With so much going on nationally and internationally, there has been some major changes occurring in regards to US economic news that has been under-reported and basically ignored by the MSM, with Gregory Mannarino telling traders to "prepare for the worst case scenario," and Martin Armstrong,†the former chairman of Princeton Economics International, best known for his economic predictions based on the†Economic Confidence Model which he developed, saying "You really cannot make up this level of insanity."
The U.S. Supreme Court ruled last week in the unanimous 8-page decision, Tibble v Edison, stating that employers have a duty to protect workers in their 401(k) plans from mutual funds that perform poorly or are too expensive. That is simply astonishing since there is no constitutional requirement for even government to provide social benefits. The Supreme Court held in the 1980 case HARRIS v McRAE, that there is no duty imposed upon the state to provide a public program, for that would convert the constitution from a negative restrain upon government to a positive obligation to provide for everyone.
If we take the fact that the constitution is NEGATIVE, and was a restrain upon government, then this latest ruling is completely unfounded. Mondayís unanimous ruling sends a warning to employers that they now must improve their plans, as it is now an obligation to project employees. This comes just in time for the next step is government to seize private funds and prosecute employers who poorly chose a fund manager. This fits perfectly, and is just in time for the Obama Administrationís next assault as they prepare a landmark change of its own by issuing rules requiring financial advisers to put the interest of customers ahead of their own. This creates a very grey area wide enough to justify public seizure of pension funds under management.
Yet this decision is even deeper. It sets the stage to JUSTIFY government seizure of private pension funds to protect pensioners. When the economy turns down and things get messy, they place measures to eliminate money in its physical dimension by closing all tax loopholes and shutting down the world economy with FATCA. They are preparing for the final straw of Economic Totalitarianism with the Supreme Court reversing its entire construction of the Constitution to impose a duty upon employers to ensure the 401(k) plans perform in a world where interest rates are going negative. You really cannot make up this level of insanity.
Armstrong succinctly concludes "Between the court ruling and the Obama Administrationís push for stronger fiduciary rules sends a strong message that government can easily seize the pension fund management industry, of course to ďprotect the consumer".
Turning to the stock market news, trader Gregory Mannarino provides proof that the "bull market in stocks is over," and says it is "not just the inordinate low market volume, capital outflows, or even the lagging transports, but it is the divergences between them," leading him to state "something has to give," and there is "no end in sight," †then warning people in the video below to "prepare for a worst case scenario."
Mannarino's advice is spot on, prepare for the worst and hope for the best.