"Bond and Stock Markets A Bomb Waiting To Go Off"
By Greg Hunter’s USAWatchdog.com
"Trader/analyst Gregory Mannarino says the world is on the edge of big financial trouble, and he lays the blame at the feet of central bankers. Mannarino explains, “We have proof positive that the Federal Reserve and other central banks have, yet again, gotten it wrong. How many times have you heard me say the Fed will get it wrong again? Well, they have gotten it wrong, and the proof is everything is going in the opposite direction they said it would go.”
Mannarino says the Fed and other central bankers have “created enormous distortions in the financial markets.” Mannarino contends, “This environment we are in is not sustainable. All of these trade deficits and trade wars that are developing right now, all of them should have been addressed a long time ago. It’s too late, it’s too late for anything. Right now, we’ve got nothing. We have unbacked liabilities being distributed by bankrupt governments around the world. That’s what we have. They are forcing people to put their cash into an inflated stock market. It’s like a bomb that is waiting to go off.”
When rates start to go up, look out below. Mannarino explains, “You are going to have central banks do whatever they can to attempt to stop the bleeding. That means they are going to be the buyer of last resort. They will get in there and try to buy everything, and that will melt the currency. As rates spike, what will that do? You are going to see a lot of pressure on the stock market. The only reason why the stock market is where it is today is rates are low. You will get an opposite effect. So, you have massive sell-off potential here, and I mean massive in the bond market followed by a massive sell-off in the stock market.”
Mannarino expects war to come into play. Mannarino predicts, “This is going to lead to another world war. I have said this many times, and that is this has the potential to be Biblical. It will be a worldwide event or a correction to fair value is really what it is. We might be seeing the opening salvos already. Governments around the world are building up their militaries just like the U.S. We are unfortunately going to clear this out and lose a large percent of the world population through this financial correction and war. We will rebuild, but the world will not be what we are seeing now.”