Tag: Peter Knight Advisor

Track us capturing the move higher in U.S. Rates

Track this trade using this 2 month GEM22 daily chart each 0.01 up -$6,250, down +$6,250
Secondary position 2 month GEZ22 daily chart each 0.01 up -$2,500, down +$2,500

U.S. inflation 5.40%
3 month deposit rates 0.20%
Entry 0.20%, position value $125,000, short 99.80
Objective 1.20%, position value at $625,000, contract price 98.80
5 Year chart for the June 2022 delivery
Today’s probability of a rate hike at the next Fed meeting

Sources & Data Spreadsheet

3 month deposit rate history 1934 to 2021

Low  0.01%, position value $6,250, January 1940
High 16.30%, position value $10,187.500, May 1981
Average 3.57%, position value $2,231,250


Sources & Data Spreadsheet

What we’re trading

3 month rate futures (Eurodollars) represent the interest on $1,000,000 for 3 months, each 0.01% change in rate $25.00 change in contract value, a 1.00% move $2,500 per contact.

How it works

As rates rise the contact price falls to reflect the increase in rate. To convert contact price into the rate it represents take 100.0000 –  the contact price = the rate.


Sources & Data Spreadsheet

To calculate contract’s value take the rate and multiply it by $2,500.00 USD.


Sources & Data Spreadsheet

Trading the first leg higher

    • There are 6 Fed meetings through June 2022
    • Inflation is at 5.40%
    • Our trade entry is 0.20%, price 99.80, delivery June 2022
    • We’re expecting 2 to 4, 0.25% rate hikes at these 6 meetings through June 2022
    • Increasing the position’s value from $125,000 to $625,00 at 1.20%
    • At 1.20% 3 month rates will be 4.20% below reported inflation
    • If our 1.20% objective isn’t achieved we’ll roll the position annually until it is

Sources & Data Spreadsheet

New position June 2022 delivery

    • Short 250 contracts at 99.80
    • 99.8000 represents a rate of 0.20% (100.00 – 99.80 = 0.20%)
    • Contact value at 99.80 = $500.00, position value = $125,000.00.
    • Margin requirement $176.00 per contact, position requirement $44,000.00
    • Each 0.01% change = $25.00 per contact, my position = $6,250.00
    • I’m allocating $800.00 per contact, total for my position $200,000.
    • In order for me to be stopped out 3 month deposit rates for June 2022 delivery would have to go negative 0.05%.

Track this trade using this chart each 0.01 move up from 99.80 creates a loss of -$6,250, each 0.01 move down from 99.80 a profit of +6,250.

Potential outcomes of this trade,

June 2022 delivery went on the Board 15 June 2012
I’ve capitalized this position with $200,000

At the lowest rate for June 2022 delivery since 2012

    • 99.8450, date 4 August 2020
    • 100.00 – 99.8450 = a rate of 0.1550%
    • Loss of 0.045, -$112.50 per contact,
    • Total Loss at the lowest rate for June 2022 delivery since June 2012 -$28,125.00.

If 3 month rates go to the 1934-2021 all-time low

    • 99.9900, date January 1940
    • 100.0000 – 99.9900 = a rate of 0.0100%
    • Loss 0.019 or $475 per contact
    • Total on my position at the 1934-2021 low -$118,750.00.

Realistic objective by June 2022

    • 98.80 by June 2022
    • 100.00 – 98.80 = a rate of 1.20%
    • Profit 1.00 or $2,500.00 per contact
    • Total on my position at 1.20% $500,000
    • If my objective is not achieved I’ll roll the position annually until it is

At the highest rate for June 2022 delivery since June 2012

    • 94.885, date 10 September 2013
    • 100.00 – 94.885 = a rate of 5.115%
    • Profit 4.9150 or $12,287.50 per contact
    • Total on the position at the highest rate for June 2022 delivery $3,071,875.

My log-term objective over the next 2 to 4 years is to see 3 months rates move up to reported inflation currently at 5.40%, at 5.40% a 250 contact position will have a value of $3,375,000.

As this position appreciates I’ll be protecting gains using collar strategies with expirations timed shortly after each Fed meeting.

Why I’m in this trade, 3 month deposit rates currently pay 5.20% less than reported inflation (negative rate of return), current fundamentals tell us that U.S, inflation cannot be contained and will fuel rates higher.


Sources & Data Spreadsheet

Historical real and negative rates of return

1970 through 2007

    • Reported inflation averaged 4.71%
    • Average 3 month deposit rate 7.03%
    • Real rate of return 2.32% (rate paid above reported inflation)

From 2008 through 2021

    • Reported inflation averaged 1.98%
    • Average 3 month deposit rate 1.02%
    • Negative rate of return -0.97%  (rate paid below reported inflation)

October 2021

    • Reported inflation 5.40%
    • 3 month deposit rate 0.20%
    • Negative rate of return -5.20% (rate paid below reported inflation)

Fundamentals

By 2008 negative rates of return had collapsed demand for record amounts of new debt hitting the open market.


Sources & Data Spreadsheet

In 2008 the Federal Government had 2 choices

    • To protect the fiscal integrity of America, the U.S. dollar, U.S debt rating and quality of life of future generations by letting the institutions that caused the mortgage crisis fail, balancing the budget and dealing with the impact.
    • Have a print and spend party, clean out all the government Trust funds, steal as much as you can, lie about inflation, trash the dollar, the U’S.’s debt rating and fiscal futures of generations of Americans and, do it in the name of “economic stimulus”. 

__In 2008 politicians chose to have a print & spend party

From 2008 through 2019 (144 months)

    • Federal debt grew by 13.972 trillion from 8.86 trillion to 22.833 trillion
    • The Federal Reserve created 3.274 trillion dollars with keypunch entries
    • 13.972 trillion is more than 3 times the fiscal cost of World War II in 2021 USD
    • 13.972 trillion is more than the combined total debt of United Kingdom, Ireland, Australia, Mexico, China and Russia total population of these countries 1.816 billion, U.S., 331 million.

2020 through 21 October 2021 (last 22 months) print & spend party 2

    • Federal debt grew by 6.072 trillion from 22,833 trillion to 28.905 trillion
    • The Federal Reserve created 4.315 trillion dollars with keypunch entries
    • 6.072 trillion in new Federal debt over the last 22 months is 86 billion more than the combined debt of Brazil, Argentina, Mexico, Russia and India, population of these countries 1.918 billion, U.S. 331 million.
    • 6.072 trillion is more than 6 times the cost of FDR’s New Deal


Sources & Data Spreadsheet

Rational for shutting down the global economy, loss of personal freedom and increasing the Federal deficit by 6.072 trillion, a virus less lethal than obesity related illnesses.


Sources & Data Spreadsheet

U.S. debt versus other countries

Sources & Data Spreadsheet

Impact

Record deficit spending and the Fed’s creation of money caused the first U.S. debt downgrade in history by 2012,  as of 2012 11 countries had higher rated debt than the U.S. who then shared the same rating as Hong Kong and Finland.

With current spending and creation of money surpassing the 2008-2019 pace my peers and I expect U.S. debt to be downgraded prior to 2026. If our expectations are correct the U.S. debt rating will fall to A-, par with Japan, Latvia, Lithuania and Slovakia.

Should the Federal Government continue funding record deficit spending with created money at the current pace by 2026 the U.S debt market and dollar will collapse igniting a hyperinflationary Greater Depression.

Sources & data Spreadsheet

Greed, corruption and gross political incompetence during the 21st century has reduced annual Federal Revenue to a mere 11.16% of total federal debt, down from 35.98% at the end of 2000 and 28.69% in 2007.

1970 50.62%
1980 58.89%
1990 32.19%
2000 35.98%
2007 28.69%
2021 11.16%


Sources & Data Spreadsheet

An 11.16% annual Federal revenue to total Federal debt ratio makes it impossible for the U.S. to accurately report inflation, normalize interest rates or any increase in Federal expenses pegged to reported inflation such as Social Security, Medicare, Military and Civilian employee pensions.

Yes, the U.S is going to see the largest increase in Social Security beneficiary payments in 40 years (5.90% in 2022) but overall increases including the one on deck have not kept pace with true inflation, this increase does confirm inflation is here to stay or this 5.9% increase on in 2022 wouldn’t be happening.

The increase in Social Security payments also increases the shortfall in funds needed to meet beneficiary payments and pushes up the projected insolvency date for Social Security from 2035 to as early at 2030.

Military and Civilian employee pensions are also at risk of insolvency because the majority of all monies paid into all Governmental trusts and pensions by their beneficiaries has been borrowed out by the Federal Government, their liquidity replaced with “special issue non-marketable debt” that pays beneficiary Trusts noncompetitive rates. (Non-marketable = illiquid).


Sources & Data Spreadsheet

What it would take to replace the Federal Reserve

The Federal Reserve currently buys 54.04% of all new Federal debt, trillions more in mortgage backed securities all at noncompetitive rates using money they’ve create with keypunch entries, these purchases have artificially contained interest rates since 2008.



Sources & Data Spreadsheet

Reported inflation is now running at 5.40%, true inflation north of 7.00% trying to sell record amounts of new Treasury debt in the Free market with these stats will be next to impossible. 

    • The worst debt rating in history (same as Finland & Hong Kong)
    • Further debt downgrades are on deck
    • A greater than 4.00% negative rate of return,
    • Denominated in a currency the Federal Reserve creates by the trillions at will

It’s going to take an average Treasury rate north 6.00% to as high as 8.70% to attract buyers in the Free market to buy all the new Treasury debt hitting the market. (8.70% was the average Treasury rate from 1970 through 2007) anything south of 6.00% with reported inflation at 5.40% will require the Federal Reserve to keep the printing press on.

Rates and Real Rates of Return 2008-2021


Sources & Data Spreadsheet

Rates and Real Rates of Return 1970-2007


Sources & Data Spreadsheet

If Treasury rates did normalize to the 1970 – 2007 average of 8.70%, Federal Debt service cost would increase from 538 billion to 2.483 trillion consuming 69.35% of total Federal revenue.

Sources & Data Spreadsheet

Impact of lower rates on debt service cost

From 2008 – 2020 Federal debt increased by 200.33% yet annual Federal debt service cost increased by only 30.90%. The Fed pushing rates lower has reduced Federal debt service cost by more than 3 trillion dollars since 2008.

Total Federal debt in 2007, 8.950 trillion, annual debt service cost 411.32 billion
Total Federal debt in 2020, 26.880 trillion, annual debt service cost 538.45 billion


Sources & Data Spreadsheet

Another Round of Economic Stimulus?

