I have stated over time some things that have been proven correct. Here are some:
• The US is a fraud enterprise
• Real estate will drop at least 30%
• The Dow will drop at least 50%
• The USD will fall
• By the end of 2008 there will be tears on the streets
A couple still unfolding:
• Gold to hit 2k by the end of 2011
• We are heading into the greater depression
The fraud enterprise was proven to be true with the near collapse of the financial system. Unfortunately the fraud is still continuing. Large scale paper transactions add nothing of great tangible value to wider society and as long as it continues to go on unabated the free enterprise system will continue to be a fraud.
Real Estate has dropped more than 50% in some areas. Some think that real estate has recovered, however, I think this is delusional. There is a second and third wave coming, the commercial real estate defaults and the prime borrowers default. There will be no leveling off of the real estate market until around late 2011/2012.
The Dow did drop over 50% however I do not expect it go back down to that level but it would be better if it did. I expect it to trade within a range of 7k 11k for a while yet. However if it goes above 15k then heaven help us all!
The USD has fallen more then 50% vs CDN currency and has fallen very much vs all major currencies. This is the only way that the US can pay all of its foreign debt and meet all of its debt obligations. Expect the USD to continue to fall.
There was already tears on the streets in many US cities by the end 2008 and still continue to be the case in many major US cities, Detroit, LA, NY, Cleveland, to name a few. I expect this to get uglier as unemployment continues to rise.
Gold is today over 1K and I expect this to continue to increase in value. With all of the money being created in the US and worldwide, I expect gold to appreciate vs all currencies. The last time gold hit its high the ratio was 1:1 Gold vs the Dow. Take your pick either the Dow falls or gold increases or we have a combination and they meet somewhere in the middle. Even if the ratio is 2:1 for the Dow you can see the potential for gold to increase in value.
We are heading for a greater depression, when the combination of real unemployment and real inflation goes over 30 we have entered a depression. The combination of unemployment and under employment puts Real unemployment at about 15. Real inflation is currently close to double digits, I expect this to increase to at least 15%, hence the increase in gold price, and the Dow not falling back to its 2009 lows. If we ever hit hyper inflation then gold will hit some crazy highs and that would not be good for anyone of US.
It took us over 25 years to get to the peak of the economic and financial bubble and anyone who thinks it will unfold in 2 or 3 years need to think again.
At the end of the day, despite what the talking heads say, deflation is better than inflation. Inflation enables the ones in power to transfer wealth from the poor and working class to themselves as paper is worth less and less over time. In deflationary times paper is scarce and it is at least worth something more than in inflationary times.
I believe that the worst is not yet over, buckle up and make the moves that will let you go through this crisis with minimal impact, however, none of the poor, working or middle class will be spared, but, we can minimize the damage. Good luck!
Tuesday, October 20, 2009
Friday, June 5, 2009
Markets will crash soon
The markets will crash soon, probably within the next month. We are still in a long term bear market and eventually the bear will take over again, likely before the end of June. The US is still in crisis with unemployment, debt, deficit, real estate and the falling dollar still major problems.
The problems will continue for years. I expect real estate to bottom somewhere in the second half of 2011. High unemployment will continue for years and inflation will be high. I expect the Dow will fluctuate between 7000 and 11000 for many years to come; at least 10 yrs. If it goes below its March 2009 lows or above 11000 during this period, heaven help us. The US is adding liquidity 3 times as fast as Japan and Japan has had almost 2 decades of a fairly flat stock market, the US should not be any different. If it is different then we are in even worse trouble.
Whilst travelling last Christmas, someone overseas said to me; “you know, a big scam brought us here and I believe it will take another big scam to get us out of it”. I hope he was right and I hope they are cooking up a good scam, because the one they are serving up right now isn’t working.
The problems will continue for years. I expect real estate to bottom somewhere in the second half of 2011. High unemployment will continue for years and inflation will be high. I expect the Dow will fluctuate between 7000 and 11000 for many years to come; at least 10 yrs. If it goes below its March 2009 lows or above 11000 during this period, heaven help us. The US is adding liquidity 3 times as fast as Japan and Japan has had almost 2 decades of a fairly flat stock market, the US should not be any different. If it is different then we are in even worse trouble.
