The Wreck… Has Already Occurred – Wall Street Underground

By Nick Guarino | February 27, 2016

Your Bank is Stone Cold BROKE!


You need to grasp the fact we have had for over 50 years rising commodity price lead growth, inflation and profits. We are now entering a time of a commodity prices crashing led contraction, deflation and losses. It will be the biggest depression the world has ever experienced. It’s not too difficult a job to analyze and understand this. What we are not being told is the extent of losses generated by crashing commodity and oil prices. Your bank is broke and most major corporations are taking their biggest hit ever.

What got a temporary reprieve to the 2008 sub prime mortgage crises. A hyper bubble was formed in stocks, commodities and oil. Government allowed bankers and investment banks and mega corporations to rig the commodity and energy markets. With borrowed money creating the greatest bubble ever! The bubble has crashed in commodities, banks and stocks are next.

Want PROOF? All you have to do is look at the soaring prices of oil and every commodity under the sun. Here is a chart of oil from the 2008 financial crises to its peak. From $40 a barrel to $115:

But it was not just oil that soared in price. Now look at one of the key industrial metals, copper. From $1.40 a pound to over $4.60:

Now look at silver from $10 an ounce to a peak of $50. That move fooled a lot of people:

Gold also joined in the fun from $700 a ounce to $1900:

Now look at agricultural commodities. Corn soared from $3.50 a bushel to over $8.50. These are staggering gains unexplained by normal market forces moves unprecedented:

Look at soybeans. From $9.00 a bushel to $18.00. These are staggering increases in prices:

Even the price of your hamburger soared in value. Here is a chart of Cattle prices. From .80 a pound to over $1.70:

Even cotton prices were manipulated to the moon. From $40 a pound to $200… Crazy:

As you have seen the bankers and mega corporations using borrowed money from the FED. To manipulate oil and commodity prices to the moon creating the greatest commodity price bubble in world history.

But their manipulations were not limited to commodities. With hundreds of trillions in leveraged money they applied their evil to the stock market. Look at the chart of the DOW. From the post financial crash low of 7000 the stock market more than doubled to over 18,000:

This just a sampling. All commodities and stocks were manipulated higher in recent years with incredible sums of borrowed money. This illegal manipulation was done by the banks and mega corporations in an organized conspiracy with the aide of the worlds central banks in a desperate attempt to forestall the coming global depression. The scheme has let them manipulate commodities and stocks to hopefully save themselves and save the global financial system from collapse.

Unfortunately for mankind as you will see all manipulations are destined to fail. With disastrous consequences. The bankers were hoping that global growth would kick in and sustain the manipulated prices and bail their bacon out of the fire.

Global growth never came and stock and commodity prices collapsed

The global economic slow down is the death knell for the global financial system. The truth is that China was supposed to lead the global economy forward. Demand, as the masses of Asia entered the middle class, was supposed to boost all commodities. The truth is just the opposite happened. China growth never materialized and their economy is leading the global depression. As a result all and I mean all commodities are in vast surplus. With demand and price crashing!

It is a well known fact that sky high oil prices did two things. First it made new technologies feasible like fracking, oil tar and oil sands recovery. It also brought about new efficiencies in the use of fossil fuels. The car of today consumes far, far, less fuel.

And as you have seen, high prices cut demand. In fact global demand for oil is dropping while global production is soaring. The net result is oil has plunged from $110 a barrel to around $30. Look at the chart of oil prices below. From $40 when the manipulation started to $115 high and now $30 as the manipulation failed:

Don’t be fooled, a lot of bankers and funds and mega corporations invested with the idea that oil would never come down. The Einstein analysts the bankers employed predicted oil would be at $250 a barrel right now. No one except us predicted the wipe out. And oil will, after a sucker rally back, drop to $10 a barrel. The trillions invested and financed in oil stagger the consciousness. The losses are also staggering. It will wipe out the global banking system

Now look at copper. It is a key industrial metal and proxy for all industrial metals. What you see happen in copper happened in ALL industrial metals. Now let’s look at the round trip in the worlds key industrial metal copper. As you can see, before the manipulation copper was trading at $1.60 a pound. It hit a manipulation high of $4.60 a pound. And now it’s trading around $2.00 a pound. It will drop to below $1.00 a pound.