During the “economic stimulus of the Obama-Biden administration Federal debt increased by 9.169 trillion from 8.950 trillion to 18.120 trillion up 102.44%, 9.169 trillion is 721.308 billion more than the combined total debt of China and Russia.

Obama-Biden administration’s idea of clean energy

Methane gas capture, cost of production, 7 cents per kilowatt-hour (kWh) or 10 times the cost of hydroelectric power; farmers also receive a 4 cent per kilowatt-hour credit.

2021 “Economic Stimulus” taxes farmers, it begins at $1,800 per ton of emissions in 2023, rising at 5 percent per year above inflation escalating production cost which will be passed onto the consumer.

FDR’s idea of clean energy, multiple hydroelectric dams, the Hoover dam was one built during the New Deal.

The Hoover dam’s construction employed thousands of workers and cost 49 million dollars  according the BLS.GOV this translates into 981 million in 2021. Now in its 86th year of operation it continues to control flooding, provide water and clean energy to millions in Arizona, southern California, and southern Nevada. The Hoover Dam generates on average 4 billion kilowatt-hours of hydroelectric power each year. The plant has a rated capacity of 2,998,000 horsepower. See this Seeking Alpha Article for more on the comparisons of Obama-Biden stimulus programs to FDR’s new deal, what they cost and what they produced.

The 981 million dollar cost of the Hoover dam in 2021 dollars equates to a little less than 3 hours of average Federal Deficit spending over the last 22 months.

Adding to the current debt crisis, the projected insolvency of Medicare between 2024 and 2026.  

Sources & Data Spreadsheet

Projected insolvency of Social Security between 2030 and 2035.


Sources & Data Spreadsheet

The next mortgage crisis

You can’t have a 30 year mortgage rate at 3.01% when inflation is 5.40% without massive ongoing intervention by the Federal Reserve.


Sources & Data Spreadsheet

Since 2008 the Federal Reserve has purchased 2.526 trillion in mortgage backed securities with created money.

1.141 of the 2.526 rillion in the last 22 months, if this intervention slows or subsides the 30 year fixed rate will move north of 5.00%. I see mortgage debt owned by the Federal Reserve escalating past 4 trillion by 2026.

To monitor the Federal Reserve’s purchases of mortgage debt see this Fed link.

Sources & Data Spreadsheet

Higher rates will fuel the mortgage delinquency rates higher from the current 2.49%. By 2026 I see the delinquency rate north of 5.00%.

To monitor the mortgage delinquency rate see this Fed link.


Sources & Data Spreadsheet

Foreign Held Treasury debt

Currently over 7.02 trillion of U.S. Federal debt is held by foreign entities, all have their finger on the sell trigger.

Ask yourself would you maintain your position in a debt instrument of this country or liquidate it?

    • The country’s annual Federal revenue is at 11.16% of total Federal debt
    • Reported inflation at 5.40%, true inflation north of 7.00%
    • Has guaranteed negative rate of return greater than 4.00%
    • Was falling in price (rates rise treasuries prices fall)
    • Ongoing obscene deficit spending
    • Zero ability to balance the budget
    • Zero ability the permanently cease the creation of money
    • This Government uses its central bank as a front to buy 54.04% of its own new debt using money created by its central bank.
    • Another mortgage crisis on deck
    • Facing insolvency of nearly every Government program by 2035
    • Wants to spend another 1.5 to 5 trillion after the last 60.888 trillion spent since 2008 didn’t produce anything more than a 19.917 trillion dollar bill for future generations of Americans to pay off.

When this Fed chart turns lower aggressive selling of U.S. dollars and debt will engage as foreign investors repatriate and reallocate funds to tangible assets, quality stocks and/or any of the 11 countries that have a higher debt rating than the U.S.

The buyer of last resort is already in play, the Federal Reserve will continue to create unprecedented amounts of money backed by nothing to try and cauterize the fiscal hemorrhages on horizon, creation of money = inflation.

Sources & Data Spreadsheet

There is no one to replace the Federal Reserve and the Federal Government can’t afford to raise rates high enough to make Treasury debt attractive enough for the Free market to voluntarily take over 100% of deficit funding.

In 2021 without the Federal Reserve creating trillions to buy the majority of all new Federal debt the Federal Government would be insolvent.

I see total money created by the Federal Reserve increasing from the current 8.56 trillion to more than 13 trillion by 2026. To monitor creation of money see this Fed chart.

Sources & Data Spreadsheet

Since 2008

    • 40.970 trillion in cumulative Federal Revenue
    • 60.888 trillion in cumulative Federal Spending
    • 19.917 trillion in new Federal debt
    • 7.590 trillion created by the Federal Reserve with keypunch entries
    • Cumulative median personal income 2008-2021 $684,478
    • Federal Revenue per employed person $277,670
    • Federal revenue as a percent of median income 40.69%
    • Federal spending per employed person $412,654
    • Federal spending as a percent of median income 60.46%
    • New Federal debt per employed person $134,985
    • Money created by the Federal Reserve per employed person $51,441


Sources & Data Spreadsheet

In 2021 every asset manager has to accept the fact reported inflation is fictional, for the hard numbers and supporting links see this Seeking Alpha report

The last round of “Economic Stimulus” is irrefutable proof politicians cannot be trusted with the American taxpayer’s checkbook or fiscal future. The article linked below explains in detail what was spent from 2008 through 2016 and what it produced, then compares it to what FDR spent in the 1930’s on the New Deal that softened the great Depression and fiscal cost of World War 2.

The only solution is a balanced budget and the U.S. returning its currency to being backed by a tangible asset.

Let the corrupt, incompetent, political dinosaurs deal with the consequences of the crisis they’ve created, let them to find the solutions rather than spending more and passing on the horrific cost of thier corruption to  future generations of Americans to pay off.

In 2021 we have the most extreme fundamentals I’ve seen in my 30 years as a professional trader, major market moves up and down are on deck creating unprecedented opportunity for those who are prepared and potential fiscal ruin for those who aren’t.

Other Seeking Alpha articles on fundamentals and rates.

If you have any questions, contact me.

Peter Knight
Voice & Video Chats.
Message me

 

 

Privacy Notice

Disclosure

Test For Kristyn 210930

Putting Barchart To Work For You
(like to make this a series)

Trading Exponential Moving Averages
(this would be one trading program in the series)

Sections in this report

1) Postion valuations on the settlement
2) Simplified trend qualification procedure
3) 2000-2021 performance by Individual market and links to track trades
4) Setting up with Barchart to monitor intra-day performance for any EMA allocation.
5) Top allocations that trade using Exponential Moving Averages (EMAs)
6) Creating your own EMA portfolio

It would be great if I could drop in a live feed enabling us to load trades as they occurred and readers to monitor performance updated every 15 minutes. if this isn’t possible I’d like to purchase a feed monthly enabling me to drop the portfolio into a WordPress site, please get back to me on cost.

Position valuations on the settlement 29 September 2021

1) Simplified Trend Qualification Procedure

Open the 2 month barchart 3rd column
When price action is above the EMA9 red and the EMA9 is above EMA18 blue trade long.
When price action is below the EMA9 red and the EMA9 is below EMA18 blue trade short.
When it’s close we use the green EMA 4.5, EMA9 and the opinion (4th column) for confirmation

2) 2000-2021 performance by market and links to generate trades

January 2000 – August 2021 performance by EMA market traded
Using this spreadsheet you can create a 2000-2021 allocation for any combination of the markets below
Spreadsheets, daily trades, data, charts
 Candle
Stick Chart
 Bar Chart
 15 M Chart
 O
 Margin Requirement
 Net Per Contract Maximum Drawdown Last 12 Months
Stock Indices
ES SP 500 Mini ES ES ES
 O
 $12,650 $301,580 ($12,882) $42,952
ET SP 500 Micro ET ET ET O
 $1,265 $22,612 ($2,594) $4,014
NQ Nasdaq 100 NQ NQ NQ
 O
 $18,700 $399,001 ($20,668) $47,021
NQ Nasdaq 100 Micro NM NM NQ O
 $1,870 $32,613 ($3,104) $4,259
Metals
GC Gold 100 Ounces GC GC GC
 O
 $9,900 $377,067 ($20,857) $1,291
QO Gold 50 Ounces QO QO QO O
 $4,950 $184,185 ($11,213) $372
GR Gold 10 Ounces GR GR GR O
 $990 $29,880 ($2,461) ($362)
SI Silver 5000 Ounces SI SI SI
 O
 $5,000 $529,894 ($48,503) $6,069
QI Silver 2500 Ounces QI QI QI O
 $2,500 $260,891 ($24,291) $2,859
SO Silver 1000 Ounces SO SO SO O
 $1,000 $99,489 ($9,837) $933
Currencies
A6 100,000 AUD A6 A6 A6
 O
 $1,760 $188,534 ($14,039) $6,152
MG-10,000 AUD MG MG MG
 O
 $200 $11,904 ($1,966) $370
D6 100,000 CAD D6 D6 D6
 O
 $1,210 $105,822 ($11,077) $4,893
S6 125,000 CHF S6 S6 S6 O
 $3,630 $188,879 ($13,332) $467
WN 12,500 CHF WN WN WN O
 $363 $10,183 ($1,967) ($550)
E6 125,000 EUR E6 E6 E6 O
 $2,420 $290,355 ($19,570) $693
E7 62,500 EUR E7 E7 E7 O
 $1,210 $140,615 ($9,940) $112
MF 12,500 EUR MF MF MF O
 $242 $21,352 ($2,323) ($351)
B6 62,500 GBP B6 B6 B6 O
 $2,365 $142,404 ($16,663) $6,177
J6 12,500,000 JPY J6 J6 J6 O
 $2,255 $254,380 ($8,750) $2,451
J7 6,250,000 JPY J7 J7 J7 O
 $1,127 $122,471 ($4,383) $991
WM-1,250,000 JPY WM WM WM O
 $363 $16,944 ($1,405) ($176)
DX 100,000 D-Index DX DX DX O
 $2,090 $200,605 ($5,760) $3,083
BT 5 Bitcoin BT BT BT O
 $76,375 $506,302 ($28,404) $340,724
Energy
CL Crude 1000 Barrel CL
 CL
 CL O $5,675
 $536,412 ($18,783) $24,179
QM Crude 500 Barrel QM
 QM
 QM O $2,850
 $264,267 ($9,528) $11,914
CY Crude 100 Barrel CY
 CY
 CY O $575
 $46,551 ($2,124) $2,102
Create An Allocation Track Your Allocation Forward Allocation Studies
About ATAs Defining ATA Account Risk Risk Disclosure

3) Setting up with Barchart to track trades for you allocation intra-day.

