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Senator Orrin Hatch warns that the bubble has the power to “destroy the retirement savings of millions of Americans.”
Famed economist Leonard E. Burman of Syracuse University is warning the U.S. Senate of “disastrous consequences for ourselves and the rest of the world.”
Goldman Sachs … Bank of America … Morgan Stanley … Royal Bank of Scotland … JPMorgan … and Oppenheimer Funds are all warning that it could bankrupt millions of investors.
Congressman Ron Paul says, simply, “this country will be ruined.”
These and many other authorities are talking about the greatest financial bubble in human history:
A bubble that is now more than EIGHT times larger than all the stock exchanges in the United States combined.
A bubble so massive, it is four times larger than the dot-com bubble of the 1990s and the housing bubble of the 2000s combined.
Now that bubble has begun to burst.
As it implodes, it will launch interest rates into the stratosphere … crush the feeble U.S. economy … destroy major U.S. banks and insurance companies … drive your cost of living through the roof, threaten your standard of living and financial security … and push the U.S. government to the very brink of financial collapse.
But the best defense is a strong offense — and this crisis will also create windfall profit opportunities for a select group of investors who make the right moves now.
Just a few days ago, Weiss Research analyst Tom Essaye hosted a special online summit meeting to explain exactly how, and I’ll give you a transcript of the meeting in a moment.
Tom’s career began as a trader on the floor of the New York Stock Exchange for Merrill Lynch, where he regularly traded multi-million-dollar orders from some of the largest mutual and hedge funds in the world.
In early 2005, Mr. Essaye joined a global hedge fund where he invested in precious metals, agricultural commodities, energy, and natural-resource-related equities — placing initial long positions in gold below $500 per ounce and silver below $7.00 per ounce.
More recently, I personally became so impressed with Mr. Essaye’s unique approach to wealth-building that I picked him to call the shots with $1 million of my own, personal money.
In our online summit, he was joined by Safe Money editor Mike Larson and Real Wealth editor Larry Edelson. Here’s the transcript…
The Next Great Bubble about to Collapse
with Tom Essaye, Mike Larson and Larry Edelson — abridged transcript
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Tom Essaye: If there’s anyone who knows how to capitalize on bursting bubbles, it’s our firm, Weiss Research.
All of us are extremely proud that in the late 1990s, we were one of the first financial research firms in the world to warn investors that the tech stock bubble was about to burst.
Investors who heeded that warning didn’t have to lose a penny when the Nasdaq index crashed 78% and many tech darlings fell to zero.
Equally important, you could have used our warnings to buy things that soar when stocks sink.
An ordinary leveraged investment vehicle designed to soar when Nasdaq stocks sink, rose 350% in value between March and October of 2000 alone.
A second one jumped 395%.
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And a third soared 600% — enough to every $10,000 into $70,000!
We’re also proud that in 2005, we became one of the first to sound the alarm before the housing bust. Mike Larson, who will join me in a moment, even NAMED the companies and stocks that would be hit the hardest well in advance.
Once again, investors who acted on that warning didn’t have to lose a red cent when the S&P plunged 56% in the most painful recession since the Great Depression.
And once again, anyone who acted on that warning could have earned windfall profits.
One simple investment anyone can buy in an ordinary brokerage account generated a 92% gain.
Another jumped 107% — more than a double — as the housing bust unfolded.
And still another soared 225% in value between 2007 and 2009 — enough to multiply your money more than three times over.
For nearly a year now, I’ve been sounding the alarm again; NOT for the bursting of a bubble in the tech sector or housing sector … but in a market that is many times larger than all the stock exchanges in the United States COMBINED.
And as before, I am absolutely convinced that if you heed this warning, you will not only sidestep the costliest economic and financial crisis any of us has ever seen …
You will also have the opportunity to reap windfall profits — even potentially multiply your money many times over.
In fact, this is precisely why I recently asked Dr. Weiss to let me invest an additional $25,000 on top of the $1 million he has already entrusted to me: To stake a claim to truly enormous profit potential as this giant bubble begins to burst.
Even if the coming crash is far less severe than I expect it will be, the bursting of this great bubble could generate a 250% gain, turning Dr. Weiss’ $25,000 into as much as $87,500.
And if my best-case scenario is fully realized, Dr. Weiss’ $25,000 could, over time, be worth as much as $148,500. Unless I miss my guess, this will begin to happen sooner rather than later.
