11 Red Flag Events That Just Happened As We Enter The Pivotal Month Of August 2015

By Michael Snyder – Via The Economic Collapse Blog

Are you ready for what is coming in August?  All over America, economic, political and social tensions are building, and the next 30 days could turn out to be pivotal.  In July, we saw things start to turn.  As you will read about below, a major six year trendline for the S&P 500 was finally broken this month, Chinese stocks crashed, commodities crashed, and debt problems started erupting all over the planet.

I fully expect that this next month (August) will be a month of transition as we enter an extremely chaotic time in the fall and winter.  Things are unfolding in textbook fashion for another major global financial crisis in the months ahead, and yet most people refuse to see what is happening.  In their blind optimism, they want to believe that things will somehow be different this time.  Well, the coming months will definitely reveal who was right and who was wrong.  The following are 11 red flag events that just happened as we enter the pivotal month of August 2015…

#1 Puerto Rico is going to default on a 58 million dollar debt payment that is due on Saturday.  Even though this has serious implications for the U.S. financial system, Barack Obama has said that there will be no bailout for “America’s Greece”.

#2 As James Bailey has pointed out, the most important trendline for the S&P 500 has finally been broken after holding up for six years.  This is a critical technical signal that will likely motivate a significant number of investors to sell off their holdings in the weeks ahead.

#3 The IMF is indicating that it will not take part in the new Greek debt deal.  As a result, the whole thing may completely fall apart

Leaked minutes of the fund’s latest board meeting, which took place on Wednesday, showed staff “cannot reach agreement at this stage” on whether to take part in the new €86bn (£60bn) bailout for Greece. The document said there were doubts over the capacity of the Athens Government to implement economic reforms, as well as the over the sustainability of the country’s sovereign debt pile, which is now projected to hit 200 percent of GDP.

The German Chancellor, Angela Merkel, only sanctioned a new Greek deal earlier this month on the condition that the IMF takes part.

#4 Italy is going down the exact same path as Greece, but Italy is going to be a much larger problem for Europe because it has a far, far larger economy.  This week, we learned that youth unemployment in Italy has reached a 38-year high o f44 percent, and Italy’s debt to GDP ratio has now hit 135 percent.

#5 The Canadian economy has officially entered a new recession.  This is something that was not supposed to happen.

#6 The price of oil plummeted close to 20 percent during the month of July.  It was the worst month for the price of oil that we have seen since October 2008, which just happened to be during the height of the last financial crisis.

#7 Commodities just had their worst month in almost four years.  As I have written about previously, we witnessed a collapse in commodity prices just before the stock market crash of 2008 too.

#8 Thanks to Barack Obama, the U.S. coal industry is imploding, and some of the largest coal producers in the entire country have just announced that they aredeclaring bankruptcy

On Thursday, Bloomberg reported that the biggest American producer of coking coal, Alpha Natural Resources, could file for bankruptcy as soon as Monday.

Competitor Walter Energy filed for bankruptcy earlier this month, and several others have done the same this year.

#9 For the month of July, the Shanghai Composite Index was down 13.4 percent.  Despite unprecedented government intervention to prop up the market, it was the worst month for Chinese stocks since October 2009.

#10 A major red flag that a recession in the United States is fast approaching is the fact that Exxon Mobile just announced their worst earnings for a single quartersince 2009.  Compared to the same time period one year ago, Exxon Mobile’s earnings were down 51 percent.

#11 Chevron is another oil giant that has seen earnings plunge.  In the second quarter of this year, Chevron’s earnings were down an eye-popping 90 percentfrom a year ago.

And in this list I didn’t even mention the economic chaos that is happening down in South America.  For full coverage of that, please see my previous article entitled “The South American Financial Crisis Of 2015“.

To a certain extent, I can understand why most Americans are not alarmed about the months ahead.  The relative stability of the past several years has lulled most of us into a false sense of security, and the mainstream media is assuring everyone that everything is going to be just fine and that brighter days are ahead.  At this point, many believe that it is patently absurd to suggest that we could see an economic collapse in 2015.  But of course even though the signs were glaringly apparent, very few of us anticipated the financial crisis of 2008 either.

A few weeks ago, I authored a piece entitled “The Last Days Of ‘Normal Life’ In America“, and I stand by every single word of that article.  I truly believe that the era of debt-fueled prosperity that we have been enjoying for so long is coming to an end, and our standard of living will never again get back to this level.