Open this page then click on sign up

Click on get free (it never expires)

Enter your name, email, pick a password, create a free account, (no additional information is required).

 login to your Barchart account, under my account click on portfolio

Click on new portfolio

Name the portfolio

Click on create

Add markets traded to your EMA portfolio

Enter the contract code

Enter date, price, quantity of contracts traded, then apply

Once you’ve built out your allocation prices and performance are updated every 15 minutes.

1)_Today’s total profit or loss
2) Total open trade equity
3) Total profit or loss
4) Current contract price
5) Today’s P&L per market
6) Total P&L per market

To offset any positions click on edit

Enter the offset price, then apply

What you’ll see

1)_Shows net profit or loss
2) Shows the position has been liquidated
3) The offset position’s profit or loss is added to closed P&L.

To organize the portfolio click on edit

Clicking on the arrow or dragging the trade moves the position

When finished hit save

Portfolio performance is updated every 15 minutes.

5) Top allocations that trade using Exponential Moving Averages (EMAs)

EMA Performance January 2000 through August 2021
Trading one unit, net of all spreads and commissions, no compounding and withdrawing all profits annually
Allocation pages provide full disclosure of trading methodology, all trades & data enabling performance verification
Trading one unit, net of all costs, no compounding and withdrawing all profits annually
Allocation Spreadsheet
 Minimum (USD) Net Profit 2000-2021 Drawdown Best Year Worst Year Annual Average Last 12 Months
32586942 $500,000 $10,103,970 ($111,161) $1,005,272 $209,300 $453,273 $909,835
9314318 $250,000 $5,093,302 ($50,599) $612,171 $84,880 $227,168 $558,797
All Markets $250,000
 $3,918,685
 ($77,725)
 $484,528
 $73,547
 $173,680
 $481,520
944278 $200,000 $4,042,349 ($45,222) $488,310 $67,629 $183,388 $215,022
9981614 $150,000 $3,925,072 ($58,298) $259,387 $84,360 $178,563 $172,350
7747141 $150,000 $3,343,705 ($41,211) $350,272 $67,256 $152,023 $155,546
5891142 $150,000 $2,573,366 ($39,910) $332,345 $54,702 $112,606 $437,046
6733212 $100,000 $2,467,594 ($31,451) $263,330 $49,976 $112,152 $112,518
7348775 $100,000 $2,736,582 ($40,662) $285,664 $44,254 $124,519 $122,384
1241523 $75,000 $1,654,314 ($34,376) $180,644 $34,902 $75,725 $58,654
8747196 $75,000 $1,555,795 ($23,239) $206,364 $28,215 $70,923 $65,176
1030710 $60,000 $1,613,969 ($22,047) $130,233 $19,872 $73,413 $75,004
9626236 $50,000 $1,212,946 ($24,566) $165,436 $28,613 $55,103 $63,838
25720010 $50,000 $937,779 ($12,444) $140,452 $11,013 $42,096 $80,758
7798523 $30,000 $850,545 ($12,567) $108,231 $15,914 $38,940 $28,783
5699710 $25,000 $556,996 ($8,080) $67,078 $11,123 $25,109 $45,259
Micro-D $25,000 $544,441 ($9,572) $68,293 $12,468 $24,629 $37,087
8877101 $25,000 $478,592 ($8,522) $66,917 $10,213 $21,634 $32,423
4119881 $25,000 $431,667 ($6,454) $55,639 $10,072 $19,479 $33,076

6) Using this spreadsheet you can create any allocation of the EMA markets below. Enter your start balance in cell H19, number of contacts traded for each market in cells I19 – I44, 2000-2021 annual performance shows in cells D19-D43, monthly performance column F, maximum drawdown H-21.

Allocation studies
Top 50,000 Combinations of mini and full size contacts
Top 100,000 combintions of mini and micro contacts

 

 

 

Create Your Own Allocation

1) Using this spreadsheet you can create any allocation of the 24 ATA trading models and instantly review 2019-2026 daily, monthly and annual performance.

1.1) Current positions, today’s stops, reversals, objectives
1.2) 2019-2026 monthly & annual performance
1.3) 2019-2026 daily performance
1.4) Disclosure of strategy, all data, orders & trades 2019-2026 
1.5) Top 50 allocations 25K to 500K
1.6) Top 100,000 allocation summaries trading 1 lots
1.7) Top 200,000 allocations trading micros & minis  
1.8) How to create your own allocation
1.9) Register for information on other top programs

2) Disclosure of trading methodology by market and model, daily historical data, every order generated, every trade entry, offset, net profit or loss, trade-by-trade cumulative profit and drawdown

Individual Markets & Models Traded Net  Per  Contract Net Last 12  Months Max
Draw		 Risk Tolerance Specs & Quotes
ESN011 Mini S&P $302,925 $69,700 -$31,150 -$54,513 ESN
ESM004 Micro S&P $16,253 $4,990 -$4,791 -$8,385 ESM
NQN002 NASDAQ 100 $456,990 $88,650 -$33,375 -$58,406 NQN
NQM008 Micro NASDAQ $39,174 $8,010 -$3,698 -$6,471 NQM
YMN0016 Dow Jones $226,970 $50,130 -$18,315 -$32,051 YMN
YMM015 Micro Dow $16,215 $4,353 -$2,362 -$4,133 YMM
GC1005 Gold 100  $297,612 $120,168 -$27,771 -$48,599 GC1
GC2014 Gold 50  $156,607 $79,914 -$14,128 -$24,724 GC2
GC3010 Gold 10  $21,059 $3,503 -$2,479 -$4,337 GC3
SI1002 Silver 5000 $578,590 $133,615 -$33,615 -$58,826 SI1
SI2005 Silver 2500 $357,708 $193,685 -$16,535 -$28,936 SI2
SI3005 Silver 1000 $117,463 $73,484 -$8,114 -$14,199 SI3
HG1005 Copper 25K $146,525 $17,482 -$14,853 -$25,992 HG1
HG2001 Copper 12.5K $63,551 $5,515 -$7,701 -$13,477 HG2
PLA008 Platinum 50 $112,062 $13,482 -$10,832 -$18,956 PLA
CL1012 Crude 1000 $204,040 $24,260 -$16,990 -$29,733 CL1
CL2010 Crude 500 $96,170 $11,180 -$8,700 -$15,225 CL2
RBN005 Gas 42K  $206,882 $32,986 -$15,290 -$26,757 RBN
BTC022 Bitcoin (0.10) $25,576 $7,840 -$3,038 -$5,317 BTC
J6N012 Yen $65,313 $6,575 -$9,944 -$17,402 J6N
DXX016 Dollar Index $28,857 $4,740 -$5,536 -$9,687 DXX
S6N003 Swiss $87,281 $21,925 -$9,325 -$16,319 S6N
E6N015 Euro $68,713 $15,525 -$6,944 -$12,152 E6N
E7M008 Mini Euro $31,706 $7,238 -$3,772 -$6,601 E7N
Disclosure

3) What we do, my team researches Hedge Funds, CTAs, objective long/short trading programs and provides access to top the performers through the safest and most capable firms worldwide. All objective trading programs are fully automated through our platform on ChartVPS using CQG integrated client linked to multiple exchange members worldwide

4) How it works, you decide on an allocation or markets and number of contacts you want traded, My team places all orders and monitors all trades 24 hours a day.

5) Defining your overall account risk, but it should be realistic, in 2024 with the benefit of hindsight, diversification and optimization a capable analyst with access to 6,200 hedge funds, CTA’s and trading programs could optimize performance and produce an allocation where there are no losing quarters over a 20 year period.

6) Our fee structure is based on 5.00% to 12.50% of net new high profits quarterly (depends on start balance)

7) How balances are guaranteed plus or minus trading activity

Every firm we use segregates customer accounts, balances are guaranteed plus or minus trading activity by the Financial Safeguard System the FSS has protected customer balances for over 100 years with zero defaults, unlike SPIC that protects balances up to 500,000 or FDICup to 250,000 the FSS has no limit.

7.01) Financial Safeguards
7.02) Financial Safeguards Brochure
7.03) Financial Surveillance Programs
7.04) Financial and Regulatory Surveillance
7.05) Customer and Market Protections
7.06) Quick Facts on Margins
7.07) Financial Safeguards .pdf
7.08) Understanding Margin Changes
7.09) CME clearing Firms
7.10) Principles for Financial Market Infrastructures Disclosure
7.11) Risk Management
7.12) Clearing Risk Management
7.13) Clearing Membership Requirements
7.14) Policies that require increased financial and operational resources
7.15) Additional reports on the Financial Safeguard System

8) To open an account  please complete this form my team will match your criteria to a brokerage firm on this list that can accommodate the markets, programs you want to trade and your regulatory jurisdiction.

9) Educational videos and resources

9.01 Futures General Information
9.02 Options General Information
9.03 Stock Index Futures
9.04 Interest Rate Futures
9.05 Metals Futures
9.06 Energy Futures
9.07 Currency Futures
9.08 CME Learning Center
9.09 Futures Fundamentals
9.10 Education Material
9.11 Resource Center
9.12 Research Reports
9.13 Podcasts
9.14 Monthly FX Review
9.15 Media Room
9.16 Economic reports & data

If you have any questions, contact me.

Peter Knight
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Disclosure

 

Inflation – Perception versus Reality 

Perception

From 1970 to 2020 personal Income, stocks, home prices, precious metals, GDP, Federal revenue per capita and per employed person all outperformed reported inflation.

