George
Washington’s Blog
January 5, 2009
Here are my predictions for 2009. If these predictions sound too gloomy
and you don’t buy them, bookmark this, and come back to it later in the year to
see whether or not it was right.
After
a short rally in the stock markets, lasting somewhere on the order of 1 to 4
months after Obama is inaugurated as President, people will realize that
Obama’s stimulus plan isn’t going to work.
Specifically, it will become obvious that
we’re in a Great Depression, and that nothing that Bushco or Obamaco did can
get us out of it (it may take a while longer for people to realize that what
both administrations did actually made the financial crisis much worse).
At that point, the stock market will
crash like a waterfall. Mish thinks
the crash will leave the S&P at 600. Robert McHugh thinks
the crash will drive the S&P to 500 or lower (in McHugh’s worst-case
scenario, the S&P could end up at 50).
At around the time of the crash, the bubble
in long-term treasuries will burst. Retirees and other people who have
socked away their money in treasuries will get hit hard.
The government itself will start
massively buying its own long-term treasuries.
Obama will institute numerous
"emergency measures" to "restore stability". None of them
will be pretty, and none of them will work . . . except to undermine our
liberties still further.
Its going to be a bumpy ride.