Socialism is the primary market force at work in America today.

Corruption, incompetence, expropriation of business wealth, enslavement of the competent, central planning, central control, crisis creation, pollution, more lies, more murder and destruction, finally starvation... that is a synopsis of the post WWII European world under the influence of true eastern socialism. That was clearly observed despite no public scrutiny of the corrupt and often evil socialist leaders. Under socialism the incentive was to be an active socialist political leader and to hold a government job.

The post WWII European world under the influence of American western capitalism has been expanded human rights, prosperity, a cleaner environment, an explosion in computer technology, higher productivity, shrinking socialism/unions, shrinking world corruption... all with high public scrutiny of leaders.

Market forces June 22

World instability under current expanding world socialism causes an increasing risk to free capitalism and markets. The Great Depression was caused by the popularization of socialist and communist policies in the 1930s. That led to the rise of Stalin, Hitler and other socialists who squandered former accumulated national wealth to conquer and steal the wealth of neighboring nations. They had to conquer and expropriate the wealth of others in order to survive. When their murderous expansion and exploitation of other people’s accumulated wealth was stopped... the socialists rapidly collapsed.

The current recession has been lead by the socialists too. Once the democrat socialist’s have expropriated the maximum from energetic, productive and competent Americans and redistributed it all to the people who vote for socialism there will be no incentive for energetic, productive and competent Americans to continue. Under Democrat Socialism the incentive is to become politicians and/or to hold a high paying government jobs. The socialist always give their politicians and federal employees the best health and job benefits… not available to other citizens.

Socialism is a powerful negative market force that eventually caused all eastern economies to spiral down into a chronic permanent depression ruled by political tyranny. Socialism is the primary market force at work in America today. Huxley’s book, “1984” applies today to Democrat Socialist manufactured crises. This past week the Democrat Socialists have been spending $millions nationally saying they oppose performance taxes on radio music and we should call our Democrat-Socialist Congressmen about it. The truth is only the Democrat Socialists could even think up such a tax on music.


Market Outlook

The light market volume means that the stock market is destabilized and can be manipulated easily. The market is unstable because even a low volume of selling could now drive the market much lower and very rapidly. Lenin and other great socialists created market crises because they are excellent opportunities for socialist dictators to expropriate private wealth. American socialist government recent intervention at the Stanford investment firm in Texas caused a $5billion evaporation of private wealth on top of the $1billion the FED originally said was actually missing. Socialist government intervention into any honest private company means instant destruction of capital. Criminals like Bernie Madoff can shield stolen money for use in their defense but real business entrepreneurs have their money invested and their investments require active/real management which ends the moment the socialists invade their office and shut them down. That is how Lenin expropriated the wealth of all the Russian banks during their Communist Revolution. The fact that the FED caused $5billion loss at Sanford probably means they were probably not a Ponzi scheme after all but were honest active investors. Socialists think all great individual wealth is a sign of inequity or criminality. However in free societies great individual wealth is usually a sign of industriousness, creativity, and competency.

The world is becoming politically and economically unstable under President Obama similar to the world in the 1930s. Real estate is probably the best investment at this time. Bonds are the most recent victim of expanding American socialism and debt. The Soviets and Nazis were big spenders too and defaulted on everything as interest rates rose.

We have zero confidence in all socialist markets. The risk of enormous investment/currency losses in emerging economies is now very high. The risk of a panic and collapse being orchestrated by Red China, Russia, and N. Korea is now very high. The dollar is strong now but once American wealth falls under heavy socialist taxation the dollar will collapse just as all socialist currencies have collapsed on multiple occasions.

American socialists are not just interested in redistributing American wealth to other Americans. No, they are world socialists and plan to distribute America’s wealth around the world.

Last night most Asian markets were flat with China up 0.5%, Japan up 0.4%, and India down -1.4%.

Most European markets are down sharply today in a range of -0.8% to -1.8% half way through their session.

US futures are down about 0.5% today. We are on the sidelines now. It would be better to buy real estate now than to buy stocks at current prices based on their imaginary potential future earnings ten years from now. Based on real earnings the S&P PE ratio is at an historic high and even a 50% decline is still possible.

Over the next two months we expect to see a stock market sell-off of about 27% as investors realize this Obama crisis of socialism will get deeper and will last at least another one or two years.

China does not want its population even thinking about the massive drop in their national income as China's exports continue to plummet so we can expect world wide unrest to be the socialist approach to keep citizens from thinking about the destruction of wealth caused by current socialist tyrants.

President Obama has shown Americans just how easy it is to nationalize an industry. First he loans them some government money, then rules them like a dictator, then bankrupts them, and finally takes majority ownership for the government. Then they can appoint their socialist bureaucrat friends as the managers.