1970-2020 average annual reported inflation 4.03%

Average annual growth in personal income 5.51%
Average increase in median home prices 5.25%
Average increase in the S&P 500 8.63%
Average increase in Gold 9.81%
Average increase in Federal revenue per capita 4.99%
Average increase in Federal revenue per employed person 4.53%
Average annual growth in GDP per capita 5.14%
Average annual growth in the GDP per employed person 4.70%

Personal income outperformed inflation by 100.72%

5.51% 1970-2020, average annual growth in personal income
1.48% average annual growth above reported inflation
$29,714 what personal income would be in 2020 if pegged to inflation
$59,642 actual personal income in 2020
$29,928 overall growth in annual personal income above inflation


Sources & Data

Median home prices outperformed inflation by 74.88%

5.25% 1970-2020 average annual appreciation
1.22% average appreciation above inflation
$192,671 what median home prices would be in 2020 if pegged to inflation
$336,950 actual median home price in 2020
$144,279 overall appreciation in median home prices above inflation
x


The S&P 500 outperformed inflation by 432.48%

8.63% 1970-2020 average annual appreciation
4.83% average appreciation above inflation
705.40 what the S&P 500 would be in 2020 if pegged to inflation
3,756.10 actual price for the S&P in 2020
3,050.70 overall appreciation of the S&P 500 above inflation
x

Sources & Data

Gold outperformed inflation by 462.54%

9.81% 1970-2020 average annual appreciation
5.78% average appreciation above inflation
$315 what the price of gold would be in 2020 if pegged to inflation
$1,772 actual price of gold in 2020
$1,457 overall appreciation of gold above inflation
x

Sources & Data

Federal revenue per capita outperformed inflation by 44.13%

4.99% 1970-2020 average annual growth in Federal revenue per capita
0.96% average appreciation above inflation
$7,160 what Federal revenue would be per capita if pegged to inflation
$10,320 actual Federal revenue per capita in 2020
4.03% 1970-2021 average annual reported inflation

Federal revenue per employed person by 20.43%

4.53% 1970-2020 average annual growth in Federal revenue per employed person
0.50% average appreciation above inflation
$20,093 what Federal revenue would be per employed person if pegged to inflation
$24,197 actual Federal revenue per employed person in 2020

x

GDP per capita outperformed inflation by 67.16%

5.14% 1970-2020 average annual growth in GDP per capita
1.11% average growth above inflation
$38,551 what GDP per capita would be if pegged to inflation
$64,443 actual GDP per capita in 2020

GDP per employed person by 49.33%

4.70% 1970-2020average annual growth in GDP per employed person
0.67% average growth above inflation
$101,190 what GDP per employed person would be if pegged to inflation
$151,103 actual GDP per employed person in 2020

Sources & Data

In 2021 the U.S. has a higher percentage of the U.S population working and paying taxes than 36 out of the last 52 years.

44.23% of U.S. population is employed in 2021
2.25% from its 52 year high of 46.79% set in 2000
2.16% higher than the 52 year average 42.07%
9.88% higher than the 52 year low of 34.35% set in 1971

Sources & Data

Perception

With these glowing fundamentals you’d expect quality of life for U.S. citizens to be at or near an all time high, that the Federal Government would be running budget surpluses, paying down debt and working hard towards restoring their fiscal credibility and their AAA debt rating.

Reality

From 1970 to 2021 Federal debt increased by 28.16 trillion
Federal debt as a percent of GDP increased from 35.49% to 125.77%
Federal debt per capita, from $1,879 to $86,025
Federal debt per employed person from $5,365 to $195,836
Federal Spending per employed person, from $2,929 to $53,210
9.1 trillion dollars in Federal Reserve bailouts, 8.2 trillion since 2008
2 debt downgrades caused by record deficit spending and the creation of trillions to fund it.
Borrowing out all monies paid into Social Security by issuing non marketable debt which has helped expedite its projected insolvency date to as early as 2028.
Borrowing the monies paid into Military and Civilian Employee Trusts by issuing non marketable debt which could jeopardize fair retirement income for beneficiaries.
Mismanaging Medicare pushing up it’s projected insolvency date to 2026
All in, Government had piled on 154.473 trillion in unfunded liabilities

Federal spending per capita from 1970 to 2021 outpaced inflation by 228.46%

6.88% average annual growth in Federal spending per capita
2.85% average growth above inflation
$23,406 actual Federal spending per capita in 2020
$7,242 what per capita Federal spending would be in 2020 if pegged to inflation

Federal spending per employed person outpaced inflation by 158.58%

6.49% 1970-2020 average annual growth in Federal spending per employed person
2.46% average growth above inflation
$53,547 actual Federal spending per capita in 2020
$20,705 what per employed person Federal spending would be in 2020 if pegged to inflation


Sources & Data

Average annual Federal spending above reported inflation.

Per Capita
1970-2007 1.77%
2008-2019 1.87%
2008-2020 6.40%
1970-2020 2.95%

Per employed person
1970-2007 1.04%
2008-2019 1.89%
2008-2020 7.25%
1970-2020 2.62%


Sources & Data

In 2020-2021 Federal spending per employed person is equivalent to 87.09% of median personal income.


Sources & Data

Increases in Debt to GDP from 1900 through 2021

1900 to 2006, from 10.29% to 35.49%
1970 to 2007, from 35.49% to 61.93%
2008 to 2021 from, 61.93% to 125.77%
1939, 43.30% (end of the Great Depression)
1946, 119.12% (end of World War 2)
High, 2020, 129.19%
1900-1970 Average, 38.97%
1970-2007 Average, 42.17%
2008-2021 Average, 100.53%
Low, 1907 7.19%


Sources & Data

Increases in Federal debt per capita

1970-2021 actual increase in Federal debt per capita, $1,879 to $86,025, +4,478.23%
1970-2021 if pegged to reported inflation, $1,879 to $13,206, +602.63%
2008-2021 actual per capita increase in Federal debt, $29,998 to $86,025, +186.77%
2008-2021 if pegged to reported inflation $10,036 to $13,206, +31.58%
2020-2021 actual per capita increase in Federal debt, from $69,392 to $86,025, +23.97%
2020-2021 if pegged to reported inflation $12,374 to $13,206, +6.72%

Increases in Federal debt per employed person

1970-2021 actual increase per employed person $5,365 to $195,836, +3,691.59%
1970-2021 if pegged to reported inflation $5,365 to $37,693, +602.63%
2008-2021 actual increase per employed person, $64,871 to $195,836, +201.89%
2008-2021 if pegged to reported inflation, $28,645 to $37,693, +31.58%
2020-2021 actual increase per employed person. $150,228 to $195,836, +30.36%
2020-2021 if pegged to reported inflation. $35,420 to $37,693, +6.41%


Sources & Data

U.S. debt compared to other countries

1970-2020, 28.17 trillion in new Federal debt, this is more than the total debt of the United Kingdom, Italy, France, Germany, Australia, Canada, Mexico, Russia, China, Taiwan and India combined, total population of these countries 3.468 billion, U.S. population 332 million.

Since 2008, 19.60 trillion in new Federal debt, more than the total debt of the United Kingdom, Canada, Australia, Switzerland, Greece, Turkey, Taiwan, China, Russia, India, Argentina, Mexico and Nigeria combined, total population of these countries 3.587 billion.

Fed Bailouts since 2008 8.26 trillion, more than the total debt of China, population 1.442 billion.

16 months, 5.88 trillion in new Federal debt, 304 billion more than the combined total debt of the United Kingdom and Canada.


Sources & Data

Impact of record deficit spending and the creation of money to fund it

2 Federal debt downgrades, in 2021 the United States has the worst debt rating in history, 11 countries are now rated higher.

Country/Region Rating Outlook Date
Canada AAA Stable 2002-07-29
Denmark AAA Stable 2001-02-27
Germany AAA Stable 2012-01-13
Liechtenstein AAA Stable 2016-02-26
Luxembourg AAA Stable 2013-01-14
Netherlands AAA Stable 2015-11-20
Norway AAA Stable 1990-11-08
Singapore AAA Stable 1995-03-06
Sweden AAA Stable 2004-02-16
Switzerland AAA Stable 1989-06-26
Australia AAA Stable 2020-10-20
Austria AA+ Stable 2013-01-29
Finland AA+ Stable 2016-09-16
Hong Kong AA+ Stable 2017-09-22
United States AA+ Stable 2013-06-10

Debt to GDP by country


Sources & Data

Federal Reserve bailouts

1913-2007, 94 years
Formation of the Federal Reserve 1913
Total Federal Reserve bailouts 890.66 billion

2008-2019, 11 years
Total new debt Federal 13.719 trillion
Total money created by the Federal Reserve 3.275 trillion
Federal Reserve profits forfeited to the U.S. Treasury 892 billion
Total Federal Reserve bailouts, 4.167 trillion

2020-2021, last 16 months
Total new federal debt 5.881 trillion
Total money created by the Federal Reserve 4.036 trillion
Federal Reserve profits forfeited to the U.S. Treasury 144 billion
Total Federal Reserve bailouts, 4.180 trillion


Sources & Data

In addition to the bailouts from 1998 to 2020 the Federal Reserve forfeited 1.242 trillion in operating profits to the U.S. Treasury, 142.49 billion more than total Federal debt in 1982.


Sources & Data

Since 2008 the U.S. has cranked up 19.3 trillion in in new Federal debt and required the Federal Reserve to create over 8 trillion with keypunch entries for bailouts in the real world this would be inflationary

In the world of government inflation magically disappeared until May of this year

1970 to 2007 average Treasury rate 8.70% paying 3.99% more than reported inflation
2008 to 2020 average Treasury rate 2.67% paying 0.94% more than reported inflation
2021 average Treasury rate 2.01% paying 3.39% less than reported inflation
Reported inflation over the last 12 months 5.40%
1970 through 2021 average annual inflation 4.03%


Sources & Data

What the BLS tells us a 1939, 1946 and 1980 dollar is worth today.

In 1980 total Federal was 863.45 billion closing in on 1.00 trillion dollars, citizens panicked, gold rallied to $850 an ounce and interest rates spiked above of 15%.

The BLS translates 863.45 billion in 1980 into 3.015 trillion in 2021 dollars, 2.865 trillion less than new Federal debt in the last 16 months

Cost of the New Deal 1933-1939

Total cost of the New Deal from 1933 to 1939, 41.70 billion (1939 dollars)
The BLS translates this into 809.27 billion in 2021 dollars .

Total cost of the New Deal in gold 1.226 million ounces
Cost of the New Deal in 2021 if pegged to gold 2.207 trillion dollars

What the New Deal did for 809.27 billion BLS 2021 dollars

    • Job training for 8.5 million unskilled men to learn a new professions as they carried out public works infrastructure projects.
    • Built or modernized more than 55,000 civilian and military buildings.
    • Built 32 naval vessels, many played key roles during World War 2.
    • Built 4,026 new schools, the majority are still open today.
    • Built 130 new hospitals, including Fitzsimons , Allegheny General & Jersey City
    • 29,000 new bridges & tunnels including Lincoln,Throgs Neck and Golden Gate.
    • Scores of Dams including Hover & Shasta, the majority still produce power today
    • Built or modernized over 180,000 miles of highways including the Los Angeles Freeway, the Overseas Highway(107 miles) connecting Key West to the mainland
    • Built or modernized more than 150 airports including La Guardia and Midway.
    • Built or modernized nearly 9,000 miles of storm drains and sewer lines.

New Deal Programs provided more than Infrastructure.

    • The laborers of the New Deal programs worked in schools serving more than 900 million hot lunches to hungry children during the depression.
    • Operated 1,500 nurseries enabling childcare so parents could work.
    • Funded over 225,000 concerts and thousands of plays.
    • New Deal cultural programs produced more than half a million works of art including Jackson Pollock’s 17A which sold for 200 million in 2016.
    • The New Deal Writers’ program featured works from soon-to-be famous Authors like John Steinbeck, Steinbeck went on to win the Pulitzer Prize in 1940 for his novel The Grapes of Wrath.

