First and foremost, you will note for the first time after being called the Wall Street Whiz Kid by Steve Crowley of Good Morning America back in 1988 for having forecasted the 1987 crash, I used the word “former” before that title. Why? For starters, I think anyone who could make and lose millions twice, shouldn’t be deemed a “Whiz Kid”. I also believe the investing public has been fooled enough into thinking financial people are much smarter than them. In an industry where 80% of so-called professional money managers can’t even beat simply putting one’s money in an index fund, I think appearing as a soothsayer is an insult to Almighty God. I already have far too many other sins to answer to him when I stand naked and alone in front of him (and me naked is a horrific sight at this point).
So my views are strictly those of an individual now who’s well into his fourth decade in and around the financial markets. I’m here to say I never been more bearish on the U.S. financial markets. This says a lot given when I last thought I was the most bearish ever and the results that followed. Unfortunately, not only have we not only failed to learn anything from the last financial crisis, we’re in far worse shape to recover from the next one.
I’ve stated for a few years now that the general public never came close to understanding what led to the last financial crisis and have tried to put it into a context they could:
- Led by U.S. financial institutions, hundreds of billions of dollars in bad mortgage –related products were sold and many times the financial institutions actually took the other side of the transaction to their clients.
- To truly appreciate the “balls” of these folks, imagine what you feel if on tonight’s news, you learned that automakers not only built faulty cars knowing they would crash, but also put life insurance on the drivers they sold the cars to and collected again when they died.
Not only are these folks pretty much still around (if they didn’t retire filth rich from the process), but their industry incredibly found a currently “legal” way to beat their clients again. This time, they effectively see their clients shopping list, run ahead of them and buy what’s on their shopping list, then sell it back to their clients when they arrive to go shopping at a higher price!
America has been robbing Peter to pay Paul but Peter is tapped out. We’ve gone from largest creditor nation to the world’s biggest debtor nation in just a generation. Simply put, after the costs to service the debt and all the entitlements, we have little or no cash flow left. I think this is undisputable. Unfortunately, most so-called financial advisors don’t have it in their interest (and/or their firms won’t let them if they wanted to) to state this.
To the small percentage who have concluded the same (or I pray to God do so before it’s too late), I’m here for you if you like to discuss this further.
The time has come for most to become a live chicken versus a dead duck.
Once a legend in my own mind, I thank Almighty God for showing me the H –U –M in HUMBLE. I pray I get the B-L-E before it’s too late.
Have a most blessed day!