INFLATE OR DIE

by Gregory Mannarino

Despite a dead economy and tens of millions losing their jobs, over the last seven weeks, the stock market has gone virtually straight up, with more gains to come.

The main driver is the unprecedented takeover of the global financial system by the Federal Reserve, now the new central bank of the world. In their quest to fulfill their goal of becoming the lender, buyer, and owner of the world, the Federal Reserve is inflating their balance sheet to historic levels... and this is just the beginning.

In the literal sense, the Fed is buying assets across the globe, and, moreover, they are funneling trillions to central banks worldwide, which also are buying assets. This mechanism is having a profound effect on the stock market, which seems to be defying gravity… and it is.

Understand that as long as the Fed continues to inflate its balance sheet, now standing at nearly seven trillion, stocks will put on gains despite a dead economy.

Recently, the stock market has begun to price in negative rates.

Despite the charade between President Trump, who is calling for negative rates, and Fed Chair Jerome Powell saying “no” to negative rates, the market believes negative rates are coming, and this is very stock market positive.

Negative rates force a major “risk on” environment to occur, meaning capital makes its way into the stock market. Negative rates are great for anyone who owns stocks, but they rob blind anyone with an interest-earning account. In a negative rate environment, instead of paying interest, financial institutions actually, and legally, remove cash from depositors’ accounts. For the average person, negative rates are legal theft on a grand scale.

Rates and Yield

Many confuse “rates” and “yield,” so allow me to briefly explain.

A “yield” refers to the annual return on an investment, say, a bond. A “rate” is the amount charged by the lender for a loan. A negative rate environment, however, does not necessarily mean a low yield environment. In a negative rate situation, the ones losing are the average “savers,” whom are just trying to put cash away for a rainy day.

Today, we exist in an environment of extreme distortions being fostered by corrupt politicians and financial wizardry. It is all smoke and mirrors. Underlying this is a new world disorder in which total control is being given to world central banks.

Since its inception, the Federal Reserve has had but ONE goal: To Own It All.

We are now witnessing a fulfillment of that objective on an epic scale.=

20 Comments
  1. onlyme 2 weeks ago

    Well written.
    “Negative rates are great for anyone who owns stocks, but they rob blind anyone with an interest-earning account.”
    And that is death to us retired types who depend on some kind of earnings.

  2. Dave from L.A. 2 weeks ago

    The Fed is going to give us negative interest rates; our “education system” i.e. training system has given us negative IQ points. People at this point don’t even have a sense of self-preservation. They are trained zombies.

    • lvblasiotti 6 days ago

      You nailed it. I see this lack of self-preservation everywhere. As Mr. Celente says: THINK FOR YOURSELF. They do not. They want to be told what to do. I think the moving backgrounds on the TV news programs are hypnotizing them or sending them hidden messages. Go figure. What else can it be? I read somewhere a few years ago that the magazine pictures of hard liquor in a glass with ice cubes actually have hidden messages imbeded in the cubes so as to encourage the purchase of the liquor. Who knows? Sounds possible. A good/talented artist/designer could imbed messages especially in the moving backgrounds of the TV news studio programs. It is an interesting thought!

  3. Stephen Kohn 1 week ago

    Do bond yields go up when interest rates go down or something? or are they just not correlated?

    • donaldnovak1 7 days ago

      It’s more complicated than that from what I gather. Factors include discount rates on bonds, bond prices and bond yields.

  4. jlamp21 1 week ago

    NEXT THEY WILL BE DIPPING INTO OUR SAVINGS ACCOUNT AND STATING YOU CAN ONLY WITHDRAW X AMOUNT DOLLARS PER MONTH!

    • grego1 1 week ago

      They are already doing this. Notice the limit per day, week or month that you can take from an atm? My bank NBT allows withdrawls of 5k per month…maximum. is this covid related, who is to say.

  5. Jay Jericho 1 week ago

    How many people have experienced that ‘flash crash’. The phenomenon where your stock price crashes by about 90% for 0.001 seconds at the time when you sell your stock, and then immediately returns to the scam price. This is one way of recouping funds from an over inflated Ponzi scheme – that blew up in 2008.

