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David Collum: The Next Recession Will Be A Barn-Burner
Submitted by David Collum via PeakProsperity.com,
For those who enjoyed his encyclopedic 2015: Year In Review, this week we spend an hour with David Collum to ask: After processing through all of that information, what do you think the future is most likely to bring?
Perhaps it comes as little surprise that he sees the global economy headed back down into recession, one that will be deeper and more damaging than the 2008 crisis:
In 2008/9, while the equity markets when down, the bond markets went up. And that buffered an awful lot of pensions and 401Ks and endowments and things like that. And so people felt pain, but they didn’t realize that there was an offsetting gain. They did not notice that part as much, but I think the next downturn is going to be concurrent bond market collapse and equity collapse and there will be no slack in that downturn.
I think stocks and bonds are both at ridiculously high levels now. The bond market can only go down from here, right? I mean, it can keep going up for a while, but there is just nothing left to be squeezed out of it. Interest rates are at seven hundred-year lows, supposedly - they’re certainly at stupid lows, right. You have a third of Europe at negative rates... And so I think at some point the bond market’s got to collapse. It will start in the high yield market, and that is happening right now. Then it’ll spread, maybe treasuries will get bid to the stratosphere, but at some point you’ve got to get a real return. And so bonds have to sell off to get back to that real return -- after all, all crises are credit crises, right,? And then equities are going to go once there’s not leverage out there for share buy backs and stuff like that.
That's why I think the next recession is going to be a barn-burner.
Click the play button below to listen to Chris' interview with David Collum (74m:53s)
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...maybe treasuries will get bid to the stratosphere, but at some point you’ve got to get a real return. Says who?
The agenda will continue on unabated into 2016......
http://beforeitsnews.com/conspiracy-theories/2015/12/as-events-spiral-ou...
It's all Bullshit!!!
Oh no! "The X,Y and environment are considered" ..... Environment as a topic is too subjective. Too many adherents of the Church of Globull Warming Cash spout apocolyptic visions that just happen to suit their bottom line.
Bonds will be the buy of the year.
"Will be"? If the world collapses like most readers here think, long treasuries are now the buy of the Century.
Will be will be too will be late
PS Question: Why would you burn down the barn when the horses have all run off, were killed by the hordes and eaten for breakfast?
Answer: So the hordes can't use it after you are gone.
It's all too complex for me to understand. Martin Armstrong seems to believe money flows will go to private equities rather than government all due to lack of trust in government, but I don't trust the corporations either. Why is it that we are stuck in the paradigm of being seemingly forced to choose between "investing" with any of these crooked bastards. Surely there must be a means of investing in ones self...something we at least have some control over. Instead we are constantly being pulled between one ponzi to another sham to supposedly "protect" our assets. Are we really all that weak and simple minded so as to HAVE to depend on others for this protection....or is it that most are not looking for protection but speculation, ROI, easy money?
I am investing in building an autarky in Costa Rica.
I don't like your world, trying to build another one.
You haven't been keeping up with the economic condition in CR have you?
Wrong country my friend. CR is nothing but the water boy for the United States... The US IS going down and you must know that... so where the heck do you think hind teat sucking CR is going to be with their coroba tied to the petro-dollar, all their banks enforcing the US rules and waiting for the US handouts??
Should have taken a flyer on Nicaragua.
Just more propaganda from the wizards of the gold cult & scam, desperately trying to inflame anxiety and fear to stimulate collapsing sales of shiny lead, which will continue to plummet below $900/oz by end of 2016.
When oil hits the bottom next year, so will the gold and silver. Below 900 would not surprise me. But wtf do I know?
some comments are just so moronic there's no point engaging in re-education
I understand why you cannot understand me, I am the guy with PROFITS from interest income AND capital gains, EVERY YEAR since the Lehman bust, while you are one of the shiny-lead money-destroyer cult-worshipers, for whom income and capital gains are scorned, resented and insulting.
Yeah, interest income has been crushing it lately. My credit union has paid me interest (0.1%) every year since Lehman(TM). Why did I never think to brag about that before?
Yes, the interest rates paid by the financial intermediaries has been crushed by the FED - it sucks.
