Stock market high on Sept 11 2024?

 Ok, hopefully nothing will happen on that day.  But it could be the day that the stock market hits a high before the next recession starts.

 If you start on 7/12/1990, which is the date of the DJIA high for the year (when it hit 2969), and add 6240 days, you get 8/12/2007, which wasn't the date of the high in 2007 but it was close (since the actual high was 10/9/07 when it hit 14,164).  Now add another 6240 days and you get 9/11/2024.  

Ok it is probably nothing, but the stock market will reach a high sometime this summer or fall, and this could be the date.  Then the Fed will start to cut rates, I just predicted 10/15/24 (6237 days after it first cut rates in 2007), or more likely 9/18/2024, since there is no Fed meeting in October.  Then the recession will officially start about 1/1/25 (6240 days after the recession started in December 2007).

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Oh, one more thing.  I was completely ignoring that this is an election year.  November 5, 2024 is the date of the general election.  The FOMC will meet on November 6-7 - any guesses as to if they cut rates at that time?  This is just a conspiracy theory, but hypothetically let's say that Trump wins on November 5, just in time for the start of the Great Recession, Part II.

17 year cycle

 In 2005, the Fed raised rates 8 times, starting at 2.25% and ending at 4.25%.

In 2006, the Fed raised rates 4 times (with the last time on June 29, 2006), ending at 5.25%.

In 2022, the Fed raised rates 7 times, starting at 0.25% and ending at 4.25%.  (The Fed raised rates much quicker in 2022 than it did in 2005, so this is not an identical rate hike history, but the end rate is the same.)

In 2023, the Fed raised rates 4 times (with the last time on July 27, 2023), ending at 5.25%.

See also: https://aftermath2022.blogspot.com/2017/03/17-year-business-cycle.html , which speculated about a double pi cycle.  A pi cycle (per Martin Armstrong) has 3,141 days, and a double pi cycle has 6,282 days. If you start at June 29, 2006 (the last time rates were raised in that cycle) and add 6282 you get Sept 10, 2023 (on which nothing significant happened).  

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Update:  I think there is something to this.  

The 1973-1975 recession began in November 1973 and was triggered by an oil embargo in October 1973 by OPEC (in response to Western support for Israel during the Yom Kippur War). So let's use October 6, 1973 (when the war started), as a starting point.

This brings us to December 18, 1990.  Nothing happened on this date, but the 1990-1991 recession began in July 1990.  So backtrack 3 months to July 1, 1990.  

This brings us to September 12, 2007.   The Federal Reserved noticed a slowdown and cuts on September 18, 2007 to 4.75%.  The 2007-2009 recession officially began on December 1, 2007.  So advance the date 3 months. 

Now advance another 6282 days until you get to February 11, 2025.  Or maybe 3 months earlier which is November 12, 2024.  The next recession should begin around these dates.

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The Mayans had a 52 year cycle where their 260 day and 360 days cycle repeated.  This was 18,720 days long.  One third of this is 6,240 days, which is almost exactly one month longer than 17 years.  So if you use October 1, 1973 as a starting point, the next dates would be November 1, 1990;  December 2, 2007; and January 1, 2025.

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Hmm, start at Thursday, June 29, 2006 and add 6,240 days and what do you get? Sunday, July 30, 2023.  When you adjust for the day of the week, you get Thursday, July 27, 2023.  These are 6,237 days apart.  So maybe this is the number to use for a double pi cycle.

When did the Fed first cut rates after 2006? On Sept 18, 2007.  So 6237 days after this is October 15, 2024.

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So I just said that the Feb first cut rates during that cycle on Sept 18, 2007.  Go back 6237 days.  You get Aug 21, 1990.  When did the Fed first cut rates in that cycle?  On July 13, 1990.  This is a difference of 39 days, which is pretty close.

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But there is no Fed meeting this year in October. There is one on Sept 17-18, 2024.  So could this be almost an exact repeat of 2007?  This is too freaky. See also: September 18 is rate cut day.

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Update (yet again):  Article about the bear market of 1973-1974 - https://jasonzweig.com/learning-from-the-bear-market-of-1973-1974/

Odysseus fake?

 

Source: https://static.wixstatic.com/media/7c27f7_a9ef02ff09a44a36adc78a30a3959f9b~mv2.png

This spacecraft supposedly landed on the moon yesterday.  I don't know - this looks fake to me because it is so perfect and brilliant and clean. 

Source: https://www.reddit.com/r/space/comments/1axlj32/lunar_lander_odysseus_touches_down_on_the_moon/

And this is definitely photoshopped.

Source: https://www.cbsnews.com/news/moon-lander-tipped-over-on-its-side-during-touchdown/

They admit this is fake - they call it an "artist's impression".

At least the very cool looking circular mission control center in Houston is real.

What is the outstanding amount of SBA EIDL loans?

EIDL stands for Economic Injury Disaster Loan.  The SBA gave as much as $1.2 trillion of PPP and EIDL loans in 2020 and 2021, and as much as $200 billion of these are potentially fraudulent.  Most of the PPP loans have already been forgiven or paid back.

My specific question is how much of EIDL loans were outstanding as of September 30, 2022 and 2023, and how much was written off.

So as of 9/30/22, the EIDL total was $357.8 billion and as of 9/30/23, the total is $301.9 billion.  This is the Unpaid Principal Balance totals and includes only those loans that have not been charged off.  (source)

In fiscal year 2023, the SBA charged off $51.9 billion in EIDL loans.  Since the decrease in the EIDL from 2022 to 2023 was $55.9 billion, that means the actual balance decreased only $4 billion from repayment.