And in just a few minutes, I’m going to name these investments for you so you can grab the same profit potential we have.
It’s no secret that we — all of us — are sitting on a ticking time bomb.
I am talking, of course, about the most colossal mountain of debt in world history:
A bubble of such monumental proportions that it dwarfs the tech stock bubble of the 1990s and the housing stock bubble of the 2000s COMBINED.
The thing about bubbles is, they ALL burst. Without exception.
The bigger they are, the harder they fall; the more damage they inflict on the economy and on unwary investors.
But for sophisticated investors, bubbles create enormous opportunities — and the bigger the bubble, the more money it could make you.
And as we’ll see in a moment, this bubble — the bubble in the U.S. debt markets — is the granddaddy of them all!
Debt is created in the bond market. That’s where the government goes to borrow money. So do states and local governments. Companies, too.
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Borrowers sell bonds — or notes and bills — that guarantee investors a certain rate of interest or “yield” over time.
Since the turn of the century, the U.S. bond market has simply exploded in size — adding $20.7 trillion in new debt.
But now, despite massive new initiatives by the U.S. Federal Reserve, the meteoric rise in prices that characterized the debt market since the turn of the century has sputtered, stalled and is now dead in its tracks.
Millions of investors all over the world — including many of the world’s richest central banks — have started to stampede for the bond market’s exit.
And now, we’re beginning to see the first cracks appearing in this massive bubble.
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This chart of the PIMCO Total Return Bond Fund is a perfect picture of the bubble in the bond market — and also the beginning of the crash.
On the left side of the chart, you can see the bubble in the bond market being inflated.
On the right-hand side, you can see how prices just plunged well below their support levels.
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And just look at this chart of the iShares Municipal Bond ETF: It just fell off the proverbial cliff, giving back every penny it gained since last July!
But this crash has barely begun. The last few Treasury auctions showed that bidding from foreign central banks is plunging to the lowest level in years.
In addition, U.S. investors are starting to turn bearish on Treasuries. A recent report from a top industry watchdog showed that nearly 20% of all Treasury investors have started to cut back their holdings.
Even Fitch — the normally conservative ratings firm — is warning that a massive bubble has been created in the bond market.
This is huge. Bubbles are like an enormous Ponzi scheme: They collapse when the money stops flowing in.
The moment that happens, it’s over. And it’s beginning to happen right now!
As this bubble — the greatest bubble mankind has ever seen — implodes, the consequences will be devastating for millions of unprepared investors, just like the tech bubble was and just like the housing bubble was.
The most vulnerable are those who can least afford to suffer losses: Seniors who are approaching or in retirement, who have shifted large amounts of their money into fixed income investments.
Your tax-free municipal bonds could tank.
Your annuities and other insurance policies could turn to dust.
Your money invested in bank and insurance company stocks could vanish right before your very eyes.
Mike Larson, editor of Safe Money Report, has earned international acclaim as the ONLY analyst to not only forecast the historic housing bust and “Great Recession” of 2008-2009 … but also to NAME each one of the major companies and stocks that were hit hardest.
Let’s go to him now. Mike, please explain why a crash in the bond market is so critical.
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Mike Larson: This is a big deal because the bond market is HUGE!
To understand how huge this is, let’s first add up the value of all the stocks of all the listed companies on all the exchanges in the United States: That’s $25.8 trillion, according to the Fed.
Plus, to make sure we’re not missing anything, let’s also add up the value of stock futures, stock options and other stock instruments: According to the U.S. Comptroller of the Currency, that’s another $2 trillion.
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Total equities in America: $27.8 trillion.
Now, let’s do the same for bonds and other debt instruments:
The total outstanding debt right now is $55.3 trillion. And that’s already twice as big as all the stock markets combined.
But it’s just the tip of the iceberg. Because in addition, U.S. banks hold a whopping $179 trillion in derivatives that are based on bonds and the like. Grand total of bonds and debt instruments: $234.3 trillion.
That’s 8.4 times the size of all U.S. stock markets combined!
The plain truth is that today’s debt bubble dwarfs the bubble in tech stocks and the bubble in housing stocks combined.
At the peak of the tech stock bubble in 2000, the entire Nasdaq index was worth $5 trillion.
At the peak of the housing bubble in 2007, the entire real estate and financial sectors were worth $8 trillion.
But today’s market in actual debt instruments is $55.3 trillion: That’s FOUR times larger than the tech stock bubble and the housing bubble COMBINED!