And as in oil the losses are incredible. From billion dollar mines to ships and rail systems to move industrial metals from mine to smelter to market. All financed by our soon to be declared broke banker buddies and Wall Street financiers.

It does not stop there. Now let’s look at what happened to precious metals starting with silver. The reality is that the masses bought into the hype that the commodity surge would at least bring about massive inflation. With some hysterical analysts predicting hyper inflation. Indeed as you are about to see we have a massive commodity lead deflation instead. Silver soared to new highs driven not by demand but the manipulation and incredible hype. As you can see by the chart below Silver before the manipulation was trading around $10.00 an ounce and soared to $50.00 as the hysteria spread. Once the manipulation failed Silver plunged and is now trading at $15.00 as the depression takes hold silver will fall to under $2.00 an ounce.

All commodities ARE STILL wiping out. It’s not over. The losses in silver are staggering.

Now let’s look at the disaster in gold. From under $700 an ounce pre manipulation to a high of close to $2000 an ounce. Another disaster, gold is now trading around $1200 an ounce. Look at the chart:

Just like the entire commodity complex the disaster in gold is far, far, far from over. Gold ceased to be money 100 years ago. Other then jewelry gold is an inflation hedge and a good one. As you are seeing inflation is long dead, buried and gone. Gold is doomed! We are now in a global deflation that will soon be called a depression. Which means gold will go to under $150 a ounce. And the losses in gold are astonishing. A store house of wealth does not lose half its value in 4 years.

Let’s look at the agricultural commodity complex. One of the key human and animal and fuel crops is corn. From your cereal, to animal feed to even automobile fuel, corn is a bellwether agricultural commodity. It has been a disaster. From a pre-manipulation low of under $3.00 a bushel to a manipulation high of over $8.50 a bushel. Now that the manipulation has failed corn is trading at $3.60 a bushel. And it will soon be under $1.50 a bushel. Look at the chart:

As you can well imagine the losses are staggering. Bankers, farmers, farm equipment manufacturers and mega food agriculture traders are taking huge losses. It’s the same sad story. They predicted demand would cover the manipulation. It was believed that as the worlds poor would join the middle class. Their demand for meat would soar creating ever increasing prices for corn as an animal feed. It was even better. As oil prices soared it was believed corn would come into its own. As a renewable energy source. Demand for a cheaper than oil fuel alternative would bring $15.00 a bushel corn. Well that never happened and will never happen. Oil crashed. And the Asian miracle became a nightmare. Corn will be trading under $1.50 a bushel as the depression takes hold.

Now let’s look at another key agricultural commodity and feed source, soybeans. Again the expectations in the manipulation were absurd. I saw predictions of soybeans at $25 a bushel. Let’s see what really happened. Soybeans before the manipulation were trading under $8.00 a bushel. They achieved a high of $18.00 a bushel. And now that the banker party has come to a disastrous end, soybeans are trading under $9.00 a bushel on their way to $3.00. And once again the losses are staggering. You can see the wipe out on the chart below:

And if feed prices soared and collapsed the animals you feed prices also boomed and collapsed. Look at the chart for cattle:

From .80 a pound to $1.80 peak and now trading at $1.25. with a drop to under $1.00 a pound to soon come.

