Capital Flight Chaos - Safe Havens Are Tiny Markets

Tyler Durden's picture

Submitted by Adam Taggart via PeakProsperity.com,

Little did I realize when creating the short video below how prescient it would quickly become in the wake of Friday's Brexit vote...

Its message is simple: there's a preponderance of data that shows the world's major asset markets are dangerously overvalued. And when these asset bubbles start to burst, the 'save haven' markets that investment capital will try to flee to are ridiculously small. Investors who do not start moving their capital in advance of crisis will be forced to pay much higher prices for safety -- or may find they can't get into these haven assets at any price...

The aftermath of Friday's Brexit vote is providing us with ample validation of the video's thesis.

Stock prices immediately plunged:

The US dollar surged:

Gold put in a $100/oz reversal (which has since moderated a bit):

And Bitcoin jumped:

And look at the capital fleeing derivatives like sovereign credit default swaps. Losses of over 30% in a matter of hours. Yikes!

Response To Reader Requests

Over the years of writing about the risks in markets so distorted as the ones live with today, many Peak Prosperity readers have often asked me how my personal portfolio is positioned. Am I loaded up on save haven assets, and if so, which ones? Do I have long positions in stocks and bonds? What sort of private investments do I own? What am I focused on most going forward?

In Part 2: How My Personal Portfolio Is Positioned Right Now, I've finally decided to openly answer that question. I realize that many people are wrestling with the difficult challenge of identifying and assessing opportunities for safety as well as for prudent return in a market where price signals are bastardized and market risks obfuscated. Hopefully by sharing my own positioning, these folks may find a few constructive ideas worth discussing with their own financial advisers.

Click here to read Part 2 of this report (free executive summary, enrollment required for full access)

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
cossack55's picture

Don't be knockin' on my door

Deathrips's picture

Silver!

 

Its what lakes are made for!

 

RIPS

thinkmoretalkless's picture

Common they don't want a barbaric relic.

Everyman's picture

I like the sound of that:  "Credit Default Swaps" are triggered"!

I M Luvin' it!  30% losses or a start.

SoilMyselfRotten's picture

I'm also a tight invester with small hands...wait, how that go again?

dumbhandle's picture

Bitcoin jumped,  but Ethereum skyrocketed. For some reason, someone wrote a program and put it on the network and a bunch of highly intelligent individuals put USD150MM of ether in it.  When that program blew up, it dragged the price of Ethereum down.  Ether appears to be shrugging off that debacle, as Ethereum itself was not to blame.  Ether can be purchased at GDAX.COM, a unit owned by Coinbase.  

Prisoners_dilemna's picture

a 4 week old ZH account urges you to buy Ether.

 

Ether is to Bitcoin; as fiat currency is to gold.

dumbhandle's picture

Bitcoin jumped,  but Ethereum skyrocketed. For some reason, someone wrote a program and put it on the network and a bunch of highly intelligent individuals put USD150MM of ether in it.  When that program blew up, it dragged the price of Ethereum down.  Ether appears to be shrugging off that debacle, as Ethereum itself was not to blame.  Ether can be purchased at GDAX.COM, a unit owned by Coinbase.  

dumbhandle's picture

Bitcoin jumped,  but Ethereum skyrocketed. For some reason, someone wrote a program and put it on the network and a bunch of highly intelligent individuals put USD150MM of ether in it.  When that program blew up, it dragged the price of Ethereum down.  Ether appears to be shrugging off that debacle, as Ethereum itself was not to blame.  Ether can be purchased at GDAX.COM, a unit owned by Coinbase.  

Stormtrooper's picture

Not selling my gold until it hits 10,000/ounce.  Not $10,000 funny moneys/ounce.  10,000 beef cattle/ounce.

natxlaw's picture

I'll be selling my SLV futures at 40 and buying the real thing. I won't be selling my phys until its at least 400 an ounce, which I'm told is how expensive silver has to be before anyone can feasibly recycle it from used industrial status. There are 1 billion oz of silver above ground right now and 6.5 billion oz of gold. Yeah, silver comes out of the ground in larger numbers, but it dissapears. Once gold is out, it's here forever.

HRH of Aquitaine's picture
HRH of Aquitaine (not verified) Jun 26, 2016 7:54 PM

Turbulence ahead. Buckle up!

Lost in translation's picture

Check.

Motion sickness bag is in-hand and ready to be filled with semi-digested dum sum.

youngman's picture

You can bet your savings that if the market crashes 30% or more that the central banks will be in buying stocks to add STABILITY or so they will say

willwork4food's picture

Yup, defaltion isn't working, so let's try hyper inflation. The.Last.Tool.In. Their.Bag.Of Tricks.

Works everytime.

natxlaw's picture

Well, it does the same thing every time. As Dr. Phil might say to Venezuela, "How's that workin' for ya?"

Paul John Smith's picture

I think there are far fewer "safe havens" than people realize.

ClydeCrashcup's picture

Yeah, really.  I mean, all we need are good ol' US dollars for the ultimate in safety, right?

SirBarksAlot's picture

I like that video.  Simple to understand but still puts things in perspective.

natxlaw's picture

I've been warning people, maybe some of them have been listening but I Kinda doubt it. My kids own more silver than the average investor, and they're in grammar school. Got them 6 or so ounces in 1 gram bars so they could learn to count and learn to recognize real money. They are the reason I do what I do.

Lost in translation's picture

You're a good parent.

I tell the incoming freshmen about PMs but only 1 in 200 ever does anything about it.

TradingTroll's picture

A small market is illiquid.

 

But your chart of USD. Is that a small market to you??

uncle_vito's picture

Safe Haven.   Banks, Money Market accounts and Mattresses are small market?

Planetary Books's picture
Planetary Books (not verified) Jun 27, 2016 4:35 AM

Don't get caught with "your pants down!" Everything you need to know about how the globalists, and their banking cartel's market manipulator allies, will be playing the "Brexit" can be found free of charge, simply by reading the latest web blog posting of a Planetary Books novelist here:

http://bit.ly/294dOGg