Tom: So the bursting of this enormous debt and bond bubble means that anybody who owns bonds, bond funds or derivatives tied to bonds is about to suffer huge losses.
And that includes everyday investors, banks, insurance companies, pension funds, not to mention every government in the world that Washington owes money to.
More to the point, if you own any kind of bond, bill or note, you will suffer huge losses.
If you own stock in a company that holds bonds or debt derivatives, you could suffer huge losses there as well.
If your pension fund or retirement plan invests in bonds, it could suffer huge losses.
And there’s another reason why this bubble impacts almost every investment and business in the world:
When bond prices fall, interest rates rise.
Higher interest rates would sabotage the housing market, undermine corporate profits, drive your cost of living through the roof and virtually snuff out any whiff of economic growth that remains in the air.
So the big lesson here is that when bond prices collapse, interest rates go through the roof. And if bonds fall in half, their interest rates DOUBLE.
And there’s more.
Look. When stocks fall, they fall. Investors lose money.
When bond prices collapse, like they’re beginning to now, investors also lose money.
PLUS, when bonds crash, interest rates shoot the moon, which would be a death sentence for an economy on life support like ours is now.
Worse, foreigners own enormous amounts of U.S. debt. So this time around, the U.S. dollar will also get clobbered! Your buying power could plunge. Your cost of living could soar. When the bond market crash accelerates, millions of people will be pushed to the brink of bankruptcy and beyond.
Let’s go to Larry Edelson, reporting from Los Angeles today. Larry has the distinction of being one of the very first analysts to forecast a massive new bull market in gold and natural resources all the way back in the year 2000 — when gold was selling for under $300 per ounce.
Larry, you’re Weiss Research’s inflation and bullion specialist; explain why a crash in the bond market pretty much guarantees our cost of living will explode.
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Larry Edelson: It’s actually pretty simple. It’s because you can’t buy U.S. bonds without using the U.S. dollar.
Before a foreign investor can buy a Treasury bond … a municipal bond … or a corporate bond in the U.S. bond market, he must first exchange his yuan, his yen or his euros for U.S. dollars.
So as the bond market bubble was growing … demand for U.S. dollars was also growing!
But when foreigners sell U.S. bonds, the opposite happens. They have to sell U.S. dollars, too!
They cash in their bonds for U.S. dollars — and then EXCHANGE those dollars back into their home currencies.
That drives the dollar down — and the price we pay for just about everything straight UP.
Tom: And in turn, the falling dollar causes more declines in bond prices. Explain how that happens.
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Larry: Sure. Investors are not stupid. They know the low inflation numbers Washington reports are pure baloney, 100% baloney.
And they’re right. John Williams, an expert economist who tracks inflation the way Washington used to back in 1980 before they started manipulating the numbers, reports that the true inflation rate today is now well over 10%.
Every year, the value — the buying power of our money — is falling TEN FREAKING PERCENT!
At that rate, prices double every seven years!
Worse, it means that buying a bond GUARANTEES you a loss in real terms.
True inflation is now running more than THREE TIMES what the 30-year Treasury is paying …
SIX TIMES more than what the 10-year Treasury pays …
And a whopping 14 TIMES what the five-year Treasury pays …
And 40 TIMES more than what the two-year Treasury pays!
The same is also true with municipal and corporate bonds.
And even most junk bonds — the riskiest bonds on the market — are paying far less than the true inflation rate!
When adjusted for inflation, the ridiculously low rates the bond market is paying now virtually GUARANTEES you will get poorer very quickly.
That means, as true inflation continues to rise, the likelihood of a massive bond market crash also rises.
Tom: Exactly. It’s like a downward death spiral: Falling demand for bonds crushes the dollar … and the falling dollar cuts bond demand — and prices — even more!
Ultimately, you have a collapse that crushes investors, companies, and potentially the entire U.S. economy. And the ironic thing is, the Fed did it. The U.S. Federal Reserve.
Larry, your home is in Bangkok, Thailand. You have a unique perspective OUTSIDE of the United States. How have the Fed’s actions been seen by foreign investors?
Larry: The folks at the Fed have sent a clear message to investors all over the world:
They have proclaimed that U.S. Treasuries are the ONE investment being directly supported, even jacked up in value by the largest, most powerful, richest central bank on the entire planet.
Mike, what are your thoughts on this?