The last commodity full circle chart I want to show you is cotton. Wall Street and their banker buddies market manipulation waged war on all commodities. The idea was to get the price to soar to the moon (which they did) and dump their holdings as demand kicked in. It was a good plan except for one fatal flaw. Demand never kicked in. And they were never able to dump their holdings. Look at the cotton chart below:

Let’s look at the chart of the DOW. Because of Wall Street’s ability to hide losses (more on that in a moment) stock prices have not crashed yet. This next chart will show you how the manipulation shot stock prices to the moon. The stock market has peaked and soon will be in a death plunge. As you can see by the chart below, from the financial crises low of under 7000 stocks have soared to a high of over 18,000. Currently the DOW is trading in the 16,000 area. I can tell you wall street is scared shitless by this recent minor plunge. The truth is as the losses come out the DOW will go under 7000 and in fact will go to under 5000.

As you have just seen the losses in the biggest oil and commodity bust ever are staggering. There is no issue here, we are in a depression with commodity prices plunging like never seen before.

This is what happens in a depression. There are two more events that are about to occur that can make you very, very wealthy or very, very poor.

The banks are about to wipe out and the stock market is about to crash

Yes it is obvious that these 2 key events have not happened just yet. Now ask yourself, how come now that ALL commodity prices have crashed at least 50% and oil 70% we have not seen any significant losses in banks or the stock market?

They sure as hell were booking the soaring commodity prices profits. How come no one is posting losses. We know they never took profits. We know the loans were never repaid. So how come to date there is no apparent fallout. No losses or company collapse. No banking losses and no stock market plunge. The biggest commodity price bust in history! With the greatest ever bank exposure to commodities and Nothing?????

The answer lies in accounting rule FAS 157

Necessity is the mother of invention and in this case the mother of deception. Allow me to explain. In the 2007/08 financial wipe out the FED had to save the system. Remember the FED is a creature of the banking system. And its blood brothers were stone cold broke with massive losses they had to book. The FED provided massive amounts of liquidity in the form of very low interest, massive loans to the dead broke banks. But it soon became apparent that was not enough. At that time banks, like other mere mortals, had to record their trades at mark to market. That meant that trades profit or losses (in this case massive losses) had to be recorded.

If that happened the banking system would be in ruin no matter how much money the Fed loaned the banks. So the banking lobby kicked in and what was supposed to be a temporary accounting change was made known as Rule FAS 78. For the first time ever dead broke banks did not have to record the actual losses they were taking on their derivative trades. They were allowed to mark to model.

Here is the rule change. Quoted is the definition of Mark To Model by the Financial Accounting Standards Board (FASB) Known as FAS 157 for financial assets and liabilities like derivatives. It allows:

“The pricing of a specific investment position or portfolio based on internal assumptions or financial models. This contrasts with traditional mark-to-market valuations, in which market prices are used to calculate values as well as the losses or gains on positions. Assets that must be marked-to-model either don’t have a regular market that provides accurate pricing, or valuations rely on a complex set of reference variables and time frames. This creates a situation in which guesswork and assumptions must be used to assign value to an asset. These assets are typically derivative contracts or securitized cash flow instruments, and most do not have liquid trading markets.”

Current accounting standards have significant provisions for valuing structured financial products (that’s the shit your bank is trading in the derivatives casino) based on analytically derived expectations of future cash flows.

First off, let me explain to you this rule was supposed to expire and banks were supposed to go back to marking to market. Quietly in the dead of night the mark to miracle fantasy has been extended.

Your bank is still allowed to price the value of their commodities and oil trades at any price they want. At what fantasy price they expect the price of oil and commodities to be… Over $100 a barrel in oil is their model. Not the actual oil price of $30 a barrel. Your bank is already dead broke. A dead man walking. They are still in business by accounting rules (legalized accounting fraud) that allow them to hide the massive losses they are taking.

This is the height of desperation. Banks and major corporations are stone cold broke. You can cook the books all you want. But as 2007/08 has proven, eventually you wipe out. This time they will go broke and stay broke.

Prepare yourself for the biggest banking wipe out in world history. Prepare yourself for the biggest stock market crash ever.

And this time there will be no bail outs. With interest rates near zero, the Fed is out of ammo and cutie accounting tricks.

Yes, you can become fabulously wealthy in the coming great depression. We know what to do and we know how to trade this.

Thank You,
Nick Guarino




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