AUG 19, 2016
August 19, 2016
A major crisis warning signal just hit.
It concerns “behind the scenes” liquidity for Central banks.
Here’s how it works.
When “all is well” in the financial system, foreign Central Banks like to park money at the Fed overnight. The reason they do this is because the Fed offers a special program that yields more interest than money markets.
So when things are calm in the financial system, foreign Central Banks don’t need emergency access to capital and so park significant amounts of money with the Fed overnight.
But when things are bad and foreign Central Banks NEED access to capital, this number falls.
As Worth Way notes, this number is falling… in a big way. In fact, any time it’s fallen by this much (5.6% year over year) a crisis hits soon after.
If you're looking for investment strategies to profit from this, I can help you...
Because I am usually warning about risks in the market, everyone assumes I'm nothing but a bear who has his clients shorting the heck out of the market all the time.
Pointing out the risks to the stock market is very different from actively shorting it. The editorial I publish here is focused on alerting EVERYONE about the problems the financial system faces.
However, when it comes to active investment strategies... I do see opportunities to short... but I also see opportunities to go long.
Chief Market Strategist
Phoenix Capital Research