central banks

BIS: Global Debt Markets Grow To Estimated $100 Trillion In 2013, Up From $70 Trillion In 2007

Last night, I read about global debt markets hitting the $100 trillion-mark.

One word came to my mind at that moment:

Unsustainable.

Branimir Gruić and Andreas Schrimpf wrote “Cross-border investments in global debt markets since the crisis” in the latest BIS Quarterly Review- a report from the Bank of International Settlements (the central bank of central banks). From the publication released Sunday:

Global debt markets have grown to an estimated $100 trillion (in amounts outstanding) in mid-2013 (Graph C, left-hand panel), up from $70 trillion in mid-2007. Growth has been uneven across the main market segments. Active issuance by governments and non-financial corporations has lifted the share of domestically issued bonds, whereas more restrained activity by financial institutions has held back international issuance (Graph C, left-hand panel).

Not surprisingly, given the significant expansion in government spending in recent years, governments (including central, state and local governments) have been the largest debt issuers (Graph C, left-hand panel). They mostly issue debt in domestic markets, where amounts outstanding reached $43 trillion in June 2013, about 80% higher than in mid-2007 (as indicated by the yellow area in Graph C, left-hand panel)…

(Editor’s note: Italics added for emphasis)

“Not surprisingly, given the significant expansion in government spending in recent years, governments (including central, state and local governments) have been the largest debt issuers”

Gruić and Schrimpf are correct- I’m not surprised.

And regular Survival And Prosperity readers shouldn’t be either, as warnings about reduced government services and new/higher taxes and fees (to deal with all this new debt) have been issued time and time again.

You can read the entire BIS report here (page 22 of the .pdf file/page 18 of the publication contains Gruić and Schrimpf’s findings).

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Jim Rogers: Fed Will Reverse Taper, Leading To ‘Disaster In The End’

Well-known investor, author, and financial commentator Jim Rogers was recently interviewed by BBC News. The interview was published on their website on December 24, and in it, Sharanjit Leyl asked the former investing partner of George Soros what effect “tapering” would have on the U.S. economy. Rogers explained:

It will not have much effect on the economy. It will have an effect on the financial markets, and therefore, indirectly on the economy. What will happen is, they will taper. They will do some more. Eventually the markets will get scared. They will go down all over the world. And then the bureaucrats and the academics at the Fed will panic, and they will start printing money again. And everybody will say, “Phew! It’s okay.”

Leyl asked the Singapore-based investor, “Will it be okay though?” To which Rogers replied:

No. Sharanjit, it’s a disaster for the world. It’s unmitigated disaster. This is the first time in world history- recorded history- that all the major central banks in the world are printing staggering amounts of money at the same time. There’s an artificial sea of liquidity out- look out the window. You’ll see the ocean of liquidity rising, rising, rising. This is going to be a disaster in the end.


BBC News Video

Rogers mentions 2015, 2016 in the interview. On December 5, I blogged that he appeared two days earlier on The Lang and O’Leary Exchange, a Canadian business news television series which airs weekdays on CBC Television and CBC News Network. The CEO of Rogers Holdings and Beeland Interests warned host Amanda Lang:

Well, eventually Amanda, when the next big collapse comes- and we’ve had them every four to six years since the beginning of the American republic and the Canadian republic- you’re going to see serious, serious problems. The next correction when it comes- because the debt is so very very high. You know, 2008 was worse than 2002 because the debt was so much higher. You wait until 2015 or 16, Amanda. The debt has gone through the roof. The next one is going to be very bad. Be very careful. Be prepared, be worried, and be careful.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Peter Schiff Bashes QE, Taper Lite, Gold Bears

“Gold Set for Worst Annual Tumble Since ‘81”

-FOX Business website headline, December 23, 2013

“Gold’s safe-haven role is over: strategist”

-MarketWatch.com headline, December 23, 2013

“I wouldn’t buy gold with my worst enemy’s cash: Strategist”

-CNBC.com headline, December 22, 2013

Not only have I been waiting to hear Euro Pacific Capital CEO Peter Schiff’s take on last week’s “taper” of the Federal Reserve’s quantitative easing program, but also his opinion on the latest bout of gold selling.

