WHAT IS SO WRONG WITH THE STATE OF AFFAIRS

Here's my list of what is so wrong about the state of affairs in the global economy:

1. Soon after Ben Bernanke's visit to Japan, Japan announces massive US$98B fiscal stimulus to upgrade infrastructure and a host of other initiatives, on top of the BOJ's monthly bond and ETF purchases with NIRP. How's that for more money printing?  As articulated by Zerohedge, could Japan be the first experiment of helicopter money?

2. The S&P continue to reach all time highs despite 4 consecutive quarters of earnings recession. is there any sanity left in the market? As it stands, the free market economy where price discovery happens is lost in all the market intervention by the central bankers.

3. Italy banks are in a dire situation. In fact, the IMF warns today that Italy banks could create a global contagion if left unarrested. Germany has been against any bailout of the Italy banks using taxpayer money.

4. And herein seals the fate of Deutsche Bank. If  Germany does not allow the Italian Government from bailing out her banks, Germany could likewise deny Deutsche Bank of any government aided bail out. So Deutsche Bank is all alone in this debacle. Deutsche Bank is the most intoxicated bank in the world. Laden with derivatives that are 20x Germany's GDP, it comes as no surprise that the IMF has included Deutsche Bank on its list of world most dangerous bank. To mark the effect, the bank's bond yield just spike 11.5%

5. China too is joining into the fray of central bank intervention when she announced a war chest of US$400B from her pension fund to support the market. China is also devaluing her Yuan which exports deflation worldwide, which contravenes the other central bankers policy of creating inflation. We are now in a never ending vicious cycle which could be a race to the bottom.

6. Meanwhile, global debt continue to mount. US student loans, auto loans and consumer credit have surpassed US$1 trillion each. The ECB and BOJ's balance sheet too are getting bloated through their monetary actions.

Precious metal prices continue to be suppressed as record shorts on precious metals reached all time highs.it is like a coiled spring and when unleashed with push the prices upwards. nevertheless, mining stocks and related ETFs have done well and will continue to do well as we move into the US Presidential Election.

I continue to be long in precious metals, miners and related ETFs.

Please do your own research as our risk appetite often differs.