at a press conference that he had vetoed British entry into the Common Market. This would be the first move towards France and West Germany’s formation of the European Monetary System, which excluded Great Britain, likely due to its imperialist tendencies and its infamous sin City of London.
Former Secretary of State Dean Acheson telegrammed West German Chancellor Konrad Adenauer directly, appealing to him to try to persuade de Gaulle to backtrack on the veto, stating “if anyone can affect Gen. de Gaulle’s decision, you are surely that person.”
Little did Acheson know that Adenauer was just days away from signing the Franco-German Treaty of Jan 22nd, 1963 (also known as the ÉlyséeTreaty), which had enormous implications. Franco-German relations, which had long been dominated by centuries of rivalry, had now agreed that their fates were aligned. (This close relationship was continued to a climactic point in the late 1970s, with the formation of the European Monetary System, and France and West Germany’s willingness in 1977 to work with OPEC countries trading oil for nuclear technology, which was sabotaged by the U.S.-Britain alliance.
The Élysée Treaty was a clear denunciation of the Anglo-American forceful overseeing that had overtaken Western Europe since the end of WWII.
On June 28th, 1961, Kennedy wrote NSAM #55. This document changed the responsibility of defense during the Cold War from the CIA to the Joint Chiefs of Staff and would have (if seen through) drastically changed the course of the war in Vietnam. It would also have effectively removed the CIA from Cold War military operations and limited the CIA to its sole lawful responsibility, the collecting, and coordination of intelligence.
By Oct 11th, 1963, NSAM #263, closely overseen by Kennedy[14], was released and outlined a policy decision “to withdraw 1,000 military personnel [from Vietnam] by the end of 1963” and further stated that “It should be possible to withdraw the bulk of U.S. personnel by 1965.” The Armed Forces newspaper Stars and Stripes had the headline U.S. TROOPS SEEN OUT OF VIET BY ’65.
It would be the final nail in the coffin.
Treason in America
“Treason doth never prosper; what is the reason? Why, if it prospers, none dare call it treason.”
– Sir John Harrington
By Germany supporting de Gaulle’s exposure of the international assassination ring, his adamant opposition to western imperialism and the role of NATO, and with a young Kennedy building his own resistance against the imperialist war of Vietnam, it was clear that the power elite was in big trouble.
On November 22nd, 1963 President Kennedy was brutally murdered in the streets of Dallas, Texas in broad daylight.
With the assassination of Ngo Dinh Diem, likely ordained by the CIA, on Nov. 2nd, 1963, and Kennedy just a few weeks later, de facto President Johnson signed NSAM #273 on Nov. 26th, 1963 to begin the reversal of Kennedy’s policy under #263. And on March 17th, 1964, Johnson signed NSAM #288 that marked the full escalation of the Vietnam War and involved 2,709,918 Americans directly serving in Vietnam, with 9,087,000 serving with the U.S. Armed Forces during this period.
The Vietnam War would continue for another 12 years after Kennedy’s death, lasting a total of 20 years for Americans, and 30 years if you count American covert action in Vietnam.
Two days before Kennedy’s assassination, a hate-Kennedy handbill was circulated in Dallas accusing the president of treasonous activities including being a communist sympathizer.
https://assets.zerohedge.com/s3fs-pu...?itok=oyU7X4GT
On November 29th, 1963 the Warren Commission was set up to investigate the murder of President Kennedy.
The old Congressman Hale Boggs of Louisiana was a member of that Warren Commission. Boggs became increasingly disturbed by the lack of transparency and rigor exhibited by the Commission and became convinced that many of the documents used to incriminate Oswald were in fact forgeries.
In 1965 Rep. Boggs told New Orleans District Attorney Jim Garrison that Oswald could not have been the one who killed Kennedy. It was Boggs who encouraged Garrison to begin the only law enforcement prosecution of the President’s murder to this day.
Nixon was inaugurated as President of the United States on Jan 20th, 1969. Hale Boggs soon after called on Nixon’s Attorney General John Mitchell to have the courage to fire J. Edgar Hoover.
