Skip to comments.John Williams Warns Of "Severe And Violent Sell-Off In Stocks"
Posted on 10/15/2010 9:54:44 PM PDT by FromLori
John Williams utters his most ruthless words of condemnation not only toward the Fed, but to everyone who is stupid enough to be chasing returns in the face of what is a hyperinflationary collaspe.
Euphoric Inflation Insanity. Buying U.S. stocks because the Fed says it will proactively debase the U.S. dollar is like sitting on the beach in order to get a great view of an incoming tsunami. Any pleasure so derived should be short-lived, when the terror of underlying reality quickly takes hold.
If one were to view movement in the price of gold as a surrogate for anticipated inflation, for example, the issues begin to come into focus. Consider that last night's (October 14th) respective S&P 500, Dow Jones Industrial Average and NASDAQ Composite closing levels were up by 7.5%, 10.8%, 12.1% from a year ago, but the price of gold was up by 29.6% in the same period. Relative to gold, which tends to hold its purchasing power over time -- albeit sometimes in an anticipatory manner -- the S&P 500, Dow Jones Industrial Average and NASDAQ Composite have declined respectively by 22.1%, 18.8% and 17.5% year-to-year. This is against the prospective inflation environment being discounted by the gold market.
(Excerpt) Read more at zerohedge.com ...
Buy gold. And silver. And lead. And copper. And indium. And yttrium. Come to think of it, buy them all. Except for lutetium, and bromine. But get all the rest. At least a little.
It doesn’t take a rocket scientist......
Lead is the best for the long term.
How about bottled water, generators, gas. The market since the end of August has went up over 10%, nothing going on in the Economy can explain part of this, Unemployment Lost 95,000 more net jobs, consumer confidence, foreclosures, $1.3 - $1.6 Trillion debt.
The thing is any interest bearing investment is dead, now would be a buying opportunity. Gold, Silver, Platinum, Copper. Any commodities are on a tear including food. This has to become inflationary at some point.
Lead and brass. Don’t forget brass.
Okay, but when I’m done violently selling stuff, I’m not ever listening to any fancy pants movie soundtracks again. I hope he’s happy.
that being said, I am locked and loaded.
Load up with Thyme,Cloves and Rosemary too.
Investment Dead Cat Ping!
It kind of amazes me that some people see gold and silver as the ultimate wealth protector. The article claims gold tends to hold its buying power over time. It wasn’t all that long ago that gold was under $300 an ounce (and silver under $4). Had someone purchased gold at the peak of its last bubble in the 80’s, they would have had to wait twenty years to break even (not counting inflation).
I’m all for people doing whatever they think is in their best interests, but I wouldn’t touch gold with a ten-foot pole. I purchased metals back when they were practically giving them away, but right now, this run up looks speculative to say the least. Like every bubble, there will be plenty of folks pushing the “product,” not because they care about you or I, but because they want to profit from it. Historically, these things always burst, and when they do, the late comers get slaughtered.
National Inflation Association is very informative and ranks the gold/silver sellers. Check out articles and videos at NIA website.
Good guns and rifles are good investments because they hold their value and protect the investment at the same time.
Interestingly, Rosland and Goldline get panned, big time.
Copper! You need copper to protect your lead!
I need some guidance on managing my mother’s 401k to protect what she has and hopefully grow it to help support her through her illness.
I heard coal is good too. China is consuming a lot more coal. GOP likely to be kinder to coal. WV better get rid of Dems too.
Love his soundtracks, especially the Star Wars series.
One can’t work without the other.
Gold went up like a rocket when Carter was President because of inflation. It hits all time highs today for the same reason. The fed is cranking up the printing press. No one want's to say inflation but that is what is happening.
Interestingly, the USD has fallen against most Asian currencies by 4-5% over that same period. Probably easy to get "euphoria" over a rise in the DJIA because the currency it's based on is being devalued...
Once something becomes common knowledge for us little folk, the bubble is on its way to bursting. I'm actually wondering if maybe I should sell a few small gold trinkets that are bent and useless. It's not a lot, but at the prices now, it might be spending money for a few weeks.
What about parsley and sage? Can’t very well go to Scarborough Fair without them...
I'd keep it in FDIC bank CDs, no more than $100,000 each bank. And I'd keep her out of it as long as possible, until interest rates go up. But I'm overly cautious.
You really want to protect her and you? Move her in with you.
My mother in law is in a similar situation except she’s in reasonably good health. She has a small nest egg that used to provide enough interest/ROI for her living expenses. Now she’s living off of the nest egg itself. I was worried about that at first, but she’s in her 90s. As she explained, it’s not like she has to live off it for 20 - 30 years, and all of her children/grandchildren are financially independent. What if she runs out of money before she dies? That’s where family comes in. We will do whatever is necessary when and if that time comes.
