Post by Investment warning on Apr 3, 2006 20:59:56 GMT -6
The last time I posted the M3 info on www.aspendailynews.com they took it off very quickly.
March 31, 2006
INVESTMENT WARNING!
Sometimes your gut just tells you do something, that is the case this morning. While all the economic indicators have been screaming loudly for quite sometime, I have the eerie feeling that many 401K's as well as other investments that depend or ride on the strength of the dollars coat-tails are in for a free fall.
Of interesting note, the fed has stopped reporting the all important M3 numbers, un-official reports are out indicating a massive printing of dollars is underway which will flood the market; the precious metals markets are becoming very volatile in an upward kind of way. Rising precious metals mean instability at best and economic chaos as worst. There are many other market indicators yelling to be heard that we won't go into at this time.
Couple this with a housing bubble that appears to be ready to burst and you have a potential rather large banking disaster as well. I read that in 1985, banks had 30% of their assets tied up home mortgages. Today, that figure is near 62% and this doesn't include the dollars tied up in lending to hedge funds which invest in large blocks of home mortgages. In USA Today, this week, we read where nearly 5% of mortgages are in default/delinquent status. For every .25% increase in the interest rate, that figure can climb another percent or so. This could make the savings and loan scandal look like a walk in the park as this unfolds.
The wizard of Omaha, Warren Buffet along with many other astute investors have been dumping American dollars for a couple years now, are they aware of something that mainstream America might not be in tune to? Put in plain terms, they are betting their fortunes on the demise of the dollar and our current economic system.
What makes this scenario so devastating to most Americans that really have no understanding of how economics, is that you can find numbers that will tell you otherwise. Without an understanding of how the real world works, one can be sucked into a false sense of security while the floor is collapsing around them.
We are told the economy is expanding, business orders are up and the un-employment numbers are as good as they have ever been. For those that understand economics, all of the above can be true, yet a collapse still be on the near horizon.
When the dollar loses value, orders for goods (especially from overseas) will go up causing a short-term and artificial economic expansion. Bottom-line is while things are getting worse at home, it is masked by overseas trade. Throughout the collapse, corporate profits can be up.
If only it was so simple. In addition to that, the expanding corporate machine lays off American workers to enhance their profits which are demanded by the stockholders. They then use the increased profits gotten by lower production costs overseas to buy or merge with other American companies and then repeat the cycle. The vicious cycle of layoffs and loss of jobs is then repeated.
In addition to this, as the dollar losses value and the economy is flooded with even more dollars, your stocks might be going up. The problem is that the stocks are actually losing purchasing value and what you think is a comfy retirement fund is slowly (or rapidly) becoming worthless.
As we mentioned many times, the un-employment numbers are outright lies. Subtract government hires over the past few years and our un-employment sky-rockets. That doesn't include the millions of Americans that are now under-employed and having to use double jobs to make ends meet.
We could go on and on about the why's and how's and if's. Suffice it to say, you've been warned. The dollar is in deep trouble as is our entire financial network. Just as honest capitalism is a great system, dis-honest capitalism is a curse and house of cards. The house of cards has started to fall, and while no one will escape the ramifications of such, we can all prepare ourselves.
The scriptures speak of the parable of the 10 virgins. Turning that around a bit, are your preparedness and temporal lamps full of oil, or will you be one of those whom the door closes on.
from
lonepatriot.com/archives/daily_post/index.html#000188
March 31, 2006
INVESTMENT WARNING!
Sometimes your gut just tells you do something, that is the case this morning. While all the economic indicators have been screaming loudly for quite sometime, I have the eerie feeling that many 401K's as well as other investments that depend or ride on the strength of the dollars coat-tails are in for a free fall.
Of interesting note, the fed has stopped reporting the all important M3 numbers, un-official reports are out indicating a massive printing of dollars is underway which will flood the market; the precious metals markets are becoming very volatile in an upward kind of way. Rising precious metals mean instability at best and economic chaos as worst. There are many other market indicators yelling to be heard that we won't go into at this time.
Couple this with a housing bubble that appears to be ready to burst and you have a potential rather large banking disaster as well. I read that in 1985, banks had 30% of their assets tied up home mortgages. Today, that figure is near 62% and this doesn't include the dollars tied up in lending to hedge funds which invest in large blocks of home mortgages. In USA Today, this week, we read where nearly 5% of mortgages are in default/delinquent status. For every .25% increase in the interest rate, that figure can climb another percent or so. This could make the savings and loan scandal look like a walk in the park as this unfolds.
The wizard of Omaha, Warren Buffet along with many other astute investors have been dumping American dollars for a couple years now, are they aware of something that mainstream America might not be in tune to? Put in plain terms, they are betting their fortunes on the demise of the dollar and our current economic system.
What makes this scenario so devastating to most Americans that really have no understanding of how economics, is that you can find numbers that will tell you otherwise. Without an understanding of how the real world works, one can be sucked into a false sense of security while the floor is collapsing around them.
We are told the economy is expanding, business orders are up and the un-employment numbers are as good as they have ever been. For those that understand economics, all of the above can be true, yet a collapse still be on the near horizon.
When the dollar loses value, orders for goods (especially from overseas) will go up causing a short-term and artificial economic expansion. Bottom-line is while things are getting worse at home, it is masked by overseas trade. Throughout the collapse, corporate profits can be up.
If only it was so simple. In addition to that, the expanding corporate machine lays off American workers to enhance their profits which are demanded by the stockholders. They then use the increased profits gotten by lower production costs overseas to buy or merge with other American companies and then repeat the cycle. The vicious cycle of layoffs and loss of jobs is then repeated.
In addition to this, as the dollar losses value and the economy is flooded with even more dollars, your stocks might be going up. The problem is that the stocks are actually losing purchasing value and what you think is a comfy retirement fund is slowly (or rapidly) becoming worthless.
As we mentioned many times, the un-employment numbers are outright lies. Subtract government hires over the past few years and our un-employment sky-rockets. That doesn't include the millions of Americans that are now under-employed and having to use double jobs to make ends meet.
We could go on and on about the why's and how's and if's. Suffice it to say, you've been warned. The dollar is in deep trouble as is our entire financial network. Just as honest capitalism is a great system, dis-honest capitalism is a curse and house of cards. The house of cards has started to fall, and while no one will escape the ramifications of such, we can all prepare ourselves.
The scriptures speak of the parable of the 10 virgins. Turning that around a bit, are your preparedness and temporal lamps full of oil, or will you be one of those whom the door closes on.
from
lonepatriot.com/archives/daily_post/index.html#000188