Schiff, who correctly called the recent housing crash and 2008 global economic crisis, just uploaded a new entry to The Schiff Report, his YouTube video blog. Schiff told viewers on December 20:

We have never had more stimulus- both monetary and fiscal- than we have right now. This is record-breaking, Keynesian stimulus. And it’s barely working. Yes, it’s inflating a stock market bubble. It’s inflating a real estate bubble. But it’s not creating genuine economic growth. And it never will. It is not raising living standards for the vast majority of Americans. And it isn’t creating productive, high-paying jobs. And it never will. And Ben Bernanke doesn’t understand that.

Like fellow “crash prophet” Marc Faber, Schiff believes the Federal Reserve will eventually pursue more, not less, bond-buying in the future. He explained:

Why did gold sell off? “Because everything is great.” “Because the Fed has done the impossible.” “It’s tapered and it hasn’t hurt anything.” This is what everybody believes. That the Fed has accomplished its goal. It hasn’t done anything. It’s talked about doing a tiny bit. But again, as far as I’m concerned, monetary policy is even easier now than it was before they announced this trivial taper lite. And the rest of the taper is probably never going to happen because the Fed is going to have to buy more bonds, not fewer bonds, to keep this whole house of cards from imploding.

Now, is gold going to continue to fall? I don’t know. My gut is that it’s probably still finding a bottom around 1,200. There is plenty of legitimate support for gold all around the world. Yes, all the speculators who are convinced that everything is great. The same people that thought it was great in 2007. Or it was great in 1999. That crowd, completely clueless about actual economics, is convinced that there is no reason to own gold. And so, they’re going to sell it, they’re going to short it. But there is a larger community around the world, particularly I think a lot of the emerging markets, central banks, China in particular, that see it differently. And they’re using this opportunity to buy as much gold as they can so that when the speculators and the investors figure out how wrong they’ve got it, and they realize that they need to be buying gold not selling it, there won’t be any gold left to buy because they would have already sold it. And the people who bought it from them aren’t going to sell it back. The gold that China bought- they’re never going to sell it. I don’t care how high the price of gold goes. They want that gold as reserves for their currency because they know the dollars that they have in reserve are eventually going to be Monopoly money. It’s going to be confetti. So they need something real to back up their own currency, and they want gold.

And so, I think that we need to be taking advantage of this opportunity. And don’t be worried about all the negativity that’s out there and all the professionals who are writing gold’s obituary. They’ve written it before, they’ll write it again. But I still think that the bull market has a long way to go. Ultimately, we are still heading for a currency crisis.


“Taper Lite: Bernanke Tightens Monetary Policy by Easing it!”
YouTube Video

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

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Peter Schiff Predicts Effect On Consumers When Bond, Stock, And Real Estate Bubbles Pop

Anyone catch Euro Pacific Capital’s CEO and Chief Global Strategist Peter Schiff on FOX Business Network’s The Willis Report back on November 27?

I just saw it for the first time the other day. Host Gerri Willis began the segment by talking about recent upbeat economic reports, to which Schiff replied:

You know, Alan Greenspan actually came out today and proclaimed that there was no bubble in the stock market. And he ought to know, right? Because he’s 0 for 2 when it comes to spotting bubbles. I think it’s 3 strikes and he’s out.

Ouch. A close second for my earlier “Quote For The Week” post.

The “crash prophet” added:

Because not only is there a bubble in the stock market. But the Fed has managed to make bubbles in the stock market, the bond market, and the real estate market simultaneously. That’s a lot of bubbles for the Fed to juggle.

Later on in the segment, Schiff, who correctly predicted the recent housing market crash and 2008 economic crisis, told Willis the U.S. dollar “is eventually going to get hit hard.” The host asked:

What will I feel as a consumer?

