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Urgent notice: Despite Hurricane Irma, our emergency online conference for subscribers will be held as scheduled on Tuesday, September 12, at 2PM. Although there is no cost to you, registration is required. So, if you are reading this on Monday, September 11, that means you have only until 11:59 PM to sign up. It won’t take you more than a minute or two. Go here. |
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We’re slated to take a direct hit from Irma, the strongest and largest Atlantic hurricane in modern history.
It’s expected to be a massive Category 4 when it comes our way. It will spin off countless tornados and wreak unimagined damage.
So, I’m writing this column ahead of time, before we hunker down.
Elisabeth and I talked about evacuating. But by that time, all flights from PBI, FLL and MIA were booked, and gasoline supplies were exhausted.
“The highways are going to be jammed up,” said our adopted son who lives near us. “There’s no way I’m going to risk getting stuck on the road with Camila,” he added, referring to our three-month-old granddaughter.
At the Weiss Research offices, we met yesterday to implement our preparedness plan:
All equipment and data go offline and into a protected area. The office is shut down and we work remotely from home. Everyone connects directly to our computer servers housed in a vault stronger than Fort Knox.
That includes Stan Pyatt and our Customer Service team. If they lose power at home, they come to my house, where all electric lines are underground. If I lose power, all incoming customer calls get switched over to our call center in Texas, which, fortunately, is far from the Harvey damage zone.
Our first priority was to set into motion our preparedness plan for our emergency subscriber conference, to be held September 12. That’s also about a perfect storm — of the financial and geopolitical kind. So, we’ve made absolutely sure that it won’t be derailed by the perfect storm that’s about to hit us here in South Florida.
In fact, right now in this part of the world, we’re not talking just about one, but three monster tempests — not just Harvey and Irma, but also Jose which is whirling right behind her.
That’s an apt metaphor for the three debt disasters we predict will strike the most heavily indebted countries on the planet — Japan, the European Union and, ultimately, the United States.
President Trump has deflected the immediate threat of a debt default in the United States by cutting a deal with the Democratic leadership to lift the debt ceiling for 90 days. That’s completely consistent with our forecast because, as we’ve said all along, the debt disaster in the United States is due to strike later — not now.
As I warned here last week (Alarming Prediction about Immediate Future), the country that’s most vulnerable to a debt disaster is Japan!
That’s where …
- Government debt, at a whopping 250% of GDP, is more than double the nosebleed debt levels of the U.S. government. Even if Japan could run a steady annual surplus of 1 trillion yen, it would still take 1,000 years to pay it off.
- The Bank of Japan has been on a money-printing binge that’s far more extreme than the Fed’s record-shattering QE1, QE2, QE3 and QE4 put together. It has helped put off Japan’s day of reckoning until now. But it also means that the smallest baby step to reverse their giant money pumps threatens to crush Japan’s economy.
- Japan’s citizens are already being taxed to death: Estate taxes are so onerous, it’s virtually impossible for any citizen, rich or poor, to inherit wealth. National sales taxes are 8%, and lawmakers are now proposing to jack that up even further. But there’s no possible way that any new sales tax revenues will go toward paying off the monstrous government debt: Every single penny will be needed to support …
- The elderly in Japan (65 or older). They are a whopping 27% of the population, the highest of any country in the world, whether advanced or backward. Back in 1960, Japan’s population was very young with only 6% elderly, and the country was on the verge of a rip-roaring boom. Today, even without the massive debts, these horrible demographics alone would be enough to cause a gut-wrenching bust.
- More big borrowing for defense spending is on the way. Japan faces a potentially fierce battle with China over the Senkaku Islands in the East China Sea. And at the same time, it’s in the immediate crosshairs of North Korean dictator Kim Jong-un.
- Fortunately, the chances that China will fight a war with Japan or that North Korea will bomb Tokyo are small. But there’s no chance Japan can escape the economic impacts of those threats. Even as I write these words, Prime Minister Abe is moving swiftly to push through a massive defense buildup that Japan simply cannot afford. That means much more debt piled onto what’s already the largest debt heap in the world.
The European Union is next.
The thunder and lightning we saw in Portugal, Italy, Spain and Greece a few years ago were mild by comparison to what Europe will be up against in the next big season of debt disasters.
Economists with any ounce of sincerity and sanity agree that the most a country’s government can reasonably borrow is 50% of GDP.
Right now, the U.K. has a mountain of government debt that’s 88% of GDP, which is bad enough. And among the eight important European Union countries depicted in the chart below, the U.K. is actually the country with the LEAST exposure to a major debt crisis.
France has a government debt burden that represents 96% of GDP. Spain is at 99%; Cyprus, 105%; Belgium, 106%; Portugal, 129%; Italy 133%; and Greece, despite massive EU debt rescues, is at 176%.
Europe’s demographic doomsday clock is also ticking loud and clear, not far behind Japan’s. In Portugal, the elderly are 21% of the population. In Greece, they’re 22%, and in Italy, they’re 23%. In the United States (15%), this is also a growing problem, but not nearly as dire.
As in Japan, European funny money, pumped into the EU economy by the European Central Bank, has so far postponed the financial reckoning day. But now, that too is about to end.
The Worst Time for Winds of War
All told, no matter where you go in the world, there could be no tougher time for a dramatic ramp-up in expenditures for defense — let alone for hurricane relief.
That’s why the president held an emergency meeting with the Democratic leadership to raise the debt ceiling and cut a quick deal for Harvey victims.
And that’s also why I’m holding my emergency conference on Tuesday come hell or high water. Register here. I’ll be there no matter what happens.
Forgive me if I sound like a nag. But if you also want to be there, you’ve got to register now.
Good luck and God bless!
Martin
Dr. Weiss founded Weiss Research in 1971 and has dedicated his entire career to helping millions of average investors find truly safe havens and investments. He is Chairman of the Weiss Group, which includes Weiss Research and Weiss Ratings, the nation’s leading independent rating agency accepting no fees from rated companies. His last three books have all been New York Times Bestsellers and his most recent title is The Ultimate Money Guide for Bubbles, Busts, Recession and Depression.
{ 22 comments }
May God protect you all.
Robyn
If true. With so many smart people and institutions in the world, how did they let this happen. Is it because no smart and knowledgable people find themselves in politics and therefore they become our leaders, where all talk and no action can get you somewhere ? D.B.
Good Martin,
I am a South African, and as such, I would be very interested in knowing where the BRICS countries slot in with your predictions.
With the present attitude of the current White House, investing in the US stock markets is not an option for me. Where would you recommend, I should be looking as an alternative.
Regards,
John Blair.
What are you talking about John Blair? The White house is pro business & pro main street (get the government out of the way) for the first time in 8 + years.
I hope we will be able to hear a replay of this at a later date, because some of us are still working and are unable to sit in on a mid-day call.
Marsha Dossey
The fastest growing economies in the world, Brazil, Russia, India and China, is where the next boom is gonna be. Quantitative easing is quite a good policy it helps get over speed bumps in the economy, what we need is a great boom again. In this boom, recession, depression, recovery and growth cycle that we are at. We need debt because its impossible to run businesses without credit. Unless you want another credit crunch. We live in interesting times as the Chinese say. How big this boom that we are headed towards is anyone’s guess.
Martin;
Will there be a script of your presentation as I have a 4 hour meeting right in the middle of when you go live?
hi martin,
i fear that most of the peoples of this planet are not aware of certain events and occurrences. my info. says that the firebomb that destroyed 160 buildings in ‘rostov on don’ in russia was the work of the americans. did you read or see it reported in our news. no? oh well must be a breakdown in communications somewhere.
in retaliation, the russians have begun a ‘;weather war’. meaning that the most significant weather patterns on show right now are being ‘stimulated’ by scientific methods way beyond the imaginings of most of the population. a series of hurricanes stirred up to fragment the american economy. watch out for a series of earthquakes too in california..devastating in effectiveness. in all the russians are going to bring america to its knees, and that is not a bad thing as it may save venezuela from another (ad nauseum) invasion, like vietnam, north korea, libya, iraq, afghanistan, etc.etc. etc. and we might have some peace for a while. then comes the dreaded E.M.P. to take out your power grid for about 15 years minimum. i sympathise with the american public who haven’t a clue what is happening.
please define and give examples of a debt disaster.