Just yesterday, I had the chance to go over and stock up on some emergency supplies at a dollar store.  It always astounds me what you can still buy for a dollar.  The combined cost of raw materials, manufacturing, packaging, shipping and retailing most of these items shouldn’t be less than a dollar, but thanks to having the reserve currency of the world we are still able to go to these big box stores and fill up our carts with lots and lots of extremely inexpensive merchandise.

Unfortunately, this massively inflated standard of living is going to come crashing to a halt.  This next financial crisis is going to destroy the system that is currently producing such comfortable lifestyles for the vast majority of us, and that will be an extremely painful experience.

So enjoy this summer for as long as it lasts.  Even though August threatens to be pivotal, it is going to be nothing compared to what will follow.

Fall and winter are coming.

Prepare while there is still time to do so.

Comments

  1. Chuck Findlay says:

    If it falls apart, it falls apart.

    I don’t wan it to go that way, but no one asked for my input.

    I prep and at the same time enjoy life. I don’t see worrying about things going on in far off places (and DC is a far off place) as productive. After all ‘m already prepping a lot, what more can I do?

    • I’m with you, Chuck.
      The present economy can not continue. It must and will collapse soon. I have prepared. I am as prepared as I can be. Until the crash I intend to enjoy life to its fullest.
      Right now life is good for me.
      I have learned the skills that I will need. I have stored up what I will need and I know that I will adapt to whatever comes down the pike.
      Bring it on.

  2. I hate it when “their” plans come together.

  3. Thomas The Tinker says:

    “If it falls apart, it falls apart.” Yowwza Chuck. I donwanit to emplode either…. I take the ride down the toilet anyways… The current ‘Swirlly’ should take us well into the election cycle. As we are the market of last resort, we’ll be juzz fine far longer than the rest of this world. Sssooo Whats ta worry about.

    Nobody in the DC beltway has called me up either Chuck.. so I prep and enjoy the show.. rotate stock.. fix the house.. fix myself.. practice my skill sets.. practice my ‘less than PC’ skill sets.. yepper…. enjoy the show and ignore the Fear Porn.

    • Yeah, Thomas.
      Skill sets are the most important. Looters can steal your stuff, but your skills and knowledge can’t be taken from you.
      I think we all have some idea of what might be coming, but we, none of us, knows the details. Most of what happens will be unexpected. With practical useful skills we can adapt to the unexpected.

  4. Secret Agent Man says:

    @Chuck and Tom
    Actually I’ve been getting almost daily phone calls from Barry. However, all that he wants to talk about is how great of a President that he thinks he is ! I’ve tried to block his calls, but that darn C.I.A. keeps getting them through.

    I could go on, but I see on my Caller I.D. that Janet, the Fed Chair, is calling me again about what she should do about interest rates. WHAT A PEST!

    (serious sarcasm)

  5. At this point with the debacle that has become our government, I almost wish for a collapse and reset. I dont want anyone to suffer,but this country cant go on much longer,down the path its taken.,,,,,,,,,or ,,,,I’m just a cranky old dude. Be right back,,gotta go shake my fist at some kids that wandered across my grass.

    • axelsteve says:

      Get off my lawn pointing m1 g with bayonet fixed.

    • Your Right.
      Too bad the “reset button” will involve so mush suffering and hardships for so many. I am especially worried about my friends and family in the big cities and densely populated areas.

  6. PrepperDoc says:

    The stock market and the economy are two completely different things. We now know that central banks around the world (and in the case of China, the government openly) are buying/selling in their stock markets. That, combined with ridiculous stock “buybacks” by large corporations (using borrowed money) mean that the normal “market” is temporarily at least, not present.

    It is a funny time. Governments all over the world are DETERMINED that you should MAKE, not lose money in their stock markets. They have been able to make this happen for several years (and I made bukoo bucks!) but they can’t make it forever…. Several indicators suggest they may be reaching their limit. For preppers, no matter: when the market crashes, smart/wise people will buy up stocks of surving companies at pennies on the dollar. Companies that have REAL PRODUCTS will survive (if the nation does). People who make engines, pumps, drilling equipment, who grow food, etc. I’m hedging my bets, moved 50% of my investments to “cash” [it is still not in my posession, however] but also moved REAL CASH out of banks and into my safe or into real farm equipment or precious metals. Diversify! I’m not smart enough to know what will happen.

    • Thomas The Tinker says:

      Pdoc… My stock holdings are ….. small! I would only call them a “Portfolio” cause I own more than a few different shares. I use the ‘Garage and Kitchen Cabinet’ method of investing. The products and ergo the companies I invest in can all be found in our garage and or under the kitchen cabinet. Hardly MBAPaineWebberish thinking…. How will it pan out….. I see at the other end of the “Long Run”.

