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The sands of time are shifting, and so are vast swaths of geopolitical fault lines … entire countries … economic systems and yes, the financial markets.
It’s the cumulative affect of intended and unintended consequences of …
Western governments who embraced Keynesian-style socialism, thinking they could toy with economies through government spending and taxation to try and make the world a fairer place to live.
Yet it’s now backfiring on them, leading to bankrupt governments, pension crises, housing instability, class warfare and more.
Eastern governments, Asia, rising from the ashes of communism and feudal societies, ushering into the 21st century nearly 4 billion souls, more than 60 percent of the world’s population …
Creating gargantuan demand in every area of life, putting excessive demands on Mother Earth’s natural resources … sending Asian economies on a rocket ride higher, while the West slumps miserably.
Political leaders, caught in the crossfire, knowing not what to do, but to repeat the mistakes of the past. Consciously or unconsciously, leaders of Western economies are turning against their own people, raising taxes, hunting down every penny of their assets, confiscating assets in Europe, preparing to confiscate assets in the U.S. of A.
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| Grains are in the final throes of a deflationary decline. |
Central banks, running amuck, still printing money, now even buying equities, trying desperately to reinflate the global economy.
Financial markets, some not knowing whether they are coming or going, some coiling up like a tightly wound spring, ready to explode higher … while others are dancing on the edge of a cliff.
What’s an investor to do?
My view: With the ramping up of the war cycles, the cycles of human nature that predispose societies to conflict and that cause immense turmoil in economics and markets …
Every investor should batten down the hatches and prepare to both protect your wealth and profit from the coming turmoil, the shifting sands of time … from the crises and the opportunities they present.
The steps I recommend …
FIRST, if you haven’t already done so, start buying gold again. Physical gold and gold ETFs. Add some silver too. Nibble away at the metals, and if they move a tad lower, buy more.
SECOND, I maintain my view that the stock markets of Europe and the United States are on the edge of a cliff. Don’t be complacent. Don’t think for a minute that they can’t go over the cliff. They can and will.
They will soon plummet in a short-lived, but very sharp plunge that will scare the dickens out of almost everyone.
How low can they go? Let me give you my new, worst-case targets:
Dow Jones Industrials, 13,623 (20.25 percent)
S&P 500 Index, 1,510 (23.7 percent)
Nasdaq, 3,612 (19.2 percent)
Europe, in general, based on the iShares Europe ETF (IEV), still 21 percent below its 2007 high, Europe’s equity markets are headed for another devastating plunge that will see them shed, on average, more than 43 percent.
Be smart. If not already out of U.S. and European equity markets, get out now while you can.
Stand on the sidelines with most of the proceeds, using some of it to buy gold and silver, some to buy select Asian equity markets — and most of the cash kept ready to buy back equities after the crash.
THIRD, don’t be complacent about the sovereign bond markets of Europe and the U.S. either. Interest rates will stay low for a while longer, due to so many threats out there and the still present — but weakening — perceptions that sovereign securities are safe.
They are not safe. Sovereign bond prices are on the edge of a cliff too, and there are far safer and better places to put your money these days.
FOURTH, get ready to deploy capital intensely in the commodities sector. Oil and energy are bottoming. Grains are in the final throes of a deflationary decline that I have been warning you about.
Commodities are going to represent some of the most spectacular gains going forward. Pay particular attention to natural gas, which is now making an important secondary bottom and will soon rocket higher.
FIFTH, no matter what you do, don’t be complacent! Complacency will cost you a bloody fortune.
Stay tuned and stay safe …
Larry
Larry Edelson, one of the world’s foremost experts on gold and precious metals, is the editor of Real Wealth Report and Supercycle Trader.
Larry has called the ups and downs in the gold market time and again. As a result, he is often called upon by the media for his investing views. Larry has been featured on Bloomberg, Reuters and CNBC as well as The New York Times and New York Sun.
{ 29 comments }
Dear Sir,
When you say tha the stock market will plunge soon, is it a matter a days, weeks ,months??
All of us know that central banks support stock market so i am wondering if your predictions will be for short, medium or long term.
Best regards
There you have – July 31st … the 1st day of a decent the correction ….about time, isn’t it ?
Could go all the way into October – re: Martin Armstrong . But will have good bounces now and then I’m sure .
He’s as slippery as an eel. Only when the move has been made will he then say “See, I told you so”.