Whilst travelling last Christmas, someone overseas said to me; “you know, a big scam brought us here and I believe it will take another big scam to get us out of it”. I hope he was right and I hope they are cooking up a good scam, because the one they are serving up right now isn’t working.
Thursday, February 26, 2009
Convergence and divergence between Japan and the US
I have called for this crisis to take anywhere from 10 to 25 yrs before we see any turn around. I have called for RE to drop a lot and as much as 50% in some places, I have called for the Dow to fall 50%, among other forecasts that I have made in the past.
Now after looking at data from Japan I realize that things can get even worse. Here are some observations:
In Japan’s RE boom a piece of land about 3.41 square kilometers of land on which the Emperor's palace sits was worth all the land in California, no need to tell you what happened shortly after.
In its peak the Nikkei was over 38000, today it is under 8000
The down at its peak was over 14000, in this down turn it has gone as low as under 7200 (do you see what can possibly happen?)
Japan started out sourcing jobs to other pats of Asia.
The US has done the same
Japan lowered interest rates as much as they can to avoid their crisis but it did not work
The US is also doing this
Japan had a lost decade in the 90’s and a horrible one this decade also
Will the US suffer the same fate?
Japan had very little debt
The US has massive debt
Japan had a Trade Surplus
The US has a trade deficit
Japan created a lot of paper over a ten yr period
The US has created just as much in a third of the time
Japan was able to avoid a depression
Will the US be able to avoid a depression?
Well we are doing all of the same things the Japanese did but only much faster. Japan was able to avoid a depression because of a trade surplus and very little foreign debt compared to the US. Because of the trade deficit, overall debt and monetary inflation in the US, there is no way in the hell the US can avoid the Greater Depression. As a matter of fact it has already started.
The world is full of stupid people and every time I hear someone says “go out and spend” to get us out of this, I add one more idiot to the list. You cannot create more debt to get out of debt, you do not create long term solutions by going into debt, now sir! You solve financial problems by saving and paying off those debts. Saving instills confidence in individuals and countries. Saving provides capital for innovations. Debt only encourages leveraging that transfers wealth from the poor and working class to the power class and it props up the fractional reserve banking system that facilitates this transfer of wealth from the working class and poor to the power class.
What will save us and avoid a crisis of this magnitude in the future is saving and a gold backed currency, without these, life will be a living hell for the foreseeable future.
In closing I will restate another forecast I made many times; Gold will hit 2K by the end of 2011. And to that I will add Oil will go to 100 dollars a barrel within 3 years.
Now after looking at data from Japan I realize that things can get even worse. Here are some observations:
In Japan’s RE boom a piece of land about 3.41 square kilometers of land on which the Emperor's palace sits was worth all the land in California, no need to tell you what happened shortly after.
In its peak the Nikkei was over 38000, today it is under 8000
The down at its peak was over 14000, in this down turn it has gone as low as under 7200 (do you see what can possibly happen?)
Japan started out sourcing jobs to other pats of Asia.
The US has done the same
Japan lowered interest rates as much as they can to avoid their crisis but it did not work
The US is also doing this
Japan had a lost decade in the 90’s and a horrible one this decade also
Will the US suffer the same fate?
Japan had very little debt
The US has massive debt
Japan had a Trade Surplus
The US has a trade deficit
Japan created a lot of paper over a ten yr period
The US has created just as much in a third of the time
Japan was able to avoid a depression
Will the US be able to avoid a depression?
Well we are doing all of the same things the Japanese did but only much faster. Japan was able to avoid a depression because of a trade surplus and very little foreign debt compared to the US. Because of the trade deficit, overall debt and monetary inflation in the US, there is no way in the hell the US can avoid the Greater Depression. As a matter of fact it has already started.
The world is full of stupid people and every time I hear someone says “go out and spend” to get us out of this, I add one more idiot to the list. You cannot create more debt to get out of debt, you do not create long term solutions by going into debt, now sir! You solve financial problems by saving and paying off those debts. Saving instills confidence in individuals and countries. Saving provides capital for innovations. Debt only encourages leveraging that transfers wealth from the poor and working class to the power class and it props up the fractional reserve banking system that facilitates this transfer of wealth from the working class and poor to the power class.
What will save us and avoid a crisis of this magnitude in the future is saving and a gold backed currency, without these, life will be a living hell for the foreseeable future.
