The Last Time These 3 Ominous Signals Appeared Simultaneously Was Just Before The Last Financial Crisis

by | Nov 16, 2017 | Headline News | 18 comments

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    This article was originally published by Michael Snyder at The Economic Collapse


    We have not seen a “leadership reversal”, a “Hindenburg Omen” and a “Titanic Syndrome signal” all appear simultaneously since just before the last financial crisis. Does this mean that a stock market crash is imminent? Not necessarily, but as I have been writing about quite a bit recently, the markets are certainly primed for one. On Wednesday, the Dow fell another 138 points, and that represented the largest single day decline that we have seen since September. Much more importantly, the downward trend that has been developing over the past week appears to be accelerating. Just take a look at this chart. Could we be right on the precipice of a major move to the downside?

    John Hussman certainly seems to think so. He is the one that pointed out that we have not seen this sort of a threefold sell signal since just before the last financial crisis. The following comes from Business Insider

    On Tuesday, the number of New York Stock Exchange companies setting new 52-week lows climbed above the number hitting new highs, representing a “leadership reversal” that Hussman says highlights the deterioration of market internals. Stocks also received confirmation of two bearish market-breadth readings known as the Hindenburg Omen and the Titanic Syndrome.

    Hussman says these three readings haven’t occurred simultaneously since 2007, when the financial crisis was getting underway. It happened before that in 1999, right before the dot-com crash. That’s not very welcome company.

    In fact, every time we have seen these three signals appear all at once there has been a market crash.

    Will things be different this time?

    We shall see.

    If you are not familiar with a “Hindenburg Omen” or “the Titanic Syndrome”, here are a couple of pretty good concise definitions

    • Hindenburg Omen: A sell signal that occurs when NYSE new highs and new lows each exceed 2.8% of advances plus declines on the same day. On Tuesday, they totaled more than 3%.
    • Titanic Syndrome: A sell signal triggered when NYSE 52-week lows outnumber 52-week highs within seven days of an all-time high in equities. Stocks most recently hit a record on November 8.

    You can see the other times in recent decades when these three signals have appeared simultaneously on this chart right here.

    Once again, past patterns do not guarantee that the same thing will happen in the future, but if the market does crash it should not surprise anyone.

    10 days ago, I published an article entitled “The Federal Reserve Has Just Given Financial Markets The Greatest Sell Signal In Modern American History”. I pointed out that this stock market bubble was created by unprecedented central bank intervention, and now global central banks are reversing the process that created the bubble in unison. There is no possible way that stock prices can stay at these absolutely absurd levels without central bank help, and if global central banks stay on the sidelines a market decline would seem to be virtually inevitable.

    Meanwhile, we are also witnessing a very alarming flattening of the yield curve

    Hogan said the market is nervous about the “flattening” difference between the 2-year yield and the 10-year Treasury yield, which have been moving closer together. The curve dipped to 68 basis points Tuesday, a 10-year low. Hogan said 70 has become a line in the sand, and when it falls below that traders get nervous.

    flattening curve can signal that the curve will invert, which historically means a recession is on the horizon.

    If the yield curve does end up inverting, that will be a major red flag.

    But the experts assure us that we have nothing to worry about.

    For example, just check out what Karyn Cavanaugh of Voya Financial is saying

    “Now that the earnings season is wrapped up, markets are more beholden to macro data. Weakness in oil prices and skepticism about the passing of the tax bill are also weighing on sentiment,” said Karyn Cavanaugh, senior market strategist at Voya Financial.

    Despite the drop on the day, major indexes remain within 1.5 percentage points of record levels.

    Any pullback at this stage should be viewed as an opportunity to buy, however. Earnings outlook for U.S. stocks, especially with the synchronized global growth environment is still good,” Cavanaugh said.

    And U.S. consumers continue to pile on more debt as if there is no tomorrow. This week we learned that U.S. household debt has almost reached the 13 trillion dollar threshold

    Americans’ debt level rose during the third quarter, driven by an increase in mortgage loans, according to a Federal Reserve Bank of New York report published on Tuesday.

    Total U.S. household debt was $12.96 trillion in the three months to September, up $116 billion from the prior three months. Debt levels were $605 billion higher than during the third quarter of 2016.

    The fundamentals do not support this kind of irrational optimism.

    What the fundamentals have been telling us is that in the absence of central bank support we should see the markets start to decline, and that it is quite likely that a painful recession is on the horizon.

