Dire warnings are pouring in from all over the place. The UN is warning of increasing global conflicts and rising poverty globally. The Department of Agriculture is warning about disappointing corn yields and the global farming community is being hammered by floods, droughts, and government interference in their activities. This doesn’t even take into account the fact that railroads and others have been refusing to deliver fertilizer to our farmers when needed. I guess I should also be concerned about the OVER 100 food processors and fertilizer companies that have been destroyed just here in the USA since January of this year. Coincidence???
Morgan Stanley is warning of a global selloff in the stock “markets”. This is just one more warning to add to the multi-billionaire warnings from the likes of Ray Dalio, Warren Buffett and others along with many other major banks. Does that sound good for 401ks and other investments that can only make money when the “markets” are up?
Supply and demand suggests that with a coming shortage of MOST goods that we need to survive there could be FAR higher prices than we are currently seeing. The only way I can see to take advantage of this situation is to move out of debt-based assets and move into HARD ASSETS which is also likely to be all that is left after this all plays out.
Unfortunately, most retirement plans have severely limited choices even though there may be many funds available. 2003-2007 all assets ROSE together. 2008 all collapsed together. We have seen the same in the past 10 years and are currently seeing all assets pull back. It is important to remember, however, that just as in the lead-up to the 1929 stock market crash energy and materials have not shared in the massive gains and may provide a hedge today. Gold and silver have actually been artificially repressed while the major banks, central banks and their friends attempt to “buy it all”.
My guess is that needed commodities should see higher prices for as far as the eye can see and there could likely come a day where gold and silver prices skyrocket. This would only be allowing the PRICE to catch up with the VALUE which increases with each dollar, yen, euro and every other fiat currency conjured up out of nowhere with NO intrinsic value associated with it.
Currently, we are seeing the US dollar being strong against other currencies but that is unlikely to last for long. The East (most of the world’s population) is moving away from fiat currencies and mainly the US dollar. This will likely lead to severe weakness in the near future (guess: 1-2 years at most).
In addition, it is likely that the US dollar is only strong right now because the Fed is raising rates faster than the currencies it is measured against- mainly the Yen and Euro. At some point it is likely that they go too far and the economy implodes even worse than it is imploding now. As a matter of fact, Fed Chairman Powell warned of that very thing in his post-meeting press conference. I hope that most are paying attention- this is real.
In the meantime, Gregory Mannarino cited an article that stated there would be DOUBLE the amount of millionaires in the USA by 2026. He said that is further proof of the income inequality taking place. While I believe that to be PARTIALLY true, I really believe that many, if not most people in the USA will be millionaires by 2026.Before you start doing a happy dance keep in mind that in Zimbabwe ALL were BILLIONAIRES when the Zimbabwe Dollar collapsed. The unfortunate part of that is that it cost a trillion Zimbabwe dollars for 3 Eggs.
Back when our dollar was actually backed by gold being a millionaire meant something. Now you have to be a billionaire to have any ability to live as the millionaires lived in the 1900s.
The bottom line to me is that you may have to be a millionaire- if not a billionaire to survive in the USA in the not too distant future.
While many are undoubtedly thinking “this will never happen here” let me assure you- as I have written in the past- economic laws apply EVERYWHERE- not just other banana republics. There is 1 100% success rate for fiat currencies failing throughout the world. In each case, the countries that had currencies fail have followed the same path that we have been on since 1971. It has taken FAR longer for our currency to collapse because of its reserve status and the fact that virtually all other central banks are going down a very similar path.
Again, I believe that the entire debt-based system is nearing an inflection point where most debt-based assets could collapse in price (to reflect true value) and hard assets will be all that people are interested in.
If currencies fall the cost of all goods, by definition, have to rise- and probably far more than we can imagine at this time. By the way- What is the VALUE of a promise (debt) that cannot or will not be kept?
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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