As I type this, a flurry of activity is taking place within security and financial circles around the world. Normally, this would signify just another busy day in the hard-working quarters of modern defence and finance, however this time there is good reason to suspect that the world may be about to witness something historic.
If not something violent, then certainly something spectacular.
I’m not going to waste time on a long, detailed post. Instead, I’m going to present the data, the facts and the patterns. Then I’m going to make you make up your own mind.
First are the financial movements that preceded the security movements, starting with the CNN Money report on October 1st, which shows an unusual .15 yield on treasury bonds. Basically, investors are betting big time on ‘you know what’ hitting the fan shortly.
Digging a little deeper we begin to see something interesting emerge. As of closing (again, October 1) on Friday, we see some unusually high option volume reported in Schaeffer’s Investment Research supporting this trend.
The S&P traders seemed to be on the bandwagon too. This video showing massive put options on the S&P for October speaks for itself.
It was only today that it became clear to many that the world economy is actually decoupling from the U.S, fleeing the sinking ship while it still can. In that industry, you look out for yourself.
To top it off, the other global capital of modern finance, London, has even worse news.
According to an economic think-tank and Sky News, the UK is on the cusp of a second banking failure.
Now whether all of these events are pointing towards the same thing or not, the theme of something big happening soon is replete throughout the media lately. We should not be scared, nor should we panic. We must take a step back and look carefully at what is going on so that we can assess what, and where, the real danger actually is.
With the unusual activity happening in one place, we could be mistaken for missing the events unfolding in another.
That other place is Western Europe.
This week, the United States and Britain issued a strong travel warning to European-bound tourists. Without offering specifics, they said the threat was “high” and “imminent”, raising more questions than it answered. Yes, this happens from time to time and in most cases nothing comes of it.
That’s why when Japan issued an extremely rare travel warning to its citizens, this developing story suddenly became a lot more interesting to me. An official at the foreign ministry in Tokyo said that the warning “was not prompted by any specific intelligence but by the previous British and American alerts.”
Make of it what you will, but the key phrase here is “unusually rare travel warning”.
So, in summary, we’ve got massive bets on a bumpy ride ahead by prominent investors on the back of warnings concerning imminent terrorist attacks in Europe.
Surely one can’t be blamed if his ears prick up. We will hear of wars and rumours of war (or stock market crashes, terrorist attacks, etc, etc)
But rumours aside, something big is about to happen.