Hi from the UK,
Registered but no confirmation e-mail received.
Hope you got your Son back home.
Kind Regards
John B.
I have emailed once already but received no reply -so apologies if one is being prepared.
Will I be able to listen to a recording of this if I am unable to attend?
The truth is I will not be able to attend as it is the exact time when I will be receiving a dose of radiology for cancer – this with travelling etc takes up over 4 hours of my day so to try and rearrange the treatment is well nigh impossible.
Look forward to a reply even if it is not one I wish to hear !
All the best
William
We want to watch and listen in but we’ll be in flight from LAX to Auckland NX and on to Melbourne AU. Can you please post an after event steam of the thoughts and info you present. Thnks
I hope everyone’s doing well at headquarters, and anticipate the information from tomorrow’s emergency summit.
Looking forward to your webinar
Looking forward to your information
Hello Martin,
Which “black swan” lands first in your opinion?
Which economic sectors do you imagine might unravel first?
This question may be of little or no academic value. In this day of computerized AI trading, I fear that the speed of whatever market correction may be initiated will occur with breathtaking speed. Except for the automatic closures of markets that may be in free-fall, the time for thoughtful decision-making may be behind us.
Your audience will be hungering for defensive ideas, and perhaps I too will hear of some that I’ve not considered.
I have already positioned myself more aggressively with respect to gold, silver and precious metals, but I would appreciate your views regarding percent allocations among different asset classes.
Best wishes and I am looking forward to your analysis and advice.
PS: Martin, I’ve been an adherent of your investment programs since October 2014. It’s not been easy! I feel good about not having lost capital, but we’ve not much to show for our efforts either. I respect Jon’s record, but these are dangerous times to identify significant pivot points. I’m participating, but only to a limited extent.I thought that Douglas Davenport’s use of a limited number of ETFs to capture gains by riding trends made a great deal of sense, but his ability to do so proved disappointing as well. There are clearly few alternatives to careful study and unceasing vigilance. Somewhat more possible in retirement, but clearly impossible during my working years in academic biochemical research (13 years) and as a Scientific Review Officer at the National Institutes of Health in Bethesda, MD (21 years).. I married my Canadian wife in 1992 and moved to Canada in February 2001 following my retirement from my federal position.
Thank you for sharing your wisdom as well as that of your father.
Allen Stoolmiller, PhD (soon to be a dual citizen in Canada)
Prince Edward Island, Canada.
I’m in Indonesia for tomorrow’s meeting; which off course means that it will be live at 2 am my time.
Will there be a transcript or video recording of the seminar?
I look forward to hearing from you
Elizabeth
Hope there is a recap of all this at later hours for us who can’t attend during business hours.
Printed (or created electronic) money by central banks is no different in its impact upon the economy as that printed in a counterfeiter’s basement. It creates claims for goods and services created by others without having produced anything of value to honor those claims. Most of the created money has gone into the financial markets to inflate the paper value of ownership of existing resources and further enrich the one percent who own fifty percent or more of the country’s corporate wealth, at the expense (ever increasing indebtedness) for the rest of us, it is the primary facilitator (addictive debt injections) of economic disenfranchisement (maldistribution of income and wealth) for the masses (aka: “class warfare”), Father Charles Couglin in the 1930s warned his generation about the “machinations of international bankers” ! VladIimir ilyich: where art thou?
I signe ed up for unline confrence but got no e mail notice. brent
I registered (twice) but have had no email replies.
Please indicate/answer the question…is there another way to listen to today’s broadcast? I have no idea how to connect since I received no instructions.
I live in MArgate florida and no power until today so missed the event sadly…will it be repeated