Man­u­fac­turing activity is too low to create new jobs. St. Louis Fed pres­i­dent wor­ries about defla­tion and eco­nomic decline. Leading finan­cial pundit is taking Robert Prechter seri­ously: Could the Dow hit 1,000? M3 money supply in the U.S. is con­tracting at a 10 per­cent annual rate. Stocks still have some resilience but the rally is wearing very thin; a strong down­draft in prices could be seen as early as next week.

Secret and unac­count­able intel­li­gence net­works threaten the secu­rity of all Amer­i­cans while leading the U.S. down the road to out­right tyranny.  Durable goods orders shrunk in June by 1 per­cent, while the Baltic Dry Index con­tinues its free fall plunge. Moody’s turns neg­a­tive on big banks as 2010 bank fail­ures tops 100.

Real estate fore­clo­sures rise as sales decline. Without a sub­stan­tial recovery in employ­ment, there can be no true rebound in real estate. When he headed the NY Fed, Tim­othy Gei­thner knew that some of the AIG bailout money was going to Euro­pean banks; did he lie to the Senate during his con­fir­ma­tion as Sec’y of the Trea­sury? Stocks are at cross­road, looking at a down day on Tuesday/Wednesday or an extended rally lasting for another 1 – 2 weeks.

Euro­pean bank stress tests are lame because sov­er­eign debt risk is not fac­tored in. Is ECB’s Trichet trying to push Humpty Dumpty off the wall by pushing global aus­terity? Investors tem­porarily cling to the good news of earn­ings reports, while stocks take on a more com­plex cor­rec­tion pattern.

So far, TARP has cost $45,000 for every man, woman and child in America. The Finan­cial Reform bill is largely the same as the Trea­sury Blue­print cre­ated in 2008 on Henry Paulson’s watch at Trea­sury; it just needed the right crisis to slip it through. Defla­tion is get­ting more wide­spread recog­ni­tion. Stocks should con­tinue to work their way down in weeks to come, as with gold and silver.

Geithner’s poor han­dling of GM and Chrysler dealers caused the failure of thou­sands of small busi­nesses. The IRS, which Trea­sury man­ages, will cause addi­tional thou­sands of fail­ures with dra­conian enforce­ment of Oba­macare require­ments. Is the glob­alist goal to estab­lish a Tech­noc­racy in America and the world? Stocks appear ready to com­plete a minor upward cor­rec­tion prior to heading down again.

“The world is at risk of folding in on itself”, according to a Roubini econ­o­mist. Man­u­fac­turing and prices both fell in June, marking eco­nomic dete­ri­o­ra­tion and defla­tion at the same time. Con­sumer sen­ti­ment also dropped in July to the lowest level in one year. Stocks were pun­ished hard as wave 3 down resumes. There is some risk of a water­fall decline from cur­rent levels.

Pres­i­den­tial Com­mis­sion on Debt: A “cancer” that will “destroy us from within.” Retail sales fell for second month as 70 per­cent of Amer­i­cans believe we are already in a reces­sion. Summer travel and tourism had rocky start in June. Mort­gage appli­ca­tions fell to a 13 year low, fur­ther dete­ri­o­rating the real estate market.

Con­sumer credit scores are in the tank as bor­rowers slip below a 599 rating. These will not help any sup­posed retail revival in the near future. The FDIC indi­rectly admits that there are “large, risky banks” in the 8000 lenders who col­lec­tively hold $7 tril­lion of deposits. Stocks may have already set minor wave 2 highs, and are ready to roll over into wave 3 down.

Greenspan says “pause” in economy. Pri­va­ti­za­tion of public assets will accel­erate as states go broke. Debt col­lec­tion agen­cies are more abu­sive as con­sumers have less to pay on debt. When the cur­rent market rally peaks, the next direc­tion should be down hard to new lows.