In closing I will restate another forecast I made many times; Gold will hit 2K by the end of 2011. And to that I will add Oil will go to 100 dollars a barrel within 3 years.
No We Can't
Well the new mantra “Yes we can” has everyone believing. However, as kids almost everyone believed in Santa Clause and the tooth fairy, but, as time proved it was just a fallacy. So it is, this “yes we can” mantra will prove to be a fallacy.
The economy is not an electronic device, or a machine, that you can turn on or off with the flick of a switch, it is a dynamic instrument that will rebalance from time to time regardless of what the pundits preach or the devotes chant. In other words one cannot say “we will create 3 million jobs” and boom it happens, hell if that were the case then why not go for zero unemployment. The robbers at the top can run the printing presses overnight for as long as they want and create endless piles of money, however, fiat money does not equal jobs or something tangible. The running of the printing presses will cause massive inflation, perhaps hyperinflation and if that happens, then heaven help us all!
“Yes we can” create all the fiat money we want, but, "No we cannot" fix the economy of this fraud that has been perpetrated on the poor and working class people of the world. As I have said many; times what is unfolding right now is something no one alive has ever seen. The Greater Depression has started my friends and it does not matter what anyone says or does, the die is cast and suffer we will.
The economy is not an electronic device, or a machine, that you can turn on or off with the flick of a switch, it is a dynamic instrument that will rebalance from time to time regardless of what the pundits preach or the devotes chant. In other words one cannot say “we will create 3 million jobs” and boom it happens, hell if that were the case then why not go for zero unemployment. The robbers at the top can run the printing presses overnight for as long as they want and create endless piles of money, however, fiat money does not equal jobs or something tangible. The running of the printing presses will cause massive inflation, perhaps hyperinflation and if that happens, then heaven help us all!
“Yes we can” create all the fiat money we want, but, "No we cannot" fix the economy of this fraud that has been perpetrated on the poor and working class people of the world. As I have said many; times what is unfolding right now is something no one alive has ever seen. The Greater Depression has started my friends and it does not matter what anyone says or does, the die is cast and suffer we will.
Wednesday, January 14, 2009
Ten to 25 years before a turn around
The economic and financial crisis has been unfolding for over a year now and there are many opinions about when things will turn around. Some feel that it will turn around in 2H 09 or in 2010. I am not sure if this is their own opinion or what they read and hear in the mainstream media, however, be weary of the mainstream media.
Personally I think that this crisis will take anywhere from 10 to 25 years before we see any up trend. Now it depends on when people think the down turn started, if you figure it started in 2001 then best case for a turn around is 2011, if you think it started 2005 then best case 2015. However, it could drag on to 2026 to 2030.
If anyone thinks otherwise, then good luck! My advice to people would be to live way below your means, stay out of debt and if you have any income; save, save, save!
Currently real inflation is double digits, real unemployment is double digits and I expect at least 15% of established businesses – from small to large – to fail this year.
As an aside; In the last depression one of the biggest sellers was spam, guess what! Yes it is one of the biggest sellers again and the factory cannot keep up with demand.
spam in demand
Personally I think that this crisis will take anywhere from 10 to 25 years before we see any up trend. Now it depends on when people think the down turn started, if you figure it started in 2001 then best case for a turn around is 2011, if you think it started 2005 then best case 2015. However, it could drag on to 2026 to 2030.
If anyone thinks otherwise, then good luck! My advice to people would be to live way below your means, stay out of debt and if you have any income; save, save, save!
Currently real inflation is double digits, real unemployment is double digits and I expect at least 15% of established businesses – from small to large – to fail this year.
As an aside; In the last depression one of the biggest sellers was spam, guess what! Yes it is one of the biggest sellers again and the factory cannot keep up with demand.
spam in demand
Tuesday, December 16, 2008
Capitalism is Dead in the USA
I hear many people speak of Capitalism and saying that capitalism in the USA is alive and well.
Well, have people stopped to think what Capitalism really is? I believe what we have in the USA is what many have already called “socialism for the rich”.
This is evident everywhere, bankers being bailed out at the expense of tax payers, White collar criminals stealing countless millions and even billions and doing a relatively small amount of soft time, etc. This is not Capitalism.
