Skip to comments.Dow Theorist: Sell Everything Liquid, You Won't Recognize America By The End Of The Year
Posted on 05/18/2010 7:05:51 AM PDT by blam
Dow Theorist: Sell Everything Liquid, You Won't Recognize America By The End Of The Year
May. 18, 2010, 8:57 AM
Image: US Army
Richard Russell, the famous writer of the Dow Theory Letters, has a chilling line in today's note:
Do your friends a favor. Tell them to "batten down the hatches" because there's a HARD RAIN coming. Tell them to get out of debt and sell anything they can sell (and don't need) in order to get liquid. Tell them that Richard Russell says that by the end of this year they won't recognize the country. They'll retort, "How the dickens does Russell know -- who told him?" Tell them the stock market told him.
That's pretty intense!
Update: By popular demand, here's more on what he sees in the market:
And I ask myself, "Am I seeing things? The April 26 high for the Dow was 11205.03. The Dow is selling as write at 10557 down 648 points from its April high. If business is even better than expected, then why is the Dow down over 600 points? And why, if there were 674 new highs on the NYSE on April 26, were there only 20 new highs on Friday, May 14? And if my PTI was 6133 on April 26, why is it down 17 points since its April high?
The fact is that I've been seeing deterioration in the stock market ever since early-April, and this in the face of improving business news. The D-J Industrial Average is composed of 30 internationally known top-quality blue-chip stocks. These are 30 of "America's biggest companies." If Barron's is so bullish on the future of America's
The DJIA is up 62 as I post. See here.
(Excerpt) Read more at businessinsider.com ...
Except some of us are living in democrat towns where the community looking good on the outside is more important than survival. So you can’t have a fence large enough to provide any security or privacy. And you can’t raise chickens.
The government doesn’t want anything resold unless it’s been tested for toxicity so there go the garage sales...
We built our deck out of bricks we got from the city dump after the cobblestone street was replaced about 10 years ago. We made our retaining wall out of concrete chunks from the dump after they removed some sidewalk. Now they won’t let anybody get anything from the dump.
And they would probably say that they are the “green” ones.
I adjust my stock and possible procedures as necessary.
That's good, you never know how things will turn out with that situation. I recommend stocking up on vacuum tubes; I don't trust the new integrated circuits that are coming.
LOL ... yep, there are some who would say that, too ... :-)
If you trade online, the trading site will guide you to it.
You can also short the entire market of NYSE, or Nasdaq.
Sorry, I don't trust gold.
Governments can confiscate it.
Remember, Obama is president and he thinks he is the reincarnation of FDR.
See post 56.
Southhack had a good post about surviving the coming adventures ... that song came to mind.
But another thought also popped in: It's Papagallos line from 'Road Warrior", to Mel Gibbsons' character (Mad Max); Goes to the effect of ;" A scavenger, that's what you are, living off the bones of the old dead world..."
While I doubt we'll see any gay biker gangs in assless chaps, putting a bit extra away won't hurt.
I'm pretty liquid now myself....more cash than assets. And I don't feel all that good about it...
Rock and hard place come to mind.......
Do you think that the looters can’t find you out in the woods?
I don’t do much gold. Hard to use it to buy a loaf of bread or a bag of wheat.
A $1 silver coin, though, worth $20 today, is tradeable.
FDR was able to confiscate gold because the people allowed it. What if they don’t next time?
Google “how to short stocks”. If you have a non-margin account google “bear etf’s”.
Assuming, for the sake of argument, that this guy is right about the impending financial doom, isn’t paper currency the last thing you would want your entire worth invested in?
I'm long QID...fwiw-
If you think about it we are just one crisis away from a crash, the camels back is under great stress.
At least he would die on his feet like a man, and not whimpering on the floor like a lib, crying for someone to ‘save him’.
Which way are you going to go?
OK, what’s being advised here? Should I put my entire 401K in a Money Market account?
The percentage of Americans who owned guns in the 1930 was much higher than it is now. 80% of Americans are sheeple. They will not put up much of a fuss, especially when only about 5% of the American population actually has any serious investment in Gold.
1) Sell shares short. Call your broker and say "sell short 300 shares of XYZ at (say) 40". Your broker will attempt to borrow the shares from another firm (or, conceivably, from an account w/in his own firm). Assuming he is able to do so, he'll then sell them and you receive the proceeds of the sale. If the share price subsequently moves up, you suffer a loss; if the share price subsequently moves down, you profit.
2) Buy put options. Call your broker and say "buy 3 (say) December XYZ 40 puts at the market". This is a purchase of the guaranteed right to sell shares of XYZ at 40, no matter where the share price may go, up until the 3rd Friday in December. You pay for this right, of course, so, in order to profit, the share price must decline more than a few points in order for you to profit. If the share price does not do so by December, you might lose your entire investment. Option buying should NOT be attempted by those who do not understand the pricing mechanism of options. There are any number of excellent books on the subject, the best being "Options as a Strategic Investment" by Larry McMillan.
The occasional way. There may be an ETF or ETN that deals in the shares/commodities you wish to short. These are usually, but by no means always, labelled 'short' or 'ultra-short' Blah-blah Fund(s). If the ETF is labelled 'short'/'ultra-short', then **buy** the shares of the ETF if you are looking for the share price of XYZ to decline. If **not**, sell the ETF shares short (much easier, as a rule, than selling stock shares short).