I agree with you completely! However, the market doesn’t seem to be aware of the good common horse-sense facts you state… So do you really think the market will correct anytime soon….or is this just another among many of your “correction” prophecies, while the market continues to market ever higher?? And what about gold? You said the double bottom we saw a few months ago was NOT the bottom, but now you seem to feel it was…even while it is now doing extremely well just to maintain $1,300?? Best case scenario, you’ve got us sitting on the sidelines, waiting….for something… Worst case scenario, it’s only money, OUR money we’re losing here!!??
Robert , if you are sitting on the sidelines – you’re not losing money …. you might not make any but you’re not losing it .
Now this reminds me of 2008 – Larry was right at THAT time and the markets went over the cliff BUT he also recommended to buy gold/silver and pm stocks all the down into Oct. when the low was just about there …Nov. 2008 was the low for most . Will it be the same again ? If the stock markets skids so will gold ETF’s or any other pm stock …. called liquidity .
You wouldn’t believe how many ” Market Gurus ” have the DOW going down since early 2014 …. it’s not just Larry . And so go ahead … buy gold ETF’s , pm stocks but no stocks from the DOW …. Your pm stock will save your day .
The only thing missing in this report is : ” GOLD to Explode while the DOW tanks “…maybe for next week ?
What to do? Restart our nation by applying George Washington’s wisdom!
Begin with his First Inaugural Address,where he wrote that he does not want mopey
for being a General of President, although he did write that later their should be pay
for those who operate government duties.
To see the real-Washington, type in search box: “THE BULLET PROOF GEORGE WASHINGTON.”: ALSO: “DUEL BETWEEN THE ALABAMA AND THE KEARSARGE.”
FYI…
http://armstrongeconomics.com/2014/07/28/interview-on-financial-news-network/
Yes, maybe next week he’ll have that one again…
When one calls for clouds and rain while predicting sunshine, he gets to sound the trumpets at being right, regardless of which way it goes, huh?
I still read the “free” stuff, but this kind of performance is exactly why I quit paying for the subscription years ago! I’m still trying to “invest” in the market, since the bank offers nothing in the way of interest….and very admittedly, I need help with insights beyond my own thoughts. I am coming to believe, however, that Edelson and the other Weiss guys would serve better as a contrary indicator…maybe I should start doing exactly the opposite of what they predict… the market seems to go that way more often. Good case in point: the gold miners bottomed and were “off to the races” as of August 7, 2013!! Yeh, right! LOL (to keep from crying…) …and buy such and such options with a strike price of xyz…I’m just a very simple trader with a simple equity account!! Cut out the crap, please, and just let us know when you think something will go up of down…I don’t mind waiting a few days or even a few weeks…just let us know some sort of proximity and we’ll all be okay… But a year now since miners are supposed to be “off to the races??” Does any forecaster know anything more than I do…?? Doesn’t seem like it!
Oh yeah, there are a few out there but not as ” famous ” as Larry .
Hello, the miners gained good since last June & Dec. 2013 and are still all above their lows . Is just this announced ” A massive rally into August / September ” seem’s to need more ( natural ) gas …lol
Please forgive my outburst. I’m just soooo tired of having my @$$ handed to me without the $$$!!!
A few months ago u claimed Nasdaq was in for a huge correction and fb was gonna drop in half.. Now u say Nasdaq has least amount to fall of the 3 indices.: what gives there?
Larry, I am a great fan of your and a subscriber to your Real Wealth Report. Many of your critics are pretty stupid, it seems to me, because they seem to expect you to get everything right for them, including the timing. Well, too bad. Your advice, which I use together with my own judgment and due diligence, has served me extremely well. In my opinion, you have blown it badly a few times – not by being “wrong”, which is part of the game, but by being inattentive. However, since God does not publish a financial newsletter, I believe that, as a human, your advise and analysis is about as good as I can expect. That said, I want to say that I wish that you would stop interjecting crap politics into your publications. For example, here you speak of “governments embracing Keynesian-style socialism”. There are so many things wrong with that that it’s hard to know where to begin. I don’t know of any government that has paid much attention to Keynes. Few people who talk about Keynesianism have ever read a word of Keynes. Second, whether or not you like Keynes as a theorist or policy-maker, he was no socialist. There’s no such thing as “Keynesian-style socialism” – you, and so many others, just use “socialism” as a mud-slinging word, like Joe McCarthy used “communism”. Third, your implication is that Western economies are in trouble because they have supported social welfare programs. Again, whether one approves or disapproves of government-sponsored social welfare programs, this implication is just bullshit, and you ought to know that full well. You urge us to see through central bank propaganda, so why do you peddle junk-economics propaganda? Or (as you and Martin Weiss have done, although not in this post) war-mongering propaganda. Please, stick to what you know something about. That’s a lot! Best wishes, Mikael
Stupid is as stupid does. If you have been “served extremely well” where do you come off with a critic about the “filler” statements that he’s using to flesh out his rationale?
