The Inevitable End To Our Bull Run

Sell your ether stock before it’s worthless! They’re already pumping it into the water on Wall Street for free. Major analysts have been warning of a stock market collapse for months, yet new DJIA highs continue to come almost daily. CNBC recently reported a measurement indicating that stocks are 72% overvalued. Yesterday morning, it was reported that jobless claims rose by 10,000 and U. S. pending home sales is near a 3-year low, so of course the DJIA immediately ran up 100 points. Idiot logic is certifiably in full swing, but as I’ve been saying, that’s exactly what happens prior to every serious market collapse throughout history. The Johnny Comelatelies rush into the market, providing the last minute opportunity for an even quicker and more precipitous fall.

Do the math! The DJIA needs to lose 30% just to approach a “realistic” value. From that, subtract for geopolitical turmoil on the usual fronts, then square it! Continue subtracting for the lack of healthcare passage, infrastructure planning, and the kind of real tax reform that can make a difference. Then, factor in the deal breaker. Congress has postponed the budget ceiling increase until December, but in December the fur is going to fly and it’s going to hit the fan. That’s where the rubber meets the road and true accounting is forced into the limelight. REAL numbers, not political bravado or hogwash will come into play. That’s when the market will be forced to true up.

Maybe the market can tack on another 10% before the collapse. But what if there’s a terrorist attack, North Korea incident, or major bank failure? My point is, depending on the trigger, this collapse could happen in 5 months or 5 minutes, but regardless, it won’t be protracted, like in 2008. But that’s a good example anyway, because between August of 2008 and February of 2009, stocks fell 37%, during the same period of time gold rose 15%. Many say, yes but look at the great recovery from there! Good idea, let’s. Between February 2009 and August 2011, the DJIA rose 54%, but during that same period of time gold rose 80%. So, to summarize the collapse, between August of 2008 and August of 2011, the DJIA actually lost 3% and gold rose 111%.

Don’t get me wrong, during any given time numbers can be crunched to say anything, but the simple fact of the matter is that during times of economic hardship, gold and other precious metals offer the greatest protection from devastating losses. I’m not suggesting that you sell the farm and convert everything to physical precious metals, but if you don’t have a percentage of your portfolio in precious metals, and even a higher percentage than normal when the coming collapse occurs, then whatever havoc is wreaked on your portfolio will entirely be self-induced, for a simple lack of foresight and preparation. Today’s lower precious metal prices and availability are just additional bonuses. Take advantage of this limited opportunity to sell high and buy low. But don’t get caught without a chair when the music stops!

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