    As the next crisis erupts, the mainstream media is going to respond with shock and horror. But the only real surprise is that this ridiculous bubble lasted for as long as it did.

    The truth is that a market decline is way overdue. If central banks had not pumped trillions upon trillions of dollars into the global financial system, there is no possible way that stock prices would have ever gotten so high, and now that the central banks are removing the artificial life support we shall see how the markets do on their own.

    Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on

    GetPreparedNow-MichaelSnyderBarbaraFixMichael T. Snyder is a graduate of the University of Florida law school and he worked as an attorney in the heart of Washington D.C. for a number of years.Today, Michael is best known for his work as the publisher of The Economic Collapse Blog and The American Dream

    If you want to know what is coming and what you can do to prepare, read his latest book [amazon text=Get Prepared Now!: Why A Great Crisis Is Coming & How You Can Survive It&asin=150522599X].


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      1. Well, when it blows, it will NOT be pretty folks. The entire system seems to be so damn manipulated and “ponzi like” in various ways…

        • No doubt it is all just an illusion and a giant criminal enterprise at this juncture, both economically/financially and politically.

          How is it possible we have an ongoing investigation aganiit Trump and nothing found at all after a full year + of false accusation that were fabricated, yet Hillary, Comey and many others walk freely and we know of many of their far more serious crimes with massive amounts of evidence ? This can only happen in a fully corrupted and criminal run system. What most people cannot wrap their head around is that all of it can only last until the day doesn’t ? And it is all being revealed and breaking down all on its own weight. There will be a series of outlier events and that is how it will fail one day. Some of them are already in motion and many more are floating around out there as we speak ! We are all already on the Titanic and few can see it. No reason to live in fear or freak out, but all the more reason to get ones shit together in every possible way an enjoy it as well. That is what the warrior mindset is all about. This guy has some excellent videos on the subject just as I have been teaching for a long time !

          My solution is get super fit and healthy,short TSLA, CAH, MCK and enjoy it all !

        • The entire system so damn manipulated? NO KIDDING, it never should have been any where near where it is with cooked books.

      2. The only thing that matters is the yield curve inverting.

        • To some degree but not the only factor by a long shot. The bond markets are a very serious matter as well as credit markets. But there are many other factors in play as well. Mostly the massive bubbles that have been created.There are many, not just one.

      3. Due to long-term manipulation by the Federal Reserve (Printing money like it came from the Monopoly game), our stock market and housing prices have been simultaneously manipulated. Normal indicators for all markets have been jaded. This article correctly points out that this manipulation cannot be extended forever. You can’t run your household like that nor can a government hide from reality forever.

      4. We can ignore reality, but reality will not ignore us.

      5. Meh,,,
        Dont have stocks, dont have money, seriously doubt it will affect my garden or chickens!

        • Nailbanger, same here. I just keep stacking.

          • 1776, Stacking won’t make much of any difference in any event if you are not fully trained out, fit and healthy. That is by far the best insurance. But they all have a place in the scheme of things in the correct proportions. Just a matter of priorities, practicality and functional readiness. Which is all about how we think and then act on it !

            Far better to enjoy everyday and ones health and abilities now with no limits and confidence.

      6. All I took from this is gas prices at the pump are going up. A thirty cents hike in the past week headed higher. A twenty five cents further increase would top hurricane Irma pricing.

        • It’s just $2.33 here in northeastern NC.

      7. Only difference is this time it will be much worse.

      8. Sort of looking forward to the crash. It’ll be a good thing in the long-run if we/I can survive. The reset is sorely needed in so many ways. Not simply financial; more, a real sea-change to the whole way we are living. Getting shed of the digital life we all lead in one degree to another will allow us all to break the chains of our self-absorbed addictions. Yeah….. if we make it through, those of us who do, it will be a good thing. My dream? Dinner @ the table around 5 with family or friends or allies.

        • Heart, a financial reset would seriously cause massive societal changes and I agree not all of it would be a negative ! It may end up being the only hope for any serious badly needed changes to occur and a sort of cleansing affect or culling of bad acts and ideas.

      9. There will be no Reset. If You owe debt now you will still own & owe that debt after any finiancial crash. What will happen is a skyrocket ride to a no holds barred survival of the fittest Stone Age existence. You better be tuff and mentally prepared to endure and survive on your own.

      10. Mossberg 500 and plenty of a 12g rounds of 000 Buckshot. Barbed wire fencing to hold back the random unprepared looting hoards. Be able and plenty prepared to defend your property.

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