Monday, May 16, 2011

Top 13 Warning Signs for The Coming Greater Recession (Depression) & Reasons to Hold On to your Precious Metals

It was not too long ago when the S&P 500 hit the demonic 666 bottom of the so called "Great Recession." Recently we are in this amazing stimulus driven ride up to near 1300 (thanks QE2) which historically was the average for 2006, the peak of the housing bubble. How can this be?? We are only a couple hundred S&P points away from the peak of 1560 in 2007... possibly the making of a double top before the next leg down. If you think March 2009 was a scary ride down to the unknown bottom, you haven't seen the worst yet. Just remember anytime there is a massive government intervention or stimulus to prevent the true cleansing (bottom) of our local and global financial system, there will be a prolonged truth indicator that shall retest and/or exceed that support level.

For all the Silver and Gold fans, the fundamentals of real money did not change one bit for the past gazillion years and even during the recent "correction" based on fiat futures trading nonsense, margin rules, non-backed physical hype, using the eventual FRN with a long term intrinsic value of zero. Wake up!! Don't get shaken out of your long physical positions. Silver and gold is real money, PERIOD!! Enough with the intro filler, let's get into the fillet mignon on why you are reading this top 13 and why you should continue stackin' the precious metals....
  1. U.S. Debt Bubble Explodes and the Dollar Looses World Reserve Currency Status
    • The United State of America will exceed its ability to shuffle the national debt 14+ trillion (or the real 79+ trillion amount and counting), therefore loosing its AAA credit rating. Our foreign investors begin to loose interest in our bottomless debt hole. Bernanke continues to print money (QE2... now QE3, QE4...) like there is no tomorrow, therefore devaluing it to non-acceptance. The dollar will eventually lose its status as the world's reserve currency and trading currency. China decides US Treasuries are no longer worth the paper it is printed on. OPEC decides that the US Dollar is to volatile and loosing its value too quickly and therefore is being replaced with a new reserve currency (the new world order currency, Yen, Yuan, Peso, Gold, Silver or a combination of them).
  2. The Silver (SLV) Paper Ponzi Scheme is Exposed, JP Morgan Chase Has No Physical Silver Per Share
    • The crash JP Morgan movement is in auto pilot mode, just Google or YouTube it and the truth will be exposed. According to the real financial experts on the paper equivalent ETF that tracks the movement of silver, SLV,  there is a ratio of 50-100 shares to 1 ounce of physical silver that Chase actually owns. Therefore, JP Morgan Chase bank, the custodian of the SLV ETF is bound for disaster for their suppression of physical silver's tru price potential since they are steering investors into worthless pieces of paper. When the time comes for investors requesting to see the physical silver behind their investment, JP Morgan Chase will have about 1/50 to show, if even that much. The true holders of physical silver will see their investments skyrocket to the true multiple suppressed by the SLV ETF. Take note that SLV's cousin, GLD, may have the same fate as the HSBC custodian of that ETF may be running the same price suppression scheme to prevent the dollar from crashing too quickly.
  3. China and Gold and /or Silver Accumulation
    • Keep an eye on China and their moves on the worlds' gold reserves. The Chinese financial leaders seem to have a crystal ball and have already started selling off U.S. bonds by the billions, most likely to hedge against inflation of the dollar. Bets are they bought gold to hedge... you think? Feeling irate, China already claimed that they reserve the right to "renig" on any dirty derivative products sold to them by foreigners (especially by the US - Goldman Sachs, etc.). Gold is not the only precious metal to look out for, as many know that silver is also a solid currency and exchange metal that increases side-by-side with gold, or even faster. The spot price of silver (current ly around $30) is predicted to shoot up once world bank start to dump Us Dollars for the silver bullion in the bank vaults.
  4. Euro Debt Crisis
    • The Euro-zone PIIGS (Portugal, Ireland, Iceland, Greece or Spain) finally give into the "D" word and default on their increasing debt. The IMF and stronger European countries are no longer able to bailout their "friends." Greece was a good example of austerity measures pushed to its citizens and what the people will take to the streets to challenge the new government policies. This possibly triggered the flash crash of May 6th, however the SEC says it was "fat finger's" fault. Yeah right!!
