Economic Crash Of 2010

[dano]

Gerald Celente is a economic trend forcaster, he's predicting that the US economy will colapse in 2010. I personally believe he's right.


http://www.youtube.com/watch?v=FtBcEkrO ... r_embedded

[Rock]

Gerald Celente is a economic trend forcaster, he's predicting that the US economy will colapse in 2010. I personally believe he's right.


http://www.youtube.com/watch?v=FtBcEkrO ... r_embedded

That's a ballsy call. Its not so risky to predict a 'future collapse' but when you add a rigid time frame, that's a touch prediction. Assuming a bubble exists, predicting the time it will collapse is like guessing which straw will break the camels back. IMO, its really just a guess.

[dano]

I found some more experts that also believe the US economy is going to collapse soon.


Peter Schiff
http://www.youtube.com/watch?v=DWDD3lTWv9w

Whitney Tilson
http://www.youtube.com/watch?v=kunB4SnA ... re=related

Glen Beck
http://www.youtube.com/watch?v=NlHY-zYA ... re=related


Being in denial about the economy is not wise. Stocking up on food and water is wise.

[Rock]

I found some more experts that also believe the US economy is going to collapse soon.


Peter Schiff
http://www.youtube.com/watch?v=DWDD3lTWv9w

Whitney Tilson
http://www.youtube.com/watch?v=kunB4SnA ... re=related

Glen Beck
http://www.youtube.com/watch?v=NlHY-zYA ... re=related


Being in denial about the economy is not wise. Stocking up on food and water is wise.

Stocking up on food and water? Denial about the economy? And 'experts'? Can't you quote better ones? None of these guys are objective, they all have agendas. Understand, most finance pros, politicians, and news people who give investment advice generate market performance at best. You can do that with by pure guess work. Their real skill is in marketing and using lots of professional sounding jargon. One of my favorites is that Jim Cramer clown who made some outrageously bad calls in 2008. I guess I shouldn't call him a clown though. He's worth 100s of millions. The real chumps are the people who listen to him.

There's only a few guys who are really good over the long term. Many run private hedge funds that are closed to new money or anyone who is not worth US$10 million or more. Then there are people like Warren Buffet. Listen to him. He's proven himself like no other.

The rest, over 99% of the so-called experts, are full of shit when it comes to timing predictions. I remember some time ago, they had a stock picking competition in Hong Kong between stock analysts from the local offices of global investment banks and local taxi drivers. The time frame was 6 months. Result? Taxi drivers won by a modest margin. But the taxi drivers would have to work 20-40 years to earn 1 year's worth of total compensation for a fairly senior analyst or one who is ranked.

If you really believe the US economy is going to collapse in 2010, and take its leading trade partner Canada with it, why don't you just buy gold on margin in a currency account which allows for 50:1 maximum leverage? Or better yet, aggressively short the S&P500, again using leverage through futures? You can also invest in currency pairs at very high leverage - long end Jap Yen or Swiss Franc / short end USD.

If you aggressively follow these strategies and the 2010 doomsday prediction comes to pass, you can easily quintuple your investment capital in USD or loonie terms within 6 months. Sell your home, invest $200K, become a millionaire. Go for it!

[globetrotter]

Rock,

Are you aware that Celente and Schiff BOTH predicted the 2007 crisis well before it occurred?

[momopi]

...you should stock up on emergency food and water regardless of dire economic predictions. I recommend Mountain House (TM) #10 cans:
http://www.mountainhouse.com/
http://www.mountainhouse.com/shelf_lif.cfm

25+ year shelf life, if stored properly.

Also, if the economic system were to collapse, shorting stocks will not be worth anything. Instead, hand tools, boxes of nails, etc. would be worth more in barter trade.
http://www.backwoodshome.com/

Back in 1982, I tried to dig a nuclear fallout shelter in the backyard with my cousin. We were unsuccessful. ;p

[Rock]

I found some more experts that also believe the US economy is going to collapse soon.


Peter Schiff
http://www.youtube.com/watch?v=DWDD3lTWv9w

Whitney Tilson
http://www.youtube.com/watch?v=kunB4SnA ... re=related

Glen Beck
http://www.youtube.com/watch?v=NlHY-zYA ... re=related


Being in denial about the economy is not wise. Stocking up on food and water is wise.

Stocking up on food and water? Denial about the economy? And 'experts'? Can't you quote better ones? None of these guys are objective, they all have agendas. Understand, most finance pros, politicians, and news people who give investment advice generate market performance at best. You can do that with by pure guess work. Their real skill is in marketing and using lots of professional sounding jargon. One of my favorites is that Jim Cramer clown who made some outrageously bad calls in 2008. I guess I shouldn't call him a clown though. He's worth 100s of millions. The real chumps are the people who listen to him.

