…Worse Than 2008?
‘Looking around the economic and financial
world today, I see countless negative developments and virtually no positive
developments to speak of.
Just off the cuff, I note that:
China is
entering a hard landing if not an outright economic collapse.
Europe is
facing a recession, banking collapse, sovereign crisis, and a potential
break-up.
The US is
in a stagflationary recession.
Japan is
in a sovereign debt crisis, approaching armed conflict with China
Inflationary
pressures are increasing worldwide: new record food prices will hit within the
next 12 months.
The risk
of armed conflict is increasing in the Middle East as well as Asia along with
food inflation creating civil unrest/ riots.
Against
this backdrop, the one remotely positive development as far as the markets are
concerned is the belief that Central banks will somehow solve these problems
via endless liquidity.
However,
even this is now proving to be a false premise.
The
problem with this is that the primary driver of stock prices over the last
three years has been the anticipation of more monetary stimulus from
Central Banks.
Indeed,
the New York Fed itself has openly admitted that were it to remove the market
moves that occurred around Fed FOMC meetings (the times when the Fed announced
new programs or hinted at doing so), the S&P 500 would be at 600 today:
So, by
announcing a program that will be on going in nature, the Fed has removed
the anticipation of future Central Bank intervention from investors’
psychologies. This could become highly problematic, especially if these latest
announcements turn out to be duds.
Sure
enough, stocks are actually down since QE 3 was announced on September
13 2012.
So we’ve
got over 50% of the global GDP (China, the EU, and the US) in recession,
combined with Europe’s banking and sovereign crisis… at the exact time that the
Fed appears to have run out of ammo.
It’s
truly astounding. I cannot actually remember a single time in which the global
economy and financial system have faced this many difficulties. And that includes
the build up to the 2008 Crash.
Now
more than ever, investors need to get access to high quality guidance and
insights. There sheer magnitude of the issues the global financial system is
facing is enormous!
For
that reason, we are lowering the price of an annual subscription of my Private Wealth Advisory newsletter to just $249 (down from $300).
Private Wealth Advisory is my bi-weekly investment advisory service tailor made
for individual investors who want to stay informed of the real story
in the global economy and outperform markets.
To
whit, my clients made money in 2008. And we’ve been playing the Euro Crisis to perfection, with
our portfolio returning 34% between July 31 2011 and July 31 2012 (compared to
a 2% return for the S&P 500).
And
this incredible newsletter is now on sale at $249 for the next six days (until
next Tuesday).
So if
you’ve been holding off on subscribing to Private Wealth Advisory for whatever reason, this is your one chance to subscribe
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Because
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Best
Regards,
Graham
Summers