Many Americans are blissfully unaware of what is actually happening in the real world. My guess is that the 24/7 propaganda machine-previously known as mainstream media is constantly bombarding the herd with mostly political and feelings stories rather than real news.

This is why so many are not preparing for what I believe will be the most difficult time that not only the USA but, indeed the entire globe, appears to be entering into.

I think that since this has taken so long to play out many just assume that the way things have been for the last 30 years it will just continue to be that way. There are many signs that point to the fact we may be nearing the end of this road.

$400,000.00. A number of years ago I saw that a building in Detroit was sold for $400,000.00. This building was the size of the Chrysler Building in NYC. At the time the Chrysler building was worth $800 Million. This was when Detroit was already in the shape NYC appears to be heading for today. Just 13 years later that same Chrysler building sold for $150 Million. Real Estate always goes up?

I believe this is a clear warning shot of what is coming en mass.

$400,000.00. Less than a year ago Prizm Outlets in Las Vegas was valued at $28 Million (Bank of America). That was down from $125 Million in 2012 when a mortgage was taken on the property. The loan was for $62.2 million and after fees and reimbursements the loss was $74 Million. The property was liquidated for $400,000.00 recently.

How many times have I written about you possibly being able to buy assets you can’t imagine owning today because it is likely that assets being artificially propped up like stocks, bonds and real estate will find a real value at some future date. More than likely the artificial “wealth” that many believe is real will, at some point, reflect true value. If you think it’s not possible look at a property that lost nearly ALL of its value in less than 10 years. What a buy! You could knock it down and probably make millions with the value of the raw materials.

Look at the iconic companies that, in many cases, have nearly as much debt as they do assets and some iconic names actually have more debt than equity leading to a negative book value. That does not stop “investors” from buying up shares or the companies going deeper into debt to buyback shares and provide windfalls for the C-suite while the common shareholders will likely be left holding the bag.

Remember- if you remember nothing else- in the case of default the first losers are the common shareholders. You can NEVER recover from ZERO which is likely what you will get in the event of a default.

In the meantime, those who are paying attention are getting the idea that all of this “printing and buying” is going to end badly. Many are seeking refuge in real assets like gold, silver platinum and palladium which are being artificially repressed to protect the US dollar in particular but also all other fiat currencies. You can still buy these assets at a deep discount thanks to JP Morgan and the rest of the gang. My guess is that these assets will, at some point, explode higher and allow those holding these assets to get the newly deflated assets (stocks, bonds and RE) on sale.

If it weren’t for all of the government’s interference in the housing markets prices would likely already be FAR lower than they are because if people can live somewhere free they won’t be moving. This has led to a lack of inventory in some areas and that has, in turn, made prices rise as there has been more demand than supply- mainly in areas away from the major cities.

Prices are already plummeting in many urban areas. My wife had an aunt who passed away a few years ago. She owned a 2-family home in Bay Ridge Brooklyn that was valued at $1.8 million in 2019. That property just closed for $1.1 million in April 2021. $700,000.00 LOSS in 2 years. (Real Estate always goes up?)

For those who think the “printing and buying” is a good idea please tell me why Japan, who have “printed and bought “more assets than anyone, actively buying the Nikkei index every time there has been a 2% correction, is still 30% BELOW its all-time high in 1989. And this is after a major rally in the last 12 months. If anyone is buying stocks now without SUBSTANTIAL due diligence you may find yourself in a similar situation shortly. The Nikkei went from nearly 40,000 to 6000 at the bottom. 30 years later and it sits near 28,000. Timing was everything. Buy in 1989 and you will likely NEVER recover. Buy at 6000 and there is a great chance you would get great longer-term returns. Too bad human nature always makes people chase assets that they see rising and then they buy high and sell low as the mania subsides. Just maybe it would pay off to see which companies are actually making money, not cooking the books, and are likely to survive in any type of economic downturn. To me, this means solid revenue and earnings and a great debt to equity ratio.

Unfortunately, many people are buying companies and ETFs because they hear at a party that someone made a killing buying it. Not very good research. How about CBS/Viacom where the price exploded for no apparent reason from $17.00 to over $90.00 and crashed to $38.00 in 4 days. This was because of excess leverage and when the margin loans couldn’t be covered the stock was sold to cover the debts leading to a freefall in price. I believe that this is going on in many cases and that when the real correction comes it will be swift and those who are still in may not be able to get out before taking a major bath- if at all.

It is very obvious when you connect the dots that we have an economy in freefall. In March 34% of ALL income was received from government handouts. Keep in mind we have no “money”. This is all clicked into existence to create artificial demand where actual demand does not exist. The problem is that every dollar issued is a new unit of debt owed back to the Federal Reserve.

Gold, silver, platinum and palladium are assets rather than liabilities. The same can be said for uranium, iron ore, coal, oil, natural gas, agricultural products and utilities.

As central banks continue to debase all currencies at different rates there will likely come a day when something tangible will be the only means of payment people may accept. If it doesn’t go that far but you need to barter would you rather have a useful tangible asset or a piece of green paper?

Filter out the noise and believe what you are seeing with your own eyes.

Be Prepared!

Any opinions are those of Mike Savage and not necessarily of those of RJFS or Raymond James. Expressions of opinion are as of this date and are subject to change without notice. The information in this report does not purport to be a complete description of securities, markets or developments referred to in this material. The information has been obtained from sources deemed to be reliable but we do not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct.

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