Massive European Bailout On The Way & Dow 24,000??

Will Greece and Lehman Brothers Share the Same Fate??

As I tweeted (@kherriage) last week, letting Greece leave the eurozone would be like the FED allowing Lehman Brothers to go bankrupt in September, 2008...oh wait...that actually happened (and we know the economic carnage that followed).

While recognizing that anything is possible, I've been on record for the last couple of years as saying that there is little to no chance that Greece will leave the eurozone...or what is being widely referred to as a "Grexit" (Greek exit).

I can list lots of incredibly important reasons why this could become a black swan event…like: Portugal would be the next country to leave (followed by Italy and Spain)...or the nightmare reality of a $350 billion Greek sovereign debt default (80% owned by other European banks), and yes, the memory of the global panic that followed Lehman's bankruptcy.

But there is one primary reason why Greece will remain one of 19 European members that commonly use one currency…the Euro.

That reason? If Greece were to leave the eurozone, it would equate to failure of the MUCH bigger picture...our global puppet masters primary goal of “one world government” and in conjunction of course, a single global currency. This is the long game...we're talking 10-20-30 years out...and the loss of Greece to the EZ would change that narrative a great deal. And yes, I know that this puts me in the minority. In fact, many of my best sources firmly believe that the Euro will fail, as both a currency and as a concept.

Here's a parallel that will explain my position further. It was June 2012, and Supreme Court Chief Justice John Roberts...a Republican appointee no less (Bush 1)...was to cast the deciding vote on the legal legitimacy of Obamacare. Conservatives were beyond convinced that Roberts would vote in their favor, and that Obamacare would come to an end. Of course, we know the end result...

Here's what I said about Roberts vote at the time:

“As we listened to the media pundits and their educated guess that Obamacare would lose at the Supreme Court level today...because that is what the majority had predicted would happen...that little voice inside my head continued to scream "big government always wins in the end...the fix is in...Obamacare is here to stay...and it won't stop here."

Those "conspiracy theorists" that believe that the New World Order is taking over...and that this is part of their grand master plan...look pretty damn smart today. Trust me, the conspiracy theorists are not surprised...and you can count me among this group as well. Folks, we aren't becoming Europe...we ARE Europe!” 

I believe, even more strongly today, that the long term one-worlders have zero interest in deviating from their master plan...meaning they cannot afford to let Greece leave the EZ. A Grexit would easily set them back by a decade or longer (especially if Greece were to succeed economically after leaving)…just not an option in their eyes.

In addition, remember my update of February 2nd. As first reported here at the VRA, an epic battle is now underway…one that Pres. Obama has since confirmed…and the full weight of his Administration and central banks globally is being brought to bear on the world’s top leaders. They now understand fully that they MUST embark on aggressive easy money policies, or there will be a very large price to pay.

Going forward, I fully expect to see that Greece (followed by other EZ countries) will receive both debt flexibility and debt forgiveness…whatever it takes in order to win the central banks financial war against “their version of deflation"…something that we know the truth about…banks require significant "monetary velocity" in order to continue with their ponzi scheme.

This is exactly how currency inflation eventually takes over…leading to what can only result in rampant hyperinflation. 

And remember this most important point; Greece needs just $60 billion or so in the short term…a drop in the bucket for a combined EZ GDP of nearly $13 trillion.

The VRA Core Portfolio has been recommending Greek investments and if we are given the opportunity we will be adding additional positions (both stocks and options). 

BTW, this new Greek Prime Minister has some big brass ones. Alexis Tsipras has been “telling” Germany that they will need to compensate Greece for Nazi war reparations…have fun with that one Germany. 

DOW 24,000?? IT MAY HAPPEN FASTER THAN YOU THINK 

As I’ve been saying, the size of the move higher…before this bull market is over…could be FAR greater than 99% of the investing public has any clue 

I make this prediction with a fair amount of trepidation…a major black swan event could easily knock the market 10-20% (or more) lower in the blink of an eye. But frankly, that’s one of the reasons for my optimism with stocks…the vast majority of people are nervous and out of the market.

Here are the reasons I have been bullish…while 70% of the investing public has been bearish:

One: Bull markets don’t end until the public is fully invested. Then, once the majority believes that stocks cannot fall…that’s when the rug is pulled from beneath their feet. And right now, stock ownership by the public is much closer to the all time lows than vice versa…

Two: With global QE still very much in play, along with ZIRP (zero interest rate policy), and NIRP (negative interest rate policy), central banks around the world are essentially forcing investors to buy stocks…there’s nowhere else to put your money, in the hopes of making a decent return and the ability to EVER retire.

Three: As extensive VRA research/commentary has made clear, once the FED starts to raise interest rates, history tells us that instead of falling, stocks actually RISE in price (until the 3rd rate increase…on average). And of course, we aren’t there yet…no rate increases.

Four: DON’T FIGHT THE TAPE AND DON’T FIGHT THE FED…the most important paradigm of investing. 

I see very few…if any…supposed Wall Street guru’s discussing the four points above. Again…the minority/contrarian view is almost always the correct view.

Finally, in every major bull market that I have seen or studied, the top is marked by what is referred to as the “blow-off stage”. This is the final leg higher, and is met with investor euphoria and ramping stock prices. Think back to 2000 and you’ll know what I am talking about. We are nowhere close to this environment…

Let me repeat…the world is full of black swan possibilities. But unless we see one rear its ugly head, the path of least resistance…just based on the four facts I’ve explained here, is higher…and potentially, quite a bit higher.

For the Dow to hit 24,000, it would mean a move higher of 33% from today’s levels (18,000 currently). You’ll see pretty much no one else discussing this possibility…another reason that it’s likely to happen.

Finally (for now), oil prices continue to stabilize and move higher. The volatility will continue to be crazy, but the trend higher should also be maintained. If we get another significant pullback we will look to add to our new position in energy…via stocks, options and ETF’s. 

As of now, my target for oil is $100+ in less than 14 months. We will make a fortune here 

Until next time, thanks again for reading.

Kip

Vraletter.com (est. 2003)

@kherriage

kip@vraletter.com