Mike: None of this should come as a surprise to anybody. We all know the Fed under Alan Greenspan, and now Ben Bernanke, is a serial bubble blower.
It has repeatedly created bubble after bubble with reckless easy money policies. The only thing that changes is the asset class. First, it was the dot coms … then it was housing … and now it’s bonds!
We’ve seen this kind of mania blow up in our faces not just once but twice in the past 12 years! And investors have made the same mistakes each time:
Just as they did during the tech bubble, they’ve made high-stakes, low-intelligence investments in lousy companies …
And just like they did during the housing bubble, they’re buying the same kinds of crappy “alphabet-soup” investment products that caused hundreds of billions of dollars in losses just a few short years ago!
Tom: Let’s recap: We have established that the bond market is an enormous bubble. There’s no doubt about that. We have shown that it is many times larger than any bubble any of us has ever seen. There is no doubt about that either. And we know that all bubbles burst. Zero exceptions.
So here’s the $64 million question: Why NOW? Why is this great bursting of the bond market bubble happening now?
The reason is that the Fed has fired all its bullets. And now, it is out of ammo. It has lowered interest rates all it can. They can’t go any lower than zero. That means there’s only one way for interest rates to go now and that’s UP!
Plus, the Fed has printed more than $2.8 trillion since 2007 and used most of that money to buy bonds. But now, they’ve printed so much money, more printing no longer has any impact on bond prices or the price of other risky assets.
Last month, the Fed announced “QE-Infinity+1,” saying it’s going to print 45 billion ADDITIONAL dollars every month and use them to buy long-term Treasuries.
That’s in addition to the $40 billion per month in purchases of mortgage-backed securities, another type of bond. Combined, those moves are enough to expand the Fed’s balance sheet from about $2.9 trillion now to as much as $4 trillion in the future.
These were the biggest, most beyond-the-pale moves we have EVER seen from the Fed.
But what happened in response? Outright SELLING of the bond market!
Several bond market ETFs plunged below critical support levels, while yields spiked. So not only did the Fed’s announcement of more money printing and more bond buying UTTERLY FAIL to drive bond prices higher … it actually caused them to fall.
If that isn’t a clear indication that this bubble is bursting, I don’t know what is!
Plus, never forget: A crash in bond prices means a crash in the U.S. dollar.
So in addition to watching your fixed-income investments go up in smoke as bonds crash …
In addition to suddenly having to pay much more interest on every credit card you have and every new loan you need …
You’re ALSO going to see inflation accelerate like there’s no tomorrow.
As the dollar dives, your cost of living could soar. The price you pay for the food and fuel you need could potentially skyrocket.
For folks on fixed incomes, this is the worst situation imaginable; caught between a rock and a hard place. Hopelessly trapped between declining income and rising cost of living.
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So how much money could you make if you make the right moves now? Well, as we’ve already seen, in just the last few weeks, a few very tiny, minuscule fissures in this massive bubble have opened — and one very liquid, easy-to-buy, leveraged investment has already risen in value by 75% in just 38 days …
Another leveraged investment surged 141% in just 21 days …
And a third soared 156% in value in a mere 22 days — enough to turn a $10,000 investment into $25,600 in less than one month.
And as this crash accelerates in the days ahead, your profits could be far greater over time.
Plus, history offers some important clues to how large this crash and interest rate explosion will be.
Between 1979 and early 1981, the price of 30-year Treasury bonds fell from about 92 to 62 — a 30% decline: Long-term Treasuries lost almost one-third of their value in just eight months!
Then in 1994, bonds tanked from around 122 to 96 — a 21% decline. Rates surged from 5.9 percent to 8.13 percent.
And between December of 2008 and June of 2009, Treasury bonds plunged 30% and interest rates almost doubled.
But remember: We have never seen a bond market bubble that even comes close to what we have today. Bond prices have never been more inflated. Interest rates have never been this ridiculously low.
So this time all bets are off as to how high — and how quickly — interest rates could explode.
But we do know one thing for sure: Interest rates can NOT decline any further. They are effectively at zero.
There’s only one direction they could possibly go from here: UP.
So brace yourself for the consequences and stand by for our recommendations on how to protect yourself!
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.
{ 45 comments }
Any better way of cashing in without touching ETFs,which suffer from attrition/costs ?
should I continue buying real estate as an investment?