      • PrepperDoc says:

        I would say that’s a pretty wise way to pick companies myself. They call that “consumer staples” , or “defensive investing.”

  7. Secret Agent Man says:

    I guess that the whole premise of becoming a “Prepper” is that “things are going to get worst than they are now, and they seem to be.

    My solution is one that you might expect from an old worn out Clergyman. Put in simple terms, I don’t believe that there is an economic or political answer to our Country’s troubles.

    What America needs is a great move of The Spirit in the fashion of a major Christian revival. No matter what the question/problem is, the grace provided by the God of Abraham, Isaac and Jacob is the answer.

    • You are exactly right. Unless there is a turn back to God and Jesus, we are doomed. A country with no morals is going to fail, and we are there now, with abortion and the sale baby parts for profit, and the homosexual move to legitimacy. SIGH! It is no wonder we are under God’s judgement.

    • PrepperDoc says:

      Right on. What I think we need is REPENTANCE and REVIVAL. Having killed close to 50 million…..I think there is going to be Hell to pay….and it may be starting now.

  8. ozhillbilly says:

    Lately I’ve been selling what little bit of stock market stuff I have. Down to a couple of the larger accounts and starting to get some grief from family. Thoughts from the Pack on this are appreciated.

    • JP in MT says:

      ozhillbilly:

      Are these “family members” carping about it as a potential loss to their inheritance? Are they willing to step up and finance your lifestyle if you loose it all in a market crash?

      If they are unable/unwilling to step up when the chips are down, then they have no say in your finances with things are looking up – IMO.

      My family knows I don’t look to them to solve my financial issues, so they don’t get try to interfere with my decisions. Their future plans are doomed to fail (IMO) but I have done my part to open their eyes to other options, to cover more of their future needs. I warn them not to depend on others, especially the government. But then they are all more professionally educated than I am. But then it turns out a have a more stable income stream, less debt, and more resources on hand. Only the unknown future will tell who is right, but I’m comfortable with my direction.

      • ozhillbilly says:

        Hi JP, I have no financial problems, I just want out of the stock market while stuff still has some value. I don’t believe it’s about the money at all but they are in denial of how seriously upside down everything is today. These are head in the sand family members that think everything is fine. One daughter’s husband is a very successful financial advisor with a national firm. She’s just repeating what she hears from him. Both of my daughters and wife tolerate my “behavior.” I’m certain I don’t need to elaborate. I’m glad my kids are college educated (thanks to their parents) and successful but kinda having some regrets also. My lifestyle compared to theirs is caveman versus Hollywood. I will survive no matter what happens unless the powers that be crash my door in and drag me off.

        • JP in MT says:

          ozhillbilly:

          Trust me, I understand. And there is still money to be made in the stock market. However, in my opinion, once the “wheels fall off the cart”, it will happen suddenly. It is the average investor that will be left holding worthless paper.

          Personally, the only money I have in the market are my wife’s 401k, which we can’t touch as long as she is with her current employer, and an account set up for my grandson’s future education. I would like to liquidate my DW’s 401k (as she would too) but we are still in need of the income from the job. Once that “issue” is resolved, she will be out of there (if she wants) but the retirement account will be changed.

          My advise about the market is the same as my advise about rental properties; have paid for resources, be debt free, and don’t put your future in the hands of others. I you can control your investments, much better. I only “invest” money that I can afford to loose.

          Basically, do what you can sleep well with. If you are worried about an investment, based upon YOUR research and decisions, not the hysterics/ostrichsity of the mass media, then you should probably do something.

        • PrepperDoc says:

          Are you able to describe what you decided to do with the funds you obtained by liquidating the stocks? I have done a fair bit of the same, but I am still in the market to some extent — but to the LEAST extent in 15 years….. I think it is well overvalued at the moment. But that might not matter any more as long as the FED can print money and buy stocks to buoy up their value….. it is a very odd time.

          • JP in MT says:

            Well Said.

            • ozhillbilly says:

              Trying to stay in the thread here. What I’m liquidating is stuff I’ve bought on my own and not in the account I have with my above mentioned son-in-law. Getting out of that would be bad for family cohesiveness. I’ve basically already written that off anyway. None of the money I’m talking about is life altering or anything I’m dependent on, although it is more than a few thousand dollars. By the time I allow for capitol gains, tithing, etc. I get about 50 percent of it. I recently purchased a small acreage in a neighboring county and will likely use the money for improvements on the property.

              • JP in MT says:

                oz:

                That sounds like the tactic that we are using with our “investments”. So I would be naturally be positive towards this idea.