Schiff answered:

When the Fed is ultimately forced to raise interest rates- yes, we’ll have a big drop in the stock market, a big drop in the real estate market, we’ll be back in a severe recession, and it’s going to be tough. Prices are also going to go up for consumer goods, because a weak dollar means consumer goods are more expensive, But ultimately if the Fed has to protect the weak dollar with rate hikes, then your assets go down in value. But the price of everything you need to buy goes up.

Not a pretty scenario at all for American consumers if Schiff is correct once again.


“Holding the Dollar Could be Riskier Than Stocks”
YouTube Video

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

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Marc Faber: ‘We Are In A Gigantic Speculative Bubble’

Swiss-born investment advisor and fund manager Marc Faber issued another warning about stocks being in a bubble this past Friday. Appearing on CNBC’s Squawk Box, “Doctor Doom” told viewers:

I’ve been quite positive for equities after 2009 when they became very cheap. But recently I have to say that we are once again in a massive financial bubble in bonds, in equities. We are in a bubble in asset prices that have gone up dramatically. Farmland is up ten times over the last ten years. And Bitcoins are up now. And who knows what next will go up. But, we are in a gigantic speculative bubble. And as I have said, I haven’t shorted any stocks yet because they may still move up. But I don’t see any value in stocks any longer, except very few sectors…

So I think that financial assets, if you look at the next five to ten years’ expected returns, but these returns will be very low.

Now can the market go up another twenty percent before it tumbles? Yeah, it can go up even more, if you print money.


“Marc Faber: No value in stocks”
CNBC Video

Dr. Faber, who became famous for advising clients to get out of the U.S. stock market one week before the October 1987 crash, also warned of a bubble in financial assets on CNBC’s Fast Money on November 19. He said:

I see a bubble in everything that relates to the financial sector. We have a bubble in bonds. We have a bubble in low-quality bonds. We have a bubble in equities. If you look at the financial sector as a percentage of the global economy, it’s very large. We have a huge debt bubble, and it’s only getting bigger. It’s not getting any smaller.

So we are the bubble. Everything that is in the financial sector is the bubble, and it’s been pumped up by central banks.

I don’t know about you, but talk about bubbles seems to be growing these days.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

Source:

Navarro, Bruno J., “Superbear Marc Faber sees opportunities.” CNBC. 19 Nov. 2013. (http://www.cnbc.com/id/101212211). 1 Dec. 2013.

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Marc Faber Sees Bubbles In Bonds, Stocks, Debt, And High-End Sector

While “crash prophet” Jeremy Grantham sees only a “few signs yet of a traditional bubble” in stocks, “Doctor Doom” Marc Faber thinks otherwise.

In fact, the Swiss-born investment advisor and fund manager sees the whole financial sector as being very bubbly these days.

Faber appeared on CNBC’s Fast Money last Tuesday and warned viewers:

I see a bubble in everything that relates to the financial sector. We have a bubble in bonds. We have a bubble in low-quality bonds. We have a bubble in equities. If you look at the financial sector as a percentage of the global economy, it’s very large. We have a huge debt bubble, and it’s only getting bigger. It’s not getting any smaller.

So we are the bubble. Everything that is in the financial sector is the bubble, and it’s been pumped up by central banks.

Now within the big bubble, I think the high-end sector is probably a huge bubble. You know- pink diamonds, the prestige art, and luxury.


“Uber bear Marc Faber gets a little bullish”
CNBC Video

The editor/publisher of the monthly investment newsletter The Gloom Boom & Doom Report revealed he owned stocks in European telecom companies, utilities, and blue-chip companies in Switzerland.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

Source:

Navarro, Bruno J., “Superbear Marc Faber sees opportunities.” CNBC. 19 Nov. 2013. (http://www.cnbc.com/id/101212211). 25 Nov. 2013.

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Marc Faber Reveals Gold Investments

This afternoon I want to pick up where I left off last night (couldn’t keep my eyes open after a long couple of days away from home!) on the latest investment activities and recommendations from the “crash prophets.” I already mentioned Jeremy Grantham. Now lets talk about “Doctor Doom” Marc Faber. The Swiss-born investment advisor and fund manager appeared on Canada’s only all-business and financial news television channel BNN last Wednesday and talked precious metals.