    • grego1 1 week ago

      When I left my last job, my 401k, based on the parent company stock, was not transferred to me until the stock prices it was based was at its lowest. It took several months for this to occur too, not very pleasing to me but it was the way of a sleaze tabloid called Newsday in Long Island, NY.

  6. James Koch 1 week ago

    Nice article- thanks

  7. James Koch 1 week ago

    I strongly suggest readers make it a goal to get out of debt quickly! Sell those big ticket assets that will have declining values.

  8. ralphhallmark 1 week ago

    Shed the debt!

  9. Craig Bradley 1 week ago

    Proposed delisting of Chinese companies (ADR’s) from U.S. Stock Exchanges suggests the decline of U.S. financial markets may already be in-progress. While such non-tariff actions, should a Bill actually be passed and signed into law, reflect the divergence of Chinese financial interests and U.S. interests. Growing friction and ill-will are likely to lead to a World War III between China (+ Russia) vs. the United States at some future date .

    Many view this possible scenario as impossible but it remains a major security risk, regardless. The rest of the world may at some point tire of U.S. political antics and B.S. and choose to list their companies in Asia and not in U.S. stock or financial markets. In that event, we lose financial importance to Beijing, China. American stock markets have outperformed the rest of the world for a long, long time as it is. This trend is getting “long in the tooth”. We may reach a point where our financial markets under-perform overseas markets for a decade or two. Its a possibility.

    https://www.armstrongeconomics.com/international-news/china/chine-the-financial-capital-of-the-world-after-2032/

  10. Lancelot Forbes 1 week ago

    As long as countries around the world continue to finance trade transactions in US dollars the FED can print all the money it wants. Additionally if very little of that money gets into the hands of consumers but mainly juices the stock and bond markets it will not cause hyperinflation . On the contrary it will continue to fuel deflation except in the case of supply shortages. The day of reckoning comes only when the FED stops buying or the US dollar loses its primary role in trade finance. Until then the country will continue its slow descent into third world status.

  11. Craig Bradley 1 week ago

    CALIFORNIA’S DECENT INTO 3D WORLD STATUS IS A WORK IN-PROGRESS

    A young European woman was demonstrating some beverages at the local Ralphs (Kroger) Grocery Store last year. She told me she visited many grocery stores around Southern Calif. while doing in her job. She also told me there are some good areas, such as the Foothills but by and large, SoCAL is a “big shithole”. Interior cities and towns are even more shitty (depressed or dumpy) in this regard. If you live in a good area, you can deny everything else. This is why the strip of affluence along the Pacific Ocean is doing fine but the rest of the state and people are struggling. Most of the political power and influence is among the most affluent. The rest of Californians have to suck hind tit (Take what they can get ).

    • lvblasiotti 6 days ago

      This started more than 50 years ago and has been getting progressively worse. California used to be the number one state in the U.S……sad.

  12. grego1 1 week ago

    Especially since the 2007 financial disaster note how anyone with money outside the stock market was literally forced through no-interest yield accounts to move their monies into the stock market. Most had no intension nor knowledge of the market, hence they were forced into risky investing. Many hired “experts” to manage these changes. That can also be seen as an interest charge or fantom negative interest rate. These sleazoids spend so much time conjuring ways and methods to eat our savings through taxes, charges interest etc., rather than taking the logical approach of cutting spending. Well, that means jobs hence, votes bla bla bla…

  13. donaldnovak1 7 days ago

    We were in Copenhagen last August where mortgage rates were…drum roll please… negative 0.5%. That is not a typo. 0.5%!!!
    How does that actually work? Does the bank pay you to take a mortgage??? Only in your dreams, right?

    • lvblasiotti 6 days ago

      Sounds like they want people to take on more debt. “The more you spend the more money you can make.” Where have we heard that before? Debt is masked slavery and unfortunately most of us have been sucked/fooled into more and more debt.

  14. lvblasiotti 6 days ago

    From what I have been hearing it seems that the end of the dollar as a reserve currency is coming to an end or has ended….not sure. What with all of the money being printed by the The Exchange Stabilization Fund (ESF) in coordination with the Federal Reserve we are possibly facing hyperinflation…Venezuelan style. Hope not but prepare for the worst.

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