Either President Roosevelt really knew how to stretch a buck in the 1930’s or BLS.GOV inflation is fictional.

Fiscal cost of World War 2

Total U.S. fiscal cost 291.18 billion in 1946 dollars.
The BLS.GOV translates this into 4.347 trillion in 2021 dollars

4.347 trillion is 59.59% of what the Federal Government spent in 2020,
97.35% of what the Federal Government spent in 2019.

The U.S.’s fiscal cost of World War 2 in gold, 131.662 million ounces
Cost of the WW 2 if pegged to gold 15.088 trillion 2021 dollars

Spending and new debt during last “crisis” and “recovery”, 2008-2019

47.689 trillion total Federal Spending (all in)
5,892.84% the total cost of New Deal
1,097.06% the total fiscal cost of World War 2

13.718 trillion total New Federal Debt
1,695.11% the total cost of the New Deal
315.57% the total fiscal cost of World War 2


Sources & Data

Spending and new debt during the Covid crisis 2020-2021

11.312 trillion in Federal Spending (all in)
5.88 trillion in New Federal Debt
Data on pre Covid causes of death & Covid causes of death

BLS inflation calculations tell us that in the last 16 months new Federal debt grew by 724 billion more than the combined fiscal cost of the New Deal and World War 2 (5,156 trillion)

Annual Federal Revenue is now a mere 11.16% of total Federal debt.

1970 50.62%
1980 58.89%
1990 32.19%
2000 35.98%
2007 28.69%
2021 11.16%


Sources & Data

Impact

An 11.16% annual revenue to total debt ratio makes it impossible for the U.S. to accurately report inflation, normalize interest rates or increases in any Federal expense that’s pegged to reported inflation such as Social Security, Medicare, Military or Civilian employee pensions.

If Treasury rates normalized to the 1970 – 2008 average of 8.70%, 68% of all Federal revenue would be consumed by debt service cost alone.

Accurate increases in Medicare would push it’s insolvency date closer than the projected 2026, Social Security before the projected 2028 to 2035.

Under reporting inflation contains the majority of all Federal costs

From 2008 to 2021 Federal debt increased by 200.00% yet annual debt service cost increased by only 30.91%.

Total Federal debt in 2007 8.950 trillion, annual debt service cost 411.32 billion
Total Federal debt in 2020 26.880 trillion, annual debt service cost 538.45 billion


Sources & Data

How the U.S. reports budget deficits, the poverty and homeless rates have further eroded U.S. fiscal credibility.

1970-2020 cumulative reported budget deficits $17.857 trillion, cumulative increase in Federal debt $26,515 trillion. According to U.S. politicians the 8.658 trillion doesn’t count because they’re mandatory expenses and they don’t et to vote on them.


Sources & Data

Difference between reported deficits and increase in total Federal debt

1970 to 2007 4.021 trillion,
2008 to 2020 4.637 trillion.

U.S poverty rate

The Federal Government has contained the official poverty rate and all subsides linked to the poverty rate by lowering what the poverty rate is.

In 1970 if your income was less than 49.60% of median personal income you were below the poverty threshold and qualified for government assistance.
In 2020 your income needed to be below 21.70% of median personal income to be below the poverty threshold and qualify for government assistance.


Sources & Data

Homeless rate

By redefining who’s homeless the Department of Housing and Urban development has reduced the official homeless rate between 2005 and 20920 by 173,691 people.

Sources & Data

In 2021 Federal Debt as a percentage of GDP is the worst in history


Sources & Data

Regulation, taxation and litigation have destroyed U.S. manufacturing and eliminated over 20 million jobs.


Sources & Data

The resulting trade deficits have eliminated 13.95 trillion in domestic wealth, 7.652 trillion since 2008.


Supporting Links & Data

Foreign held Treasury debt now impedes the U.S.’s ability to negotiate fair trade

If the 7.012 trillion in foreign held Treasury debt hits the market for any reason it will create an unprecedented financial crisis, unprecedented dollar sales by foreign investors and additional dollar devaluation fueled by the Federal Reserve’s creation of trillions of dollars trying to support the Treasury market and dollar, hyper inflation will engage.

Sources & Data

In 2021 without ongoing Fed intervention the U.S would be insolvent

Since 2008 the Fed’s created over over 8 trillion dollars with keypunch entries to buy debt at non competitive rates the free market wouldn’t. In the last 16 months the Federal Reserve bought more Treasury debt than the previous 50 years.

2020-2021 last 16 months
Federal debt purchased by the Federal Reserve 2.764 trillion
Increase in Federal debt 5.881 trillion
Domestically purchased Federal debt 2.694 trillion
Debt purchased by foreign investors 311.5 billion
Non marketable debt held by Federal agencies & Trusts 111.8 billion

1970-2019 previous 50 years
Federal debt purchased by the Federal Reserve 2.637 trillion
Increase in Federal debt 22.289 trillion
Domestically purchased Federal debt 7.301 trillion
Debt purchased by foreign investors 6.716 trillion
Non marketable debt held by Federal agencies & Trusts 6.01 trillion


Sources & Data

Percent ownership of total Federal Debt

2020
Domestic, publicly held Federal debt 35.01%
Federal debt held by foreign investors 24.62%
Non marketable Federal debt held by Federal Agencies & Trusts 21.46%
Federal debt held by the Federal Reserve 18.92%

1970
Domestic publicly held Federal debt 79.58%
Federal debt held by foreign investors 4.12%
Non marketable Federal debt held by Federal Agencies & Trusts 0.00%
Held by the Federal Reserve 16.30%


Sources & Data

Income assets and spending in ounces of gold

Personal income in ounces of gold 1981-2021

Gold +36.46%, from 24.67 to 33.66, +8.99 ounces
Dollars +426.59%, from $11,326 to $59,642, +$48,316

2020 33.46 ounces
1981 24.67 ounces
1981-2021 annual average 55.33 ounces
High 2001 117.29 ounces
Low 1981 24.67 ounces


Sources & Data

Increase in Median home prices

Gold +1.28%, from 183.32 to 185.67 ounces, +2.24 ounces
Dollars +388.69%, from $68,950 to $336,950, +$268,000

2020 185.67 ounces
1981 183.32 ounces
1981-2021 average 312.01 ounces
High 2000 617.83 ounces
Low 2011 134.10 ounces


Sources & Data

S&P 500 futures contract

Gold +721.69%, from 14.78 to 121.47ounces, +106.69 ounces
Dollars +3,147.64, from $6,788 to $220,450 +$213,662

2020 185.67 ounces
1981 183.32 ounces
1981-2021 average 312.01 ounces
High 2000 617.83 ounces
Low 2011 134.10 ounces

Sources & Data

 GDP per employed person in gold

Gold +8.96%, from 78.27 to 85.28 ounces, +5.23 ounces
Dollars +320.45%, from $35,937.56 to $151.102.75, +$115,165.18

2020 85.28 ounces
1981 78.27 ounces
1981-2020 average 153.27 ounces
High 2001 297.62 ounces
Low 2012 73.07 ounces

Per capita

Gold +16.80%, from 31.14 to 36.37 ounces, +5.23 ounces
Dollars +350.72%, from $14,297.62 to $64,443.08 +$50,145.46

2020 36.37 ounces
1981 31.14 ounces
1981-2020 average 67.64
High 2001 137.94 ounces
Low 2011 31.14 ounces

Sources & Data

Federal revenue per employed person in gold

Gold -7.34%, from 14.74 to 13.66 ounces, -1.08 ounces
Dollars +257.58, from $6,766.66 to $24,196.85, +$17,429.94

2020 13.66 ounces
1981 14.74 ounces
1981-2020 average 27.13 ounces
High 1999 56.20 ounces

Per capita

Gold -0.67%, from 5.86 to 5.82 ounces, -0.04 ounces
Dollars, +283.32%, From $2,692.19 to $10,319.60, +7,627.14

2020 5.82 ounces
1981 5.86 ounces
1981-2020 average 11.98
High 1999 26.03 ounces
Low 2011 5.00 ounces


Sources & Data

Federal spending per employed person in gold

Gold +85.26% from 16.34 to 30.28 ounces, +13.93 ounces
Dollars +614.91% from $7,504 to $53,647, +46,143

2020 30.28 ounces
1981 16.34 ounces
1981-2020 average 32.86
High 2001 59.53 ounces
Low 1981 16.34 ounces

Per capita

Gold +100.86% from 6.50 to 13.06 ounces, +6.56 ounces
Dollars, +675.08% from $2,985 to $23,140, +20,154

2020 13.06 ounces
1981 6.50 ounces
1981-2021 average 14.48
High 2001 27.59 ounces
Low 1981 6.50 ounces

Sources & Data

Federal debt per employed person in gold

Gold +349.38%, from 23.73 to 106.65 ounces, +82.92 ounces
Dollars +1,634.08%, from $10,897 to $188,966, +178,069 

2020 106.65 ounces
1981 23.73 ounces
1981-2020 average 97.51
High 2001 161.09 ounces
Low 1981 23.73 ounces

Per capita

Gold +387.20%, from 9.44 to 46.00 ounces, +36.56 ounces
Dollars, +1,780.03%, from $4,335 to $81,507, +77,172

2020 46.00 ounces
1981 9.44 ounces
1981-2020 average 43.17
High 2001 74.66 ounces
Low 1981 9.44 ounces


Sources & Data

What could clean up this mess?

Fiscally responsible politicians on both sides of the isle
Giving up on trying to spend out of every crisis, 28.5 trillion in new debt proves it doesn’t work
Balanced budgets and paying down debt to minimize the damage to future generations
Effective regulations rather than regulations that foment fines & litigation
Bring companies back to the US by hiking tariffs rather than taxes
Trade surpluses rather than trade deficits,
Transparency in Federal revenue and expenditures that’s easy to understand and follow
Citizens joining Patrick Henry’s united we stand divided we fall party rather than being pawns of Julius Caesar’s divide and conquer.
Have a government that was afraid of voters rather than voters being afraid of government

What’s more likely to happen

Annual Federal Revenue is now a 11.16% of total Federal debt, this ratio makes it impossible for Federal government to raise interest rates high enough to attract enough buyers to finance the ongoing record deficit spending.


Sources & Data

For the U.S to remain solvent the Federal Reserve has to continue creating trillions of dollars with keypunch entries to buy all the debt the free market won’t.