The rates on $100,000 CDs are abysmal.
"Use your feelings, Luke. Join me, and we will rule Commodities together as father and son."
Been meaning to say glad to see you back in force on the subject Lori! Thought you dropped out on us there for a while...
For us small savers, they're non-existant. If I decide to stop working my supplemental income job, the answer is just going to be to not spend money until interest rates go up.
I'm up tonight at least partially because I'm heartsick. Today, I was at a school where there are a few teachers who are over 55, and had a career change to education when the layoff situation in private businesses started....it's over ten years ago now. It's a tough school. Three of them, good people, actually said they're pretty sure the job will kill them. They're to young to get their small amount of social security, and they'll never see a teacher pension. If they take a year off, they'll never be rehired...they know that.
One can't help but wonder if the system is trying to force them out by putting them in the most challenging schools. These are good people, who deserve better. The thing is, they're good teachers, the kind who know when all of these new initiatives and plans just aren't working.
I agree.... lots of it encased in brass.
I wish I could tell you it’s going to get better, but who can predict the future? I think we’re all agreed here that the country is on the wrong path, but changing course isn’t likely to be painless. On the other hand, not changing is probably going to be much worse. Good people will find a way through it like they always do.
The only time you give up is when you die. Not before. And maybe not even then because what you do survives even after death.
It is the only way the government can deal with trillion dollar deficits.
This is going to get ugly I think. Not that it isn't already. I am old enough to rember Jimmy Carter and this is much worse.
As opposed to the gradual and polite selloffs we usually see. And keep pushing rare metals. Pretty soon it’ll be trapped juan the miner stories daily. These “miners” are gold bugs digging around in century old holes because of the current gold mania. Hardly worthy of our oohs and ahhs.
IF things ever went to hell in a handbasket, your gold is going to be worthless than a bag of nickels or whatever the agreed to currency becomes. Or the Fed will just confiscate it like they did in the 30’s. It’s not going to the gold bugs handing out little bags of gold to each other for services and goods. This is a mania and you are going to get burned. Badly.
After 50 years the Fed figured there's no need to be the cleanest and biggest financier in the world, just the biggest since there's no other game in town which comes close.
Investing in the market is the practical thing to do to stay ahead of inflation from QE. Yes, gold works too, as does real estate, bullets, cigarettes, alcohol, etc. In fact I saw someone coming out of Sams Club yesterday with a flatcar full of cigarette cartons. However, I find stocks and mutual funds easier to trade.
Argentina suffered a sharp one-time currency devaluation in 2002. This is a forerunner of what America will suffer within the next 18 months, albeit for different reasons.
When the peso devalued, people who had gold and other hard assets were fine. Everybody else got wiped out.
This is what happened. It’s recent history. There’s nothing arcane or mysterious about this: Gold maintains its buying power - but people only notice this when the fiat currency gets wiped out.
If the Feds try to confiscate your Gold (and I agree it is likely that they will try) then you have several options.
* Don’t tell them you own any.
* Don’t tell them where it is.
* When they come for it, shoot them in the head.
* Move to Arizona and secede.
Coal is good.........it’s just difficult to store in quantities. I stored some in back yard, but the neighbors complained.
This may be FDR, Nixon and Carter are rolled into one big pile of stink. Only a handful of people are old enough to remember FDR.
“I’d keep it in FDIC bank CDs, no more than $100,000 each bank. And I’d keep her out of it as long as possible, until interest rates go up. But I’m overly cautious.”
The insurance limit is $250,000, but I tend to agree with the insured-accounts advice. I would keep the CDs very short (no more than a year) and look at credit unions for a slightly-oh so slightly-greater yield. Obama as president adds too much risk to stocks to make them attractive (they may do great, but the risk is just too high). Commodoties are for professionals only. 1% yields are near criminal (in essence, the government is imposing a 100% tax on savers by holding rates down), but plus 1% beats a loss.
Thanks for the ping, Candor7.
For the time being, I’m under water in FAZ (3X short financials) because of the fake market “euphoria.”
A couple of days ago on CNBC, a trader laughingly said something like “an unknown or invisible force is buying stocks to prop the market.” Everybody laughed in acknowledgement.
I believe it’s the feds because Soros and the like sold their stocks and went into gold.
I’m thinking to double up on FAZ because the financials are wilting and the foreclosure problem is mounting with much more foreclosures coming.
I know its dangerous but, what the heck.
Been working on restocking the pantry. I wanted to pick-up some ground meat the other day. It was nearly $5 per Lb. I didn't buy and thought...been a while since I've needed it...when did those prices jump like that? Lots of stuff is being reduced in size one serving at a time. Inflation is already here, it is just hidden in the packaging.