On gold, when asked how much of an investment portfolio should be in the yellow metal, Dr. Faber replied:

Well, that depends. Say, if you owned a lot of real estate, your requirements for gold are not as high as if someone has all his money in financial assets. I have an overweight in financial assets. I own real estate- but not that much. So I have a relatively large allocation to gold- something like 25 percent… But I don’t value gold- I just weight it every year.

(Editor’s note: Italics added for emphasis)

Faber chuckled and added:

I wished that they would do that with the Federal Reserve. Because nobody has yet audited all these governments who claim they have that much gold. Maybe they don’t have it. Maybe they lent it out already.

The editor/publisher of the monthly investment newsletter The Gloom Boom & Doom Report was also asked about silver. He responded:

I think the commodities- the precious metals- will all move in the same direction. Some may move faster than others. Some people think that silver is a better value today than gold. Other people- and I tend to agree- that maybe platinum is the best precious metal right now.

(Editor’s note: Italics added for emphasis)

Finally, the man who made a name for himself in financial/investing circles for reportedly advising clients to get out of the U.S. stock market one week before the October 1987 crash, talked about gold stocks. Dr. Faber told viewers:

Gold shares outperformed gold until 2010-11. And since then, they grossly underperformed. Many gold shares are down 50, 80 percent from their highs. And I think if someone wanted to speculate and buy shares like a warrant on the price of gold he would buy some smaller gold companies.

(Editor’s note: Italics added for emphasis)

When asked about names, Faber mentioned Ivanhoe Mines (formerly Ivanplats), NovaGold.

He conclued the Business News Network segment by revealing:

I stick to physcial gold largely, and I have some holdings in shares like Newmont, American Barrick, Freeport-McMoRan.

(Editor’s note: Italics added for emphasis)

A terrific interview by BNN host Andrew Bell, which you can watch on the channel’s website here.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

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Central Banks Net Purchasers Of Gold For 11 Consecutive Quarters

Earlier today, Janet Yellen, the American economist and Vice Chair of the Board of Governors of the Federal Reserve System who is President Obama’s nominee to succeed Ben Bernanke as Chairman of the Fed, participated in her confirmation hearing before the U.S. Senate Banking Committee. Victor Reklaitis wrote on The Tell blog on the MarketWatch website this afternoon:

At Yellen’s confirmation hearing on Thursday, [U.S. Senator from Nevada Dean] Heller asked the Fed chair nominee whether she follows gold prices and what causes them to rise or fall.

“Well, I don’t think anybody has a very good model of what makes gold prices go up or down,” Yellen responded.

“But certainly it is — it is an asset that people want to hold when they’re very fearful about potential financial market catastrophe or economic troubles and tail risks. And when there is financial market turbulence, often we see gold prices rise as people flee into them.”

(Editor’s note: Italics added for emphasis)

I had to chuckle when I read that. Here’s a central banker linking the acquisition/possession of gold with fear, yet as I pointed out back in July 2011, central banks were by then holding onto and even accumulating the precious metal after years of selling.

As a matter of fact, the London-based World Gold Council, the gold industry’s market development organization, issued a press release today which demonstrated central banks around the world continue to amass the yellow metal. From the release:

Net central bank purchases totalled 93t, 17% down on Q3 2012. Central banks have now been net purchasers of gold for 11 consecutive quarters.

“Net purchasers of gold for 11 consecutive quarters.” Something to remember next time someone brings up that “barbarous relic” claim (if gold is so barbaric, why does it continue to play a role in the modern global banking system?).

There’s also this from Nat Rudarakanchana, writing on the International Business Times website on October 30. He reported:

-Collectively, central banks have bought about 218 tons of gold so far in 2013
-Central bank holdings are up about 1.7 million ounces this year
-France, Germany, Italy, and the United States maintain more than 80 percent of their foreign reserves in gold

Ms. Yellen mentioned in her confirmation hearing that gold is “an asset that people want to hold when they’re very fearful about potential financial market catastrophe or economic troubles and tail risks.”

Does that apply to central bankers as well?