Capitalism is a system where there are checks and balances, a system where the government makes the guidelines fair and equal for all and not slanted to the side of the wealthy and powerful. It is a system where the financial markets are allowed to move up or down naturally without government interference, other than the guidelines already in place from the beginning. Any government bail outs amounts to Socialism. Capitalism is a system where market forces unfold without interference or manipulation from the government.
Many may say that if the government does not bail out the troubled sectors then it will be dooms day, well if the government was not interfering and manipulating to begin with we would have never been in this position.
Again, Capitalism is a system of checks and balances and market forces unfolding in an organic way. What we have in the USA today is not Capitalism. Capitalism contracted cancer in 1913 with the creation of the Federal Reserve and died in 1971 when the Gold backing for the dollar was removed.
The only honest checks and balance vehicle is gold and until we go back to an honest gold backing for all currencies then we will go through this situation again and again, the next time worse than the last.
The problem with the Gold Backing is that with it the Wealthy and powerful will no longer be able to rig the system by creating money out of nothing and using it to acquire real assets and also enslaving us by chronic debt. With gold backing we will be playing on a fairly even field but that is no good for the monsters that control our lives today.
If one were to go back and check the check the CPI from 1800 to 1913 you would see that it was basically a flat line from 1913 to 1971 there was a gradual rise, however, from 1971 to today the increase is basically a vertical line.
What we have in the US today is not what the founding fathers had in mind, it is NOT Capitalism. Citizens of the US must demand a rebirth of Capitalism by starting with a return to a gold backed currency.
Well, have people stopped to think what Capitalism really is? I believe what we have in the USA is what many have already called “socialism for the rich”.
This is evident everywhere, bankers being bailed out at the expense of tax payers, White collar criminals stealing countless millions and even billions and doing a relatively small amount of soft time, etc. This is not Capitalism.
Capitalism is a system where there are checks and balances, a system where the government makes the guidelines fair and equal for all and not slanted to the side of the wealthy and powerful. It is a system where the financial markets are allowed to move up or down naturally without government interference, other than the guidelines already in place from the beginning. Any government bail outs amounts to Socialism. Capitalism is a system where market forces unfold without interference or manipulation from the government.
Many may say that if the government does not bail out the troubled sectors then it will be dooms day, well if the government was not interfering and manipulating to begin with we would have never been in this position.
Again, Capitalism is a system of checks and balances and market forces unfolding in an organic way. What we have in the USA today is not Capitalism. Capitalism contracted cancer in 1913 with the creation of the Federal Reserve and died in 1971 when the Gold backing for the dollar was removed.
The only honest checks and balance vehicle is gold and until we go back to an honest gold backing for all currencies then we will go through this situation again and again, the next time worse than the last.
The problem with the Gold Backing is that with it the Wealthy and powerful will no longer be able to rig the system by creating money out of nothing and using it to acquire real assets and also enslaving us by chronic debt. With gold backing we will be playing on a fairly even field but that is no good for the monsters that control our lives today.
If one were to go back and check the check the CPI from 1800 to 1913 you would see that it was basically a flat line from 1913 to 1971 there was a gradual rise, however, from 1971 to today the increase is basically a vertical line.
What we have in the US today is not what the founding fathers had in mind, it is NOT Capitalism. Citizens of the US must demand a rebirth of Capitalism by starting with a return to a gold backed currency.
Massive inflation ahead
Many believe and have been taught by our educational institutions that inflation = increase in the price of goods, commodities and services. However, that is only the result of inflation and not inflation itself.
There is only one type of inflation; monetary inflation. Therefore, inflation is the increase in money supply and deflation is a decrease in the money supply.
As it stands right now, there is a massive increase in the money supply and, therefore, look out for massive inflation in the future. You will see this reflected in gold price.
As a matter of fact over the past 6 yrs gold has doubled in price and still has a long way to go.
I expect Gold to hit at least $2000.00 by the end of 2011
There is only one type of inflation; monetary inflation. Therefore, inflation is the increase in money supply and deflation is a decrease in the money supply.
As it stands right now, there is a massive increase in the money supply and, therefore, look out for massive inflation in the future. You will see this reflected in gold price.
As a matter of fact over the past 6 yrs gold has doubled in price and still has a long way to go.
I expect Gold to hit at least $2000.00 by the end of 2011
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