Having just hit 60, I now seriously thank the Creator of All That Is Good in the Universe for His grace to rise each day and the strength for all the challenges life in a fallen world brings.
Knowing we have many new readers of my blog, allow me to make a few quick reminders:
- The word “former” wasn’t inserted into the latest edition of my book because I was knocking it out of the park with my forecasts when I was in the soothsayer “racket.” Thankfully, after 30 years of thinking I could predict the future, I successfully concluded only God does. The financial services industry has spent billions of dollars to create an “illusion” their people can predict the future (and sadly most of their clients will pay the price for this façade).
- Nobel Prize Laureates have demonstrated that about 80% of all equity managers (85% for bond managers) underperform someone simply putting their funds into a diversified, low-cost Index Fund. Of the 20% who do beat the Index Fund one year, almost all will not do so the next year. Conclusion? Unless you’re way up the food chain and get the cream de la cream in the business (these are the folks who get info and opportunities not afforded to the “common man”), your active money management account is all but certain to underperform. And whether or not your advisor had your best interests at heart, he or she will still be compensated at your expense.
- Any and all invitations to me for financial services companies’ parties and most financial media appearances are torn up thanks to what I have just stated above. I will just have to suffer without them.
- What I am and also what I’m not can be read here and here.
Okay, let’s ponder!
Overall – There are three key factors I operate under and help form my economic opinions (which still require $2 or a cup of coffee with or without them):
- America has been robbing Peter to pay Paul, and Peter is tapped out
- Until we stop “opening” public storage facilities and instead are closing them, the economic, social and political crisis now underway here in America (and the world) shall only grow worse. (We suffer from too much stuff).
- If I haven’t angered some by now (trust me, most in the financial service business have already thrown me under the bus by now), this last point usually does the trick; the further America moves away from the Judeo-Christian ways the Founding Fathers built this once great nation on, the more things shall grow worse.
U.S. Stock Market – Keeping in mind I’m out of the stock-picking racket (but as I age I seem to be picking at more and more other things), I do think being a live chicken versus dead duck approach seems appropriate.
Despite what the “Don’t Worry, Be Happy” crowd on Wall Street tries to get the sheep to ignore, there shall come a day (and I don’t know that day other than it’s a question of when, not if) when the stock market ignores computer programs and crazy financial TV commentators (especially those who ring bells, whistles and speaks out of both sides of his mouth) and reverts back to what it once was intended to be: a place where people buy and sell interests in companies and those companies by-and-large do well or not based on how the economy is actually performing (and not some magic wand waved by the Federal Reserve).
I know it’s hard to imagine, but stock markets can go down and stay down (Heaven forbid).
I’ll be here until further notice:
U.S. Bonds – I’ve said for quite some time now that Treasuries and most muni-bonds are a far less evil versus equities. I would still avoid junk bonds (high-yield, corporate bonds); it’s the same as buying Knicks season tickets.
U.S. Dollar – I may or may not live to see the day, but the world shall wake up and see that while it had already been dealing with the enormity of issues it faced, America’s denial has finally caught up to it and this is the reality of Uncle Sam’s future:
Oil – I had to give up my soothsayer suit in order to make one of my better predictions. Having spoken about a sub-$30 price when oil was just under $100, I then spoke about the Fat Lady in the building and the fact with everyone was knocking themselves over with $10-a-barrel predictions, a rally to above $40 seem the most likely course going forward.
Perhaps I should keep this one in my pocket and not risk egg on my face… Nah! The old “Whiz Kid” bug is still there.
While I don’t think we take out the low made earlier this year, I do hope my old “pal” Dennis Gartman retracts this prediction as I would hate to see him die so young-lol.
The news over the weekend is being reported as very bearish, but I see it being quite constructive for the long term. The lack of a “Doha deal” would be better in the long term and would mean that a rebalancing process of supply and demand can continue to its natural conclusion. A so-called deal would’ve sent prices well above $40, but soon would encourage producers to ramp up production.
It may not be this week or even next month, but I see myself ordering flowers for Dennis Gartman’s wake before I see my next Super Bowl.
Gold – Not too long ago I ate, slept and lived it 24/7 (and to the detriment of family, friends, followers and my net worth).
I found the news this past weekend the straw that will end up breaking the back of this manipulation that has cost so many tens, if not hundreds of billions of dollars (directly and indirectly for several decades). Those of us who have long argued that gold and silver were manipulated and were laughed at and scorned by most (including many in the media), have seen their vindication born out of this news (and the many lawsuits to follow).
I also would like to pay homage to two men who many said were fighting a “David versus Goliath” battle against the manipulators (David at least had a slingshot. These two gentlemen ran on fumes for years but stayed in the battle while people like myself were slain). Chris Powell and Bill Murphy of GATA.ORG are true warriors. I don’t miss much of my “former” life in metals and mining, but not seeing and being around these two gentlemen is something I regret. I only hope they live long enough to see the fullness of this weekend’s revelation.
Oh yeah, the new mega gold bull market has only just begun… There, I said it (for old time’s sake).
Other Points to Ponder:
- China’s ability to continuing being the engine that pulls many world economies, is being put at great risk by a very high-risk strategy that if it backfires, shall be the fuse that ends up imploding the world into a serious economic contraction. Hope for the best but fear the worst.
- Negative Interest Rates – It won’t work in Japan or here.
- Water – the new gold.
- If someone accused me of saying things that transcripts of what I said could prove them wrong in an instant, you couldn’t get them out fast enough for all the see as far as I’m concern. The opposite would be the case if what I said could be damaging to me. Hello?
Have a most blessed week!