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Sources:

Reklaitis, Victor. “Yellen on gold: “People want to hold (it) when they’re very fearful.” The Tell. 14 Nov. 2013. (http://blogs.marketwatch.com/thetell/2013/11/14/yellen-on-gold-people-want-to-hold-it-when-theyre-very-fearful/). 14 Nov. 2013.

“Gold continues its journey from West to East as buoyant consumer markets balance investment outflows.” World Gold Council. 14 Nov. 2013. (http://www.gold.org/media/press_releases/). 14 Nov. 2013.

Rudarakanchana, Nat. “Perspectives On Central Bank Gold Buying: Gold Experts.” International Business Times. 30 Oct. 2013. (http://www.ibtimes.com/perspectives-central-bank-gold-buying-gold-experts-1448444). 13 Nov. 2013.

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Jim Rogers Bullish On Base Metals, Cocoa, Coffee, And Crude Oil

Another “crash prophet” was recently interviewed by The Economic Times (India). Well-known investor, author, and financial commentator Jim Rogers appeared on their business/financial news channel ET Now and talked about a number of financial and investing topics. Rogers, who correctly announced the start of the latest commodities boom in 1999, told viewers:

I own sugar. I bought sugar not long ago… I am optimistic about coffee, cocoa… Coffee is certainly down a lot, and it’s one that one should consider buying.

The former investing partner of George Soros also talked about base metals. Rogers said:

I’d rather buy base metals now than gold, for instance… The base metals are down substantially. There is all this money printing. And some of it is working its way into the economy. Some of that money will go into base metals as a way to protect ourselves against inflation and currency debasement. So, yes- I’d much rather buy base metals that precious metals.

Finally, the Chairman of Rogers Holdings touched on crude oil. Rogers pointed out:

Well, there is a certain excess supply in the crude market at the moment because of the shale boom in the U.S. I’m not sure how much longer that’s going to last because those wells are very short-lived wells and the production declines pretty quickly. But, at the moment we certainly do have a glut, and we could very well see lower prices. But don’t sell your crude, because if prices go lower, first of all it cuts back on the shale, because shale has to have high prices in order to bring it to market. And second, oil is going to go much higher over the decade. Other reserves around the world- known reserves- are in decline. Every other country in the world has declining reserves. So, this is a temporary thing.

You can view the entire interview with Jim Rogers on The Economic Times website here.

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

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Marc Faber: Crude Oil Probably ‘The Most Attractive Commodity’ Among Industrial Commodities

“Doctor Doom” Marc Faber was recently interviewed by The Economic Times (India). In a November 8, 2013, video segment on the Times website, the Swiss-born investment advisor and fund manager shared his thoughts on gold and crude oil:

The price of gold at this level is not terribly high compared to the wealth creation in the world compared to the expansion of the central banks’ balance sheets compared to the tech explosion and so forth and so on. So ja, I continue to recommend people that they allocate some of their money to gold. I prefer physical gold, but I have to say that numerous gold mining shares are now very inexpensive. Crude oil is probably, among the industrial commodities, the most attractive commodity because the supply of oil could be interrupted at some point.

Source:

“Prefer buying physical gold: Marc Faber.” The Economic Times. 8 Nov. 2013. (http://economictimes.indiatimes.com/et-now/commodities/prefer-buying-physical-gold-marc-faber/videoshow/25453685.cms) 10 Nov. 2013.

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

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Jim Rogers Predicts Economic Slowdown ‘Sometime In The Next Year Or Two’

While I don’t read Chinese newspapers on a regular basis, I happened to spot an unpleasant economic prediction from well-known investor, commentator, and author Jim Rogers on one of them this morning. According to the Global Times (China) website, Singapore-based Rogers warned of the following this past Saturday:

Addressing a forum ahead of the 17th China International Fair for Investment and Trade, Rogers said, “Quantitative easing and money printing is going to end in one way or the other. It is going to cause problems in the world economy. Sometime in the next year or two, we are going to have another economic slowdown.”