Good stuff. However, the America you are advising financially, in my opinion, is no longer. Although this advice may be spot on, the current administration will no longer allow individuals to creat and harbor great wealth, especially in your predicted senario. The somewhere over 16 trillion dollars being held in IRA’s and 401K’s is targeted for goverment confiscation upon a collapse “crisis” of this magnitude. In a time of collapse, you can have your investments, at pennies on the dollar, or you can have it all, at retirement age, in payments much like SS. Once you pass, and a spouse passes, it belongs to Obmanation.
In 09, one of the first acts as pres, was to commission a Treasury study, as to how much in resources a retiree in America actually needed in an economic crisis. There were several recommend options, above was 1 of about 4.
When hussein declared he intended to spread the wealth around, I firmly believe he was speaking about the wealth of those clever enough to invest wisely and build wealth, especially in your crisis senario when most wealth has vanished.
It is a shame, that 60 year old’s like me, who have had the opportunity to grow up in the best country ever, at the best time ever, have to resign themselves to ride out our downfall, and witness a looter/moocher class destroy this great American experiment. Most folk have yet to come to grips with reality.
I have many friends retired from School Teaching at age 50, who haven’t a clue that most all states retirement funds are in deep trouble, just like the national budget. And they will never see what is about to hit them, as they refuse to converse about it.
Spot on J B. I find myself watching and learning more about chickens, goats, rudebagas and guns allthe time – holy crap, i’ve become a prepper !
You are so right. I never worried about my savings….. living in America ……. until a few years ago. Now nothing is safe. And most Americans are oblivious.
The PIMCO total return fund have two distributions in December that led to the decline in the NAV of the fund? 26 cents on 12/11 and another 11 cents on Dec 26. How else did this fund’s NAV drop?
See Dallas Fed Chairman Richard Fisher’s speech (Richard.Fisher@dal.frb.org ) calling for breaking up the Too Big To Fail Banks and replacing Dodd-Frank with serious reform.
Which inverse currency ETFs do you recommend?
Excellent article!
Tom, What happens to the bank warrants you said to buy not so long ago. They do have six and seven
year expiration horizons, but will this be enough to overcome the large losses in bank stocks you expect
with the collapse of the bond market.
I dont hear anything about buying puts i n EURODOLLARS {interest rates} IM buying a small position in them. What do you think? Thank you
Separately, Larry has been telling us that precious metals are in a temporary decline and that they are bound to rise later this year. Is that rise expected to coincide with the bursting of the bond bubble?
Would you say that now’s the time to (1) invest in China because the gov’t plans to boost its stock market starting now; and (2) in Australia, as it’s currency is strong and it doesn’t suffer from America’s foibles?
What will this to the price of gold and real estate???
Art Snell
I have subscribed to your newsletters and this new information is very important,albeit bad news. I suppose Nilus Mattive news letter is the best for me . I am 84 years old, out of the market, and wondering how to survive this coming collapse. All of my savings are in banks in checking accounts… OH Dear!! Any comments welcome.. Joy
I’m buying cheesecake, cigarettes, cheap red wine, and liquor…..OK, and some rice and beans.
OK. You left us hanging. What do we do from here?
Thank you Dr.Weiss I always enjoy your comentarys they are very education and informative to me., a breath of sunshine. . Regards Gerald Lee
Gerald – The word would be “educational” Just saying !!!
I totally agree. I am a Swing Trader and I have seen this coming for a long time. Some people thing I an half crazy. Thanks for confirming my long term thinking about the bond market and the Federal Reserve trying to print their way out of the problem. To me, this problem cannot be solved by increasing the tax rates or printing more money and that includes selling more bonds. I think we are about to reach a point where the U.S. cannot pay the interest on the bonds, basically due to the amount of Spending that Washington refuses to control. You have not heard a single Congressman or Senator discuss what the government is spending today…..only what they intend to spend in the future. They are more interesting in their next campaign to get re-elected that the “health” of the United States.
when you say bond market crashes you mean tha thte price of bonds will go down- owever the companies will pay full value at maturity or you mean that all companies will go bankrupt and money will be lost?
WILL THIS “BOND BUBBLE” AFFECT GOVT. I-BONDS AS WELL?
Ditto the above question of Jan. 19, 2013. Is it realistic to expect the same collapse of I-bonds, including the interest earned since 2001?