It wasn’t long thereafter that the private airplane carrying Hale Boggs disappeared without a trace.
Jim Garrison was the District Attorney of New Orleans from 1962 to 1973 and was the only one to bring forth a trial concerning the assassination of President Kennedy. In Jim Garrison’s book “On the Trail of the Assassins”, J. Edgar Hoover comes up several times impeding or shutting down investigations into JFK’s murder, in particular concerning the evidence collected by the Dallas Police Department, such as the nitrate test Oswald was given and which exonerated him, proving that he never shot a rifle the day of Nov 22nd, 1963.
However, for reasons only known to the government and its investigators this fact was kept secret for 10 months.
It was finally revealed in the Warren Commission report, which inexplicably didn’t change their opinion that Oswald had shot Kennedy.
Another particularly damning incident was concerning the Zapruder film that was in the possession of the FBI and which they had sent a “copy” to the Warren Commission for their investigation. This film was one of the leading pieces of evidence used to support the “magic bullet theory” and showcase the direction of the headshot coming from behind, thus verifying that Oswald’s location was adequate for such a shot.
During Garrison’s trial on the Kennedy assassination (1967-1969), he subpoenaed the Zapruder film that for some peculiar reason had been locked up in some vault owned by Life magazine (the reader should note that Henry Luce the owner of Life magazine was in a very close relationship with the CIA). This was the first time in more than five years that the Zapruder film was made public. It turns out the FBI’s copy that was sent to the Warren Commission had two critical frames reversed to create a false impression that the rifle shot was from behind.
When Garrison got a hold of the original film it was discovered that the headshot had actually come from the front. In fact, what the whole film showed was that the President had been shot from multiple angles meaning there was more than one gunman.
When the FBI was questioned about how these two critical frames could have been reversed, they answered self-satisfactorily that it must have been a technical glitch…
There is also the matter of the original autopsy papers being destroyed by the chief autopsy physician, James Humes, to which he even testified during the Warren Commission, apparently, nobody bothered to ask why…
This would explain why the Assassination Records Review Board (ARRB), reported in a July 1998 staff report their concern for the number of shortcomings in the original autopsy, that “One of the many tragedies of the assassination of President Kennedy has been the incompleteness of the autopsy record and the suspicion caused by the shroud of secrecy that has surrounded the records that do exist.” [emphasis added]
The staff report for the Assassinations Records Review Board contended that brain photographs in the Kennedy records are not of Kennedy’s brain and show much less damage than Kennedy sustained.
There is a lot of spurious effort to try to ridicule anyone who challenges the Warren Commission’s official report as nothing but a fringe conspiracy theory. And that we should not find it highly suspect that Allen Dulles, of all people, was a member and pretty much leader of said commission. The reader should keep in mind that much of this frothing opposition stems from the very agency that perpetrated crime after crime on the American people, as well as abroad. When has the CIA ever admitted guilt, unless caught red-handed? Even after the Church Committee hearings, when the CIA was found guilty of planning out foreign assassinations, they claimed that they had failed in every single plot or that someone had beaten them to the punch, including in the case of Lumumba.
The American people need to realize that the CIA is not a respectable agency; we are not dealing with honorable men. It is a rogue force that believes that the ends justify the means, that they are the hands of the king so to speak, above government and above law. Those at the top such as Allen Dulles were just as adamant as Churchill about protecting the interests of the power elite, or as Churchill termed it, the “High Cabal.”
Interestingly, on Dec. 22nd, 1963, just one month after Kennedy’s assassination, Harry Truman published a scathing critique of the CIA in The Washington Post, even going so far as to state “There is something about the way the CIA has been functioning that is casting a shadow over our historic position [as a] free and open society, and I feel that we need to correct it.”
The timing of such a scathing quote cannot be stressed enough. Dulles, of course, told the public not to be distressed, that Truman was just in entering his twilight years.