Good trading to you!
I haven't recognized it since 1967 thanks to LBJ!!
It sure isn’t the America I was born in.
I’m just glad my dead father isn’t around
to have to see what has become of the
country he fought for all through the
A hurdred bucks at wall mart can buy enough can goods to keep four people alive for a month. Do that 4 or 5 times and you will be in good shape on food.
Are you looking for anything in particular in tubes. I got a couple of old radios with lots of spare tubes.
Bump that...been spreading that message for some time...
I think that is a fairly good idea. One ounce Silver coins could be used as barter just about anywhere. The government is not likely to use its power to confiscate silver.
Sell it into things that make you self sufficient without social or govt services
so are small items of good quality jewelry
and booze! scotch and bourbon = hard currency
also medical supplies
Idiots who watch TV and pay for cable and sat TV enable the 5 networks that control 90+% of the channels. ALL the networks support Obama including Fox/Saudi News.
Keep watching them ball games serfs.
The food riots will be ugly. The communists need a catastrophic collapse and are in position to cause it.
The History Channel had a week of "disaster docu-dramas" on, a couple of months ago, I believe -- it was called "Armageddon Week" ... :-)
That was interesting because it showed people dying off in the big cities, and many congregating in the smaller communities for self-protection. But, it certainly wasn't what I would call "living" -- because even in the "safe" areas (those smaller areas where people congregated together and cooperated for protection), it was more like a dictatorship by those who controlled the smaller areas. It wasn't like "gangs" but was peaceable and controlled, but not free and like we live today.
If that happens, we won't have a Constitution any more (at least not one that anyone abides by, or pays attention to), and it will simply be the "rule of force" -- and everyone will simply do whatever they want, according to the force that they can apply ... and that's all it will be about ...
It will take a generation or two or more to ever become "civilized" again ...
Buy seed..... not from Monsanto
I am certainly no stock expert, but I consider all of the unusual events which have occurred over the past 2 years (including trillion dollar deficits, States that are bankrupt, stubborn unemployment, bank failures, out of control borders,etc. etc.) and I see interesting times ahead.
I do remember the old days when people considered such oddities as price - earnings ratios, and other fundamentals, when evaluating investments. Do they still do that today? What is the current price - earnings of the DOW?
booze and cigs are good currency,
but I don’t think I’d like to trade in them
unless absolutely necessary.
So where’s your money “stored”? T bills? Gold? Curious ... ;-)
The best advice I can give you is don't take advice from on-line forums, blogs or FR. That said, post 48 has some common sense...
Same with the religious leaders who predict the end of the world every time there is an outbreak of violence in the Middle East.
Oh ... don't worry... no matter whether the U.S. collapses and goes into the stone age or not ... that one is definitely coming... you can bet on it ... :-)
And it's not that far away... I would say within the lifetimes of any who are reading this now. Get ready for that one.
Well, it would depend on what he really has in mind. If there were straight Deflation, then paper currency would be a lovely thing, because it would buy more and more stuff with each passing day.
What worries people is that policymakers would inevitably respond to Deflation, by spending unbelievable amounts of fiat money, precisely in order to try to create some inflationary impulse. When there’s deflation, the tendency to save becomes irresistable (because the dollars in the mattress generates high returns not in interest, but in purchasing power) which leads to further stagnation, a vicious cycle.
What that can result in is something called a Liquidity trap, where your cash earns no interest, but anything you invest it in that’s linked to the economy declines in value. So you have little risk taking, little spending because of fear of the uncertainty in the future, and ongoing stagnation in activity. Japan went into a Liquidity Trap more than a decade ago, and only the Chinese economic boom helped them to get a little bit better (but far from cured).
Sorry, I don't advise...I just post'em and learn from the comments you all post. I'm a retired chip-maker.
My dad is still around, thankfully. He’s 76. I’m very grateful for that every day. He’s a truly great man.
It’s when I think of my Italian immigrant grandfather that I tear up. I can picture him (all five feet of him) looking around and shaking his head, not sure what to make of it all.
It is for people like your dad that we owe the duty to absolutely fight like hell the horseshit on parade right now. Every FReeper worth their salt knows that, and will be in the arena, come November.
Your dad didn’t fight for nothing. I promise you.
For those interested you can download my Preparedness Manual at:
The 1000 point drop was not so much about one action triggering the downturn as much as it is a hint at the mood of the brokers. Someone seems to have triggered it. Then there was a ton of buying at the bottom that triggered the rise as the panic wore off. Someone made a killing, and I suspect that is where any investigation should be made.
The near panic of the brokers is mirrored in this article. They have no confidence.
buy property, buy stockpiled foods, lots and lots of ammo for the entitlement zombies.
Talking about buying property... I was just talking to a guy who has been into real estate for a long while and he's been buying up properties at tax sales. He's getting ready to buy up about ten of them (he told me yesterday) at tax sales... amounting to about maybe 2,000 to 3,000 (or thereabouts) for a house/property, that may be valued at around $100,000. He says he gets the deed for it within 48 hours and there's no recourse for the owners ...
Someone is planning on making a lot of money, I would say ... :-)
Karl Denninger is warning as well:
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