Let's have a look at interest rates.

Interest rates are really nothing more than a measure of the herd's confidence in the ability of the ruling elite to effect a happy outcome to their centrally managed economies.  I think with Bernanke's exit and Yellen's entry, the bond market will give her a chance to see if she can fix this mess instead of constantly just kicking the can down the road.  There will eventually be a forcing function in the form of boomers trying to draw down their retirement accounts.  That is coming, no ifs ands or buts, and when they do they will find that they have been Madoffed.  There is no fixing having been robbed like that.  All that will be left is the the anger of the herd, the witch hunts and the blood lust.  The herd has been docile because it thought it was getting something for nothing.  When the herd can no longer ignore the obvious (which is that it has been conned out of a generation's worth of savings), expect the backlash to be severe.

Of course, the herd will ignore the obvious just as long as it possibly can.  Yellen's replacement of Bernanke represents another round of hope for the hopeless.  The herd will give her some time to show her mettle, but I think not nearly as long as they gave Bernanke.  There will be a year long "honeymoon" period IMO but after that the herd will realize that Yellen is just a bureaucrat, devoid of any vision and even less capable of hiding the collapse than Bernanke was.  You will know the herd is giving up by interest rates which begin to climb in spite of all efforts of the fed.  This is known as losing control of the bond market.

So here is the chart of the TNX ETF which attempts to track the 10 year treasury rate (at a times 10 multiple).  I think it shows an ending diagonal playing out.  Interest rates have been rising of late but I think they will hit a wall at the resistance line (which most people don't even know exists; it exists in a different mental spectrum than most people ever visit).

There are several reasons why I think the blue model line will play out.  These are not presented in any particular order of importance:

• Ending diagonals seem to be found all over the charts these days.  I have been able to spot a good number of peaks and troughs in individual charts using this pattern.
• Yellen will get a grace period.  The market is not just going to assume she is a clueless, soulless, vision-less loser of a nannycrat.  She will have the opportunity to prove it.  She will not disappoint in this regard.
• If this chart was going to break out right now then it would likely have to do so on a 3rd wave.  But the 3rd wave of the recent move up has already completed.  In fact, I think it was a C wave because triangles form from 5 waves (which I like to refer to as "rail bumps") each of which consists of 5-3-5 (in other words, A-B-C) moves.  Look at the wave which I indicated as red 4 in the chart above.  The first wave up off the bottom rail took a small a-b-c retracement and then 5 more clearly discernible waves up into C of 4.  Note the C wave was stronger than the A wave.
• A failure to break out right here would leave us with a declining double top.  That suggests lower interest rates.
• The last interest rate bottom actually saw people buying houses and refinancing.  I suspect that the final rate dip will see very little of either of these activities and in fact will be the reason why the rates are taken lower and lower (trying to find that level at which Keynesian "animal spirits" are rekindled by the central controlling authorities).  It is by this lack of market response that I think Keynes and all of his followers will be completely disgraced.  This outcome would show that at some point the herd no longer reacts to the central control.  In other words, just as Austrian economists have been writing about for years: the good old law of diminishing returns.

It is likely that the peak in confidence (which is the same thing as the coming bottoming of interest rates) will be accompanied by other, perhaps global, political events.  When debts cannot be repaid it oftentimes leads to war.  Here is a word to the wise: any wars started by the government or by the bankers will come wrapped in an American flag and they will stink of false nationalism, perhaps even with a major false flag event.  In response to this, people should storm Washington DC, not whoever the enemy is that the government tries to sell us.  Whatever you do, tell your children to stay out of the military.  They will be better off working the land for food than trying to scratch out a living fighting for our corrupt and lawless government.