In addition, Jim Garrison, New Orleans District Attorney at the time, who was charging Clay Shaw as a member of the conspiracy to kill Kennedy, besides uncovering his ties to David Ferrie who was found dead in his apartment days before he was scheduled to testify, also made a case that the New Orleans International Trade Mart (to which Clay Shaw was director), the U.S. subsidiary of Permindex, was linked to Kennedy’s murder. Col. Clay Shaw was an OSS officer during WWII, which provides a direct link to his knowing Allen Dulles.
Garrison did a remarkable job with the odds he was up against, and for the number of witnesses that turned up dead before the trial…
This Permindex link would not look so damning if we did not have the French intelligence SDECE report, but we do. And recall, in that report Permindex was caught transferring $200,000 directly to the bankroll of the OAS which attempted the 1962 assassination on de Gaulle.
Thus, Permindex’s implication in an international assassination ring is not up for debate. In addition, the CIA was found heavily involved in these assassination attempts against de Gaulle, thus we should not simply dismiss the possibility that Permindex was indeed a CIA front for an international hit crew.
In fact, among the strange and murderous characters who converged on Dallas in Nov. 1963 was a notorious French OAS commando named Jean Souetre, who was connected to the plots against President de Gaulle. Souetre was arrested in Dallas after the Kennedy assassination and expelled to Mexico, not even kept for questioning.
What Does the Future Hold?
After returning from Kennedy’s Nov. 24th funeral in Washington, de Gaulle and his information minister Alain Peyrefitte had a candid discussion that was recorded in Peyrefitte’s memoir “C’était de Gaulle,” the great General was quoted saying:
“What happened to Kennedy is what nearly happened to me… His story is the same as mine. … It looks like a cowboy story, but it’s only an OAS [Secret Army Organization] story. The security forces were in cahoots with the extremists.
…Security forces are all the same when they do this kind of dirty work. As soon as they succeed in wiping out the false assassin, they declare the justice system no longer need be concerned, that no further public action was needed now that the guilty perpetrator was dead. Better to assassinate an innocent man than to let a civil war break out. Better an injustice than the disorder.
America is in danger of upheavals. But you’ll see. All of them together will observe the law of silence. They will close ranks. They’ll do everything to stifle any scandal. They will throw Noah’s cloak over these shameful deeds. In order to not lose face in front of the whole world. In order to not risk unleashing riots in the United States. In order to preserve the union and to avoid a new civil war. In order to not ask themselves questions. They don’t want to know. They don’t want to find out. They won’t allow themselves to find out.”
The American people would do well to remember that it was first John F. Kennedy, acting as the President of the United States, who was to be declared a terrorist and threat to his country’s national security.
Thus is it not natural that those who continue to defend the legacy of Kennedy should be regarded today as a threat, not truly to the nation’s security, but a threat to the very same grouping responsible for Kennedy’s death and whom today have now declared open war on the American people.
This will be the greatest test the American people have ever been confronted with, and it will only be through an understanding of how the country came to where it is today that there can be sufficient clarity as to what the solutions are, which are not to be found in another civil war. To not fall for the trapping of further chaos and division, the American people will only be able to rise above this if they choose to ask those questions if they choose to want to know, to want to find out the truth of things they dared not look at in the past for fear of what it would reveal.
“Whenever the government of the United States shall break up, it will probably be in consequence of a false direction having been given to public opinion. This is the weak point of our defenses, and the part to which the enemies of the system will direct all their attacks. Opinion can be so perverted as to cause the false to seem true; the enemy, a friend, and the friend, an enemy; the best interests of the nation to appear insignificant, and the trifles of the moment; in a word, the right the wrong, the wrong the right. In a country where opinion has sway, to seize upon it is to seize upon power. As it is a rule of humanity that the upright and well-intentioned are comparatively passive, while the designing, dishonest, and selfish are the most untiring in their efforts, the danger of public opinion’s getting a false direction is four-fold since few men think for themselves.”
-James Fenimore Cooper (1789-1851)
We must dare to be among the few who think for ourselves.
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