I have quite a large holding in corporate bond mutual funds (AMERICAN HIGH INCOME TRUST and BOND FUND OF AMERICA) Should I sell (liquidate) these now? Will they be negatively affected badly when the bubble bursts? Sincerely, C Kirkpatrick
Interesting Information
Sounds about right and is backed up with facts
It was the collapse in the bond market back in 1930 that crushed my grandfather’s finances. He lost his farm because of it.
As I read this article describing how events are leading up to an eventual collapse of bonds, my concern centers
on money managers responsible for overseeing City, County, and State retirement funds. I assume they are,
or ought to be, aware of the “bubble” and are taking action needed to protect the retirees. One can visualize
the impact on the economy and the family if retirement funds were to vaporize.
are u talking about precious metals and buying them or sticking your money in the bank and getting higher interest?
I can see your points as a big possibility
Do you think it safe to keep money in a 4-5 star bank …for savings & cd’s
I have been an investor since 1958. I thank you for this analysis. From my experience I cannot fault your reasoning. In times of extreme chaos, there is also extreme opportunity.
I look forward to seeing more of the recomendations from Tom. I have switched most of my portfolio to your recommendations.
I’d like to hear what the alternative to owning Bonds is, thanks Jerry
You give advice to those who have discretionary funds to invest, or call back and reinvest.
Do you or anyone else have advice tor the millions who are in the fixed-income trap you describe in this article? What are they to do? Who has advice for them, while Washington cavils about debt deilings, tax “reform” and trickle-down ideologies, and Wall Street advisors counsel the wealthy about how to protect and multiply their wealth?
So, what are your present recommendations for avoiding the breakdowns? RH
Being a lifetime member of the “Weiss Inner Circle” has allowed me to stay up on all of the financial markets. Your newsletters/alerts has also allowed me to protect my hard earned money thus far. As a result of the help from the Weiss Team, I hope to preserve and grow my retirement savings and ride out this forthcoming “Bond Bubble Collapse” and its devastating impact on the economy. Many thanks to the Weiss Team – M. Dwight Harrison
Hello….I plan to invest in a Equity index Fixed Annuity with AVIVA that guarantees your capital. If the bond market drops and effects the amount of interest it pays on my retirement capital investment , is there any risk loosing my capital that this insurance company guarantees?….Mike
What interest rates doubled between 2008 & 2009? I think the facts are off somewhere?
Can someone please explain.
Martin – Mid-way through your report you say “More to the point, if you own any kind of bond, bill or note, you will suffer huge losses.” You recommend in January 2013’s Safe Money Report that “The rest of your funds should stay in short-term Treasury bills or equivalent. Should we not have some of our funds in Treasury Bills? If not, where should we keep our funds where they will be safe? Thanks for your help. John
Very interesting
Even thou bank interest rates are low for cd’s & savings …
Is it safe to keep money in 4 & 5 star banks?
If you have income from a very large insurance company…is this income safe.
If you know the answer please respond.
Excellent info, Is there a better ETF to be short T-Bonds than TBT? Or other vehicle?
Thanks You !!! David
I live in the uk and I gather that if the usa catches a ‘cold’ the rest of the world suffers, at best, the ‘flu, and more likely worse.
I think J.B.’s first comment says it all. This is an attack on the American people’s way of life and quality of living. As these things begin to unfold, the government will continue to target those items they know to rise from their actions of destroying the American dollar by raising capital gains taxes, income taxes, etc… This will also force Americans to look at bartering as a way of life and this in turn will be fought with tougher and stricter laws on such actions. Needless to say, the best defense in such a scenario is to cut ones expenses down to bare necessities and live on only what you have rather than going deeper in debt. What I wonder is how will this affect the quality of life in other areas around the world? Particularly in the United Kingdom as I wrestle with whether my family should return there.
Dear Larry would australia be one of the hardest economies to make money on gold when the US bond market crashes because the australin currency $aus is so strong the gold price may not go up can tjhis happen?
Never overlook the fact that there is a likely more ominous consequence of this collapse. When entitlement payments dry up either because they are reduced directly by the government or indirectly by inflation and too many Americans face loss of the essentials provided by this financial fiction, then one can easily predict blood in the streets a civil war between the producer and investor class and the supported class the like of which has not been seen since the French revolution. But it gets worse. The decline of order and productivity will usher in those enmities, foreign and domestic, who will take by whatever means what they did not earn and destroy what they did not value. I think it was the French historian, Detoqueville, who said that our country would be in irreversible decline as soon as politicians realized that it hey could buy our votes with our own money.