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For Financial Markets/Economy Ignore Economic Data Points In Reality Everything Is Locked In Now

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What you are looking at are the Fed Fund futures for December and they are still putting in big odds of 88% for at least one interest rate cut by that meeting or before it. The odds were 89% last week, so they barely changed at all, after the release of Friday’s job numbers, despite all the talk about them and the gyrations they helped created in the stock market and precious metals markets.

The odds for a cut in September fell from 60% a week ago to 51% now.

In the big picture these aren’t much of a change.

This week, the Federal Reserve is going to meet and release an FOMC edict. The Chairman will talk about how they are watching all the data points and the financial media will obsess over them every week, and every day, when in reality very little is changing.

Everything is in fact locked in.

Nothing has changed for months.

The economy is still growing slowly, thanks to the Federal government spending massive amounts of money, and growing the debt to massive proportions in the process, consumer credit card debt it growing, stock bubbles are creating risks, inflation is still growing, and interest rates are not high enough to stop it.

And the Fed Fund futures six months ago were pricing in interest rate cuts by now, just as they are pricing them in six months from today.

What has happened is that they just keeping pushing out those cuts, and they have been doing that all year.

That is nothing new.

Nothing has changed this week in the big macro picture and nothing will next week. The Federal Reserve will keep saying that they are going to lower interest rates when inflation goes down, in order to inspire confidence in stock market investors and players. They are not going to deviate from that script, but it is just a story, not what is really coming, even if it is what the financial media and most market commentators repeat over and over again.

However, the Fed fund futures are not pricing any future rate hikes in and they are not really changing on hopes that inflation will go away, BEACUSE IT WILL NOT.

What they are predicting is the simple reality that one day in the future a recession or stock market drop WILL HAPPEN. And when it does the Federal Reserve will lower rates and the bond market will signal a massive recession/bear market signal.

Recessions have not been abolished and another one WILL HAPPEN again.

And that is a future event and why the Fed Fund futures keep pricing in a rate cut six months out.

This is the macro situation that is locked in and fixed now, and the news of the day, or economic data points, are mere noise, and so are most daily gyrations in the financial markets.

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And…..

What I wrote in my earlier comments amount to a recessionary iceberg that will come over the horizon one day and when it does the thing that will fall the most in price will be……

Bitcoin….and the other crypto coins….

This chart shows that nothing has changed with Bitcoin either.

It started to lag the S&P 500 once it peaked out in March and is still doing so.

I know a lot of crypto gurus tried to guilt trip you in February and March on social media into buying Bitcoin with those new Bitcoin ETF’s.

Well, if you didn’t buy it you missed out on NOTHING, because it has done nothing since March and is poised to crash on the next bear cycle, because whenever the Nasdaq simply falls 10-20% in a correction Bitcoin just crashes.

It is not a safe haven for a portfolio.

It seems that the fast money meme players may have moved on from Bitcoin recently to play Gamestop instead. Now that Gamestop has crashed back down the SEC needs to get that Ethereum ETF going to give the meme players something new to bet into. When the SEC was formed it was an agent to stop speculation and now it encourages it.

-Mike

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