2021 ECONOMIC IMPLOSION – A US Implosion will trigger a global one

eastwind journals
Daily Tribune, Star Gazer, Dec. 27, 2020


By Bernie V. Lopez, eastwindreplyctr@gmail.com
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If the US economy crashes, the global economy crashes, including China’s. A global crash will be about a hundred times of the great depression of the 1920s. The second and third waves of the Pandemic will double the speed of this economic hurricane. What are the signs the US economy will implode?
In spite of the ongoing US recession which started in the second quarter of 2020, the Dow Jones and S&P 500 Indices continued to soar ‘mysteriously’ to record levels, as of December 18, 2020. The Pandemic which started last March 2020, with thousands of big corporations crashing, failed to dampen the spirit of these bullish markets.
That recession, at the onset, was quite violent at a minus 9.5% GDP decline, which is projected to sink further to 5.6%. The market growth is thus artificial and deceiving, giving a false picture of the US financial and economic landscape, and hinting of a highly unstable and potentially disastrous situation.
Some investment experts say the culprit is HUMAN BEHAVIOUR. When people see markets revving up, they tend to ride it, blind to future consequences. They have a false sense of optimism. This human behavior is nothing else but plain greed. This ‘band wagon effect’ fuels the bullish market towards a potential future crash never before seen.
The trillions of dollars the US government will use to bail out Wall Street can be the trigger for an economic tsunami, because it is based on printing more and more paper money, a form of ‘pseudo-wealth’. Meanwhile, 50 million jobless Americans are hungry. It is like corking a volcano about to erupt, hoping such band-aid solutions will hold, as it has so far in the past two decades. The Pandemic, however, is the final catalyst.
Unknown to everyone, known only by a few doomsday prophets, the rubber band may reach its breaking point. When it snaps, it will be sudden and intense, and the world will reverberate from the shock of the US economy imploding, the so-called ‘bubble’, an artificial entity full of nothing but air. The stockbrokers paint a rosy picture in behalf of Wall Street to maintain its wealth at the expense of ordinary small investors, the ultimate victims.
At the economic epicenter are Wall Street and the US Government. The money the ruling elites use comes from the Federal Reserve, which printed some $8 trillion under Obama, and an unknown amount under Trump, just to keep the US economy afloat.
When the US economy goes down, the entire global economy goes down. Even China, the emerging economic giant, may be affected, because its growth is based on its biggest client, namely the US. The Trump-led US-China trade war has done nothing but destroy both countries. The key to growth is cooperation, never conflict, in the long term. In the short term, conflict can induce artificial growth like massive short selling or futures speculation.
Many analysts point to 2021 as the year of the global economic meltdown. And some of them say it can be as early as the first quarter. If it is just around the corner, how come investors are in a frenzy in an artificial bullish market? Again, they say, it is Man’s nature to self-destruct based on greed and a false sense of hope.
Rising PE Ratio is the earthquake before the eruption. PE Ratio is defined as the Price (stocks) versus Earnings (income) of a corporation or stock market. If the stock price of a corporation is high compare to its performance, namely ability to generate income, then the stock is overvalued. The greater the gap between stock and performance, the greater the overvaluation. At a certain point, the empty bubble bursts. This is the essential cause of extremely bearish market, soaring, reaching a peak before it dives into the abyss.
Financial analysts agree that the ‘breaking point’ is normally a PE Ratio of 25. The NASDAQ 100 Index had a PE Ration of 39.27 in December 18, 2020, dangerously way above the 25 limit. A year ago, it was a mere 27.12. The S&P 500 Index had a PE Ratio of a staggering 42.8, while last year it was 25.23. The increase in both Indices is almost double.
Stock analysts in the US label this as a product of long-term abuse and consistent manipulation. This excessively bloated pattern is called a ‘megaphone’, or a broadening top, the period before the massive sudden explosion when the pressure uncorks the volcano. The lows (earnings) dive lower and lower, and the highs (stock price) soar higher and higher towards doomsday.
The global crash will be about a hundred times of the Great Depression of the 1920s. The second and third waves of the Pandemic will double the speed of this economic hurricane. In the end, the bubble may kill more people than the Pandemic itself.
Let us continue our prayers for salvation against the Pandemic. Lord, forgive us our sins. Lord, have mercy on us.
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By Bernie V. Lopez, eastwindreplyctr@gmail.com
Blogger – columnist – TV docu producer/director – radio broadcaster – healing ministry
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