Sorry, Scarlett! This is the beginning of the end.

While one of my most favorite female celebrity, Ms. Scarlet Johansson, is harshly criticized due to her appearance in a commercial short movie of SodaStream, which is allegedly connected to Israeli settlement in the West Bank, the geopolitical circumstances in the Middle East seem to have rather calmed down. In this regard, you can easily find some examples: After the Israeli President Peres had showed his readiness to hold a dialogue with the Iranian, his counterpart in Iran, Rouhani, donated 400,000 US dollar to a Jewish hospital in the country. On February 10, the second round of the Geneva II will begin in spite of the fact that the first one led us to a common stale mate called “agree to disagree”.

In accordance with such an apparent change of geopolitics, the Japanese stock market started to rebound as below:

Nikkei225_20140207

My closest alliance partner, Mr. “HKD”, sent me the latest result of his statistical analysis of the Nikkei 225 index, and pointed out the NY Dow index could even rise after February 19:

20140207    -1    16071.21    over 1916.09
20140210    -1    15137.19    over 674.78
20140212    -1    15087.43    over 625.02
20140213    -1    15391.5       over 929.09
20140214    -1    14983.38    over 520.97
20140217    -1    14890.29    over 427.88
20140218    -1    14661.27    over 198.86
*20140219    1    14295.66    over -166.75
20140220    1    14381.08    over -81.33
20140221    1    14369.45    over -92.96

Hmmm…  My adaptive unconscious still continues to give warnings for volatilities in the financial market. Yes, the market will be further reversed positively, but only for a while. Around February 19, that could be stopped suddenly due to the following two risk factors:

The one is that the Korean War II would break out. Even though the DPRK pretends to show its peace offensive, this year’s Ulchi Freedom Guardian will begin from February 17 as planned, which the North can’t tolerate. Especially this time, the North would react on it drastically with a declaration that the ROK didn’t accept the former’s official request to resolve the issue peacefully. An open source says the US held secret talks with the DPRK on this issues in Tehran (!!!), but that is, of course, not officially confirmed.

The point is the US needs momentum to draw positive attention of the world to US dollar and federal bond as safe havens in crisis. The famous ” federal debt limit” will seem to be reached till the end of this month. In order to avoid a fatal default, the US must let the rest of the world buy its bond. The latest financial turmois in emerging markets such as the PRC was obviously connected to this momentum. In this regard, I fully agree with the argument of the Russian propaganda. For the US leadership, a military crisis which is effective enough for a financial turbulance is urgently needed. One of them is surely a sudden military crash between the North and South in the Korean Peninsula.

The second one is possible disappointment at the forthcoming round of the financial policy meeting of the BOJ on February 17 and 18. After the FRB started the so-called “tapering” of the QE, the world financial market relies mainly on the ABENOMICS or the Japanese style of quantitative easing. The ECB can never move forward because of the liquidity trap. Under such a circumstance, everybody expect an additional bazooka of the BOJ but in vain, while the Japanese stock market has just begun to rebound as I showed. This tentative policy of motionlessness could cause abrupt disappointment of the world’s public opinion, which would lead us to an even much more sharp collapse and crisis of the market than before.  In this case, the BOJ would be regarded as an offering for the financial survival of the US.

People Scarlett Johansson

Anyway, don’t expect too much until the real crisis called “sudden default of the USG” will reveal. Sorry, Scarlett, the current situation in the market seems to be the very beginning of the end of the prolonged “Pax Americana”, which raises you to celebrity.

 

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