We see total Fed created money increasing from 8.24 to 13.53 trillion by the end of 2026
Treasury debt owned by the Federal Reserve increasing from 5.30 to 8.66 trillion
Other debt owned by the Federal Reserve increasing from 2.898 to 4.689 trillion

This Fed link to monitor the creation of money
This Fed link to monitor Treasury debt owned by the Federal Reserve


Sources & Data

Record spending plus the creation of money to fund it equals inflation

Our estimate puts average annual BLS reported inflation above 4.50% through 2026.
Actual inflation averaging more than 5.25%.
Shadow Stats puts the average above 7.50%.


Sources & Data

Dollar devaluation and negative rates of return are here to stay.


Sources & Data

    • Inflation and debt monetization have fully engaged
    • Real rates of return aren’t going to happen this decade
    • Record deficit spending and the Fed’s creation of money to fund it will fuel inflation higher
    • .U.S’ debt will be downgraded two more times before the end of 2029
    • Sales of over 7 trillion in foreign owned debt and dollars will engage
    • The Fed will create trillions more trying to support the U.S. debt market and dollar
    • Inflation will escalate moving above 6.00%
    • Growth in Federal debt will outpace growth in federal income 1.5 to 1
    • Desperate for income politicians will pass increases in income, corporate and long-term capital gains taxes forcing more corporations and citizens offshore
    • Trade deficits will increase
    • Stocks will have 1 to 3 corrections with recovery to new highs fueled by dollar devaluation.
    • Proceeds from stock sales may go into Federal debt short-term but just until these dollars find new homes in tangible assets, quality stocks and higher rated debt.
    • Mortgage delinquency rates will increase from 2.75% to more than 5.00%
    • Federal Reserve ownership of mortgage backed securities will increase from 2.422 to over 4 trillion
    • A temporary selloff in real estate will be caused by higher rates, higher taxes, higher inflation, decreasing affordability, with a recovery to new high fueled by dollar devaluation.

It’s going to be a exciting decade to trade packed with beautiful up and down trends if you have any questions or need additional information please contact me.  

Peter Knight Advisor
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Peter_Knight@peterknightadvisor.com

 

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Risk Disclosure

Preparing for tomorrow’s major market moves today

Economic perception versus reality
What I see happening between now and the end of 2026
Tools, markets and contracts for capturing major market moves long or short

2000-2021 EMA ATA performance and allocation studies
2000-2021 VBO ATA performance and allocation studies
40 stocks with clean up trends that appreciated from 880% to 6783% in the last 10 years

Perception

From 1970 to 2020 personal Income, stocks, home prices, precious metals, GDP, Federal revenue all outperformed reported inflation.

1970-2020 average annual reported inflation 4.03%
Average annual growth in personal income 5.51%
Average increase in median home prices 5.25%
Average increase in the S&P 500 8.63%
Average increase in Gold 9.81%
Average increase in Federal revenue per capita 4.99%
Average increase in Federal revenue per employed person 4.53%
Average annual growth in GDP per capita 5.14%
Average annual growth in the GDP per employed person 4.70%

Personal income outperformed inflation by 100.72%

5.51% 1970-2020, average annual growth in personal income
1.48% average annual growth above reported inflation
$29,714 what personal income would be in 2020 if pegged to inflation
$59,642 actual personal income in 2020
$29,928 overall growth in annual personal income above inflation


Sources & Data

Median home prices outperformed inflation by 74.88%

5.25% 1970-2020 average annual appreciation
1.22% average appreciation above inflation
$192,671 what median home prices would be in 2020 if pegged to inflation
$336,950 actual median home price in 2020
$144,279 overall appreciation in median home prices above inflation


S&P 500 outperformed inflation by 432.48%

8.63% 1970-2020 average annual appreciation
4.83% average appreciation above inflation
705.40 what the S&P 500 would be in 2020 if pegged to inflation
3,756.10 actual price for the S&P in 2020
3,050.70 overall appreciation of the S&P 500 above inflation

Sources & Data

Gold outperformed inflation by 462.54%

9.81% 1970-2020 average annual appreciation
5.78% average appreciation above inflation
$315 what the price of gold would be in 2020 if pegged to inflation
$1,772 actual price of gold in 2020
$1,457 overall appreciation of gold above inflation

Sources & Data

Federal revenue per capita outperformed inflation by 44.13%

4.99% 1970-2020 average annual growth in Federal revenue per capita
0.96% average appreciation above inflation
$7,160 what Federal revenue would be per capita if pegged to inflation
$10,320 actual Federal revenue per capita in 2020
4.03% 1970-2021 average annual reported inflation

Federal revenue per employed person by 20.43%

4.53% 1970-2020 average annual growth in Federal revenue per employed person
0.50% average appreciation above inflation
$20,093  what Federal revenue would be per employed person if pegged to inflation
$24,197 actual Federal revenue per employed person in 2020

GDP per capita outperformed inflation by 67.16%

5.14% 1970-2020 average annual growth in GDP per capita
1.11%  average growth above inflation
$38,551 what GDP per capita would be if pegged to inflation
$64,443 actual GDP per capita in 2020

GDP per employed person by 49.33%

4.70% 1970-2020average annual growth in GDP per employed person
0.67%  average growth above inflation
$101,190 what GDP per employed person would be if pegged to inflation
$151,103 actual GDP per employed person in 2020

Sources & Data

In 2021 the U.S. has a higher percentage of the U.S population working and paying taxes than 36 out of the last 52 years.

44.23% of U.S. population is employed in 2021
2.25% from its 52 year high of 46.79% set in 2000
2.16% higher than the 52 year average 42.07%
9.88% higher than the 52 year low of 34.35% set in 1971

Sources & Data

Perception

With these glowing fundamentals  you’d expect quality of life for U.S. citizens to be at or near an all time high, that the Federal Government would be running budget surpluses, paying down debt and working hard towards restoring their fiscal credibility and AAA debt rating.

Reality

From 1970 to 2021 Federal debt increased by 28.16 trillion
Federal debt as a percent of GDP from 35.49% to 125.77%
Federal debt per capita, from $1,879 to $86,025
Federal debt per employed person from $5,365 to $195,836
Federal Spending per employed person, from $2,929 to $53,210
9.1 trillion dollars in Federal Reserve bailouts, 8.2 trillion since 2008
2 debt downgrades caused by record spending and the creation of trillions to fund it.
Borrowing the all monies paid into Social Security by issuing it non marketable debt which helped expedite its projected insolvency date to as early as 2028.
Borrowing all the monies paid into Military and Civilian Employee Trusts by issuing  these trusts non marketable debt which could jeopardize fair retirement income for beneficiaries.
Mismanaging Medicare projected insolvency date to 2026
All in, Government piled up 153.473 trillion in unfunded liabilities

1970-2020 Federal spending per capita outpaced  reported inflation by 228.46%

6.88% average annual growth in Federal spending per capita
2.85% average growth above inflation
$23,406 actual Federal spending per capita in 2020
$7,242 what per capita Federal spending would be in 2020 if pegged to inflation

Federal spending per employed person outpaced  reported inflation by 158.58%

6.49% 1970-2020 average annual growth in Federal spending per employed person
2.46% average growth above inflation
$53,547 actual Federal spending per capita in 2020
$20,705 what per employed person Federal spending would be in 2020 if pegged to inflation


Sources & Data

Average annual Federal spending above reported inflation. 

Per Capita
1970-2007 1.77% 
2008-2019 1.87% 
2008-2020 6.40% 
1970-2020 2.95%

Per employed person
1970-2007 1.04% 
2008-2019 1.89%
2008-2020 7.25% 
1970-2020 2.62%


Sources & Data

In 2020-2021 Federal spending per employed person is equivalent to 87.09% of median personal income. 


Sources & Data

Increases Debt  to GDP 1900-2021

1900 to 2006, from 10.29% to 35.49%
1970 to 2007, from 35.49% to 61.93%
2008 to 2021 from, 61.93% to 125.77%
1939,  43.30% (end of the Great Depression)
1946, 119.12% (end of World War 2)
High, 2020, 129.19%
1900-1970 Average, 38.97%
1970-2007 Average, 42.17%
2008-2021 Average, 100.53%
Low, 1907 7.19%


Sources & Data

Federal debt per capita

1970-2021 actual increase in Federal debt per capita, $1,879 to $86,025, +4,478.23%
1970-2021 if pegged to reported inflation, $1,879 to $13,206, +602.63%
2008-2021 actual per capita increase in Federal debt, $29,998 to $86,025, +186.77%
2008-2021 if pegged to reported inflation $10,036 to $13,206, +31.58%
2020-2021 actual per capita increase in Federal debt, from $69,392 to $86,025, +23.97%
2020-2021 if pegged to reported inflation $12,374 to $13,206, +6.72%

Federal debt per employed person

1970-2021 actual increase per employed person $5,365 to $195,836, +3,691.59%
1970-2021 if pegged to reported inflation $5,365 to $37,693, +602.63%
2008-2021 actual increase per employed person, $64,871 to $195,836,  +201.89%
2008-2021 if pegged to reported inflation, $28,645 to $37,693, +31.58%
2020-2021 actual increase per employed person. $150,228 to $195,836, +30.36%
2020-2021 if pegged to reported inflation. $35,420 to $37,693, +6.41%

U.S. debt compared to other countries

1970-2020, 28.17 trillion in new Federal debt, this is more than the total debt of the United Kingdom, Italy, France, Germany, Australia, Canada, Mexico, Russia, China, Taiwan and India combined, total population of these countries 3.468 billion, U.S. population 332 million.

Since 2008, 19.60 trillion in new Federal debt, more than the total debt of the United Kingdom, Canada, Australia, Switzerland, Greece, Turkey, Taiwan, China, Russia, India, Argentina, Mexico and Nigeria combined, total population of these countries 3.587 billion.

Fed Bailouts since 2008 8.26 trillion, more than the total debt of China, population 1.442 billion.

16 months, 5.88 trillion in new Federal debt, 304 billion more than the combined total debt of the United Kingdom and Canada.


Sources & Data

Impact of record deficit spending and the creation of money to pay fund it

2 Federal debt downgrades in 2021 the United States has the worst debt rating in history, 11 countries are now rated higher.

