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SYSTEMIC RISK IS ON RED ALERT
Since 2009,
I’ve been warning that systemic risk remains high. However, from that time
until today, investors have been willing to bet on the US Federal Reserve (and
the world’s central banks) keeping a lid on things.
Until today.
Greece has
erupted into full-scale, violent riots that could shut down the entire
Government there. SHOULD this happen it’s the beginning of the END GAME for
central bank intervention in the financial system.
Let me
explain.
The only
thing that has maintained investor confidence since the depths of 2009 is the
belief that the central banks can continue to bailout/ intervene to control any
financial problem.
Remember, we
never actually “took the hit” we needed to take in 2008. The same junk debt remains
in the system (it’s just been hidden by loosened accounting standards). The
same enormous derivatives time bomb is still ticking (it’s over $600 TRILLION
in size).
None of
these problems were solved. None were even addressed. All the central banks did
was lend more money to the insolvent big banks. Well, that and damage their
sovereign balance sheets by taking on a ton of garbage debt (the Fed’s balance
sheet is now over $2.8 TRILLION in size).
So in plain
terms, the central banks took systemic risk that existed in the private sector
and allowed it to spread to the public sector.
What does
this mean?
That the
next Crisis won’t just involve banks like Goldman Sachs, it will involve entire
countries (including the US) going belly-up.
We’re already
seeing it in Greece. That situation has made it very clear what happens when
you combine public outrage with Government bankruptcy and systemic insolvency: SHUT-DOWN.
This IS
coming to the US. And it won’t be long. Once the bailout wagon stops (first in
Greece) the ensuing collapse will spread VERY quickly. The reason is quite
simple: Greece is the Bear Stearns of the Sovereign debt Collapse.
So buckle
up, because it was only six months or so after Bear Stearns that the Lehman
disaster unfolded. Given the amount of leverage in the system today, we could
easily see the issues hitting Greece today arriving at the US’s shores before
the year’s end.
So if you’ve
not taken steps to prepare for the coming Crisis, you NEED To download my FREE
report devoted to showing in painstaking detail how to protect yourself and
your portfolio from the coming ROUND TWO of the Financial Crisis (round one
wiped out $11 TRILLION in wealth).
I call it The
Financial Crisis “Round Two” Survival Kit. And its 17 pages contain a
wealth of information about portfolio protection, which investments to own,
which to avoid, and how to take out Catastrophe Insurance on the stock market
(this “insurance” paid out triple digit gains in the Autumn of 2008).
Again, this
is all 100% FREE. To pick up your copy today, go to http://www.gainspainscapital.com
and click on FREE REPORTS.
Good
Investing!
Graham
Summers
PS. We also
offer a FREE Special Report on the inflation situation in the US. This other
FREE Special Report, The Inflationary
Disaster explains not only why inflation is here now, why the Fed is
powerless to stop it, and three investments that absolutely EXPLODE as a result
of this.
All in all
its 14 pages contain a literal treasure trove of information on how to take
steps to prepare AND profit from what’s to come. And it’s all 100% FREE.
To pick up
your copy today, go to http://www.gainspainscapital.com
and click on FREE REPORTS.
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Palladium is interesting, but too rich for my blood. It has some of the same things going for it as silver does, in that it is an industrial metal that can be used (apparently) monetarily.
It's used for different things, though. Short list that I'm aware of is catalytic convertors for cars, dental fillings, and speculatively as an ingredient of cold fusion in conjunction with deuterium. The last is interesting, but I don't know that they've really every got this to work, or if it's a hoax- there are conflicting reports, and I'm not about to try nuclear power of any sort as a DiY project to find out.
Fundimentally, I think it comes down to what wins the power wars. Right now, there is nothing that can compete with oil, so palladium should be worth something as long as the internal combustion engine is. If someone comes up with a better plan, the demand may drop off severely. OTHO, if there's no better plan in the works, and severe unrest, there may be a big uptick in demand for cars when the smoke clears.
Of course, that's just my take on it. Could be completely off base.
I hold a tiny amount of physical Pd. The "Easy Money" may have been made, but I think the metal's interesting chemical properties make it a good candidate to hold if you give it time.
If you already have other PMs, yes, OK, palladium is OK to add. Physical only. Pd is (ar at was last I looked) hard to get. The coin shop I bought my Canadian 1 oz coins now only sells 100 oz Russian bars.
plat was down under 1k during the 08 crisis, look it up. if you got wealth. try holding something that wont devalue, and grab the bargains when they appear. industrial metals should fall in another crisis as production ends.
but as they say DYODD, and things can always go different.
Excellent stuff by you and one up. It is interesting to watch the commodity market. Everybody talks about Gold and Silver, which I own the physical. But who talks about Palladium or Platinum. Nobody. Who talks about Rhodium. Nobody. All three are related in a big way. When are the best buying opportunities? Maybe when nobody talks about it? These items will be in demand in the future. Surely, the economies of the world will not evaporate. But they will have needs. I want to invest on the needs of many, not just the ones that are over hyped. Oil, yes. But have we destroyed much demand, maybe so for now. Rare earths, maybe not, they are actually rare to find and process. Silver? Supplies are depleting every day. Buy another IPoop and you will need some to supply the latest greatest.
Back to the three and rare earths. Palladium is a star because it can be used in place of platinum in many cases. Rhodium, which reversed it's downtrend and now looks like a double bottom is very interesting to me. Can it be exploited, Yes. But anything in hard stuff that comes out of the ground, that once traded at $10,000 plus a ounce and is now about $2,000 gets my attention. As well as the the cousins palladium and platinum. All related. Do your own homework and find out why. All related.
I have spent many hours and months exploring and researching the Rare Earths, Rhodium and Platinum. What I have found is that many of the better miners for some of these are not even offered to the public. Do your own discovery. Find out how many miners actually mine Rhodium and Platinum. Then you might find out that most are Private. Why? Because the really greedy do not want to share their money machine. Can you blame them. If it is that good. Just keep it and sell the stuff to those in need.
We surely are in a interesting time and place. People in need of much stuff. Even food. So, how many of these things are priced above demand and how many are not. One more thought. It is interesting to me to find out the Morgue has a place to store Platinum now. Talk about things that make me go Hmmmm. As much as I hate JPM for how they do business, I always listen to what and why they do what they act on.
Good Luck All. It will surely be interesting to watch and hopefully for all of us ZHers to profit from what comes.
One thing for sure. ZH rules in the opportunity to "Share" ideas to profit from what lies ahead.
Palladium? you asked about Palladium?
Was one of my favorites..."Have gun, will travel"
+1, most of the youger pups here won't get it.
"wire paladin, carlton hotel, san francisco"
he was a bad ass.
but what does the second half of "his fast gun for hire heads the calling wind" mean?
A jew wrote that song and even he didn't know what it meant. The closest he ever got to the 'old west' was when he passed through the West Side of Chicago back in the late 1940's.
I've been to many shows at the beautiful Hollywood Palladium.