There's only a few guys who are really good over the long term. Many run private hedge funds that are closed to new money or anyone who is not worth US$10 million or more. Then there are people like Warren Buffet. Listen to him. He's proven himself like no other.

The rest, over 99% of the so-called experts, are full of shit when it comes to timing predictions. I remember some time ago, they had a stock picking competition in Hong Kong between stock analysts from the local offices of global investment banks and local taxi drivers. The time frame was 6 months. Result? Taxi drivers won by a modest margin. But the taxi drivers would have to work 20-40 years to earn 1 year's worth of total compensation for a fairly senior analyst or one who is ranked.

If you really believe the US economy is going to collapse in 2010, and take its leading trade partner Canada with it, why don't you just buy gold on margin in a currency account which allows for 50:1 maximum leverage? Or better yet, aggressively short the S&P500, again using leverage through futures? You can also invest in currency pairs at very high leverage - long end Jap Yen or Swiss Franc / short end USD.

If you aggressively follow these strategies and the 2010 doomsday prediction comes to pass, you can easily quintuple your investment capital in USD or loonie terms within 6 months. Sell your home, invest $200K, become a millionaire. Go for it!

Well, it turns out that the American sky did not fall in 2010, contrary to what many of the 'experts' referenced above were predicting. Consider a few key US data points for the year:

1. Real GDP growth: +2.4% est. in 2010 vs. -2.6% in 2009, highest since 2006

2. S&P 500: +22% in 2010. Moreover, VIX volatility indicator ended year at healthy low level of 18 vs. an 2008-09 crisis high of 90.

3. Non-farm job creation: +1.1 mn in 2010 vs. -4.7 mn in 2009 and -3.6 mn in 2008

4. Unemployment rate (which lags economic activity 6-12 months): 9.4% in December, 2010 vs. 10.0% in December, 2009

5. US dollar index: remained steady at 79.3, up a modest 1.3% in spite of quantitative easing. Lack of volatility in this index is generally welcomed and correlates positively with risk appetite.

This does not mean the US is not in bad shape. Overhang from the real estate bubble will take a hell of a long time to work through. Consumer credit outstanding started declining in July 2008 and has been contracting ever since - unprecedented. Before that, it was on a steady secular uptrend, all the way back to 1943 when we first started recording the data! And even ma and pa kettle are are aware our external debt problem by now. But we did not have a second recession or economic crises, as so many talking heads were screaming about, not in 2010.

As for 2011, guess what? In many ways, Europe looks even worse right now. Their external debt levels, structural misalignment build-ups from so many years under a single currency, and the political difficulty of implementing needed austerity measures makes for a dangerous combination.

So the Chinese must be laughing their asses off at all this, right - those bumbling laowai idiots in Europe and America? Well, China is still an export dominated economy. They need more time to build up their domestic consumption and 'transfer-in' German manufacturing technology. Their economy, which grew 10% in 2010, still relies heavily on US consumer credit (the one which just started to contract just over a year ago). And they are at a point where prospect of inflation is looming heavily which means interest rate hikes. If that were to coincide depressed external demand leading to a sudden drop in economic growth, it could easily lead to social unrest.

Ironically, the biggest risk of something like that would be a second serious recession in the US this year - something which would accelerate the downtrend in credit outstanding. If the US continues to post reasonable growth this year and the decline in consumer credit is contained or even reversed, the shot-callers in China will be a lot more comfortable as will their subjects. Time is working in their favor. The longer this current game plays out, the stronger they will be.

[Rock]

Rock,

Are you aware that Celente and Schiff BOTH predicted the 2007 crisis well before it occurred?

Well now that you told me, I am. So what? Does that mean they will be right next time??? What happened last year, lol?

My uncle Donny predicted it too. And his system is based on flipping coins and rolling dice, lol. My point is, that in any given year, there will always be a percentage of the so-called 'pros' out there who call for a crash or boom. Its their job to put their balls out on the line. When chance works in their favor and they get it right, the masses suddenly believe they have true predictive powers and can accurately time the markets - something driven by mass human psychology. Booms, bubbles, and busts do not coincide with economic fundamentals - they can lead or lag by years compared to previous cycles.

Here's a simple challenge. Find me just one 'expert' or 'guru' whose documented historic predictions accurately timed (within 6-12 months) any 3 major market events in a row well before they occurred. I'm talking about booms and busts in any equity market in the world. Wanna make it easier? OK, how about predicting 3 economic recessions in a row without any false positives in between. See what you come up with. I'm all ears (eyes).