(Editor’s note: Italics added for emphasis)

The English-speaking publication added:

He hoped that central banks will stop monetary easing. “Even if they don’t, the market will say we won’t take your garbage paper money anymore.”

But he warned that the withdrawal will cause problems and everybody will be affected, including China.

“America, Europe and Japan, these economies are ten times bigger than China. Even if China is doing everything right, it will still be affected by what’s happening in the rest of the world,” he added.

(Editor’s note: Italics added for emphasis)

I wonder just how big of a global economic slowdown Rogers is forecasting?

Back in early February I blogged about what the former investing partner of George Soros said on the Yahoo! Finance show The Daily Ticker in a discussion about stock prices and central bank money printing:

I mean, this is staggering what’s going on. It’s going to end so badly for all of us. We’re all going to wake up one day with a horrible headache. Probably 2014, 2015. Or the end of 2013.

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

Source:

“Global economic slowdown is near: investment guru.” Global Times. 7 Sep. 2013. (http://www.globaltimes.cn/content/809330.shtml#.Ui38BH9Lhwt). 9 Sep. 2013.

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Jim Rogers Predicts ‘Panic In A Lot Of Markets, Including In The U.S.’

Well-known investor, financial commentator, and author Jim Rogers was interviewed by Reuters on August 28. Speaking to Tara Joseph from Singapore, the former investing partner of George Soros was asked about Syria and its effect on his investment outlook. While Rogers predicted commodity prices would rise in the event of war, his forecast for the U.S. and emerging financial markets once central bank stimulus is withdrawn is what really stood out. From their exchange:

JOSEPH: We’re already though, Jim, seeing sort of the unwinding of what happens when there are fears of that stimulus coming out. What’s next for these countries? Where does it go from here?
ROGERS: Tara, we haven’t seen much of anything yet. I mean, normally in bear markets things go down 40 to 80 percent and people give up. They throw the shares out the window and they say, “I never want to invest again as long as I live.” Sure, we’ve seen some declines. Have we seen panic, have we seen terror? Absolutely not. Not in any markets yet.
JOSEPH: Are you expecting panic? We’ve seen many crises. But do you see more panic?
ROGERS: Yes, of course. When this artificial sea of liquidity ends, we’re going to see panic in a lot of markets, including in the U.S., including in less developed markets. I mean, Tara, this is the first time in recorded history that all major central banks have been flooding the market with artificial money printing at the same time. Where they’ve all been trying to debase their currencies at the same time. This has never happened in recorded history. When this ends, it’s going to be a huge mess.


“Prepare for market panic: Jim Rogers”
Reuters Video

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

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Jim Rogers Warns Coming Stock Market Downturn ‘Will Be Worse Than 2001 And 2008-2009’

Catching up with the “crash prophets,” on Monday I blogged about what Dr. Marc Faber was up to these days. “Doctor Doom,” as the financial news media likes to call him, issued this warning:

And I believe that one day, this financial bubble will have to adjust on the downside. Either it will adjust on the downside because we have an inflationary burst, or we have a collapse of the system.

Another “prophet” had been making the rounds as well. Along with a similar warning.

In an interview with FutureMoneyTrends.com that was published on YouTube.com on July 20, well-known investor, author, and financial commentator Jim Rogers talked about a number of finance/investing topics, including where the United States was heading (hat tip Trade The Newsroom website). From the exchange:

FMT: Is there a sense that the recovery is sustainable in the United States?
ROGERS: This is the only time in recorded history that we’ve had all the major central banks in the world printing money and debasing their currencies at the same time. So there’s a flood of artificial money floating around. And the people getting that money are having a good time and certainly making a lot of money. But overall, the situation is not improving. In fact, the situation is degenerating because there’s debt piling up everywhere, staggering amounts of printed money out there. This is going to end very, very badly. I’m not the only one who knows it. But at the moment, many people are having a good time.
FMT: Do you feel comfortable buying stocks? Is Bernanke kind of giving us a floor here?
ROGERS: Floor? No, there’s no such things as a floor. Because when it ends, the whole thing is going to collapse. It’s going to be worse than 2008, 2009. But I own some shares. I bought some shares this week, as a matter of fact. Not in the U.S., but I own shares, and I bought more. But again, I’m very worried because I know it’s going to end, and end badly.