Country/Region Rating Outlook Date
 Canada AAA Stable 2002-07-29
 Denmark AAA Stable 2001-02-27
 Germany AAA Stable 2012-01-13
 Liechtenstein AAA Stable 2016-02-26
 Luxembourg AAA Stable 2013-01-14
 Netherlands AAA Stable 2015-11-20
 Norway AAA Stable 1990-11-08
 Singapore AAA Stable 1995-03-06
 Sweden AAA Stable 2004-02-16
  Switzerland AAA Stable 1989-06-26
 Australia AAA Stable 2020-10-20
 Austria AA+ Stable 2013-01-29
 Finland AA+ Stable 2016-09-16
 Hong Kong AA+ Stable 2017-09-22
 United States AA+ Stable 2013-06-10

Debt to GDP by country


Sources & Data

Federal Reserve bailouts

1913-2007, 890.66 billion 
Formation of the Federal Reserve 1913

1970-2019 – last 12 years 3 months
Total new debt Federal 13.719 trillion
Total money created by the Federal Reserve 3.275 trillion
Federal Reserve profits forfeited to the U.S. Treasury 892 billion
Total Federal Reserve bailouts, 4.167 trillion

2020-2021 – last 16 months
Total new federal debt 5.881 trillion
Total money created by the Federal Reserve 4.036 trillion
Federal Reserve profits forfeited to the U.S. Treasury 144 billion
Total Federal Reserve bailouts, 4.180 trillion


Sources & Data

In addition to the bailouts from 1998 to 2020 the Federal Reserve forfeited 1.242 trillion in operating profits to the U.S. Treasury, 142.49 billion more than total Federal debt in 1982.


Sources & Data

Real rates of return and inflation magically disappeared until May of this year?

1970 to 2007 average Treasury rate 8.70% paying 3.99% more than reported inflation
2008 to 2020 average Treasury rate 2.67% paying 0.94% more than reported inflation
2021 average Treasury rate 2.01% paying 3.39% less than reported inflation
Reported inflation over the last 12 months 5.40%
1970 through 2021 average annual inflation 4.03%


Sources & Data

Reported inflation factual or fictional? Comparisons using the BLS inflation calculator

In 1980 total Federal was 863.45 closing in on 1.00 trillion dollars, citizens panicked, gold rallied to $850 an ounce, interest rates spiked above of 15%.

The BLS translates 863.45 billion in 1980 into  3.015 trillion in 2021, 3.015 trillion is 2.865 trillion less than new Federal debt in the last 16 months

Cost of the New Deal 1933-1939

Total cost of the New Deal from 1933 to 1939, 41.70 billion (1939 dollars)
The BLS translates this into 809.27 billion in 2021 dollars .

1939 total cost of the New Deal in gold 1.226 million ounces
Cost of the New Deal in 2021 if pegged to gold 2.207 trillion dollars

What the New Deal did for 809.27 billion BLS 2021 dollars

    • Job training for 8.5 million unskilled men to learn a new professions as they carried out public works infrastructure projects.
    • Built or modernized more than 55,000 civilian and military buildings.
    • Built 32 naval vessels, many played key roles during World War 2.
    • Built 4,026 new schools, the majority are still open today.
    • Built 130 new hospitals, including Fitzsimons , Allegheny General & Jersey City
    • 29,000 new bridges & tunnels including Lincoln,Throgs Neck and Golden Gate.
    • Scores of Dams including Hover & Shasta, the majority still produce power today
    • Built or modernized over 180,000 miles of highways including the Los Angeles Freeway, the Overseas Highway(107 miles) connecting Key West to the mainland
    • Built or modernized more than 150 airports including La Guardia and Midway.
    • Built or modernized nearly 9,000 miles of storm drains and sewer lines.

New Deal Programs provided more than Infrastructure.

    • The laborers of the New Deal programs worked in schools serving more than 900 million hot lunches to hungry children during the depression.
    • Operated 1,500 nurseries enabling childcare so parents could work.
    • Funded over 225,000 concerts and thousands of plays.
    • New Deal cultural programs produced more than half a million works of art including Jackson Pollock’s 17A which sold for 200 million in 2016.
    • The New Deal Writers’ program featured works from soon-to-be famous Authors like John Steinbeck, Steinbeck went on to win the Pulitzer Prize in 1940 for his novel The Grapes of Wrath.

Either President Roosevelt really knew how to stretch a buck in the 1930’s or BLS.GOV inflation is fictional.

Fiscal cost of World War 2 

Total U.S. fiscal cost 291.18 billion in 1946 dollars.
The  BLS.GOV translates this into 4.347 trillion in 2021 dollars

4.347 trillion is 59.59% of what the Federal Government spent in 2020,
97.35% of what the Federal Government spent in 2019.

The U.S.’s fiscal cost of World War 2 in gold, 131.662 million ounces
Cost of the WW 2 if pegged to gold 15.088 trillion 2021 dollars

Spending and new debt during  last “crisis” and “recovery”, 2008-2019

47.689 trillion total Federal Spending (all in)
5,892.84% the total cost of New Deal
1,097.06% the total fiscal cost of World War 2

13.718 trillion total New Federal Debt
1,695.11% the total cost of the New Deal
315.57% the total fiscal cost of World War 2


Data & Sources

Spending and new debt during the Covid crisis 2020-2021

11,312 trillion in Federal Spending (all in)
5.88 trillion in New Federal Debt
5.156 trillion combined BLS cost of the New Deal and World War 2 in 2021
Data on pre Covid causes of death & Covid causes of death

Annual Federal Revenue is now a mere 11.16% of total Federal debt,

1970 50.62%
1980 58.89%
1990 32.19%
2000 35.98%
2007 28.69%
2021 11.16%

Sources & Data

Impact

An 11.16% annual revenue to total debt ratio makes it impossible for the U.S. to accurately report inflation, normalize interest rates or increases in any Federal expense that’s pegged to reported inflation such as Social Security, Medicare, Military or Civilian employee pensions.

If Treasury rates normalized to the 1970 – 2008 average of 8.70%, 68% of all Federal revenue would be consumed by debt service cost alone.

Accurate increases in Medicare would push it’s insolvency date closer than the projected 2026, Social Security before the projected 2028 to 2035.

Under reporting inflation contains the majority of all Federal costs

From 2008 to 2021 Federal debt increased by 200.00% yet annual debt service cost increased by only 30.91%.

Total Federal debt in 2007 8.950 trillion, annual debt service cost 411.32 billion
Total Federal debt in 2020 26.880 trillion, annual debt service cost 538.45 billion


Sources & Data

How the U.S. reports budget deficits, the poverty rate and the homeless rate and further eroded U.S. fiscal credibility.

1970-2020 cumulative reported budget deficits $17.857 trillion, cumulative increase in Federal debt $26,515 trillion. According to U.S. politicians the 8.658 trillion doesn’t count because they’re mandatory expenses and they don’t vote on them.


Sources & Data

Difference between reported deficits and increase in total Federal debt

1970 to 2007 4.021 trillion,
2008 to 2020 4.637 trillion.

U.S poverty rate

The Federal Government has contained the official poverty rate and all subsides linked to the poverty rate by lowering what the poverty rate is.

In 1970 your income needed to be less than 49.60% of median personal income to be below the poverty threshold and qualify for government assistance.
In 2020 your income needed to be less than 21.70% of median personal income to be below the poverty threshold and qualify for government assistance.


Sources & Data

Homeless rate

By redefining who’s homeless the Department of Housing and Urban development has reduced the official homeless rate by 173,691 people since 2005.

Sources & Data

In 2021 Federal Debt as a percentage of GDP is the worst in history


Sources & Data

Regulation, taxation and litigation have destroyed U.S. manufacturing and eliminated over 20 million jobs.


Sources & Data

The resulting trade deficits have eliminated 13.95 trillion in domestic wealth, 7.652 trillion since 2008.


Supporting Links & Data

Foreign held Treasury debt now impedes the U.S.’s ability to negotiate fair trade

If the 7.012 trillion in foreign held Treasury debt hits the market for any reason it will create an unprecedented financial crisis, unprecedented dollar sales by foreign investors and additional dollar devaluation fueled by the Federal Reserve’s creation of trillions of dollars trying to support the Treasury market and dollar, hyper inflation will engage.

Sources & Data

In 2020 and 2021 the Federal Reserve is the largest buyer of new Treasury debt using money they create from and backed by nothing, without this massive ongoing multi trillion dollar intervention the Federal government would be insolvent.

The creation of  over 8 trillion dollars makes it impossible for the dollar to maintain it’s long-term value against quality stocks or tangible assets, It also moves closer the sale of 7.012 trillion in foreign owned Treasury debt.

2020-2021 last 16 months
Increase in Federal debt 5.881 trillion
Federal debt purchased by the Federal Reserve 2.764 trillion
Domestically purchased Federal debt 2.694 trillion
Debt purchased by foreign investors 311.5 billion
Non marketable debt  held by Federal agencies & Trusts 111.8 billion

1970-2019 previous 50 years
Increase in Federal debt 22.289 trillion
Federal debt purchased by the Federal Reserve 2.637 trillion
Domestically purchased Federal debt 7.301 trillion 
Debt purchased by foreign investors 6.716 trillion
Non marketable debt  held by Federal agencies & Trusts 6.01 trillion


Sources & Data

Percent ownership of total Federal Debt

2020
Domestic, publicly held Federal debt 35.01%
Federal debt held by foreign investors 24.62%
Non marketable Federal debt held by Federal Agencies & Trusts 21.46%
Federal debt held by the Federal Reserve 18.92%

1970
Domestic publicly held Federal debt 79.58%
Federal debt held by foreign investors 4.12%
Non marketable Federal debt held by Federal Agencies & Trusts 0.00%
Held by the Federal Reserve 16.30%


Sources & Data

Economy in gold

Growth of personal income in ounces of gold 1981-2021

From 24.67 to 33.66 ounces, +8.99 ounces of gold, +36.46%
Personal income dollars +426.59% from $11,326 to $59,642, +$48,316,

2020 33.46 ounces
1981 24.67 ounces
1981-2021 annual average 55.33 ounces
High 2001 117.29 ounces
Low 1981 24.67 ounces


Sources & Data

Increase in Median home price in gold

From 183.32 to 185.67 ounces, +2.24 ounces of gold, +1.28%
In US dollars +388.69% from $68,950 to $336,950, +$268,000,

2020 185.67 ounces
1981 183.32 ounces
1981-2021 average 312.01 ounces
High 2000 617.83 ounces
Low 2011 134.10 ounces


Sources & Data

Increase in the value of an S&P 500 futures contract in gold

From 14.78 to 121.47ounces, +106.69 ounces of gold, +721.69%
In US dollars +3,147.64%, from $6,788 to $220,450 +$213,662,

2020 185.67 ounces
1981 183.32 ounces
1981-2021 average 312.01 ounces
High 2000 617.83 ounces
Low 2011 134.10 ounces

Sources & Data

Increase in GDP per employed person in gold

From 78.27 to 85.28 ounces, +5.23 ounces of gold, +8.96%
GDP in dollars +320.45% from $35,937.56 to $151.102.75, +$115,165.18.