The key to surviving and earning income when the central banks go beserk is to buy what the central banks buy, starting the instant that they announce their plan to implement ZIRP and QE, ie buy treasuries.
If you had invested your savings in 30-year treasuries 7 years ago in accordance with that strategy and tactic, then you would have had as much as 5% interest all these years and 23 more years to come AND you would now have HUGE capital gains. How would you feel about being in that situation ????
I did not understand or know this principle when the Lehman crash happened, but when Dave Tepper gave an interview years ago and answered the question, "what will be the financial market consequences of QE?", he replied: "EVERYTHING will go UP!" - and he was absolutely correct.
The key was to buy the longest maturity treasuries, ie 30 years, at the START of ZIRP & QE so as to span the period of maniacal FED insanity.
I was late to the party, but I learn quickly. I am very thankful that I refused to follow the path of self-impoverishment promoted by the scammers, con artists and priests of the gold cult.
"5% interest and capital gains" on US T bills!!!
HAHAHAHAHAHAHAHAHAHAHA!
I am very thankful that I refused to follow the path of self-impoverishment promoted by the scammers, con artists and priests of the gold cult.
So instead, you're following the path of self-impoverishment promoted by the scammers, con artists and priests of the banker cult.
I wish you well, but I think I'll stick with the gold cult.
I have had interest income PLUS huge capital gains and microscopic transaction costs.
The followers of the gold cult have had:
point 1, you got me there. whoopdedoo.
point 2, my costs including insurance have been 0.25% . Im serious. and its outside the banking system with biometric scanning.
point 3, lost 10% on gold price, gained 25% on falling aussie dollar
but theres no point using facts or logic with some, is there
Sell PMs and buy Twitter? Genius
Denninger is that you?????
I don't know who he is or the intent of your reply :-(
I thought 900 was a realistic price.
Don't forget the Fed's ability to print petrodollars. As long as the people don't rise up and say stop...they can print to eternity. The USA population is so diverse it is impossible to get a unified resistance to this. The people rising up would be signaled by hyperinflation.
They are preparing and they know the dates but we're not invited and we'll never know until it hits us.
I'm fucking terrified..I have GOLD/SILVER,, bring it on..and of course ammo,, guns food and fire making materials... I'm dreaming of a free America just like the one I used to know...I dream of separating the sheep from the goats, by whatever means necessary.
I admit, this is a character flaw of mine.
Safe sex. Use a condom.
separating the sheep from the goats,
A John Wayne line in the Alamo..good one!!
Long physical, bitchez!
Don't we have to exit the on going depression before we can enter a new recession?
Next recession?
It's like having a bad appendix and the doctor prescribes pain killers. Everything seems fine and you keep rolling, keep eating the same crap and the pain returns. The doctor simply ups the painkillers and it's back to the races. This cycle continues until such time and the appendix ruptures, pouring poison throughout your body. We have failed policy compounded with debt and with each round of pain, only more painkillers are provided through cheaper, easier and longer term debt. At some point it must end and it will worse than painful, it will be down right ugly.
If it is truly terminal, the best coarse of action may well be more painkillers.
I recall 2008. I lived in S. Florida at the time. One of the things I vividly recalled was driving down I-95 the crazy highway going into Miami on a Tuesday morning around 09:30 and there was no traffic, this pattern continued for a few months....because no one had a job anymore. You could feel the unease..the tension. It was surreal. If a barn burner greater then 2008 comes to pass. I would definitely bug out of Miami. Its always been a crazy mixed up city on the edge of fast money.
How high is high? When asking this question it would also be wise to ponder the following, How low is low? Markets can make extreme or wild moves that charts often are unable to predict. This means it is both dangerous and difficult to pick a market top or bottom.
The idea that the central banks coupled with the too big to fail financial institutions will keep these distorted markets elevated has become entrenched in the minds of many investors and has lessened the importance of economic fundamentals and the question of how sustainable this market is.
While the "buy the dip mantra"is has worked since 2009 it is no guarantee that it will continue to produce positive results in the future. This will prove very costly when a real drop in the market does occur an old saying often used cautions traders they should never try to catch a falling knife. More on this subject in the article below that is titled, How High Is High? How Low Is Low?"
http://brucewilds.blogspot.com/2015/12/how-high-is-high-how-low-is-low.html