I am interested in your opinion
Interesting commentery
GOLD IS DOING WHAT YOU SAID IT WOULD YOU MIGHT HAVE BEEN THE ONLY ONE THAT CALLED THE SELL OFF THE LAST 2 YEARS.MOVED OUT AND USED SPPIX TO SHORT THE GOLD STOCKS AND NOW 85% LONG .I’AM GLAD TO SEE YOU THINK NAT GAS IS ABOUT TO START MOVING UP. GOLD AND NAT GAS ARE WHERE I’AM INVESTED NOW .THANKS LARRY YOUR THE BEST.
With the comments from Tom ( in case he is real ) I get the feeling this whole Company is only for dummies .
YES I’AM REAL GO BACK AND READ WHAT HE SAID IN THE PAST.I MOVED 2/3 MY 401k TO SHORT GOLD AND TRADED IN AND OUT ALWAYS KEEPING A CORE POSTION IN GOLD STOCKS WITH THE REST BUYING ON DOWN DAYS AND SELLING ON UP DAYS. WHEN THE GOLD STOCKS MOVED UP BIG WENT SHORT AT THE CLOSE .BY DOING THIS WASH AND RINSE CYCLE I GOT TO RIDE GOLD DOWN AND NOW I HAVE ALOT OF DRY POWDER TO PUT TO WORK IN THE COMING GOLD BULL MARKET.SO LARRY WAS SPOT ON ABOUT GOLD GOING DOWN WHAT I DID IS ON MY OWN ABOUT TRADING IN AND OUT.
Larry your I don´t recieve your mail as usual on monday , is there be a problem?
Some of us aren’t hired help, or paid supporters. We actually like Larry’s input as part of our other research to then make informed decisions. The risk is ours, as is the timing and we know that market timing itself, can be unpredictable at times. But please if you have something positive to add to this site, many of us would like to hear it.
Larry’s call on JNUG was awesome …how is that ?
Armstrong says this rally in gold is false:
http://armstrongeconomics.com/2014/07/29/gold-the-false-rally/
Larry just needs more subscribers on the conveyor belt, the others have already been mangled.
Larry could not predict rain if he was standing under a cumulonimbus cloud but he could write a good story about it. And after reading the story your would conclude that it might rain or it might not. And somewhere in the story would be: “CLICK HERE TO SUBSCRIBE”
The commentary on market correction is timed perfectly. I think for investing in miners, the recommendations have been good (selection, research, etc.). For example, a year ago, $SA had about a 100% climb in one month and it was timed through RWR alerts perfectly, what was missing was an alert on when to get out to lock in profit. Notice that another entity owned a lot of it (look up institutional owners, etc.). So, I am thinking, that the picks are good and some of the technical analysis (e.g. support/resistance levels), but that you have to put your own technical and risk analysis around your trades. As for the bottom on miners and gold (that keeps slipping out, the latter), it is definitely frustrating. Apparently a lot of gold holders where left holding the bag, and the ongoing “maybe”, “hope” keeps getting pushed out. If anyone has greater insight on a gold run, all for hearing it. Seems like it should be just around the corner for a season push, but can’t tell now if the message is: “sell all equities” (that would include miners). Guess we’ll just see how things unfold. Seabridge gold is quality and was one of the few stocks in the green day (first day of correction), and VIX (use VXX). Gold and miners are just tricky; no one on CBNC beating drums yet. The one year delay “hoping” kind of wore thin.
Remember Seabridge is not even a producer ..expensive if they only explore … watch out . I have another date for the low in gold …Jan./ Feb. 2015
surfint …” market correction timed perfectly ? Where were you in Feb. 2014 or any time after that ? This was his ?th try for a market correction .
The clock is right twice a day …kind of thing ?
On a weekly charts (gold), momentum is still dropping (down); on a daily chart, momentum is due for a bounce. Odds favor a drop in gold based on weekly momentum. It seems like gold could be channel bound for awhile. Short interest is high so maybe it will pop before too long and take some miners with it. Today (first day of market correction), high growth (quality) stocks dropped more than premium miners on average, so maybe miners (with low valuation) have less to drop if they do. Revisiting the lows would be OK with me (to build on positions, quality stocks only (vs. wild ETFs), just a preference).
Love how Larry keeps coming up with things. Like that natural gas is building a “secondary bottom” – too bad for those who took his recommendation on that gas ETF whatever it was called. Just more victims on the Edelson conveyor belt.