2020 85.28 ounces
1981 78.27 ounces
1981-2020 average 153.27 ounces
High 2001 297.62 ounces
Low 2012 73.07 ounces

Per capita

From 31.14 to 36.37 ounces, +5.23 ounces of gold, +16.80%
GDP in dollars +350.72% increased from $14,297.62 to $64,443.08 +$50,145.46

2020 36.37 ounces
1981 31.14 ounces
1981-2020 average 67.64
High 2001 137.94 ounces
Low 2011 31.14 ounces

Sources & Data

Federal revenue per employed person in gold

Decreased from 14.74 to 13.66 ounces, -1.08 ounces of gold, -7.34%  
Increased in dollars +257.58 from $6,766.66 to $24,196.85, +$17,429.94,

2020 13.66 ounces
1981 14.74 ounces
1981-2020 average 27.13 ounces
High 1999 56.20 ounces
Low 2011 11.81 ounces

Per capita

Decreased from 5.86 to 5.82 ounces, -0.04 ounces of gold, -0.67%  
Increase in dollars +283.32% from $2,692.19 to $10,319.60, +7,627.14,

2020 5.82 ounces
1981 5.86 ounces
1981-2020 average 11.98
High 1999 26.03 ounces
Low 2011 5.00 ounces


Sources & Data

Federal spending per employed person in gold

From 16.34 to 30.28 ounces, +13.93 ounces of gold +85.26%
Federal spending in dollars +614.91%, from $7,504 to $53,647, +46,143,

2020 30.28 ounces
1981 16.34 ounces
1981-2020 average 32.86
High 2001 59.53 ounces
Low 1981 16.34 ounces

Per capita

Increased from 6.50 to 13.06 ounces, +6.56 ounces gold +100.86%
Increase in dollars +675.08%, from $2,985 to $23,140, +20,154,

2020 13.06 ounces
1981 6.50 ounces
1981-2021 average 14.48
High 2001 27.59 ounces
Low 1981 6.50 ounces

Sources & Data

Federal debt in gold per employed person in gold

Increased from 23.73 to 106.65 ounces, +82.92 ounces of gold, +349.38%  
Increase in dollars +1,634.08% from $10,897 to $188,966, +178,069,

2020 106.65 ounces
1981 23.73 ounces
1981-2020 average 97.51
High 2001 161.09 ounces
Low 1981 23.73 ounces

Per capita

Increased from 9.44 to 46.00 ounces, +36.56 ounces of gold, +387.20% 
Increase in dollars +1,780.03% from $4,335 to $81,507, +77,172,

2020 46.00 ounces
1981 9.44 ounces
1981-2020 average 43.17
High 2001 74.66 ounces
Low 1981 9.44 ounces


Sources & Data

What could clean up this mess up

Fiscally responsible politicians on both sides of the isle
Giving up on trying to spend out of every crisis, 28.5 trillion in debt proves it doesn’t work
Balanced Federal budgets and paying down debt to minimize damage to future generations
Had effective regulations rather than,, regulations that foment litigation
Brought companies back to the US by hiking Tariffs rather than Taxes
Ran trade surpluses rather than trade deficits,
Transparency in Federal revenue and expenditures that’s easy to understand and follow
Citizens joining Patrick Henry’s united we stand divided we fall party rather than being pawns of Julius Caesar’s divide and conquer.
Had a government that was afraid of voters rather than voters being afraid of government

What’s more likely to happen

Same scenario as I wrote about back in 2015 in this Seeking Alpha article but far worse. 

Annual Federal Revenue has fallen from 17.94% in 2015 to a 11.16% of total Federal debt in 2021, the Federal government in 2021 can’t afford to raise interest rates high enough to attract enough buyers to finance it’s deficit spending.


Sources & Data

For the U.S to remain solvent the Federal Reserve has to continue creating trillions of dollars with keypunch entries to buy all the debt the free market won’t if they don’t rates will spike higher.

We see total Fed created money increasing from 8.24 to 13.53 trillion by the end of 2026
Treasury debt owned by the Fed increasing from 5.30 to 8.66 trillion
Other debt owned from increasing from 2.898 to 4.689 trillion


Sources & Data

Record spending + the creation of money to fund it = inflation

Our estimate puts average annual BLS reported inflation above 4.00% through 2026.
Actual annual inflation averaging more than 5.25%.
Shadow Stats puts the average above 7.50%.


Sources & Data

Dollar devaluation and negative rates of return are here to stay. 

Rates 20 July 2021

3 month Treasuries 0.04%, 5.36% below reported inflation
2 Year Treasuries 0.20%, 5.20% below reported inflation
5 Year Treasuries 0.84%, 4.56%% below reported inflation
10 Year Treasuries 1.52%, 3.88% below reported inflation
30 Year Treasuries 2.16%, 3.24% below reported inflation
30 day Fed Funds averaging 0.09%
Prime Lending Rate averaging 3.25%

Rates will move higher but not high enough to attract enough buyers to end the Fed’s creation of money, when the pain gets to great for the Federal budget they’ll lower them again during the next “crisis”, in the short term I’ll be trading them higher, same as last time, for more information see my 2015 seeking alpha article

Our estimates for rates through 2026,

3 month Treasuries as low as 0.14%, 3.90% below reported inflation
2 Year Treasuries as low as 0.55%, 3.49% below reported inflation
5 Year Treasuries as low as 1.09%, 2.95% below reported inflation
10 Year Treasuries as low 1.58%, 2.46% below reported inflation
30 Year Treasuries as low as 2.51%, 1,53% below reported inflation
30 day Fed Funds averaging 1.31%
Prime Lending Rate averaging 4.22%

These estimates assume the Federal Reserve continues creating trillions to buy any new debt the free won’t, if they stop rates will move above 7.50%. 


Sources & Data

    • Inflation and debt monetization have already engaged
    • Record deficits and the Fed’s creation of money will continue to fuel inflation higher
    • Rates will creep higher but not high enough to attract enough buyers to turn off the Federal Reserve’s printing press.
    • Real rates of return aren’t going to happen they’re nothing more than a footnote in history
    • .U.S’ debt will be downgraded 1 to 3 times before the end of 2029
    • Sales of over 7 trillion in Foreign foreign owned debt and dollars will engage
    • The Fed will create trillions more trying to support the U.S. debt market and dollar
    • Inflation will escalate
    • Desperate for income politicians will pass increases in income, corporate and long-term capital gains taxes forcing more corporations and citizens offshore
    • Proceeds from stock sales may go into Federal debt short-term but, just until these dollars  find new homes in tangible assets, global stocks, higher rated debt.
    • Mortgage delinquency rates will increase from 2.75% to more than 5.00%
    • Federal Reserve ownership of mortgage backed securities will increase from 2.422 trillion to over 4 trillion
    • A temporary selloff in real estate will be caused by higher rates, higher taxes, higher inflation, decreasing affordability, decreasing discretionary income with a recovery to new high fueled by dollar devaluation. 

Track what the Fed chair’ trusts are in,coincidentally the Fed always seems to support these markets, the chair’s allocations are in,  to track their allocation see their OGE 278e disclosures.

Long-term position trade account

40 stocks with clean 10 year trends that I’d rather have my portfolio in than U.S. debt, all have performed well over the last decade.

Name & linked 10 Year 9-18 EMA Chart July 2011 Last 10Y %Chg
Monolithic Power Sys MPWR $15.28 $448.79 2937.11%
Repligen Cp RGEN $3.62 $245.57 6783.70%
Heska Corp HSKA $9.68 $242.34 2503.51%
Domino’s Pizza Inc DPZ $25.25 $528.08 2091.41%
Tyler Technologies TYL $26.83 $495.51 1846.85%
Adobe Systems Inc ADBE $31.33 $620.79 1981.46%
Amazon.com Inc AMZN $205.55 $3,353.58 1631.52%
Fair Isaac and Company FICO $30.29 $526.79 1739.15%
Idexx Laboratories IDXX $38.71 $679.46 1755.26%
West Pharmaceutical WST $21.86 $411.16 1880.88%
MSCI Inc MSCI $37.82 $600.65 1588.18%
Costar Group Inc CSGP $5.94 $88.29 1486.36%
Cadence Design Sys CDNS $10.57 $147.46 1395.08%
Charter Communicatio CHTR $54.01 $739.32 1368.86%
Adv Micro Devices AMD $6.99 $106.38 1521.89%
Zebra Technologies ZBRA $42.22 $551.77 1306.89%
Mastercard Inc MA $30.05 $385.61 1283.23%
Copart Inc CPRT $11.68 $146.85 1257.28%
Visa Inc V $21.03 $246.48 1172.04%
Apple Inc AAPL $12.00 $146.13 1217.75%
Cintas Corp CTAS $33.08 $393.62 1189.90%
Microsoft Corp MSFT $25.93 $284.09 1095.60%
Synopsys IncSNPS $25.78 $287.75 1116.18%
Casella Waste Sys CWST $6.12 $68.14 1113.40%
Moody’s Corp MCO $38.37 $376.51 981.26%
Alphabet Cl A GOOGL $253.37 $2,688.24 1060.99%
Sherwin-Williams Company SHW $28.04 $290.68 1036.66%
Intuit Inc INTU $51.97 $522.91 1006.18%
Fortinet Inc FTNT $27.13 $271.66 1001.33%
Descartes Sys Group DSGX $7.18 $72.69 1012.40%
Charles River Laboratories CRL $40.69 $408.84 1004.77%
S&P Global Inc SPGI $41.97 $428.49 1020.94%
Molina Healthcare Inc MOH $27.17 $272.34 1002.36%
Icon Plc ICLR $23.60 $243.70 1032.63%
O’Reilly Automotive ORLY $65.61 $604.93 922.01%
Masimo Corp MASI $29.79 $274.10 920.11%
Home Depot HD $36.29 $327.64 902.84%
SBA Communications SBAC $38.32 $340.79 889.33%
Mettler-Toledo Int. MTD $169.29 $1,490.57 880.48%
Spreadsheet with links to 9/18 EMA 6 month daily, 5 year weekly & 10 year monthly charts

Capturing major market moves long or short

For my trading accounts I trade with the trend long or short, properly capitalized and maintain absolute discipline.

Exponential moving averages (EMAs) one very simple solution for trend identification and a great place to start,

It’s this simple, red line (9 day EMA) above the blue line (18 day EMA) trade long, red below blue trade short.

Using nothing but the 9 day and 18 day EMA generated these results since 2000

Drop in EMAs

You can experiment with any combination of the these EMAs using these instructions

Top EMA allocations are on this page

Creating you own EMA allocation on this page

Instructions for tracking your own EMA allocation this page

 It’s going to be a exciting decade to trade packed with beautiful trends contact me with any questions.

 

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