“Jim Rogers EXCLUSIVE Interview with Future Money Trends July 2013”
YouTube Video

The former investing partner of George Soros repeated his warning of an unhappy ending for the current bull market in U.S. stocks while attending the fourth annual Innovative Alternative Investment Strategies conference in Denver on July 23. Evan Simonoff wrote on the website of Financial Advisor on July 25:

Speaking of the current bull market in U.S. equities, Rogers told advisors, “Enjoy it, but be prepared. I do know it will end, but not when. We’re getting close to the end.”

The day that happens won’t be a pretty one. “When it ends it will be a big mess,” he continued. “This will be worse than 2001 and 2008-2009.”

(Editor’s note: Italics added for emphasis)

Simonoff added that Rogers, who has a new book out entitled Street Smarts: Adventures on the Road and in the Marketsicon, is starting to invest in Russian stocks, something I blogged about back on February 5.

As for commodities, which the CEO of Rogers Holdings and Beeland Interests, Inc. is most often associated with these days, Simonoff noted:

Water remains a more attractive commodity, though Rogers added a caveat. “Don’t own it,” he warned. “Politicians will hang you in the public square. Find a way to transport, clean it or filtrate it and you will be a hero in the public square.”

The Financial Advisor piece is very revealing as to how Jim Rogers surveys the current investing landscape, which you can read on the publication’s website here.

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

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The Survival Podcast’s Jack Spirko Predicts U.S. Boom, Then Bust Probably ‘10 Years Into The Future Or More’

The other podcast material I said I was going to talk about today comes from The Survival Podcast, hosted by modern survivalist Jack Spirko. Also selected as a “Resource Of The Week,” I wrote back in March 2011 about TSP:

I can’t remember how I first heard about the podcast- but I’m glad I did. Spirko publishes new episodes several times a week. And they’re chock-full of useful information for the novice through expert homesteader/prepper/survivalist- or someone who just wants to be more self-sufficient in their daily living.

But TSP doesn’t focus solely on preparedness/survival topics. Spirko tosses economics and finance in there as well. And listening to him for a few years now- he undoubtedly gets it. Big picture included.

And here’s what the host of The Survival Podcast had to say about the “big picture” back on May 9 in episode 1127, “Risk Assessments and Readiness Audits”:

I do believe our biggest threat is economic. I believe that this country is in store for an economic boom. Yeah, I said boom. If you’ve not been listening to me, I think we’re about to have one of the best periods ever in the history of the country from an economic standpoint. Sadly, it will be driven by both fake and real factors. Fake economic factors, real energy factors. But that can only go on so long. And sooner or later we are going to get to a point where inflation, the devaluation of money, the ridiculous level of debt and the interest there on it, do their full-scale, whole cancer-style damage, eat the patient from the inside, and we wake up to terminal financial illness as a nation.

But that’s not happening tomorrow. That’s not happening next year. That’s not even happening in the next 5 years. There could be recessions and things in the middle. But that day is probably at this point 10 years into the future or more.

And I don’t claim to be Nostradamus. I don’t know the exact timeline. I can just do math and can say with mathematical certainty this system at some point must fail.

“10 years into the future or more”

I think I just heard a collective sigh of relief from many readers.

Not so fast.

Regular readers of Survival And Prosperity know that I’ve been warning about a coming U.S. financial crash for almost 6 years (2007-2010 Boom2Bust.com included). I’ve never thrown a “start” date out there because I’m well-aware the central bankers excel at “kicking the can down the road.” Look at the “Panic of 2008” and how that was “papered over”- for the time being. Spirko knows that our “financial reckoning day” can keep getting pushed back- a lot longer than many of his listeners might think is possible. And I think that was what he was trying to convey with that “10 years into the future or more” bit. I’m pretty sure he didn’t throw that out there to say “all’s well,” or that any new preparedness plan and program should incorporate a 10-year timeframe until the economy and larger financial system hits the proverbial brick wall.