Does that mean there was $51.9 billion of fraud last year?  Not necessarily, there were some struggling businesses that went under.  Still, a large portion of this probably was fraudulent, because it is not too hard to make the small payments or to request a deferment. 

The Smith Family learns about the Magical Money Tree

 

Hey kids, here is a cool new comic book about money!  Go to https://www.mmted.org/smithfamily/episodes.php to read.  There are 12 episodes already written and more are coming.

Learn about how money really does grow on magical trees!  And about how mean old white guys who are opposed to increasing school spending are stupid.  Because the government can spend as much as it wants to, it doesn't need taxes.  How? The Central Bank just prints it.  This comic books explains it so well that even kids can understand it and be entertained.  Just don't ask any questions.

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When you are done reading these, here is a comic book about how Russia tried to influence the 2020 election to elect an evil man as President of the United States, but thankfully there was a government intelligence agency that was able to stop them.

https://www.cisa.gov/sites/default/files/publications/cfi_real-fake_graphic-novel_508.pdf

$22 billion deficit in January 2024

 See https://www.fiscal.treasury.gov/files/reports-statements/mts/mts0124.pdf

and https://www.cbo.gov/system/files/2024-02/59822%C2%ADMBR.pdf

Net interest from the month was $68 billion.  The fiscal year to date net interest is up 47% from $198 billion in 2023 to $291 billion (according the CBO, but the monthly treasury statement says it is $283 billion).  The defense spending for January was $60 billion, and FYTD is $281 billion (according to the CBO, but the monthly treasury statement says it is $298 billion).  Maybe the CBO and the Treasury department number crunchers should talk to each other and get their stories straight.

Anyways a $22 billion deficit is pretty good in the grand scale of things.  In Jan 2023 it was $38 billion.

The fiscal year to date interest was only $140 billion in the Oct 2021-Jan 2022 time frame.  So it increased 41% from 2022 to 2023, and another 47% from 2023 to 2024. 

How long until the net interest exceeds $1 trillion per year?  I think it will be in fiscal year 2026.

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On 1/31/23, the total national debt was $31.455 trillion. On 1/31/24, it was $34.191 trillion.  This is an increase of 8.7% in one year.

New 10 Year Budget Projection from CBO

 So just last week, I was saying there will be a debt crisis in 2034.  Coincidentally, the CBO just released their 10 year forecast through 2034 and it doesn't seem like any sort of debt crisis will happen.  

Here are the numbers for 2034 only:

(from https://www.cbo.gov/system/files/2024-02/51118-2024-02-Budget-Projections.xlsx)

Debt at 116% of GDP (with a $2.6 trillion deficit) doesn't sound good, but it isn't the end of the world.  And if GDP increases faster than projected, which I think is likely because of inflation, then it may be possible to stabilize the debt/GDP ratio at just over 100%.  

Jerome Powell says a $144 trillion national debt in 2053 is unsustainable

 Another lingering problem from the pandemic is a sharp increase in the national debt. Thirty years from now, by one measure, it's projected to be $144 trillion, or $1 million per U.S. household. While Powell said the Fed tries not to comment on fiscal policy, which is determined by Congress and the White House, he did comment on the debt. "The U.S. federal government's on an unsustainable fiscal path," he said. "And that just means that the debt is growing faster than the economy. So, it is unsustainable."  It worries him in the long run. "You know, we're, effectively we're borrowing from future generations," he said. "It's time for us to get back to putting a priority on fiscal sustainability. And sooner's better than later." https://www.cbsnews.com/news/jerome-powell-interest-rates-inflation-timing-60-minutes/

See also:  https://budget.house.gov/imo/media/doc/cbo_outlook_shows_share_of_debt_is_projected_to_grow_to_1_million_per_american_household.pdf

Note: The report it is referencing is the CBO June 2023 Long-Term Budget Outlook.  This report doesn't actually mention $144 trillion, but it is calculated from the projected GDP in 2053 of $79.5 trillion times the Debt Held by the Public to GDP ratio of 181%.

As an interesting hypothetical, I recently did another calculation showing the GDP could be as much as $135 trillion in 2053.  If the debt to GDP ratio is the same this would be a debt to the public of $244 trillion.  Is this possible since the current debt to the public is $27 trillion?  Believe it or not, the answer is yes,  if the debt doubles about every 9 years, which is what is has been doing.  What would the interest on that be if the rate is 5%?  It would be $12 trillion in interest per year.  

Is this sustainable?  The devil's advocate would say, yes because it isn't at infinity yet.  If it's not sustainable, then when did it become unsustainable?  Is it already unsustainable?  It seems like the answer is no, that it is not unsustainable at the moment, but we are rapidly approaching that point.

See also https://www.schiffsovereign.com/trends/the-fed-asks-america-to-fill-in-the-blanks-_______-150091/  "a more conservative estimate of the national debt is probably closer to $60 trillion or more by 2033"

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Update: According to the last Financial Report of the US, the Debt to the Public could reach 531% of GDP by 2098. What would this be in dollars, if you use my projection? In 2098, the GDP will be $1.518 quadrillion, so the Debt will be $8 quadrillion. At an interest rate of 5%, the annual interest would be $400 trillion per year. Ok, these numbers are ridiculous, but why are they unsustainable just because the numbers are so high?