              • PrepperDoc says:

                Assuming that you know your local property values correctly, that sounds like a pretty useful diversification to me!

                I had an opportunity to buy some land at probably half market value, so I snapped it up. I put a huge chunk of change into a solar power system. (I just noticed that even by moonlight, it was making enough electricity to run my refrigerators!!).

                I also invested in a good number of rifles and pistols, and some precious metals, most of which Ive lost money on, if I were to sell them now of course). Who can tell what it’s going to happen next in this crazy world….

          • axelsteve says:

            I heard Ruger is a good stock to have if you bought it the right time. Also it pisses off Obama bot drone brokers.

    • OhSoTired says:

      the money I earn is mine–no one else’s–I give 2 shits what “family members” think–NOT THEIR MONEY–Financial advisors–lol–these idiots are part of the problem and skimming billions off the backs of hard working people–They can fight over anything that is left AFTER I am gone when I don’t have any use for it anymore–just saying–you gotta do what is right for you and the survival of yours in the present–because–in the end–if nothing happens–they WILL auction all your shit off in an estate sale, which I see constantly on fliers–your guns, your ammo, your reloaders, vehicles, tools–your preps–all sold to the highest bidder. SAD at best but that’s the way it is. Good luck to you

  9. Victor Fox says:

    If America is about to suffer such blows, imagine what’s going on here.

    Real is 3.6 and raising for the dollar, pricings raising wildly, high unemployment tax, hidden by the govt, scandals involving politicicans, lost investment grade, interest is up and stock market is down (bocephus), ore and oil prices are down, external debt has risen, the depression is at our doors.

    Not to mention crime is getting higher as ever. I’m glad I became a prepper, things won’t be any easy, but I’m sure with my skills, stuff and God’s bless we’ll survive this.

    This month I’m a completely debt free man, and have some savings, my food stock, tools, guns and ammo (this is quite a feat, considering our laws…) and some knowledge to cope with this crisis, which, I guess, we all hope, will not be as hard as it looks.

    God bless you all, God bless America!

  10. I never really had the money for investing (other then bullets, beans, and bandages) but there are two things I understand.
    1. Money spent on food or drink is never wasted.
    2. The value of the cow is in the cow.

    • Hi Ron,

      I have somewhat the same view. I’ve never really had the money for investing either (besides preps), but as I’ve gotten older (I’m 28 now), I’ve come to realize, ‘ why do I need an inordinate amount of money which might come through investing? Why do I really need more than “just enough and maybe a little bit more?” ‘ If I’m self-sufficient on my homestead, what would I need money for? If the foreboding in this article comes to fruition as a worst-case scenario event, why would I break myself trying to gain more of something that will ultimately be worthless? The only valid thing that I can think of is “self-investment,” that is, skill development, food and water self-sufficiency, energy self-sufficiency, and self-defense self-sufficiency. Just my two cents.

      • Well said, sir:
        I think that it is important to note that during the depression in the 1930s that people came together. They were poor and suffering hardships, but banded together.
        I think that most of us will do the same in the upcoming crash.
        An economic crash is just that. Many of us will have less money and less material things. I don’t think it follows that we will loose our humanity. I think we will all come closer together.
        Now there will surely be a few bands of looters that will form.
        In my community we are not going to tolerate crime, or violence any more than we do now.

      • OhSoTired says:

        As I have gotten older (55) a key thing to remember is that if it is not in your hand–you do not possess it. Your 401k well into the mid 6 figures–you don’t “possess” that–the pension you are supposedly going to receive at 50K a year–you don’t possess that. Social security that you and you employer have paid for the last 30 years to the tune of $300K–you do not possess that. Any or all of these things could be gone–just like that–what IS in your possession is what is important and you seem to have a good grasp on that. I do hope that things drag out long enough for me to cash out my 401k at 59 1/2–not looking promising though–pension and SS–please–I have no illusions of where we are heading. Carry on young man–your going down the right road.

  11. I do believe that we are due for another recession. It’s been 7 yrs since the last one started. & this bull mkt has lasted longer than ave.
    As for this being the pivoted mth that leads to economic collapse, I’m a bit skeptical. This author, M Snyder, makes negative predictions every week, & when one makes that many predictions, one is bound to get a few right.
    Now… I could be wrong, which actually happens quite a bit. & that’s why I’ve opted out of the prediction business. So I prepare steadily. Not as ready as I want to be, but am getting a bit closer each month.

  12. Patriot Farmer says:

    Sir you are spot on. It’s not a matter of if it happens anymore. It’s only a matter of when and how soon.

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