Like I said before- Jack Spirko gets it. If he thinks the U.S. is heading for a boom, then a bust a decade or so out, then it’s a forecast worth considering.

In the meantime, he’d probably agree with me when I say it might be wise to take advantage of the “good times” to get squared-away for what’s in store for us down the road.

You can listen to the podcast of episode 1127 here via The Survival Podcast website.

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s note: I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein)

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Former High-Ranking Treasury Official: Fed Ordered Attack On Gold

Speaking of manipulating the price of gold, there’s been a good deal of suspicion that the yellow metal has come under deliberate attack.

It doesn’t come as a surprise to me that some might think this, considering the following:

• A number of Federal Reserve officials keep blabbing on about how the central bank might dial back quantitative easing soon, helping to shore up the U.S. dollar when they do this while subsequently detracting from gold’s allure
• The seemingly-reformed financial news media (accused of being stock market cheerleaders in the 90s and early 2000s) has bared their true colors and have savaged gold with a barrage of negative press. Of course they fail to mention that “gold is still up by more than 400 percent from the lows in 1999, whereas the S&P is barely up 2 percent from their highs in 2000,” as Marc Faber reminded Yahoo! Finance viewers this morning.
• Then there’s that huge disconnect between the “paper” gold market- where traders are supposedly running for the hills- and the “physical” gold market, where buyers are paying significant premiums over spot to acquire tangible gold and dealers are describing current demand as being a buying frenzy, not seeing anything like this in years- even decades.

Enter Paul Craig Roberts, chairman of the Florida-based Institute for Political Economy. Roberts is a former associate editor and columnist for the Wall Street Journal who President Reagan appointed as Assistant Secretary of the Treasury for Economic Policy.

Roberts thinks the Federal Reserve has been orchestrating an attack on gold.

He wrote on the Institute’s website this past Saturday:

On Friday, April 12, 2013, short sales of gold hit the New York market in an amount estimated to have been somewhere between 124 and 400 tons of gold. This enormous and unprecedented sale implies an illegal conspiracy of sellers intent on rigging the market or action by the Federal Reserve through its agents, the BTBF that are the bullion banks.

The enormous sales of naked shorts drove down the gold price, triggering stop-loss orders and margin calls. The attack continued on Monday, April 15, and has continued since.

Before going further, note that there are position limits imposed on the number of contracts that traders can sell at one time. The 124 tons figure would have required 14 traders with no open interest on the exchange to sell all together in the same few minutes 40,000 futures contracts. The likelihood of so many traders deciding to short at the same moment at the maximum permitted is not believable. This was an attack ordered by the Federal Reserve, which is why there is no investigation of the illegality.

Note also that no seller that wanted out of a position would give himself a low price by dumping an enormous amount all at once unless the goal was not profit but to smash the bullion price.

Since the April 12-15 attack on the gold price, subsequent attacks have occurred at 2pm Hong Kong time and 2 am New York time. At this time activity is light, waiting on London to begin operating. As William S.Kaye has observed, no entity concerned about profits would choose this time to sell 20,000 to 30,000 futures contracts, but this is what has been happening.

Who can be unconcerned with losing money in this way? Only a central bank that can print it.

(Editor’s note: Italics added for emphasis)

Roberts isn’t the only one accusing the Fed of ordering an attack on gold. Back on April 29 I started off a post with the following April 17 statement from Ambrose Evans-Prtichard, international business editor over at The Telegraph (UK):

My view is that the US Federal Reserve and the Bank of Japan ‘caused’ the gold crash. The rest is noise…

The world is still in a contained depression. Sliding commodities tell us global money is if anything too tight. ‘There is a threat of deflation almost everywhere. A lot of central banks will have to follow the Bank of Japan, whatever they say now,’ said Lars Christensen form Danske Bank.

The era of money printing is young yet. Gold will have its day again.

You can read the entire Roberts’ piece on the Institute for Political Economy’s website here.

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s note: I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein)

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Christopher E. Hill, Editor
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