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Hi there everyone.

Heres a few charts I pulled from FRED today.

These are the four big drivers of economic activity, all credit adds new purchasing power to the economy.

And these four measures of credit expansion and contraction show that the U.S economy is on the back of of a credit cycle right now.

Each of these measures are approaching the ZERO line rapidly.

And once credit expansion turns to credit contraction,  the credit fueled economy is toast!

Disinflation is here.

Deflation is next,

Watch out financial markets!

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S&P 500.

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The S&P has flatlined today,
after completing a possible five wave pattern in wave (v) grey at todays high.
The trend channel in wave (v) grey has held the price so far.
Although it is still possible that we get a throw over in wave 'v' in an extension.

The new highs in the market arrive with 167 year highs in consumer confidence as reported by bloomberg today.
https://www.bloomberg.com/news/articles/2018-08-28/
The last high came in October 2000.
Nobody wants to make the one single logical conclusion from this data point.
And that is,
Consumers are supremely confident at the end of a trend,
not the beginning or middle of a trend.
Of course the economists project linearily into the future this time also.
“These historically high confidence levels
should continue to support healthy consumer spending in the near term,”
Lynn Franco, director of economic indicators at the Conference Board, said in a statement.

Tomorrow;
I will continue to look for signs of an impulsive decline off the wave (v) high.

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