  5. Gold Up, Dollar Down
    • Gold Gold Gold hits near $2000/ounce or in stock terms ticker GLD hits near $200+/share and this SPDR Gold Trust ETF will be heading the opposite direction of the stock market (Dow, S&P, Nasdaq). The US dollar looses near 40-50% of its value.
  6. Another 9/11 Event or The Next World War Begins
    • Another 9/11 type "terrorist" event occurs in the USA causing a domino effect in the financial markets, possibly bank runs. The 9/11 event is another discussion, you can research for the truth here (A&E for 9/11 Truth :
    • Another world war begins with North and South Korea or Iran and Israel that sends fear into the markets, however may be good for the A&D stocks such as BA, NOC, RTN or LMT.
  7. The Low Interest Rate Ride Ends
    • Interest rates for home loans start to skyrocket to near double the bottom of the good old times rates (e.g. 4.75% == 9.5%+). This will stabilize the housing market once again and may cause another 20-30% drop in home prices.
  8. Bonds Really Become Junk!!
    • The US and Corporate bond market finally pops causing a major deficit in the needed financing of cities, states and large countries (USA). Standard & Poor's already cut Greece's ratings to junk status... the U.S. rating may not be far behind. Municipal Bonds (muni-bonds) are the worst of the bunch.
  9. Another Wave of Foreclosures on Alt-A and Option Arms
    • Post sub-prime loans, the reseting of Alt-A and Option ARM home loans, with owners unable to refinance their upside-down homes. This shall cause another foreclosure tsunami 2010-2012. Approximately 70% of the home owners with Option ARMs may default beginning in 2011.
  10. Essential Resource Shortage
    • A resource shortage of Oil, Food and/or Water will cause chaos and riots nation wide. Once the local oil reserves dry up or the Middle East decides to limit exports to the U.S., the domino effect of no gas for transportation and no food in our supermarkets begin the resource shortage in a great depression scale.
  11. The Bottoming of all Cycles begin 2011 and bottom by 2012
    • According to "The Foundation for the Study of Cycles", there will be a convergence of all major cycles. 
    • "We have the dollar cycle, stock market cycles, consumption cycles, and GDP cycles all bottoming in this same approximate time frame — between late 2011 and late 2012. Plus, 2012 is also smack dab in the middle of a sweeping transition already under way in our longest term and probably most important cycle of all... The 500-year geopolitical cycle."
  12. "The dissatisfaction in america has reached the boiling point..."
    • The mass organization of a people can bring down a government that they are no longer satisfied with.
    • America's complacency in acting as the world's police may be numbered and local protests may be the future norm in every major city in the USA. 
  13. The thirteenth wild card is the best card yet to be played, several thoughts include...
    • A domino effect of earthquakes and massive tsunamis hit all countries near the ring of fire causing massive chaos and loss of thousands of lives.
    • An EMP (electromagnetic pulse) wipes out the ability of the NYCE (New York Casino Exchange) traders from trading and all Facebook and Twitter users from updating their status causing humans to talk to each other again in a shocking face-to-face episode of reality.
    • Linda Green has truly cloned herself and has taken over all the banks as VP of mortgage bombs and therefore finally reveals that she is the wicked witch of north and mama of the Bernank'.

Well there it is. And as you know, most of these have already begun such as the China gold accumulation, Euro debt crisis, U.S. dollar inflation and major Bonds becoming junk status (Greece for now). I'm not saying all 13 will need to come to fruition, however a combination of these 13 warning signs can and will be the catalyst for the next leg down in the Dow, S&P 500, Nasdaq, our banking system, and world banks.

On a positive note, do not despair on the United States eventually coming back from a Greater Recession or even The Great Depression v2.0, we "always" bounce back from the bottom. There is hope for our country to recover from our debt sins, however it has to be a slow and steady recovery that is natural, minimal government intervention, and innovation or production based from what we were originally known for. The existence of our currency can not be based on debt financed by taxpayers and our foreign friends. We need to start saving again and only spend what we can realistically afford.

Other References: